The North London Mosque Trust v The Policy Exchange & Anor

The judgment proceeded on the accepted basis that an unincorporated trust is not a legal person and, absent a legal provision conferring standing, cannot sue in its own name for libel. Substitution of trustees does not cure the defect where they do not sue to vindicate their own reputations but seek to represent the trust. Trustees may, if the pleaded facts warrant it, sue personally where a defamatory allegation against the trust also defames them. Permission was granted under Rule 52.36 because the issue merited authoritative clarification despite no realistic prospect of overturning the decision.

The North London Mosque Trust brought a libel claim against The Policy Exchange and another, alleging that the defendants had defamed the Trust. It accepted that an unincorporated trust could not sue in its own name. It sought to substitute its trustees as claimants without changing the pleaded case, so that they would vindicate the Trust’s reputation in a representative capacity.

Eady J treated the lack of capacity as a substantive defect and struck out the claim. Sir Richard Buxton refused permission on the papers. On renewal, the Court of Appeal considered whether the proposed appeal merited authoritative consideration concerning the status of unincorporated bodies as libel claimants, despite having no realistic prospect of overturning the decision.

The renewed application for permission was allowed under the residual ground afforded by Rule 52.36. The appeal itself was not determined on its merits. A continuing stay of the costs order was granted, with liberty to the defendants to apply in writing for any other costs order.

1. The court proceeded on the appellants’ acceptance that a trust is not a legal person, being an equitable relationship, and that no legal provision gives it locus or deems it to be a legal person. The proposed substitution therefore did not cure the fundamental difficulty: the trustees did not seek damages for injury to their own reputations, but sought to vindicate the charity’s reputation through them. In strict terms, they could not be constituted representative claimants for that purpose.
2. The position would be different if the trustees sued as individuals. An unincorporated association may be treated as the totality of its members, each of whom has standing to sue. Likewise, trustees of an unincorporated charitable trust could be personally defamed by a slur against the Trust if the pleaded facts warranted that conclusion. Those possibilities did not assist an application expressly confined to vindicating the Trust’s reputation.
3. The passing-off authorities did not resolve the libel issue. The court was doubtful that Artistic Upholstery Limited v Art Forma (Furniture) Limited [1999] 4 AER 277 did more than rehearse the proposition that injury to an unincorporated association may sound in damages as injury to its individual members. Burge v Haycock [2001] EWCA Civ 900 offered a more substantial, though limited, basis for argument because it recognised that an unincorporated charitable organisation may have valuable goodwill protectable in passing off. This was an analogy, not a determination that the Trust had legal personality or standing in libel.
4. On the ordinary permission approach, the proposed appeal had no realistic prospect of overturning Eady J’s decision. Nevertheless, the law was drawing fine lines about the constitution and status of libel claimants, and authoritative clarification could provide general assistance. That residual consideration justified permission, for the stated reason and no others.

• Court of Appeal (Civil Division) — The renewed application for permission was allowed under Rule 52.36, with a continuing stay on costs. [2010] EWCA Civ 526
• Queen’s Bench Division — Eady J refused substitution of the trustees as claimants and struck out the libel claim because the lack of capacity was substantive.
• Permission stage — Sir Richard Buxton refused permission on the papers; the application was renewed before the Court of Appeal.