New Defamation Act receives Royal Assent

The Defamation Bill received Royal Assent on 25 April 2013. The main changes to the current law concern corporations and their ability to sue, website users and scientific/academic journalists. Alan Watts and Louisa Robertson explain the changes below.

Background

Libel reform featured in the three main political parties' general election manifestos in 2010 and has been the subject of a lengthy campaign by a wide spectrum of the public, from those seeking better protection for freedom of speech to those more interested in a law to protect their reputation.

Content of the Act

The Act is not designed to codify the law into a single statute; it sits alongside, and amends where applicable, the Defamation Acts of 1952 and 1996.

The key points to note are as follows:

• claimants must show that they have suffered serious harm before suing for defamation;
• corporate bodies (trading for profit) must show that the defamatory publication has caused or is likely to cause serious financial loss;
• there are new statutory defences of responsible publication on matters of public interest, truth and honest opinion to replace the defences of Reynolds (Reynolds v Times Newspapers & others), justification and fair comment;
• operators of websites that host user-generated content have increased protection, providing they comply with the procedure to enable the complainant to resolve disputes directly with the author of the material concerned;
• a statement in a scientific or academic journal is privileged (and therefore not capable of founding an action in defamation) if the statement: a) relates to a scientific or academic matter; b) is reviewed by the journal's editor or peers with expertise in the matter concerned; and c) is made without malice.  Publication of a fair and accurate copy of, extract from or summary of the statement is also privileged;
• the single publication rule: the first publication to the public triggers the one year limitation period within which the claimant must commence a claim. Subsequent statements, unless materially different, will not affect the accrual of the claimant's cause of action on the date of publication of the first statement;
• UK courts only have jurisdiction to hear a case against a non-domiciled (in UK, Member State or party to the Lugano Convention) defendant if it is clearly the most appropriate place in which to bring an action;
• there is no longer a presumption in favour of a jury trial.

Comment

Whilst the Act makes a number of substantive changes, some of the key areas are already established in case law. In practice, therefore, the specific points to highlight to our clients are as follows:

• the requirement for corporations to show serious financial loss. It is a subject of debate amongst solicitors and barristers as to how this will be demonstrated; a witness statement from the CFO without hard evidence is unlikely to suffice. We will be recommending to clients, therefore, to set up a system to enable snapshots of the company's financial position without revealing confidential information at such an early and public stage of proceedings;
• the defence of responsible publication on matters of public interest is less like the  Reynolds defence, which required responsible journalism to be proved, since it just requires it to be reasonable that the defendant believed that publishing the statement was in the public interest. This will make the defence much easier for publishers use;
• the single publication rule is designed to remove the threat which hangs over publishers that every time they repeat a statement a new cause of action accrues. It therefore requires claimants to take decisive action about the first defamatory statement which is published.

And finally… Leveson and the Royal Charter

The House of Lords sought to give effect to some of the Leveson Report's proposals in the Defamation Bill. This was resisted by the House of Commons. The matter was resolved with the cross-party agreement of the Royal Charter for press regulation, which meant that the Defamation Bill could pass through without the Leveson amendments.

The Royal Charter itself is a confusing attempt to implement Leveson's recommendations. The Royal Charter gives legal backing to a new state-recognised press regulator, which includes an arbitration service to settle libel claims. It requires relevant publishers (defined as "significant news publishers") to sign up to it, which many are currently refusing to do. If a relevant publisher does not agree to place itself under the new regulator, it will be subject to exemplary damages under the Crime and Courts Bill which is currently going through Parliament. In other words, if a relevant publisher does not offer the arbitration service prescribed under the Royal Charter and it is sued, it will have to pay the costs of both sides – even if the other side loses.

News International, Telegraph Media Group, Associated Newspapers, Trinity Mirror and Express Newspapers have drawn up an alternative draft Royal Charter proposing an independent system of self-regulation with the power to administer £1 million fines but which would not be backed by statute. This and the cross-party Royal Charter is due to be presented at the next meeting of the Privy Council on 8 May 2013.

Herbert Smith Freehills gives presentations to suit your needs on any/all of the above, in order to keep you fully updated with this area of law.