Civil Fraud Quarterly Round-Up: Q1 2021
The Defamation Act 2013 ("the Act") came into force on 1 January 2014 seeking to “overhaul the libel laws in England and Wales and bring them into the 21st century, creating a more balanced and fair law”. The call for reform arose primarily from the widely recognised viewpoint that a fairer balance needed to be struck between the protection of an individual’s reputation and the right to freedom of expression. The new Act aims to simplify the law and address some of the more alarming trends developing in recent years such as individuals and companies specifically choosing London as the place to litigate their defamation claims considering the Courts in England and Wales to be largely pro-claimant.
The key reforms are as follows:
As a consequence of what many consider to have been overly flexible jurisdictional rules, London has long been considered the libel capital of the world with Claimants seeking to take advantage of "no win no fee" funding arrangements and the limited defences available to those accused of publishing allegedly defamatory material. The Act seeks to put a stop to libel tourism with Claimants not domiciled in the EU now required to show that England and Wales is "clearly the most appropriate forum" to hear their claim.
Whilst it has long been established that "trivial" libel claims are unlikely to succeed, this principle has been further endorsed by the Act which requires the Claimant to prove that a statement has caused, or is likely to cause, serious harm to their reputation in order for it to be defamatory. This is likely to have the greatest impact in respect of libel actions taken against web-only publications where the site attracted minimal traffic during the period in which the content complained of was available.
Companies may also find it harder to sue for defamation under the Act. A body trading for profit must now demonstrate that the defamatory statement complained of has caused, or is likely to cause, "serious financial loss".
The Act introduces new statutory defences of "truth", "honest opinion" and "publication on a matter of public interest" to replace the common law defences of "justification", "fair comment" and the "Reynolds responsible journalism defence".
Truth: The defendant must show that "the imputation conveyed by the statement complained of is substantially true".
To rely on this defence the defendant must show that three conditions have been met
Publication on a Matter of Public Interest
The defendant must show that:
Whilst the impact of the new defences remains to be seen it seems likely that the courts will rely on existing law to apply the new legislation resulting in little more than a change in name.
Privileged material which is protected from defamation actions has been extended to protect scientists and academics in relation to statements published in peer-reviewed journals.
Single Publication Rule
A "single publication" rule has replaced the rule that each publication of a defamatory statement is cause for a separate legal action. The one-year limitation period for commencing web-based libel action starts from the date of first publication of the article bringing to an end indefinite liability for online publications where content is repeatedly viewed and downloaded by other users.
Protection for Website Operators
Perhaps the most significant reform introduced by the Act is a new defence for website operators, previously exposed as a consequence of hosting user-generated content that can be extremely difficult to police, to show that they did not post the statement on the website. The defence is defeated if the claimant is able to show that: (a) they were not able to identify the person who posted the statement; (b) that they gave the operator of notice of their complaint in relation to the statement made; and (c) the operator failed to respond to that notice.
For the complainant the application of a system designed to open channels of communication with the website operator is a step in the right direction in getting defamatory content removed quickly and without the need to instruct solicitors. The flip side of this reform is that the application of the process is labour intensive for the operator (necessitating compliance with The Defamation (Operators of Websites) Regulations 2013) which may in time result either in operators just removing content to avoid the need to take such steps thus infringing on freedom of expression or making their own determinations as to whether the material complained of is defamatory and letting matters run their course accordingly seeking to rely on other defences.
Trial without jury
The Act provides that defamation trials should be tried without a jury unless the Court orders otherwise. This recognises the need for clarity in this area of the law and addresses both the issues of substantial costs arising from a jury led trial and the variable damages awards that have historically been made.
As a whole the Act is likely to be welcomed by the press, such as it would appear to largely favour defendants. On paper it is now harder for both individuals and companies to sue, privilege has been extended, website operators have better protection, the common law defences have been abolished and replaced with new statutory defences seeking to simplify the law in this area and access to the English courts significantly limited for foreign claimants seeking to take advantage of what was previously felt to be a pro-claimant forum. In the case of the latter, we have already seen cases of judges throwing out cases bought by wealthy foreigners. The reforms have yet to be tested substantially in other areas. However, the position remains that each claim will be considered on a case by case basis and given the highly published and much criticised instances of irresponsible journalism in recent years we can no doubt expect the Courts to heavily scrutinise each case to ensure the balance does not tip the other way.
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