Damavand Media Ltd v DMA Media Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Collins Rice |
| Judgment Date | 25 November 2021 |
| Neutral Citation | [2021] EWHC 3164 (QB) |
| Docket Number | Case No: QB-2020-001332 |
| Court | Queen's Bench Division |
[2021] EWHC 3164 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MEDIA AND COMMUNICATIONS LIST
Royal Courts of Justice
Strand, London, WC2A 2LL
THE HONOURABLE Mrs Justice Collins Rice
Case No: QB-2020-001332
Mr Simon Cheetham QC (instructed by Ronald Fletcher Baker LLP) for the Claimants
Mr Rupert Paines (instructed by Howard Kennedy LLP) for the Defendants
Hearing dates: 18 th – 20 th October 2021
Approved Judgment
Introduction
Mr Panah Farhadbahman started as a print media journalist in his native Iran. He moved to London in 2008 to join the BBC Persian TV launch team. He rose to Senior Broadcast Journalist with BBC Persian. He says he came to the attention of the Iranian government in 2009, when he reported on a controversial general election there, and again in 2013 when he made a feature documentary about the election. In 2017 the Iranian judiciary froze the assets of a list of BBC journalists, and Mr Farhadbahman was on that list. The BBC took the matter to the UN Human Rights Council in 2018, and Mr Farhadbahman testified.
Mr Farhadbahman resigned from the BBC on 11 th September 2018. In late 2017 he had begun discussions with Mr Rob Beynon, then acting head of channel at Iran International TV (IITV) and now its CEO. IITV, then in its launch phase, is a Saudi-funded Persian language TV channel, based in London and broadcasting by satellite to Iran. It is owned by Volant Media UK Limited (Volant), and was managed by DMA Media Limited (DMA), which is run by Mr Beynon.
The outcome of the discussions was a contract dated 23 rd August 2018. This was entered into on Mr Farhadbahman's side by Damavand Media Limited (Damavand). Damavand develops and produces TV programmes, and Mr Farhadbahman is a director. Under the contract Mr Farhadbahman was to provide certain media services to DMA on a consultancy basis. He started working with IITV on 17 th September 2018, a week after he left the BBC.
The arrangement lasted less than a year. On Mr Beynon's account, he suspended the contract on 31 st August 2019 and terminated it on 6 th September 2019, because Mr Farhadbahman persistently breached editorial guidelines in his personal social media activity. Mr Farhadbahman says Mr Beynon had no right to do so.
Mr Farhadbahman and Damavand, the Claimants, bring this action for two reasons. The first is to claim compensation for wrongful termination or breach of the contract. The second arises from an incident early in the life of the contract. The Claimants say compensation is due because IITV, through the Defendant owners and managers, breached its legal duties to handle Mr Farhadbahman's private and personal information properly, so that details of his association with the channel wrongly leaked into the public domain.
The contract terms
(a) Service provision
The agreement recites that DMA was contracting with Damavand to obtain the media consultancy services it offered, and to have the benefit of its ‘ considerable skill, knowledge in show development, production strategy and editorial services’. The services Damavand were to provide were set out in a schedule to the agreement as follows:
1. The provision of television show development and individual programme development services to DMA, supporting the day to day management of productions and also developing ideas for new television shows, specifically:
a. Review of existing output
b. Development of new programme content across diverse content channels
c. Development of new programme ideas
2. Providing training and feedback to DMA staff
3. Supervising production of feature / news productions
4. Managing staff and resources with a view to the long term strategic objectives of DMA
5. Acting as supervisor for individual television programme output, including determining the content and running order of the programmes and lead others on the production of items through to transmission, including assigning, briefing and determining priorities for operational and editorial teams.
Certain services were, however, excluded. The ‘excluded services’ were:
1. Any ‘on-screen’ and ‘on-air’ contributions including but not limited to presenting, reporting, interviewing.
2. Making any form of documentary, film or series.
3. Any kind of participation in output on TV, website and social media platforms which may result in the disclosure of the identity of Damavand Media and its directors and officers.
The contract made clear that Damavand, and Mr Farhadbahman, was a contractor and not ‘ an employee, worker, agent or partner’ of DMA. The agreement was not to prevent the Claimants engaging in other activities ‘ provided that such activity does not cause a breach of any of Damavand's obligations under this agreement’.
Damavand warranted under the contract to ‘ promote and protect the interests of DMA during the term of this agreement’ and to ‘ comply with the reasonable instructions of DMA in the provision of the services which may be given from time to time’ (clause 4(a) and (f)).
(b) Information provisions
Clause 9 of the contract is a confidentiality provision requiring Damavand to preserve the confidentiality of materials made available to it by DMA. By clause 9(1)(c), Damavand ‘ undertakes to keep confidential all and every part of … the content of this Agreement’.
Clause 21 is headed ‘advertising’. It prevents Damavand making reference to the agreement, to the services being provided, or to DMA, without prior written consent (not to be unreasonably withheld).
(c) Termination
Clause 12 of the contract deals with termination. Either party was free to terminate without cause on 90 days' written notice (clause 12(3)). By clause 12(2):
DMA shall have the right to terminate this agreement in case of any material breach by Damavand Media of this agreement. Prior to exercising this right, DMA shall send a notice to Damavand Media requesting it to cure the breach within 14 days. Should Damavand Media fail to cure the breach within the said 14 days, DMA shall be entitled to terminate this agreement.
Clause 12(5) provides for the calculation of liquidated damages to be paid by DMA to Damavand if DMA terminates the agreement ‘ without reasonable cause’ in the first 36 months of the agreement.
There was some discussion at trial about the relationship between clause 12(2) and 12(5), and between the tests of ‘material breach’ and ‘reasonable cause’. The drafting is not clear. The best reading may be not that subclauses (2) and (5) operate on each other, but that subclause (5) operates on subclause (3). In other words, while both parties have a right to terminate without cause on 90 days' notice, if DMA exercises that right within the first 3 years then it must in effect buy out Damavand on a sliding scale, depending on timing.
IITV has a set of Editorial Guidelines. Clause 12(6) gives Damavand the right to terminate within 28 days of being notified of any change to the Editorial Guidelines which, in its reasonable opinion, may affect Mr Farhadbahman's journalistic impartiality, or in the event that Damavand reasonably considers that DMA's instructions or actions may constitute a breach of the Guidelines. Liquidated damages are recoverable by Damavand in these circumstances.
(d) The Editorial Guidelines: contractual status
In his oral evidence Mr Farhadbahman suggested more than once that he was ‘not bound’ by the Editorial Guidelines, including because of the limitations of his role as set out in the ‘services’ schedule. His pleadings and the submissions made on his behalf did not say that. His formal position was that in any event he did observe the Guidelines and his conduct, even assessed against the Guidelines, gave no cause for terminating the contract.
The contractual status of the Guidelines matters because the Defendants rely on them to characterise Mr Farhadbahman's conduct as sufficiently serious to justify termination. They say the Guidelines are the prism through which it must be viewed. To the extent that their contractual status is a disputed issue, then the following points arise.
First, clause 1 of the contract, the interpretation clause, includes this:
“ Editorial Guidelines” are set out in Appendix 3 and may be amended by DMA at any time by notifying Damavand.
Then Clause 19 is headed ‘ Whole Agreement’ and states: ‘ This Agreement (together with any documents annexed to it) constitutes the entire agreement between the parties…’. And clause 24, headed ‘ Variations’, says that where an appendix to the agreement is amended, replaced or updated, ‘ the agreed version shall be signed and dated by the Parties prior to its insertion’ into the agreement. These provisions, taken together, make clear enough that the Guidelines, as from time to time amended, are incorporated into the contract terms. Understanding to what effect requires reading the contract and the Guidelines together as a whole.
No express provision in the contract explicitly binds the Claimants to observe the Guidelines. Indeed, the only further reference to them in the contract is in the termination clause, set out above. The drafting of clause 12(6) is problematic: the relationship between its two limbs is unclear. But in any event, it confirms the contractual significance of change in the Guidelines and that change can affect the Claimants' contractual position. That in turn implies the contractual...
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