Citation Plc v Ellis Whittam Ltd
| Jurisdiction | England & Wales |
| Judge | THE HONOURABLE MR JUSTICE TUGENDHAT,Mr Justice Tugendhat |
| Judgment Date | 14 March 2012 |
| Neutral Citation | [2012] EWHC 549 (QB) |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ11D03824 |
| Date | 14 March 2012 |
[2012] EWHC 549 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mr Justice Tugendhat
Case No: HQ11D03824
James Price QC (instructed by Eversheds) for the Claimant
Jane Phillips (instructed by Robin Simons) for the Defendant
Hearing date: 2 March 2012
In this action for slander and malicious falsehood the Claimant and Defendant companies are competitors in business. The Claimant pleads that the Defendant is more recently established. The action arises out of words allegedly spoken on 7 April 2011. A claim form was issued on 13 October 2011 and served with Particulars of Claim. The Defence was served on 16 November 2011. On 4 January 2012 the Defendant issued the Application Notice now before the court in which it seeks an order that the claim be struck out and dismissed in its entirety. It is said that it is an abuse of the process of the court pursuant to CPR Part 3.4(2), that the Particulars of Claim disclose no reasonable grounds for bringing the claim and that there is no real or substantial tort.
The business of the Claimant, and as I understand it of the Defendant, is the provision of professional advice and compliance packages to business clients in the fields of employment law, and health and safety regulations. These services include an advice guarantee scheme pursuant to which the Claimant indemnifies the client for losses incurred as a result of following advice given to the client by the Claimant.
The alleged slander was by words spoken to Ms Harris, a representative of a firm of solicitors which was at the time a prospective client of the Claimant. That firm subsequently became a client after some negotiations. So it is not alleged that any actual damage has been suffered by the Claimant.
The person alleged to have spoken these words is a Mr Bostock, an employee of the Defendant who was formerly employed by the Claimant.
The words allegedly spoken are:
"3.1 Citation's guarantee is not what they say it is… because Citation is self insured and not insured through a broker
3.1.1 It is unable to pay out on claims";
3.1.2 Further or alternatively to 3.1.1 above ".. it does not pay out on any claims";
3.2 "Citation does not have any qualified lawyers working for the company"; and
3.3 "With Citation you would not be dealing with employment law lawyers".
Insofar as the claim is in slander the meaning attributed to the words in the Particulars of Claim is :
"5.1 The Claimant was unwilling or unable to pay out on claims made under its contracts with clients, and was accordingly guilty of mis-selling its products to clients or failing to provide them with what they were bargaining for;
5.2 The Claimant did not have any qualified lawyers working for it and accordingly provided advice to clients from inadequately qualified and/or incompetent employees or agents;
5.3 The Claimant thereby provided an inadequate and second-rate service to its clients, in particular as compared with the Defendant's, such that prospective clients should steer well clear of it".
A central issue in the application to strike out is, as pleaded in paragraph 6 of the Particulars of Claim, the admission by the Claimant that it is unable to give particulars of publications to other third parties of the words complained of, or of substantially similar words. In para 6 of the Particulars of Claim it is pleaded:
"Pending disclosure and/or the provision of Further Information herein the Claimant is unable to give particulars of other publications of the said words or words substantially similar thereto to third parties within this jurisdiction, but in the meantime it invites the obvious inference that this was not an isolated incident. It will rely on such publications at trial in support of its claim for damages".
There is also a claim for malicious falsehood, based on the same words. The particulars of falsity are as follows:
"8.1 The Claimant is able to pay out on claims made by clients under its advice guarantee scheme;
8.2 The Claimant does and would pay out such claims;
8.3 The Claimant does have qualified lawyers working for it;
8.4 The Claimant's clients do deal with suitably qualified advisors that include employment law lawyers".
Insofar as the claim in malicious falsehood is concerned, it is based not on actual damage, but on likely damage, pursuant to Defamation Act 1952 Section 3 which reads as follows:
"3 E+W+S (1) In an action for slander of title, slander of goods or other malicious falsehood, it shall not be necessary to allege or prove special damage—(b) if the said words are calculated to cause pecuniary damage to the plaintiff in respect of any office, profession, calling, trade or business held or carried on by him at the time of the publication".
In the Particulars of Claim it is pleaded:
"10. In support of this averment the Claimant will say that the words were self evidently seriously damaging to the Claimant's good will, its ability to retain current clients and its ability to attract and win new clients. Whilst the Claimant does not believe it has suffered any loss or likely loss in respect of its relationship with R G Solicitors, it is likely to have suffered loss of business as a result of other similar publications (which as pleaded above it is to be inferred have also taken place) and is likely to suffer such loss in the future unless the defendant is restrained by injunction or offers adequate undertakings as to the future.
11. Unless restrained by injunction the defendant will continue to publish the said or similar falsehood defamatory statement of and concerning the Claimant and its business in support of this averment the Claimant will refer to and rely on the correspondence between the parties in which the defendant failed and refused to offer an unqualified undertaking not to publish the said statements in the future".
In the Defence the Defendant denies publication of the words complained of and denies the words bear the defamatory meaning attributed to them in the Particulars of Claim. As to the allegation that it is to be inferred that there were publications to other publishees, the Defendant declines to plead to that on the basis that it is a speculative averment based upon an unsupported inference.
As to the particulars of falsity, again the Defendant pleads that it is unable to respond to the claim in the absence of full and proper particulars which, it is said, the Claimant has refused to provide in correspondence. Accordingly it is pleaded that the Claimant is put to strict proof of the following:
"8.1.1 The amount the Claimant's coverage under its 'advice guarantee scheme';
8.1.2 The amount of the Claimant's reserves to support its advice guarantee scheme;
8.1.3 The number of clients who have joined the advice guarantee scheme;
8.1.4 The number of the Claimant's clients who have made claims against the Claimant under its advice guarantee scheme and for how much".
For the purposes of this strike out application it seems to me the central issues before me are as follows:
i) Does the Claimant have an arguable case that it is to be inferred that there were publications of the said words, or substantially similar words, to third parties other than Ms Harris?
ii) Does the Claimant have an arguable case for the grant of a permanent injunction at trial; and in any event
iii) Is this a real and substantial tort.
WHETHER THERE HAS BEEN ANY OTHER PUBLICATION
CPR Part 53 Practice Direction paras 2.2(2) and 2.4 require that in a claim for slander the claim form, or the particulars of claim, must so far as possible contain the precise words complained of, and the names of the persons to whom they were spoken and when.
The reason for this rule is explained in a number of cases, as are the limited exceptions to it. In Best v Charter Medical Ltd [2001] EWCA Civ 1588; [2002] EMLR 18 p335, Keene LJ repeated the words of Hirst LJ in British Data Management plc v Boxer Commercial Removals plc [1996] 3 All ER 707, 717b-g.
"… we do not find it possible to accept [the] submission that it is invariably necessary for the plaintiff to plead or allege verbatim the exact words of which he complains, provided, as stated by Denning LJ in Collins v. Jones, he sets them out with 'reasonable certainty' which is, in our judgment, the correct test.
It is important to bear in mind the purpose of a statement of claim. It is to enable the defendant to know the case that he has to meet so that he can properly plead his case, with the result that the issues are sufficiently defined to enable the appropriate questions for decision to be resolved. In a libel case the first question is whether the words are defamatory of the plaintiff, which depends on their meaning; unless the plaintiff succeeds on this fundamental issue, his action will fail. Next, a number of questions may arise on defences which the defendant may wish to raise, for example, a plea of justification, which depends on whether the words are true or false, and similarly mutatis mutandis in the case of a plea of fair comment.
This purpose will not be achieved unless the words are pleaded with sufficient particularity to enable the defendant not only to understand what it is that the plaintiff alleges that they meant, but also to enable him to decide whether they had that meaning and, if not, what other meaning they had or could have….
This is why there must in all cases be reasonable certainty as to...
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