Full case report

Dar Al Arkan Real Estate Co v Al Refai

Reference [2013] EWHC 1630 (Comm)
Court Commercial Court

Judge Andrew Smith J

Date of Judgment 12 Jun 2013


Summary

Defamation – Conspiracy – Joint Tortfeasorship – Summary judgment – Defamatory website – Liability for publication where defendant did not know precise words to be published


Facts

The Cs were a Saudi Arabian property development company and a Bahraini bank with common shareholders and directors. D1 was the bank’s former Chief Executive Officer and Managing Director. He had since his dismissal been involved in a protracted dispute with the bank, involving criminal and civil proceedings in Bahrain in which he had been convicted of offences including embezzlement and misuse of funds, destruction of documents, forgery and money laundering.

D1 had engaged Kroll (D2), an accountant (D3) and FTI (D4) to assist him in his dispute with the Cs. Cs alleged that the Ds had waged a campaign intended to damage and ultimately destroy them, culiminating in the creation of a website (and circulation of an email publicising it) entitled ‘Dar Al Arkan Crisis’, which contained numerous allegations defamatory of the Cs and hundreds of their internal documents. Cs brought claims against the Ds including defamation, malicious falsehood, breach of confidence, conspiracy, breach of (and procuring breach of) contract and unlawful interference with business. Cs estimated their losses as a result of the Ds actions at around $500m.

The Ds each denied liability. FTI’s case was that it it had merely provided D1 with PR and media-related services, and that its purpose and intention had been only to defend and protect D1 in the media. It denied any liability for the website or email, asserting that it did not compose either and had never had possession of the internal documents published on the website. However there was no dispute that a senior managing director at FTI, H, knew that D1 had information adverse to the Cs in his possession, and had discussed with the other Ds using the internet to get that information into the public domain, suggesting the use of a blog site. H had received a draft structure for the website from D2 containing the gist of the allegations to be made against C, and had participated in a further discussion about it with the other Ds. H’s evidence was that these discussions were hypothetical only, and that that was the extent of FTI’s involvement prior to the launch of the website. H asserted that the website came as a surprise to him, and that he did not know that the other Ds were responsible for it, although he admitted assisting them in promoting it to the media.

FTI applied for summary judgment in respect of parts of the claims against it, primarily in respect of its alleged liability for the website and email.


Issue

Whether the Cs had a real prospect of succeeding in their claims against FTI in respect of the website and email.


Held

Dismissing the application;

The Cs had a real prospect of succeeding in their claims against FTI in respect of the website. Even accepting the general thrust of H’s account, the Cs had a sufficient argument that FTI were joint tortfeasors with the other Ds in respect of the defamatory material on the website. They had pleaded a case that FTI had acted to further a common design with the other Ds which included the relevant tortious acts relating to the website.

Further, there was sufficient reason to think that FTI’s involvement with the other Ds in relation to the Website went further than H had acknowledged. Given the apparently covert nature of the other defendants’ activities the court could not be sufficiently confident, at least before disclosure, that it had a proper understanding of FTI’s role in them to determine summarily that FTI was not responsible for the website.

It would not be in the interests of justice to deal with the email separately, and in any event the Cs had a sufficient case that the email drawing attention to the website was part of a common design, to which FTI were party, to publicise the Ds allegations against the Cs.


Comment

Of particular interest in the defamation aspect of the application was that FTI contended that they could not be liable unless they had knowledge of the particular defamatory words to be published, citing dicta in Bunt v Tilley and Tamiz v Google. The Judge rejected this, citing two 19th century cases, R v Cooper (1846) 8 QB 533 and Parkes v Prescott (1868-69) LR 4 Ex 169, which show that a defendant may be liable as a publisher without knowing the precise words to be used.


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Instructing Solicitors

Dechert LLP for the Cs; Stephenson Harwood LLP for FTI