Douglas & Ors v Hello! Ltd.& Ors

Permission to amend pleadings should be granted where the proposed case has reasonable grounds and a real, more than fanciful, prospect of success. Delay is relevant only where it causes procedural prejudice. A party’s serious misconduct in giving false evidence or failing to preserve and disclose documents does not automatically justify striking out its defence. The decisive question is whether a fair trial remains possible. The court may strike out a defence on particular issues where the misconduct creates a substantial risk of injustice, but should not impose the sanction merely as punishment. A claim against a person who publishes confidential material may be a claim against that person as an individual tortfeasor, even where the person did not participate in obtaining the material. Conspiracy by unlawful means is sufficiently arguable where false evidence and concealment form part of a broader objective to injure.

The claimants, Michael Douglas, Catherine Zeta-Jones and Northern & Shell plc, sought damages and related relief concerning unauthorised photographs of the claimants’ wedding published in Hello! magazine. They applied to re-amend their particulars of claim and to strike out the defences of the Hello! Defendants because false evidence had been deployed in an earlier interlocutory appeal and relevant documents had later been destroyed or inadequately disclosed.

The Marquesa de Varela and Neneta Overseas Ltd applied to strike out the claims against them. The court had to decide whether the proposed amendments disclosed arguable causes of action, whether the claims against those defendants were legally sustainable, and whether the Hello! Defendants’ conduct made a fair trial impossible or unsafe.

1. Amendments. Permission was granted to re-amend the particulars of claim, subject to specified additions. Under CPR Rule 3.4(2) and CPR Rule 24.2, the pleaded case had reasonable grounds and a real, more than fanciful, prospect of success. The delay was excusable because the full significance of the disclosure and witness evidence had emerged only shortly before the application and no material prejudice was shown.
2. Claims against the Marquesa and NOL. The claim was framed as one that they had published or caused the publication of confidential photographs. It was therefore capable of being a claim against them as principal and individual tortfeasors, rather than merely as joint tortfeasors or persons who had facilitated another tort. The principles concerning concerted action and mere assistance did not determine the pleaded claim.
3. Conspiracy and unlawful means. The proposed conspiracy claims were seriously arguable. Arrangements connected with obtaining the photographs could constitute unlawful means even if an alleged trespass in New York was not unlawful under New York law. False evidence, continuing concealment and destruction of documents could be capable of forming part of a broader conspiracy to injure.
4. Strike-out for misconduct. The court found that three material statements deployed in the earlier Court of Appeal proceedings were false or misleading and that documents had been deliberately destroyed or disposed of after proceedings commenced. It inferred that further material documents had probably been lost. However, the available evidence and the trial judge’s ability to draw inferences meant that a fair trial remained possible. Following Logicrose Ltd v Southend United Football Club Ltd and Arrow Nominees Inc v Blackledge, the court declined to strike out the whole or any part of the Hello! Defendants’ defence merely as punishment.
5. Exemplary damages. The claim was seriously arguable on the basis of allegedly outrageous conduct, applying the reasoning in Kuddus v Chief Constable of Leicestershire.
6. Permission to amend was granted. The strike-out application by the Marquesa and NOL was dismissed. No order was made on the claimants’ application to strike out the Hello! Defendants’ defences.

The judgment describes an earlier interlocutory appeal concerning the injunctions granted in November 2000.

• Court of Appeal: The appeal by Hello! Ltd was allowed and the injunction order was discharged. The reasons were handed down on 21 December 2000; the judgment is reported as [2001] QB 967.
• High Court (Chancery Division): The present court determined applications concerning amendment, strike-out and the continued conduct of the proceedings.