Undre & Anor v The London Borough of Harrow (Rev 1)

A corporate claimant must show that a publication referred to the company and conveyed a defamatory meaning about it. Harm caused by allegations concerning an individual does not become actionable company loss merely because that individual owns or runs the business.

Under section 1(2) of the Defamation Act 2013, a profit-making body must prove serious financial loss caused by harm to its own reputation. Reduced sales alone do not prove serious loss of profit or causation.

This was a trial of preliminary issues in a libel claim brought by a restaurateur and his company against a local authority. The authority had published a news release reporting the restaurateur’s conviction for animal-welfare offences. The first claimant’s claim had been resolved by an accepted offer of amends. The remaining issues were whether the release referred to the company and conveyed a defamatory meaning about it, and whether it caused serious harm to its reputation under section 1 of the Defamation Act 2013.

1. The company was not referred to by the release, except to the limited extent that paragraphs [6] and [7] referred to claims then being made about the restaurant’s business methods. The release focused on the first claimant’s personal conduct and did not identify the company as operating the restaurant when the neglect occurred.
2. Read as a whole, the release conveyed that the first claimant had neglected his cattle so that three died. It did not convey that the restaurant business or the company was jointly responsible for the cattle’s welfare or neglect.
3. For a profit-making body, section 1 of the Defamation Act 2013 requires serious financial loss, but financial loss alone is insufficient. The loss must result from serious harm to the company’s own reputation caused by a defamatory imputation about the company.
4. The company failed to prove serious loss of profit or the necessary causal link. The evidence showed that adverse publicity and customer hostility were directed principally at the first claimant personally. The alleged losses involving a squatter and a proposed exhibition also failed for lack of adequate proof and causation.
5. The company therefore failed on both preliminary issues and its claim was dismissed. The court made obiter observations that future preliminary trials may need to balance the benefits of determining quantum against the additional cost of fuller evidence and expert analysis.