Full case report

Ansari v Knowles

Reference [2012] EWHC 3137 (QB)
Court Queen's Bench Division

Judge Eady J

Date of Judgment 8 Nov 2012


Summary

Defamation – joint tortfeasors – settlement with one joint tortfeasor – release of cause of action – satisfaction – Jameel abuse


Facts

C sued D1 and D3 as jointly liable for the publication and republication of a memorandum to members of management and HR where he worked. He also sought to make their respective employers, D2 and D4, vicariously liable. D3 took no part in the proceedings and default judgment was entered for damages to be assessed. Following service of Defences of justification and qualified privilege and Replies pleading malice, C entered into a settlement with D4 for a lump sum payment and an apology by statement in open court.

D1 and D2 amended their Defences to plead that the settlement with D4, who was sued as joint tortfeasor with D1, D2 and D3 had finally disposed of C’s claim in respect of the Memorandum on two grounds: release of the tort (Duck v Mayeu [1892] 2 QB 511; Apley Estates v De Bernales [1947] Ch 217) and/or satisfaction of the claim. In the alternative, D1 and D2 pleaded that it would amount to Jameel abuse for C to be permitted to further pursue his claim in respect of the memorandum following the settlement with D4.

The court directed the trial of a preliminary issue on these points.


Issue

The questions which the Court had to determine were:

(1)    Whether the effect of C’s settlement with D4 was to extinguish the cause of action and release D1, D2 (and D3 who was not a party to the issue or represented).

(2)    Whether the effect of C’s settlement was to satisfy C’s claim.

(3)    Whether, following the settlement with D4, it would be an abuse of process of the type identified in Jameel (Yousef) v Dow Jones Inc [2005] QB 946 for the C to continue his claim against D1, D2 and D3 in respect of the memorandum.


Held

The Court answered all three questions in the negative. It did so having recognised that to most people the costs incurred so far, in excess of £1 million, would seem disproportionate, not only to the issues involved, but also any potential benefit to be gained by the Claimant from pursuing his claims.

(1)    On the issue of release, the court took as its starting point the words of Lord Diplock in Bryanston Finance v de Vries [1975] 1 QB 703 at 732B that “the courts nowadays are reluctant to construe an agreement with one tortfeasor as a release rather than a covenant not to sue him, unless it is plain that the agreement was intended by the plaintiff to operate also as a release of the other joint tortfeasors from their liability”. The court held that it was far from plain in this case.

(2)    As to satisfaction, the settlement agreement could not be read as having determined the maximum compensation for the cause of action.

(3)    It was not an abuse for C to continue the claim as it had the potential at least to vindicate the Claimant in respect of the allegations the subject of the justification plea, which itself was a document accessible to the public under the CPR.


Comment

It is generally recognised that it can be hazardous to settle with one but not all parties jointly liable for a tort. This is because of the general rule at common law that where there is a joint cause of action against two or more persons, a discharge of one of them operates as a discharge against all (eg Clerk & Lindsell, 20th Ed at 31-36). The usual advice in such cases is to make an express reservation of the right to continue against any other joint tortfeasor.

However, the general rule has been much criticised and this appears to be the first defamation case in which there has been a review of its operation since Watts v Aldington [1999] L & TR. 578.

If the settlement with D4 had resulted from C’s acceptance of a Part 36 offer from D4, C would have had to discontinue the claim against D1, D2 and D3 (see CPR 36.12).


Instructing Solicitors

Brabners Chaffe Street LLP; Addleshaw Goddard