Lonrho Plc and Others v Fayed and Others (No 5)

JurisdictionEngland & Wales
Judgment Date22 July 1993
Judgment citation (vLex)[1993] EWCA Civ J0722-8
CourtCourt of Appeal (Civil Division)
Date22 July 1993
Fayed & Ors
Appellants
and
Lonrho PLC
Respondent

[1993] EWCA Civ J0722-8

(Mr. Justice Swinton Thomas)

Before: Lord Justice Dillon Lord Justice Stuart-Smith and Lord Justice Evans

IN THE SUPREME COURT OF JUDICATURE

COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE HIGH COURT OF JUSTICE

(QUEEN'S BENCH DIVISION)

MR J SUMPTION QC, MR. J. MUNBY QC, and MR. A WALTON (instructed by Messrs. Herbert Smith, London) appeared on behalf of the 1st, 2nd and 3rd Appellants.

MR. G. POLLOCK QC, MR. I. GEERING QC and MR. V. LYON (instructed by Messrs. Denton Hall Burgin & Warrens, London, and Titmuss, Sainer & Webb appeared on behalf of the Respondent.

1

Thursday 22 July 1993

LORD JUSTICE DILLON
2

LORD JUSTICE DILLON This matter came before this Court, under directions given by Neill L J, as an application by the Plaintiffs (Lonrho plc, Mr Rowland and Sir Edward duCann) for leave to appeal again an Order of MacPherson J of the 24th July 1992 and on the basis that if leave was granted the hearing of the appeal would immediately follow. In the course of the argument we granted leave to appeal, and I now give my judgment on the appeal.

3

The Order of MacPherson J was that the action be struck out against the first six of the remaining Defendants. I shall refer to these six as "the Defendants"; there were at one stage various other Defendants who have since ceased to be parties to the action, but it seems that there is still one further defendant, a company, with which we are not concerned since it was not a party to the applications before the Judge and is not a party to this appeal.

4

It is well known that since 1985 there has been acrimony between Lonrho and Mr Rowland and the first two Defendants ("the Fayeds") as a result of the circumstances in which in 1985 the Fayeds succeeded in gaining control of a company called House of Fraser plc. One result of this has been a substantial amount of hard-fought litigation and the principal action —after an interlocutory excursion to the House of Lords which is reported as Lonrho plc v Fayed [1992] 1 A.C. 448—awaits trial next year.

5

A second action — Lonrho v Fayed (No.2)—arising out of the same circumstances as the principal action was started by Lonrho in September 1990. This asserted that a sale by Lonrho to in effect the Fayeds in November 1984 of a 29.9% holding in House of Fraser was induced by fraudulent misrepresentations by the Fayeds and it sought consequential relief by way of a constructive trust. Lonrho v Fayed (No.2), was struck out by Millett J on the 12th April 1991 —see [1991] 4 All ER 961—on the ground that Lonrho's claim in that action "has no foundation in fact and is not made in good faith with genuine belief in its merits but has been manufactured to provide a vehicle for a further public denunciation of the Fayeds." There has been no appeal against that Order of Millett J. But the grounds, on which he concluded that the claim in Lonrho v Fayed (No.2) had no foundation in fact, have no relevant to the present action.

6

There is no doubt that there has been extensive public denunciation of the Fayeds by Lonrho, not least in the circulation of a document entitled "A Hero from Zero" and of a special issue of the Observer newspaper.

7

The matters in issue in the present action are said by the Fayeds to represent a counter attack, in self-defence, by the Fayeds against Lonrho in order to induce Lonrho to abandon its persistent campaign of vilification against the Fayeds. There was beyond any question a campaign of vilification against Lonrho and Mr. Rowland carried on ostensibly by a Miss Francesca Pollard in her own name and for her own reasons. In the course of this campaign scurrilous letters were sent by Miss Pollard to a large number of people, including shareholders in Lonrho, people in responsible positions in this country, and people in responsible positions in the public services of countries in Africa and the Middle East where Lonrho did business or was hoping to do business. Also scurrilous pamphlets were published by Miss Pollard and other actions were taken, which I need not mention now. It is said by the Plaintiffs, and for present purposes accepted by the Defendants, that this campaign of Miss Pollard's was clandestinely sponsored and encouraged by the Defendants. It is said further, but disputed, that the campaign was thus sponsored and encouraged with the purpose of injuring the Plaintiffs. It is also said by the Plaintiffs, and for present purposes accepted by the Defendants that the Fayeds and the Third Defendant financed, and caused a Mr Esterhuysen to bring, an action, in the Chancery Division 1987 E NO 334, ("the Esterhuysen action") in the name of Jacobus Philipus Esterhuysen against Lonrho and Mr. Rowland and others, which is still pending.

8

There is no doubt at all that much that was said in the documents circulated by Lonrho was, unless true, plainly defamatory of the Fayeds, and much that was said in Miss Pollard's letters and pamphlets was, unless true, plainly defamatory of Lonrho and Mr Rowland. But no proceedings in defamation have been brought by either side.

9

The present action, which was started on the 11th July 1991 claims damages and injunctive relief against the Defendants in respect of Miss Pollard's campaign and its alleged consequences and the Esterhuysen action; the cause of action relied on is that form of the tort of conspiracy which has been referred to —not altogether conveniently —as a "lawful means" conspiracy. That is the form of action in conspiracy, recognised by the House of Lords in Lonrho plc v Fayed, and Lonrho Ltd v Shell Petroleum Co Ltd [1982] AC 173 and other decisions there discussed, where actions which, if done by one person on his own, would be lawful and cannot be actionable can be actionable as a tortious conspiracy if done by several persons in combination and if the predominant purpose of those persons was to injure the plaintiff, and not to protect or forward their own interests. See also the speech of Viscount Simon L.C. in the Crofters' Case [1942] A.C. 435 at 442–3. So far as this Court is concerned, there is no doubt that we have to recognise the validity of such a cause of action. From the Plaintiffs' point of view, the virtue of it is that the truth or otherwise of the allegations against Lonrho and Mr Rowland in Miss Pollard's letters and pamphlets would not be an issue in the action; it would be no defence to the Defendants to justify the allegations and submit that they cannot be actionable because they are true.

10

This leads to the serious dilemma to which I shall refer below as to whether it is possible by this form of action to circumvent the requirements of a defamation action, and recover damages for injury to reputation without the Defendants being able to plead justification or assert that the high reputation was not deserved; can a plaintiff by this form of action recover damages for injury to reputation if the defendants have combined to publish the truth about him?

11

In fact the Judge, while very sceptical about the Plaintiffs's prospects of obtaining damages or an injunction if the action were to go to trial, struck it out as an abuse of the process of the Court on the ground that the Plaintiffs were misusing the Court's processes in seeking to pursue this action at all. The Plaintiffs' object was, in the Judge's view, simply to continue the Plaintiffs' half of the parties' vendetta in the artificial form of an action at law so that at the trial the Plaintiffs could ventilate their allegations against the Fayeds and vilify the Fayeds with maximum publicity.

12

The temptation is great to say "a plague on both your houses and let not the Court's time be wasted with any further litigation between them" beyond the principal action already fixed for trial next year. But the issue as to what the Plaintiffs' purpose is in bringing this action is an issue of fact which is disputed and it cannot, in my judgment, be decided at an interlocutory stage on the tendentious affidavits of the solicitors on each side. It can only be decided at the trial; compare Speed Seal Products Ltd. v Paddington (1985) 1 WLR 1327.

13

The Defendants seek to support the Judge's conclusion also on grounds on which the Judge himself did not base the decision. The Defendants say in particular that this action must fail because the Plaintiffs could not possibly demonstrate, as they must, that the predominant purpose of the Defendants, in their clandestine backing of Miss Pollard's campaign, or the Esterhuysen action was to injure the Plaintiffs. But what the Defendants' predominant purpose was is again a question of fact which cannot be decided on the affidavits and must be left for the trial.

14

Two other matters I can also dispose of shortly.

15

In the first place, the Defendants say that, in view, apart from anything else, of the striking out of Lonrho v Fayed (No 2) as an abuse of the process of the Court, the Plaintiffs do not come to court with clean hands and therefore are for ever precluded from obtaining any injunction or other equitable relief against the Fayeds. As I see it, however, there is not absolute bar. the granting of an injunction is a matter for the discretion of the trial Judge, if he holds that the purpose of the Plaintiffs in bringing the action is not improper and the action is not in itself an abuse of the process of the Court.

16

In the second place, the position of the fourth Defendant, Mr. New, who is separately represented, does not differ from that of the other Defendants. He participated willingly in what was done by and for the Fayeds, and there is no basis for striking the action out against...

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3 books & journal articles
  • Tort Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2015, December 2015
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    • Singapore Academy of Law Annual Review No. 2014, December 2014
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    ...that is, it is not limited to a precise calculation of the amount of actual pecuniary loss actually proved: Lonrho plc v Fayed (No 5)[1993] 1 WLR 1489 at 1494. His Honour took into consideration three categories of damages as a consequence of the defendants' conspiracy: (a) the expenses inc......
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    • 1 Agosto 2007
    ...impact on the public interest or serious harm to others would result if the defendants withheld those facts about the plaintiffs. (1) [1994] 1 All ER 188. (2) Ibid 192 (Dillon LJ). It was also alleged that the defendants financed an action brought against the plaintiffs by a third (3) Ibid ......

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