Citation Plc v Ellis Whittam Ltd

At the strike-out stage, a claimant may rely on an inference that defamatory words were published to unidentified third parties where the surrounding circumstances provide an arguable evidential basis. The inference is fact-sensitive and does not require proof at that stage.

A permanent injunction in defamation is preventive. It depends on a real risk or reasonable apprehension that the defendant will repeat the wrongful publication. Refusal to give an unqualified undertaking does not itself establish that risk. A company cannot recover damages for distress, and where the practical value of proceedings lies in preventing repetition, an action pursued for a wider restriction may be an abuse of process.

The claimant and defendant were competing providers of employment-law and health-and-safety advice. The claimant alleged that an employee of the defendant had made defamatory statements to a prospective client concerning the claimant’s ability to meet claims and the qualifications of its advisers.

The claimant identified one publishee but pleaded that further publications to unidentified third parties should be inferred. It sought damages and, principally, an injunction. The defendant applied under CPR Part 3.4(2) to strike out the claim as disclosing no reasonable grounds, as an abuse of process, and as involving no real or substantial tort. The issues were whether further publication was arguable, whether a permanent injunction was arguable, and whether the claim was a real and substantial tort.

1. Further publication. The requirement under CPR Part 53 Practice Direction paras 2.2(2) and 2.4 to plead the words, publishees and dates is subject to limited exceptions. Whether publication to unidentified persons may be inferred is a question of fact. On the circumstances of this case, including the parties’ competition and the alleged speaker’s former employment by the claimant, there was an arguable case that similar words had been spoken to other prospective customers. The claim was therefore not speculative on that ground.
2. Permanent injunction. There is no general rule that a successful claimant in defamation is entitled to a permanent injunction. The remedy is preventive and requires a real risk or reasonable apprehension of repetition. The defendant’s refusal to give the precise unqualified undertaking sought was not itself sufficient. The correspondence and subsequent internal communication showed no intention to repeat the alleged statements, and the claimant had no arguable case that such a risk existed.
3. An injunction would be framed by reference to the meanings found at trial and would not restrain statements that were true at the time of publication or at trial, or statements of honest opinion. Article 10 and section 12(4) of the Human Rights Act 1998 were of limited assistance at this stage, although the trial court would have to take care over the form of any injunction.
4. Real and substantial tort. The claimant had no evidence of actual loss and sought no damages. As a company, it could not recover damages for distress. Although damages under section 3 of the Defamation Act 1952 would not be nominal, the practical vindication available had already been achieved by the defendant’s acceptance that the statements should not be repeated. Continuing the action to obtain a wider unqualified restriction had no legitimate value.
5. The claim was an abuse of the process of the court and was struck out.