McLaughlin & Ors v Newall

Reference: [2009] EWHC 1925 (QB)

Court: Queen's Bench Division

Judge: HHJ Moloney QC sitting as a Judge of the High Court

Date of judgment: 31 Jul 2009

Summary: Defamation – Striking out - Defence of compromise

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Appearances: Justin Rushbrooke QC (Claimant)  Jonathan Barnes (Defendant) 

Instructing Solicitors: Carter-Ruck for the Claimants/Applicants; Freeth Cartwright for the Defendant/Respondent

Facts

In a libel action, D contended that the Cs’ claim was barred by a compromise agreement entered into before proceedings were issued. The Defence also entered substantive defences to the claim, including a plea of justification. The Cs applied to strike out the defence of compromise on two bases: first, because although the alleged agreement referred to “a written apology and retraction in terms to be agreed”, none had been agreed and so there was no agreement on an essential term or at least such agreement was a condition precedent to the Cs becoming barred from suing; secondly, even if there was a binding contract, D was not entitled to rely on it by reason of the fact he had entered a plea of justification, which would be inconsistent with any possibility of a future sincere apology.

Issue

Whether the defence of compromise should be struck out.

Held

Although it was not necessarily fatal to D’s contention that the Cs had contractually foregone their right to sue him that the terms of the apology had not been agreed (Western Broadcasting Services v Seaga [2007] EMLR 18 (PC) distinguished), the structure of the agreement was that of conditions precedent to a compromise by which an enforceable compromise would only arise once there had been compliance by D with a series of conditions, one of which was the provision of an apology and retraction to be agreed. Therefore, the defence of compromise would be struck out on the first basis. However, it would not have been struck out on the second basis, since D had not elected between defences of compromise and justification (cf Adelson v Associated Newspapers ) but was running them in the alternative, which was a legitimate course (see Clarke v Marlborough Fine Arts [2002] 1 WLR 1731).

Comment

The judge took pains to make two general observations: (1) a defamation settlement which leaves open the wording of the apology will often be at risk of being found incomplete and unenforceable; (2) it will help to avoid disputes of this kind if, once the solicitors have reached agreement in principle in correspondence, they draft and sign a formal written contract or memorandum.