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This is a free critical analysis on current legal issues. It can either be a thematic analysis of a topic while referencing relevant cases or analysis of certain authoritative or jurisprudence making cases decided by various courts in the Eastern African region.


Exemplary Damages in Libel
Date: Tue 5 Oct 2010

In this Hot From the Bench, LawAfricas Charles Kanjama takes a look at the issue of exemplary damages for libel. He discovers that the legal issue has been quite dynamic in England these past 40 years. With Biwott v Clays Ltd, Kenyan courts awoke to the developments of the English law of libel. In this first instalment on the law of exemplary damages in libel, we look at the ground breaking English cases that are now within the sights of our local judges on the subject.

 

Ley v Hamilton 1935, Rookes v Barnard 1964 and Cassell v Broome 1972 mark the landscape of 20th Century English jurisprudence on exemplary damages in much the same way as the three characters with whom they are most memorably linked, Lords Atkin, Denning and Devlin, sit astride the judicial colossus, towering upon the 20th Century development of English law with their remarkable genius. In Donoghue v Stevenson, Lord Atkin’s memorable neighbour principle galvanised the common law into a profound appreciation of civil wrong that has not been ousted since. Salmon L.J. in Broome v Cassell crowns the judicial mind of Lord Atkin, “He never said what he did not mean and always said what he meant with pellucid clarity.”

 

 

Yet no controversy so much shows their judicial mien and illustrates the perils of jurisprudence as the controversy surrounding the law of exemplary damages, exemplified by its application to libel cases. In probably the boldest stroke against the centuries-old stare decisis principle was its apparent champion, Lord Denning. Acidly commenting on Lord Devlin’s decision in Rookes v Barnard that sought to limit the award of exemplary damages in tort, Lord Denning’s obiter in Broome v Cassell stands proudly erect as a monument to the epic battle between the gods and the Titans on the judicial Mount Olympus.

 

 

Lord Denning did not mince his words: “Yet when the House came to deliver their speeches, Lord Devlin threw over all we ever knew about exemplary damages. He knocked down the common law as it had existed for centuries. He laid down a new doctrine about exemplary damages. He said that they could only be awarded in two very limited categories, but in no other category; and all the other Lords agreed with him… If ever there was a decision of the House of Lords delivered per incuriam, this was it.” Yet Lord Denning concluded his attack on a wan note, a presentiment of defeat: “Some will say that it is our duty to follow the House of Lords and not to question their decision. We are not to reason why. Ours is but to do and die…”

 

 

In a supporting judgment Lord Salmon, commenting on the interpretation given to Lord Atkin’s Ley v Hamilton, was more caustic, “Lord Devlin was attaching a weight to inverted commas which they were quite unable to bear. It was like trying to suspend a three-ton truck from a cob-web... I feel driven to choose Ley v Hamilton. I would rather rely on the principles of common law than ‘categories’ which rest on no foundation but seem to have been conjured out of the air no doubt with artistry, but also with the most strange and unfortunate results.”

Lord Phillimore was not to be left behind. “If a court is to do justice, it must look at the whole case in the round. Categories and conditions all tend to make the law less flexible, less sensible and less fair. Life and the things we do or say do not fall neatly into little slots. So soon as the court starts laying down rules numbered (a), (b) and (c), or (1), (2), (3) and (4), so soon it is certain to do injustice.”

 

 

The Court of Appeal had thrown its hat into the ring, and with it a solid blow from which one may have thought the House of Lords would not recover. Lord Atkin, whose authority had been called in support by both sides, was already dead some 28 years. Lord Devlin, whose ratio in Rookes v Barnard had been subjected to such devastating criticism, had retired even before he delivered his speech in Rookes v Barnard. It was left to Lord Hailsham to deliver the reply of the House of Lords, shaken into constituting a seven-judge bench to deal with the appeal from Broome v Cassell.

 

 

The Titans did not bring down the heavens, but they laid waste the earth. And in response to the Court of Appeal Titans, Lord Hailsham led the House of Lords in rejecting their conclusions on “the settled law before Rookes v Barnard” and “Devlin’s unworkable categories.”

 

 

The swordsman who parries with the blunt edge strikes the most lethal blow with the sharp edge. Under the disguise of a measured response, Lord Hailsham unleashed a wicked jab at the Court of Appeal’s solar plexus, safe in the knowledge that as the law stands, there will be, there can be, no response: “I am driven to the conclusion that when the Court of Appeal described the decision in Rookes v Barnard as decided ‘per incuriam’ or ‘unworkable’ they really only meant that they did not agree with it. But… it is not open to the Court of Appeal to give gratuitous advice to judges of first instance to ignore decisions of the House of Lords in this way… The course taken would have put judges of first instance in an embarrassing position, as driving them to take sides in an unedifying dispute between the Court of Appeal or three members of it and the House of Lords... Whatever the merits, chaos would have reigned until the dispute was settled, and, in legal matters, some degree of certainty is at least as valuable a part of justice as perfection.”

 

 

Lord Reid was similarly emphatic, “It seems to me obvious that the Court of Appeal failed to understand Lord Devlin’s speech, but whether they did or not I would have expected them to know that they had no power to give any such direction and to realise the impossible position in which they were seeking to put [trial] judges in advising or directing them to disregard a decision of this House… That aberration of the Court of Appeal, … a strange misconception… that Rookes v Barnard was made per incuriam, was ultra vires and had produced an unworkable position… has made it necessary to re-examine the whole subject.”

 

 

The result of the engagement was decided even before battle was joined; the Titans would lose not because their missiles could not scale the heavens, but because they themselves could not. Yet four decades of English jurisprudence has not sufficed to erase the pockmarked fissures they left behind in their bold and daring attempt. And English law of libel seems forever condemned to a state of flux, as staidly travellers are forced to dodge through scarred passageways that seem unable to mend. In reviewing the following authorities, one cannot help but wonder whether Kenyan judges, who have only just awoken to the enchanting history of four tumultuous decades in English libel law, will absorb and come to grips with its consequences.

 

 

In Rookes v Barnard, the plaintiff sued the defendants, officials of a trade union, for the common law tort of intimidation. The plaintiff and all other employees of BOAC had been members of a certain trade union, but the plaintiff left the union after disagreement with its officials. The defendants threatened to commence a strike unless the plaintiff was removed from employment, which BOAC did. Damages of £7,500 were awarded by a jury in the trial court after a direction by the judge which could be interpreted to imply that exemplary or punitive damages could always be awarded in tort.

 

 

On appeal to the House of Lords, Lord Devlin raised the issue of the circumstances in which exemplary damages could be awarded in tort. Himself a critic of a system of law which awards punitive damages without allowing the defendant the benefits accorded by any average criminal law regime, Lord Devlin scanned through English jurisprudence intent on limiting the future award of exemplary damages in tort. He highlighted two categories in which exemplary damages can be awarded in tort: (1) in cases of oppressive, arbitrary or unconstitutional action by servants of the government, but not extended to private individuals and corporations, and (2) where the tortfeasor’s conduct is calculated to make him a profit which may well exceed the compensation payable to the plaintiff. A third category for award of exemplary damages could be gleaned from his ratio: (3) where exemplary damages are expressly authorised by statute.

 

 

Lord Devlin also catalogued three considerations that should be borne in mind when considering awards of exemplary damages: (1) the plaintiff should himself be the victim of the punishable behaviour; (2) an exhortation to moderation – some exemplary damages awards seem to amount to greater punishment than would be incurred if the conduct were criminal; and (3) the means of the parties, irrelevant in assessment of compensatory damages, are material in the assessment of exemplary damages. Everything which mitigates or aggravates the defendant’s conduct is relevant.

 

 

In his innovative ratio, Lord Devlin clarified the precise meaning of terms used to refer to damages ‘at large.’ Juries were instructed to give a sum for compensation of the plaintiff’s injury, which sum may be aggravated because of the defendant’s conduct. Aggravated damages would therefore be a component of compensatory damages, justified because the injury to the plaintiff has been augmented by malice or by the manner, say insolent or arrogant, of doing the injury.

 

 

If, but only if, the jury felt that the damages awarded as compensatory damages, inclusive of the aggravated component, were inadequate to mark the court’s disapproval, punish the defendant for his outrageous conduct, and deter him from repeating it, then they would be entitled to award a larger sum sufficient for this purpose. This sum would be termed punitive or - more preferably - exemplary damages.

 

 

It was a far-reaching ratio, more so because expressly concurred in without further comment by the other Law Lords on the bench. This muteness of the concurring opinions was a grievous one; an omission that left Lord Devlin’s ratio standing alone and vulnerable on the precipitous summit of English jurisprudence. Eight years later, as Lord Reid reflected on the history of the badly mauled Rookes v Barnard, he added wistfully, “I and my colleagues made a mistake in simply concurring with Lord Devlin’s speech. With the passage of time I have come more firmly to the conclusion that it is never wise to have only one speech in this House dealing with an important question of law.”

 

 

From there, the trail becomes easier to follow. In Broome v Cassell, a case involving a libellous publication, the second category in Rookes v Barnard was reviewed. Apart from discrediting the whole ratio of Lord Devlin and emulating the courts of Canada, New Zealand and Australia, the Court of Appeal with Lord Denning in the lead doubted the workings of the second category: what of the defendant who acts maliciously without caring to make any ‘cold cynical calculation?’ The direction that a jury should only award exemplary damages “if but only if’ the sum fixed for compensation is insufficient to punish the plaintiff was declared troublesome, especially in the case of joint defendants who publish a libel but with differing impunity. How would the court split the exemplary damages?

 

 

In response, Lord Hailsham in the House of Lords re-affirmed the ‘if but only if’ direction of Lord Devlin and insisted that the awards of compensatory and punitive damages are not entirely separate assessments. The court should generally make a single award of exemplary damages, which should be given the lowest assessment corresponding to the ‘least guilty’ defendant. In such assessment, he said, it was not necessarily fair to compare personal injury and defamation awards, partly because “quite obviously the [defamation] award must include factors for injury to the feelings, the anxiety and uncertainty undergone in the litigation, the absence of apology or the malice of the defendant.”

 

 

The decision in Cassell v Broome did not finally settle the unease of the courts with large jury awards of damages in libel cases. Even before Cassell in Lewis v Daily Telegraph Ltd [1963] 2 All ER 151 two newspapers had been sued for libel by the plaintiff. The jury made separate libel awards that were so excessive the appeal court would not allow them to stand. The court laid down the rule that where there is more than one action on a similar libel, the jury should consider how far the damage suffered is a joint effect of the libels, and take that into account to avoid double-counting.

 

 

Lord Diplock in McCarey v Associated Newspapers Ltd [1964] 3 All ER 947 had touched the raw nerve, “I am convinced that it is not just that… when a man’s reputation has been injured, the scale of values to be applied bears no relation whatever to the scale of values to be applied [for] physical injuries. I do not believe that the law today is more jealous of a man’s reputation than of his life or limb.”

 

 

Ever since Lord Diplock’s obiter, judges have continued to ponder on why damages for injury to reputation, seemingly a merely evanescent discomfort, should dwarf the damages awarded for more permanent physical injuries or even death. Lord Denning in Ward v James [1965] 1 All ER 563 was of the contrary opinion, urging trial judges not to refer juries to other awards in personal injury cases.

 

 

At the onset of the 1980s, a greyed and chastened Lord Denning looked back at two explosive decades in libel litigation. In Hayward v Thompson & others [1981] 3 All ER 450 he upheld the trial judge’s direction to the jury to make a single award in respect of two successive libellous publications by the same defendants. It was impossible, he said, to draw a distinction between one defendant and another regarding exemplary damages. While humbly applying Rookes v Barnard, Lord Denning could still advise that if the jury took a poor view of any of the defendants, say the journalist, sub-editor, editor or proprietor of a newspaper, they were entitled to fix whatever sum they thought fit in aggravation of damages without distinguishing between the defendants, so long as they didn’t wander into the forbidden territory of exemplary damages.

 

 

Yet Lord Denning’s ultimate peroration on the developing law of libel exposed his undying disenchantment with Rookes v Barnard, “As the argument of counsel for the defendants proceeded, I could not help feeling how unfortunate it is that our law of libel has become so technical and so complicated.”

 

 

In Blackshaw v Lord & another [1983] 2 All ER 311, another newspaper libel case, the judges proposed the application of a strict test before overturning awards of damages by juries. The court must be convinced that the sum the jury had awarded was a sum which no reasonable jury, properly directed by the judge and properly considering the evidence, could have awarded.

 

 

In response to what some have claimed is the ironical and topsy-turvy nature of awards in personal injury cases (libel, bodily harm and death), the court asserted that a judge should not substitute his own award for libel merely because he thought that the jury award was excessive. . “There was little value,” they said in response to McCarey v Associated Newspapers, “in comparing an award for defamation with awards for personal injuries since the difference between the two kinds of award was too great to be of real value.”

 

 

Despite the wall of jurisprudence built against interference with excessive jury awards in libel cases, the momentum for change was beginning to cause a breach. In Sutcliffe v Pressdram Ltd [1990] 1 All ER 269 a libel award of £600,000 against an investigative newspaper that claimed the wife of the notorious “Yorkshire Ripper” had cashed in on his fate was overturned on appeal. The court ordered retrial of the issue before a fresh jury.

 

 

Exemplary damages should not have been awarded because the case did not fall into any of Lord Devlin’s three categories.

 

 

The court advised all judges, without referring the jury to previous awards in libel cases, to assist the jury appreciate the real value of large sums. Hence for example a tax-free award of Kshs.24 million, wisely invested in zero-risk inflation-adjusted treasury bonds at 10%, would yield a plaintiff a monthly income of Kshs.200,000.00 per month in today’s currency, enough to maintain a comfortable lifestyle without work the rest of his life.

 

 

The breach widened in Rantzen v Mirror Group Newspapers Ltd [1993] 4 All ER 975 where the Court of Appeal, pursuant to section 8 of the U.K. Courts and Legal Services Act 1990, changed the practice to allow it to substitute its own award in place of an excessive jury award without requiring a retrial. Further, the trial judge was allowed to direct a jury on the expected quantum in a libel case by referring the jury to previous awards of the Court of Appeal in defamation cases.

 

 

As the momentum increased, John v MGN Ltd [1996] 2 All ER 35 proved sufficient to finally bring down thirty years of decisions against comparing libel and other personal injury awards. A tabloid newspaper had published an article about the ‘weird’ feeding habits of a popular singer, Elton John, without proper verification. The jury awarded compensatory damages of £75,000 and exemplary damages of £275,000. On appeal, the damages were reduced to a total of £75,000. For the first time, the court went the whole mile and allowed trial judges to refer juries to libel awards made or approved by the Court of Appeal and also to the scale of damages in personal injury cases!

 

 

Hence when we come to the present, in Kiam v MGN Ltd [2002] 2 All ER 219, we see the court comparing personal injury awards to libel awards as a matter of course. We see an English public, discontented with big jury awards for libel, beginning to debate an end to trial of libel actions by jury. It has been said that large awards for libel interfere with freedom of expression. Others have added that only libel in civil law, with its technical defences of justification, qualified privilege, and fair comment, shifts the burden of proof to the defendant to prove no injury to a plaintiff from an incorrect statement. Only in libel is the plaintiff exempted from proving harm. As Kenyan libel law, unfettered by Rookes v Barnard, finally wakes up to the tumultuous developments of English law, one wonders whether these concerns will be settled.

 


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