Stern v Piper
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE HIRST,LORD JUSTICE SIMON BROWN,SIR RALPH GIBSON |
| Judgment Date | 21 May 1996 |
| Judgment citation (vLex) | [1996] EWCA Civ J0521-13 |
| Docket Number | QBENI 95/0580/E |
| Court | Court of Appeal (Civil Division) |
| Date | 21 May 1996 |
[1996] EWCA Civ J0521-13
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION
(MR JUSTICE DRAKE)
Royal Courts of Justice
Strand
London WC2
Lord Justice Hirst
Lord Justice Simon Brown
Sir Ralph Gibson
QBENI 95/0580/E
MR J PRICE QC (Instructed by Manches & Co DX LDE 76) appeared on behalf of the Appellant.
MR D EADY QC and MR M BARCA (Instructed by Mishcon De Reya DX 37954) appeared on behalf of the Respondent.
( )
Tuesday, 21st May, 1996
On 9th January 1994 the Mail on Sunday in its "Money" column published an article concerning the plaintiff Mr William George Stern, who, as is common ground, was declared bankrupt in 1978, and was discharged from bankruptcy in 1985. The article was headed "Stern falls into old trap with a "£3m.debt"" and was accompanied by a photograph of the plaintiff captioned "TROUBLES; Stern faces High Court Action". The article itself, which I shall shortly quote in full, asserts that Mr Stern "has allegedly failed to honour debts of more than £3m", refers to a pending action in the High Court against Mr Stern and a number of companies associated with him, and quotes a number of allegations against Mr Stern made in an affirmation sworn in these proceedings by the plaintiffs' solicitor.
On 13th May 1994 Mr Stern commenced the present action against the author of the article Mr Allan Piper, the City Editor of The Mail on Sunday Mr Clive Wolman, and the proprietors of the newspaper Associated Newspapers Ltd, claiming damages for libel in respect of the article.
The defendants by their defence plead justification on the footing that the words are substantially true if and in so far as they mean that the plaintiff was once again in financial trouble, and in that he was involved in High Court proceedings in which he was accused of the matters averred in the affirmation referred to above.
The plaintiff applied to Master Murray on 18th January 1995 for an order to strike out the plea of justification on the grounds that it disclosed no reasonable defence to the plaintiff's claim, and was vexatious and an abuse of the process of the court. This order was refused by Master Murray, and his decision was upheld by Drake J. on 15th March 1995, giving rise to the present appeal.
The text of the article was as follows:—
"Willi Stern, the Seventies property tycoon who became Britain's biggest bankrupt and then clawed his way back, is in trouble again, This time he allegedly failed to honour debts of more than £3m.
Stern who returned to the property business following his discharge from bankruptcy in 1985, again gave personal guarantees on his business loans—an error which led to his £110m bankruptcy in the Seventies.
A High Court case over Stern's default should cast light on his use of a web of UK and offshore firms with names such as Holborn, Nycal and Pidom as well as his main operating group, Dollar Land.
One of the two claimants to the £3m. is Seymour Gorman, senior partner of a London law firm Lipkin Gorman and director of a finance group, Albion Trust Holdings.
Gorman says in his submission to the Court that Stern "is quite adept at utilising companies for his own business purposes without being a direct or registered shareholder".
He says that Stern, an ultra-orthodox Jew, visited his home with his 29- year-old son Mark shortly after the Day of Atonement in October 1992 and asked for forgiveness for "untruths" in his court submissions.
Gorman adds that Stern lives a lavish lifestyle with "the use of a large and valuable house near Hampstead Heath, a penthouse in Bournemouth, a villa in the South of France with two swimming pools and a flat in Jerusalem.""
In his statement of claim the plaintiff pleads that the article in its natural and ordinary meaning meant:—
(1) that the plaintiff was in trouble for failing to honour debts of more than £3m., and was facing as defendant a High Court action in which he was being brought to book for his default;
(2) that his said default was connected with his use of a web of companies with suspect names, many of them offshore, with many of which he was adept at showing no overt connection, as a method of concealing his activities and/or avoiding his just liabilities;
(3) that the plaintiff had committed perjury or otherwise knowingly lied in his submissions to the court, and had visited one of his creditors (a claimant to the £3m) to ask for forgiveness for having done so.
The plea of justification first sets out the details of the plaintiff's bankruptcy. It then proceeds as follows:—
"By virtue of proceedings in the Chancery Division…. Seymour Gorman (and others) claim against the plaintiff and a number of companies connected with him including Holborn Ltd and Dollar Land Holdings PLC and Pidom Export Ltd the sum of £3,014,000 plus interest. The said financial liability is alleged to arise from a variety of loan agreements and deeds of guarantee and indemnity entered into by the plaintiff and/or the said companies.
Seymour Gorman has been a Solicitor of the Supreme Court for over 30 years and is the senior partner of Lipkin Gorman, a London firm of solicitors. In his first Affirmation in the said proceedings….. Mr Gorman alleges:—
(a) The plaintiff "has had a colourful history…. and to my knowledge has a capacity of using offshore corporate entities as nominees for his own personal business activities. Indeed he told me approximately 2 years ago that when he has previously been a bankrupt, he had traded through nominees. He also has a poor record of discharging his obligations".
(b) The plaintiff "has admitted conduct towards (another) and myself which was dishonest".
(c) The plaintiff failed to honour the assurances and promises made by him to repay money lent by Mr Gorman (and another) to Dollar Land.
(d) The plaintiff had perjured himself in an affirmation made by him in support of an application to set aside statutory demands served on him by Mr Gorman (and another) on 5th August 1992.
(e) The plaintiff "said that he was prepared to make life difficult and to embarrass (another) and myself by making allegations of fraud against us".
(f) The plaintiff had told him that he had been forced to lie to First National Commercial Bank plc, because that finance house had been pressing him for repayment on a loan with which he was indirectly involved.
(g) The plaintiff "has often said to me that he considered it a religious duty or obligation that where a person in his position is being forced to relinquish an asset, he should take all steps and all means both fair and foul to avoid the consequences and if this means having to lie he will do so…. On 24th October 1992, shortly after the Day of Atonement Mr Stern and his son, Mark, came to see me at my home. Mr Stern asked for my personal forgiveness for the untruths contained in his affirmation but asked me to understand that he felt forced to do so by circumstance".
(h) The plaintiff "is quite adept at utilising companies for his own business purposes without being a director or registered shareholder of the same".
There is no complaint as to the description of the plaintiff's bankruptcy, nor as to the reference to the actual proceedings in the Chancery Division, both of which are admitted in the reply. What is objected to, and what forms the basis of this present application, is the defendants' citation of the quotations from Mr Gorman's affirmation.
The plaintiff relies on the well-established rule of the law of justification that "It is no defence to an action for defamation for the defendant to prove that he was merely repeating what he has been told" (Duncan and Neill on Defamation Second Edition paragraph 11.16 under the heading "Rumour or hearsay".) I shall refer to this in future as the "the repetition rule". Mr James Price QC on behalf of the plaintiff submits that this rule precludes the present plea.
The defendants do not contest the validity of the repetition rule. However, Mr Eady QC submits that in the present case it has not been infringed; the correct approach, he says, is to ask whether this plea goes to any conceivable meaning which the jury might reasonably hold the words to bear, and he submits that, on the authority of two cases in this court cited later in this judgment, the present plea arguably meets this test, as the judge held.
Both sides rightly invited us to approach the case on principle, rather than to side-step the issue on the grounds that the answer might not presently be so manifestly plain and obvious as to justify a striking out order at this stage.
One leading case in this field, as in so many others in the law of defamation, is Lewis v Daily Telegraph Ltd 1964 AC 234, on which both Mr Price and Mr Eady relied from their respective angles. However, since it came after the other relevant authorities, it is convenient to refer to them first.
The repetition rule is one of considerable antiquity, starting with two cases decided as long ago as 1829, De Crespigny v Wellesley 1829 5 Bing 392 and McPherson v Daniels 1829 10 B and C 263.
The decision of Best CJ. in the former is epitomised in the headnote which states that "In an action for a libel, it is no plea, that the defendant had the libellous statement from another, and upon publication disclosed the author's name".
The unanimous decision in the latter by a court consisting of Bayley J., Littledale J. and Parke J. is crystallised in the following passage from Bayley J.s' judgment at p 269 that...
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