The major problem about the denial in English law of a claim in defamation to public bodies in the absence of proof of actual financial loss is that the purpose of it is unclear. The following grounds for application of the rule are possible.
First “democratic election”. Lord Keith said in Derbyshire ( AC 534 at 549): ‘It is of the highest public importance that a democratically elected governmental body, or indeed any governmental body, should be open to uninhibited public criticism’.
Democratic election therefore appears to be a possible but not essential justification for the rule. Sullivan suggests (1) democratic justification for the restriction on the right to sue and (2) an analogy between defamation and sedition. But neither of these arguments would justify the subsequent extension by the Supreme Court of the Sullivan rule to public figures.
An alternative explanation for the rule is that politicians or officials are the real target in the case of defamation of a public body, and they should sue instead. Watermeyer C in Die Spoorbond (1946 AD 999 at 1009) said that the Crown’s reputation might fairly be regarded as distinct from the reputation of individuals temporarily responsible for the railways. In the Derbyshire case Lord Keith said ( AC 534 at 550) that an attack on the local authority will really be on the councillors from the controlling party, or the officers. This may be so, but this argument on its own does not sit well with the restriction on the right to sue in Sullivan, or the denial of the right of a political party to sue in Goldsmith.
A further possible explanation of the rule is the financial resources of public bodies. First there is the basic point that when wealthy claimants sue impecunious defendants there is an inequality of arms (Steel and Morris v UK (2005) 41 EHRR 22 at paras 72, 98). But in relation to public bodies, Schreiner JA in Die Spoorbond (1946 AD 999 at 1013) thought that if ‘the wealth of the state derived from the state’s subjects” (emphasis added) could be used to sue those subjects for defamation, it would seriously interfere with free expression of opinion. This does not however justify the restriction of the right of politicians to sue as in Sullivan.
Lord Keith’s extension of the rule to ‘any governmental body’ ( AC 534 at 549) was applied in British Coal Corporation. In Die Spoorbond Schreiner JA (1946 AD 999 at 1013) felt that all government action should be covered by the rule, even the running of railways, as it would be difficult to draw the line in any other place.
None of these arguments are really convincing. Democratic bodies may represent the people, but they have a distinct identity which may need protecting. Some defamatory statements about public bodies are of such a nature that there is no individual with sufficient motivation and funds to launch an action. Wealthy claimants should not be denied the right to sue just because they are wealthy; and why should the source of that wealth matter? Why should a democratically elected government be able to sue a foreign newspaper but not a national one? And if a particular defendant has provided a tiny fraction of a democratic body’s revenue, why should that create a bar to an action which is in the interests of the population as a whole? A ‘governmental body’ is distinguished by the fact that it has sovereign powers in addition to the ordinary powers possessed by private bodies, so why (apart from the freedom of speech argument) should it be deprived of certain powers? And in the complicated world of today, sixty years on from Die Spoorbond, it is now much harder to distinguish between public and private bodies, and public and private functions.
Neither the European Court of Human Rights in Lombardo nor the German courts in the four cases discussed above considered that Art 10 of the European Convention or Art 5 of the Basic Law respectively were in themselves sufficient reasons for a bar to defamation claims by public bodies.
There is a strong case for giving back to public bodies the right to sue in defamation provided that two safeguards are installed: protection for the defendant who has acted reasonably, and removal of the right to damages with their chilling effect.
Protection for the reasonable defendant
The defence of fair comment in English law does not go far enough because the defendant who is guilty of a factual inaccuracy will still be vulnerable. In the US the Sullivan decision allows for such inaccuracy to be overlooked. The solution to this dilemma is now found in the Reynolds v Times Newspapers Ltd ( 2 AC 127). It is a better solution than the Sullivan defence because it is lost by carelessness.
The Reynolds defence, as refined in Jameel (Mohammed) v Wall Street Journal Europe Sprl ( 1 AC 359) is available if an article is published which as a whole is in the public interest, the defamatory material in it was justifiably included, and the steps taken to gather and publish the information were responsible and fair. This might include the need to contact claimants and obtain their version of events. There is a definite similarity between the Reynolds defence and the position in German law about inaccurate assertions of fact in a matter substantially affecting the public.
The issue in public body suits is often one of complicated fact rather than one of the truth or falsehood of a simple statement. In the clinic directors and nepotism cases the statements originally complained of were only partly untrue; in the archbishopric case the statement was only defamatory because of a failure to tell the whole truth. Besides this, the claimant may need to be selected not on the basis that it was the body suffering harm, but because it is the most appropriate body for putting the record straight. In the nepotism case there was an issue as to how far the Federal Institute for Labour was affected, and in the Mole Search case as to how far the Federal Criminal Office was affected. Both these factors and the argument about the chill factor of a claim for damages could be satisfactorily addressed by restricting the right of public bodies to claim for damages for defamation to cases where they have suffered financial loss. However the problem about this approach is that alternative remedies in English defamation law are not as well developed as in German law.
The problems which Sullivan poses in America for claimants (because of the need to prove actual malice) have led to suggestions that public figures should be able to obtain a declaratory judgment about the falsehood of defamatory allegations in the media. Legislation at a federal level has been proposed for this purpose (Barrett, D A (1986) ‘Declaratory Judgments for Libel: a Better Alternative’ 74 California Law Review 847-882, 847.). It has also been suggested that a mandatory retraction should be available i.e. the declaratory relief should be accompanied by an injunction requiring the defendant to report the decision in a prominent way. The problem here, though, is that the Supreme Court in Miami Herald v. Tornillo (418 US 241 (1974)) decided that a Florida statute providing for a right of reply for candidates for nomination or election interfered with the editorial autonomy of newspapers which was protected by the First Amendment. Arguably a mandatory retraction would constitute a more serious interference. There is however no reason to think that Art 10 of the European Convention outlaws rights of reply and mandatory retraction. Certainly the German courts do not appear to have taken this view; the right of reply has been held not to be inconsistent with the basic right of press freedom under Art 5 of the Basic Law (BVerfG 1 BvR 1861/93 of 14 January 1998).
The democratic and public or governmental nature of a claimant may justify different treatment in defamation law, but the development of the Reynolds defence and a replacement of the right to claim damages at large with declaratory remedies should take care of this. If a public body has suffered identifiable financial loss then it ought of course to be able to recoup it anyway. In other cases, the concern of the public body is, or should be, only to establish the truth. This should not be limited to cases where there is fault on the defendant’s part. The issue in question will often be a matter of considerable public interest.
It is not enough to say, as was said in Goldsmith ( QB 459 at 463), that the body can reply “by public announcement”. The point has been made in both English and German courts that public announcements by the impugned party in its own words carry less weight than judicial ones (Jameel (Mohammed) v Wall Street Journal Europe Sprl  1 AC 359 at 376). Sometimes an independent public inquiry will be called, but since it will be set up by the public body in question or at least by some other arm of the public sector, there will be suspicion of manipulation as to the terms, procedure and personnel involved. A public body should normally be able to obtain a judicial pronouncement about the facts, but with the risk of being penalised in costs if the court considers the action was unnecessary.
Something akin to the German remedy of correction is required in its two forms of retraction and rectification. However, these rights are apparently only available on a summary disposal under ss 8-10 of the Defamation Act 1996. Such a disposal may of course not be available because there might be a defence with a realistic prospect of success or some other reason why the case should go to trial. The Court of Appeal has described this as an anomaly (Loutchansky v Times Newspapers Ltd and Others (Nos 4 and 5)  QB 783 at 824). Extending these two remedies to cover all defamation cases would make awards of damages to public bodies unnecessary. The European Court of Human Rights in Lombardo appeared only to wish to limit prevention of criticism of an elected body to exceptional circumstances, and correction does not have the same chilling effect as damages. The need for this kind of remedy has become especially important during the last decade in view of the rumour mill generated by the internet.
In National Union of General and Municipal Workers v Gillian ( KB 81 at 87) Scott LJ said that a trade union has a social duty to conduct its affairs so as not to invite well founded criticism, and denial of a claim in libel would not promote this; libels might cause a trade union to disintegrate, and the trade union system of collective bargaining would be defeated ( KB 81 at 87). Similar arguments apply with even stronger reason to public bodies, which should not have to stand idly by while false information about them spreads. In the mole search case it was stated that legal persons under public law had a claim to social esteem which could be injured. It will surely usually be in the public interest that the public body is vindicated if the facts justify it.
Raymond Youngs, is a Senior lecturer in law, Kingston University.
This is an edited version of a paper originally published in Communications Law, “Should public bodies be allowed to sue in defamation?” can be seen in Communications Law: Comms. L. 2011, 16(1), 19-26. It is reproduced with the kind permission of Communications Law and with thanks.