Citation Plc v Ellis Whittam Ltd  EWHC 549 (QB)
The parties are business competitors. The Claimant brought an action for slander and malicious falsehood in respect of words allegedly spoken by an employee of the Defendant to one prospective client of the Claimant, who subsequently entered into a contract with the Claimant,. The pleaded defamatory meanings included that the Claimant 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”.
The Claimant was unable to give particulars of publications to any other third parties, although it invited the court to infer that this had happened, and ultimately stated an intention to rely on such at trial. The Claimant also sought an injunction to prevent the Defendant publishing the same or similar words of the Claimant, and stated that this – and not damages – was the main purpose of the action.
By its Defence, the Defendant denied publication of the words complained of, and alleged that the plea of further publishees was speculative and declined to plead to it. The Defendant sought an order that the claim be struck out on the grounds (a) of abuse of process, (b) that the particulars of claim disclosed no reasonable grounds for bringing the claim and (c) that there was no real and substantial tort.
The claim was struck out as an abuse of process.
(i) Other publications
It was a question of fact whether the court could draw an inference that the allegedly defamatory words were probably spoken to a publishee other than the one identified by the Claimant. On the facts of this case, there was an arguable case that the court may infer that the publishee spoke similar words to another prospective customer of the Claimant. This was not to say that this would necessarily be proved at trial – where the threshold may well be high – just that the prospect of doing so was not so remote that the claim should be characterised as an abuse of process because of it (para 22).
(ii) Case for an injunction
Although it is commonly the case, there is no general rule that permanent injunctions will always be granted to successful claimants in defamation actions (para 27). Instead an injunction will be given only if there is reason to apprehend further publication by the defendant (as per Proctor v Bayley(1889) 42 Ch D 390).
In this case, on the same day the letter of claim was sent to the Defendant it gave instructions to all sales colleagues not to make the statements complained of about the Claimant, and that doing so would be against the Defendant’s values and would be treated as a disciplinary matter. The Claimant was told about this in correspondence on the same day (para 36 & 46). The Defendant also later offered an undertaking to use reasonable endeavours to ensure the statements complained of were not repeated (para 38), and had never asserted that the words complained of were true in the meaning attributed to them by the Claimant such that it intended to repeat them (para 44).
Accordingly, although the undertaking offered was not unqualified in the way the Claimant wished it to be, it had no arguable case that there was, or would at trial be found to be a real risk that the Defendant would repeat the alleged slander (para 45) (which it had denied speaking).
(iii) Real and substantial tort
The Claimant had made it clear it had no evidence of actual damage suffered, and instead sought to ground its malicious falsehood claim on s.3 Defamation Act 1952. Although an award of damages under s.3 should not be nominal since that would defeat the purpose of the section, it was also relevant that the Claimant was a company and so could not recover damage for distress, and that it had stated that damages were not its primary focus in litigation (para 47).
Since publication had been to only an unknown number of prospective clients, a public judgment following trial would involve public repetition of the words complained of, and thus provide little vindication to the Claimant. In light of all this, the acceptance by the Defendant that it must not repeat the words complained of was “likely to be as valuable a form of vindication that can in practice be achieved” (para 48 &49).
The Claimant was not to be criticised for its persistence in pursuing an unqualified undertaking until the point the claim form was issued and served, as it was entitled to obtain a legitimate object greater than its legal rights. However, what it had achieved by the date of serving the claim form was in practice “all that it could achieve which would be of any value to it in vindicating its reputation.” (para 50).
Jane Phillips, instructed by Robin Simon LLP, appeared for the Defendant.
The judgment is available here.