Libel & malicious falsehood (trade libel)
Only the person who believes he has been defamed may bring libel proceedings.
Legal entities such as companies or LLPs can sue for libel. They have their business reputations to protect.
But Section 1 of the Defamation Act 2013 (the “serious harm requirement”) restricts the ability of claimants (including companies) to sue for defamation. Serious financial loss needs to be shown.
Partnerships (other than limited liability partnerships), can bring an action in the name of the partners jointly in relation to statements that are defamatory of the firm as a whole.
In relation to any other unincorporated association (for example, an unincorporated charitable trust), there is no right to bring an action on behalf of the association, but individual members can sue if they are sufficiently identified in the statement concerned.
A libel claimant must establish that the words complained of are defamatory of him or it.
The test is whether the statement tends to lower the claimant in the estimation of right-thinking members of society generally, or is likely to affect a person adversely in the estimation of reasonable people generally.
Whether the words are defamatory depends on the precise words used. The words are judged by the standards of society generally at the time of publication rather than against the standards of a specific group or class of people within society.
Serious harm requirement
A statement is not defamatory unless its publication has caused or is likely to cause serious harm to the reputation of the claimant.
Harm to the reputation of a body that trades for profit is not “serious harm” unless it has caused or is likely to cause the body serious financial loss.
An apology published by the newspaper shortly after a complaint is received may be relevant to the consideration of whether serious harm had arisen or was likely to arise in the future. An apology may be significant in minimising the unfavourable impression a reader might have gained from reading the words complained of.
It depends on the facts how the courts will decide whether a company that trades for profit has suffered or is likely to suffer “serious financial loss” so that serious harm has been caused to its reputation.
What constitutes serious financial loss for a large multinational company is likely to be judged differently from a small privately owned company. A loss of turnover may well be persuasive evidence of serious harm. So too may be a fall in a company’s share price.
The claimant must establish that the words complained of are published to a third party and that the defendant published or is responsible for the publication of the words.
A publication (a newspaper article, blog, television programme) will be understood in different ways by each reader or viewer and a publication may be capable of bearing 2 or more separate and distinct meanings, the approach in defamation claims is that the court is required to find a single or “right” meaning of the words complained of.
The natural and ordinary meaning of words is the meaning that the words would convey to the ordinary reasonable reader who reads the entire article or publication once. The ordinary reasonable reader will be taken to read the whole article. For example, a headline might suggest that someone was guilty of an offence while the article as a whole might make clear that there were only reasonable grounds to suspect him.
Identification of the claimant
The claimant must prove that the words complained of were published about him. This is straightforward if the claimant is named or clearly identified.
If identification, or reference, is disputed, the general test is whether reasonable people would understand the words to refer to the claimant. The test is an objective one. Whether the publisher intended to refer to the claimant is irrelevant.
The remedies available for defamation are damages, an injunction, publication of a summary of the court’s judgment and an order to remove the defamatory statement. The court does not have a general power to require the defendant to correct the defamatory statement or declare the statement to have been false.
Offer of amends
This is available to a defendant who has made an innocent mistake and does not wish to defend the claim on a substantive basis. This procedure is aimed at providing a quick and inexpensive resolution of cases in which a defendant is prepared to admit that it has libelled the claimant, as well as entitling defendants who make such offers to a discount on the level of damages payable.
- Honest opinion.
- Publication on a matter of public interest.
- Absolute and qualified privilege.
- Peer-reviewed statements in scientific and academic journals.
- Internet defences (can be available for those intermediaries that are “innocent disseminators” of the relevant defamatory material).
- Offer of amends.
It is an absolute defence to a defamation claim to show that a defamatory statement is true.
The rationale for the defence is that a claimant should not be entitled to recover damages for injury to a reputation he did not deserve to have in the first place.
There is a legal presumption in favour of the claimant that a defamatory statement is false, meaning that the burden of proof is placed on the defendant to prove otherwise.
Malicious falsehood claim
A malicious falsehood (or trade libel) claim arises from the malicious publication of false words that refer to the claimant, his property or his business, and give rise to special damage as a direct and natural result of their publication.
The claimant must prove that the statement was false, regardless of any malicious intent on the part of the defendant. One trader merely saying that their goods are better than those of another, is not actionable. The court will not normally adjudicate on the comparative quality of competing products. However, where a statement is not limited to a comparison of the goods but goes on to include an untrue statement about the rival trader’s goods, malicious falsehood may be made out.
There will be liability where the defendant has an improper motive. Knowledge or recklessness as to falsity will be virtually conclusive as to malice.
There is no liability for words published in good faith or as a result of negligence, even if they are false.
Where the defendant, with the intention of doing harm, publishes words that he believes to be true, but that turn out to be false, he could be liable.