The Court of Appeal has upheld the costs ruling made by Nicola Davies J at the conclusion of Gary Flood’s action against Times Newspapers Ltd (“TNL”) for libel in respect of an article published in The Times and online from 2 June 2006 entitled “Detective accused of taking bribes from Russian exiles.”
It had previously been determined (by Tugendhat J at first instance, (upheld by the Supreme Court ) that the publications of the article in the newspaper and online until 5 September 2007 were covered by the defence of Reynolds privilege. Online publications from 5 September 2007 (the date on which TNL received information that Mr Flood had been cleared by a police investigation, but did not amend its website accordingly) until 21 October 2009 (the date on which TNL updated the online article) were not covered by any defence. These publications numbered about 550 – a small fraction of the total publications complained of. Following a trial for the assessment of damages arising from these publications, the judge had awarded Mr Flood £60,000 and ordered TNL to pay his costs of the action, which included the reserved costs of the trial of TNL’s Reynolds defence as a preliminary issue before Tugendhat J in July and October 2009.
TNL contended that the judge had erred in the exercise of her discretion on the question of costs: she had been wrong to proceed on the basis that Mr Flood was “the successful party” for the purposes of CPR r 44.2 because TNL’s defence of Reynolds privilege succeeded in respect of most of the publications sued on. It contended that as it had won on a significant part of the case, comprising numerically the greater proportion of the publications, it should have its costs of that issue which it had won. The Court of Appeal dismissed TNL’s appeal, holding that the judge had made no error of principle, and was entitled to exercise her discretion in the way that she did.
The judge was entitled to regard Mr Flood as the successful party in the litigation because the award of £60,000 was a substantial one in libel terms (particularly where the allegation was not of guilt, but a Chase level 2 meaning of strong grounds to suspect guilt of the conduct alleged), and exceeded by a considerable margin TNL’s offers of damages in settlement of the action. The allegation against Mr Flood was a serious one and the judge was entitled to conclude that he had brought the action to obtain vindication in respect of that allegation – and that he succeeded in achieving that objective. Although it was true that as a result of the ruling on Reynolds privilege the number of actionable publications was relatively small, it would be “artificial” to suggest that the issue of vindication was somehow divisible. Mr Flood had brought the proceedings to clear his name in respect of a particular allegation and by the end of the trial he had succeeded in doing so; the fact that TNL had won on a part of the case and in relation to most of the publications complained of did not preclude a judgment that Mr Flood was the overall winner of the action. In this case, to measure success in the litigation by raw numbers would have been “overly simplistic and wrong”.
TNL’s success on part of its case was only one of the factors to be taken into account by the judge when deciding what order to make about costs, and had to be balanced against Mr Flood’s success in obtaining substantial damages and vindication. In the event, the judge thought that TNL’s success, which might otherwise have entitled it to an issue based costs order, was to be counterbalanced by its “die-hard” attitude towards settlement at a stage in the litigation at which it did not have a valid Reynolds defence. This was a view she was entitled to take.
TNL could have settled the action before the Reynolds trial, or at least offered to do so, in respect of the publications on which it lost, without conceding the point on which it won, and on terms which respected its right to publish information of public interest in the period up to 5 September 2007. The judge’s order as to costs was not therefore an order that undermined the importance of the Reynolds privilege defence or the important Article 10 ECHR considerations which underpin it.
The Court of Appeal also, obiter, expressed doubts as to whether the convention of estimating readership figures for newspapers by applying a multiple of 2.5 readers per daily hard copy could still be justified given the many different ways in which people now obtain information about current affairs, not least through the Internet.
The judgment is available here.