King v Telegraph Group Ltd

Where defamatory words may convey both that a person is under investigation and that there are objectively reasonable grounds for suspicion, a justification plea must distinguish those meanings and identify the particulars relied upon for each. Police suspicion or a police raid may support the former meaning, but cannot by themselves establish reasonable grounds for suspicion.

An appellate court cannot substitute a wholly new case-management order where the judge’s approach to the order sought was not flawed. The court nevertheless gave guidance that prospective costs caps may be used in suitable defamation proceedings funded by a CFA without ATE insurance. A cap should include any CFA additional liability, so as to preserve proportionality and protect the publisher’s freedom of expression.

The claimant brought a libel action against the newspaper concerning two articles which linked him with alleged terrorist activity. The defendants appealed parts of Eady J’s order of 9 June 2003.

First, the judge had struck out or required reformulation of particulars relied on to justify alleged meanings that the claimant was suspected of terrorist involvement. Secondly, he had refused a conditional order directed to the risks to the defendants of CFA-funded litigation without ATE insurance.

The appeal therefore concerned the proper pleading of alternative defamatory meanings and the court’s power to control disproportionate costs in defamation litigation.

1. Appeal dismissed. The defendants could, however, amend their justification case so that it clearly distinguished the two meanings on which they relied.

2. A statement that the police suspected a claimant of criminal conduct and a statement that there were reasonable or strong grounds for that suspicion are distinct Lucas-Box meanings. The latter requires objectively provable primary facts. The mere fact of police suspicion, arrest or a raid cannot itself establish it. The defendants could reinstate their particulars only if the amended defence made clear which particulars supported the meaning that there were grounds for inquiry and which supported the more serious meaning of reasonable grounds for suspicion. This applied the distinctions identified in Chase v News Group Newspapers Ltd [2002] EWCA Civ 1772.

3. The court could not grant a quite different costs-management order of its own motion. Its appellate power under CPR 52.11(3) did not permit that course where Eady J’s refusal of the conditional order sought could not be faulted.

4. Brooke LJ nevertheless gave general guidance for future cases. The court has power under section 51 of the Supreme Court Act 1981 and CPR 3.2(m) to impose a prospective costs cap. In a suitable defamation action begun under a CFA without ATE cover, an early order analogous to section 65 of the Arbitration Act 1996 should ordinarily control recoverable costs and require prior approval for steps likely significantly to increase them.

5. Because defamation costs may restrict a publisher’s Article 10 right to freedom of expression, a cap imposed in such a CFA case should be inclusive of any success fee or other additional liability. The cap should be fixed by reference to reasonable and proportionate costs. Prospective control is normally the first response to a substantiated concern about extravagant conduct, alongside rigorous assessment and, where appropriate, wasted-costs jurisdiction.

• Court of Appeal (Civil Division) — dismissed the defendants’ appeal from parts of Eady J’s order, while indicating that appropriate amendments to the justification pleading should be permitted.

• Queen’s Bench Division — Eady J, on 9 June 2003, struck out or required amendment of parts of the justification case and refused the defendants’ application for a conditional order relating to CFA funding without ATE insurance.