Full case report
Chang Wa Shan v Esther Chan Pui Kwan
Reference CACV 240/2015
Court Hong Kong Court of Appeal
Judge Yuen, Kwan, Macrae JJA
Date of Judgment 8 Sep 2017
Defamation – malicious falsehood – slander – absolute privilege – civil proceedings – informant – damages – causation – remoteness – Hong Kong
In the course of the trial of a notorious probate action in Hong Kong, in which an adventurer sought to challenge the will of a property tycoon, leaving her vast fortune to a charitable foundation, relying on a later will – ultimately found to be forged – leaving everything to him, D provided to the solicitor and counsel acting for the adventurer a document for use in discrediting a significant witness for the charitable foundation, stating, when asked, that the person who provided the document to her, and for whom she was acting in passing it to the lawyers, was C. The C was otherwise entirely unconnected to the probate litigation, though he was a business associate of the witness.
Before cross-examination of the witness in the probate trial on the document proceeded, the Judge asked its provenance, and was told by counsel in open court that it was provided by C. That information, although stated in good faith by the solicitor and counsel, was admittedly false. It was widely reported, causing, so C claimed, serious reputational damage and special damage to him.
C brought Norwich Pharmacal proceedings to discover D’s identity, and then sued her for slander and malicious falsehood. D claimed absolute privilege, and claimed that in any event, damage caused directly by the republications could not be recovered against D in an action founded on the original publication, as the republications were admittedly absolutely privileged.
The trial judge rejected the claim, finding that D was malicious, but that her statement did not bear the pleaded innuendo meaning, and in any event he upheld the plea of absolute privilege. C appealed.
1. Whether D’s statement bore the pleaded defamatory innuendo meaning.
2. Whether it was communicated to the lawyers in the probate litigation on an absolutely privileged occasion.
3. Whether damage, including special damage, caused by (absolutely privileged) republications could be recovered against D in an action founded on the original publication.
The CA held by a majority (Kwan and Macrae JJA) that the statement made by D bore an innuendo meaning defamatory of C.
The CA unanimously held that the occasion on which D made the statement to the lawyers was not absolutely privileged. Absolute privilege for statements made in Court was confined to participants in the proceedings coram judice, that is, the judge himself or herself, parties, advocates, witnesses and jurors. The extension of immunity to potential witnesses was necessary to protect them from a flank attack, in which they were sued for what they said out of Court in their witness statements, rather than directly for what they said in Court. Absolute privilege should not be extended by analogy to existing cases, and was not strictly necessary in the case of mere informants.
The extension of immunity to out-of-court statements between investigators and persons assisting with the inquiry, which could fairly be said to be part of the process of investigating a crime or possible crime with a view to prosecution (Taylor v Serious Fraud Office  2 AC 177) arose from developments – disclosure by the prosecution of unused material – peculiar to criminal cases, and was grounded in the public interest in detecting and punishing crime.
The majority of the CA (Kwan and Macrae JJA) however held that damages flowing from absolutely privileged republications could not be recovered against the original publisher, as to do so would undermine an immunity which is essential to the administration of justice. To allow recovery against an informant may deter a participant in proceedings from speaking without inhibition.
The majority therefore awarded general damages of HK$30,000 for injury to reputation directly caused by the original publication.
Yuen JA would have held that D’s statement did not bear the pleaded innuendo meaning, but that damages caused by the absolutely privileged republications could be awarded in an action founded on the original publication. The principle that where a person (in this case an innocent bystander) suffered a wrong, there should be a remedy should prevail. There was no erosion of the immunity given to the republishers. On this basis, Yuen JA would have allowed the claim for malicious falsehood, including general damage for the widespread republications and the special damage.
The points of law on absolute privilege are free from previous authority, and the CA judgments may be persuasive, and in any event contain valuable discussions of the relevant principles and authorities
Baker & McKenzie for the Claimant / Appellant; Lui & Law for the Defendant / Respondent
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