Full case report

Cruddas v Calvert & Others (No.4)

Reference [2013] EWHC 2298 (QB)
Court Queen's Bench Division

Judge Tugendhat J

Date of Judgment 31 Jul 2013


Summary

Libel – Malicious Falsehood – subterfuge – covert recording – Press Complaints Commission Code of Conduct – Public Interest – Justification – s.5 Defamation Act 1952 – Malice – Intention to Injure – Falsity – s.3 Defamation Act 1952 – Damages – Aggravated Damages


Facts

The Claimant was the former Treasurer of the Conservative Party. On 15 March 2012 he had been made the subject of subterfuge and covert recording by the First and Second Defendants (members of the Insight team of The Sunday Times) who posed as potential donors to the Conservative Party.

The Claimant sued on the articles published on 25 March 2012 by the Defendants. He brought claims for libel and malicious falsehood. Following variation of mode of trial to judge alone, at the PTR, the Court ruled that the Articles meant:

(1) in return for cash donations to the Conservative Party, the Claimant corruptly offered for sale the opportunity to influence government policy and gain unfair advantage through secret meetings with the Prime Minister and other senior ministers;

(2) the Claimant made the offer, even though he knew that the money offered for secret meetings was to come, in breach of the ban under UK electoral law, from Middle Eastern investors in a Liechtenstein fund; and

(3) further, in order to circumvent and thereby evade the law, the Claimant was happy that the foreign donors should use deceptive devices, such as creating an artificial UK company to donate the money or using UK employees as conduits, so that the true source of the donation would be concealed.

These meanings were (a) the single meaning of the Articles for the purposes of the claim in libel; and (b) meanings which a substantial number of reasonable readers of the Articles would have understood the words to bear for the purposes of the malicious falsehood claim. In addition, and as affirmed by the Court of Appeal, the allegation of corruption in the first meaning connoted criminal corruption for the purposes of the malicious falsehood claim.

The Defendants sought to defend the libel claim with a plea of justification. In relation to the malicious falsehood claim, the Defendants denied malice, relied upon their justification defence to rebut falsity of the allegations (apart from criminal corruption) and contended that the publication was not likely to cause the Claimant pecuniary damage within s.3 Defamation Act 1952.


Issue

(1) In relation to the libel claim:

(a) were the single-meanings substantially true;

(b) if the Defendants had not proved all of the imputations true, had they proved sufficient true to be entitled to rely on s.5 Defamation Act 1952;

(c) if not, what sum in damages should the Claimant receive;

(2) In relation to the malicious falsehood claim:

(a) were the meanings false;

(b) were the Articles published maliciously by the First and Second Defendant journalists;

(c) were the allegations likely to cause the Claimant pecuniary damage so as to come within s.3 Defamation Act 1952

(d) if the Claimant succeeded in proving these things, what sum in damages should the Claimant receive.


Held

(1) granting judgment for the Claimant on the libel claim;

(a) all three meanings were false. In relation to the first meaning, the Claimant was not offering for sale any influence or unfair advantage to the putative donors, corrupt or otherwise. He was offering the donors the publicly stated benefits of the Conservative Party’s Leader’s Group. In relation to the second and third meanings – which suggested a breach of electoral law – these were also false. The Claimant repeatedly stressed during the meeting that donations to the party had to be compliant with the law. In relation to donations made by companies, the relevant company had to be a bona fide operating British company and that donations funnelled through third parties were not acceptable.

(b) in light of the findings on justification, s.5 Defamation Act 1952 did not arise.

(c) the appropriate sum in damages was £180,000 (including £15,000 aggravated damages). The libel was serious with the Articles receiving “the maximum possible publicity” (and they were not removed until 6 June 2013). The Claimant had been publicly criticised for his conduct by the Prime Minister, which was a “massive humiliation” for him. The Defendants did nothing to give publicity to the various events following publication which vindicated the Claimant and the cross-examination of the Claimant during the trial had been “offensive” as had been the Defendants’ conduct in contesting the action before and at the trial.

(2) granting judgment for the Claimant on the malicious falsehood claim;

(a) the Claimant had shown all three meanings to be false for the same reasons as led the Court to reject the defence of justification. Nothing turned on the burden of proof in the case.

(b) both journalists were found to be malicious on the basis that they knew that the meanings conveyed by the Articles were false and that they had a dominant intention to injury the Claimant. The Third Defendant publisher was vicariously liable for their malice.

(c) the Claimant met the conditions for s.3 Defamation Act 1952. He was likely to be caused pecuniary damage by reason of his position as an approved person under the Financial Services legislation and regulated by the FSA. The publication of the allegations against the Claimant was likely to cause at least an investigation into the Claimant by the FSA and that the Claimant would have incurred the substantial costs of dealing with that. Having made that finding, it was not necessary to consider whether he was likely to have suffered any further financial loss as a result of any adverse findings by the FSA.

(d) given the size of the award for the libel claim, the Judge did not make a separate award for the malicious falsehood claim.


Comment

Findings of malice against journalists are rare, but not unprecedented (see Thornton -v- Telegraph and Qadir -v- Associated Newspapers Ltd). Here the basis of the finding was both knowledge of falsity of the allegations made in the Article and dominant intention to injure the Claimant.


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Instructing Solicitors

Slater & Gordon for the Claimant; Bates Wells Braithwaite for the Defendants


Links

Cruddas wins damages from Sunday Times - Financial Times
Ex Tory co-treasurer Peter Cruddas awarded GBP180,000 damages over Sunday Times lobbying story - Daily Telegraph
Ex-Tory co-treasurer wins damages from Sunday Times - Metro
Ex-Tory treasurer Cruddas wins GBP180,000 libel damages - BBC News
Ex-Tory treasury Peter Cruddas lashes out after winning libel action - Daily Mail
Former Tory official Peter Cruddas wins GBP180,000 libel award - Independent
Lord Ashcroft's Blog
Peter Cruddas blasts PM after libel win - Evening Standard
Peter Cruddas wins GBP180,000 damages in Sunday Times libel case - The Guardian
Peter Cruddas Wins GBP180k In Libel Damages - Sky News
Sunday Times loses Cruddas libel battle, pays GBP180,000 plus costs - Press Gazette
Times Newspapers ordered to pay GBP180k damages, GBP500k costs in libel battle - The Lawyer