The cost of bringing or defending any defamation case can be substantial. Claimants or defendants who lose a claim can be presented with a sizeable legal bill, the payment of which may be beyond the reach of most people.
By way of background, defamation occurs when there is a publication to a third party of words or matters containing an untrue imputation of individuals or companies which serve to undermine that reputation in the eyes of right thinking members of society.
Defamation can be divided into two forms – libel and slander. Slander is the publication of defamatory words in a temporary or transient form (generally, oral publication), whereas, libel is the publication of defamatory allegations in a permanent form.
As part of his review on civil litigation costs reforms L.J. Jackson considered the substantive law of libel and looked into whether the law strikes the right balance between free speech and the protection of reputations.
L.J. Jackson proposed that a regime of qualified one-way costs shifting should be introduced, under which the amount of costs that an unsuccessful claimant may be ordered to pay will be a reasonable amount – reflective of the means of the parties and their conduct in the proceedings.
Following the proposals, the government has recently published a consultation paper containing proposals for a regime that could effectively protect a claimant of modest means against the prospect of unaffordable costs awards, if they were to eventually lose their case.
The government has long recognised that certain litigants should generally be protected from having to pay the other side’s legal costs if their case is unsuccessful; this is the general provision in relation to civil legal aid, for example.
The aim behind the reforms is to promote access to justice and to make the legal costs of civil cases more proportionate than they have become. The proposals are designed to help people and organisations of more modest means be able to protect their reputation and privacy. The paper suggests parties who have substantial means should be excluded from protection. There would be a degree of means testing so that the parties should be protected to a degree commensurate with their ability to pay.
I am inclined to agree with the proposals, as poorer parties should be able to litigate where necessary, without the fear of exposure to the substantial costs that they might be ordered to pay to the other side. It is acknowledged already that these proposals would undoubtedly affect a relatively small number of cases each year, however the proposed changes would nevertheless be significant.
The government believes that the proposals, although still in their infancy, strike the right balance in allowing poorer claimants to bring claims, controlling costs and encouraging early settlement, whilst not protecting wealthier parties.
The government have sought the advice of the Civil Justice Council as to what costs protection regime may be appropriate and will need to consider the responses to its consultation paper before the new cost protections rules come into effect.
The consultation commenced on 13 September 2013 and is due to end at midnight on 8 November 2013. To contribute to the consultations via the online survey and to find out further information, please click here to visit the Parliament UK website.
How this will work in practice is yet to be seen, however the government hopes to introduce the new regime through changes to the Civil Procedure Rules in April 2014. We shall await these reforms with baited breath.
If you would like any further information on the developments in this area of law please contact a member of our Dispute Resolution team on 0161 475 7676..