Fiona George v Linda Cannell & Anor

The Court of Appeal allowed the appellant's appeal on the key issue of statutory interpretation of section 3(1) of the Defamation Act 1952. The court held that s 3(1) is forward-looking: a claimant need not prove, as a historical fact, that pecuniary loss in fact occurred. Instead it is sufficient to show that the false, malicious words complained of were, viewed objectively in context at the time of publication, calculated (i.e. were inherently likely or probable) to cause pecuniary damage to the claimant in the ordinary course of events. The judge at first instance was therefore wrong to require proof that the words in fact caused financial loss on the balance of probabilities.

The court also held that, where a claimant succeeds under s 3(1), compensatory damages for non-pecuniary harm such as injury to feelings are not excluded as a matter of law and may be awarded in an appropriate case. The matter was remitted for assessment of damages, including an award for injury to feelings to be assessed.

Background and parties: The claimant was a recruitment consultant who left her former employer (the second defendant) and obtained employment with another agency. The first defendant wrote to a client of the claimant and to the claimant's new employer alleging that the claimant had breached post-employment non-solicitation obligations. The claimant sued for libel, slander and malicious falsehood. At trial Saini J found publication, falsity and malice but dismissed the malicious falsehood claims for want of proof of special damage and on the basis that the claimant had not established pecuniary harm under section 3(1) of the Defamation Act 1952.

Procedural posture: The claimant appealed to the Court of Appeal with leave against dismissal of the malicious falsehood claims. The appeal required determination of the proper interpretation of s 3(1) of the 1952 Act and whether, in the absence of proven pecuniary loss, more than nominal damages (including compensation for injury to feelings) could be awarded.

Nature of the claim/application: The appellant sought a finding of liability under common law malicious falsehood relying on s 3(1) of the Defamation Act 1952 to avoid the common law requirement to plead and prove special damage. Remedies sought included general damages and damages for emotional distress/injury to feelings.

Issues framed:

1. What must a claimant prove to satisfy s 3(1) of the Defamation Act 1952: whether the test requires proof that the words in fact caused pecuniary loss (historic approach) or whether it is enough that the words were such that pecuniary loss was inherently probable in the ordinary course of events (forward-looking approach).
2. Whether, if a claimant satisfies s 3(1) without proof of actual pecuniary loss, she can recover more than nominal damages, in particular damages for injury to feelings.

Court's reasoning and outcome: The Court of Appeal analysed the statutory language, the Porter Committee report which led to s 3(1), and relevant authorities. It concluded that Parliament intended to relieve claimants from proving actual loss by providing a forward-looking test: the words must be calculated (probable) to cause pecuniary damage when judged objectively at the time of publication. The court rejected the judge's historic approach that required proof that the words in fact caused loss on the balance of probabilities. Applying the forward-looking test to the facts, the court found the publications met s 3(1) because allegations that a commission-based recruiter had breached post-employment restrictions were inherently likely to cause financial loss. On remedies the court held that damages for distress/injury to feelings can, in principle, be awarded where the claimant succeeds under s 3(1). The appeal was allowed; judgment for the claimant on liability under s 3(1) was restored and the case was remitted for assessment of damages, including compensation for injury to feelings.

Appeal allowed. The Court of Appeal held that section 3(1) of the Defamation Act 1952 is forward-looking: a claimant relying on s 3(1) need only show that the false and malicious words were, in context at the time of publication, calculated (i.e. objectively probably likely) to cause pecuniary damage to the claimant; proof of actual historic pecuniary loss is not required. The claimant was entitled to judgment on liability under s 3(1) and the case was remitted for assessment of damages, including possible compensation for injury to feelings.

Appeal from the High Court (Queen's Bench Division, Media and Communications List) judgment of Saini J [2021] EWHC 2988 (QB); appealed to the Court of Appeal which delivered judgment [2022] EWCA Civ 1067 allowing the appeal.