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The Future of Phone Hacking Claims, the position updated – Steven Heffer

In a post published on Inforrm on 14 November 2011, I discussed the current state of the Voicemail Interception Litigation (“the Litigation”) and the proposed new Voicemail Interception Compensation Scheme (“the Scheme”). This post seeks to bring matters up to date.

Background

In November and December 2011 a number of settlements took place in the first tranche of the Litigation. A scale of awards emerged of between about £7,500 damages for relatively minor incidents of unlawful information gathering to over £100,000 for the most serious claims. Most settlements were in the £20,000 to £50,000 range. It was clear that News Group Newspapers (“NGN”) wished to avoid a trial.

Operation Weeting continued until recently to inform individuals that their names appeared in the Mulcaire notebooks, or there was other evidence of interception, for example in the form of call data.

Many more claims came to light. There are currently about 64 claims in the voicemail interception compensation scheme and 49 issued claims in the High Court, second tranche of the Litigation, with many more to come. (See post on Voicemail Interception Litigation – the second tranche, CMC of 1 June 2012).

The deadline for issuing claims in the second tranche of Litigation (pursuant to orders made by Vos J) is 24 August 2012. Inevitably there will be a rush to issue claims prior to that deadline. In the light of clarification of proposed revisions to the Scheme, there may well be a surge in further claims lodged in the Scheme.

Further Claims

Deputy Assistant Commissioner Sue Akers confirmed to the writer recently that she believed that all individuals whose names appeared in the Mulcaire notebooks have now been informed. So it is likely that the position will crystallise in terms of the numbers of claims going forward, at least in relation to Mulcaire and his associates.

In recent months there have been a number of meetings held between NGN’s lawyers, lawyers acting for the Metropolitan Police Service, the Independent Scheme solicitors and the adjudicator of the Scheme, Sir Charles Gray.

It was confirmed that 64 people had so far been accepted into the scheme. There are 163 applicants awaiting further information and there had altogether been 275 enquiries.

Nine applications to the Scheme have been rejected by NGN. It is not known on what basis these claims were rejected.

Scope of the Scheme

The recent revisions mean that a claim in the Scheme must be

“for misuse of private information and/or breach of confidence and/or harassment and/or breach of statutory duty under the Data Protection Act; the claim must arise from the activities of Glen Mulcaire and/or his associates pursuant to instructions from employees of NGN and/or activities undertaken by or on behalf of employees of NGN; and the conduct complained of must be accessing mobile telephone voicemails, accessing electronic information held on computers (or related activities); and/or “any other investigative method complained of in the claim”.

NGN appear to accept that this covers matters such as “blagging” and even land line interception.

The intention of the amendments recently agreed is that the scheme will cover all matters which would be likely to be a part of any claim in the Litigation.

Disclosure

The preliminary disclosure procedure in the Scheme now follows the pre-action procedure adopted and set out in the Order of 27 February 2012 (amended 18 May and 1 June) [pdf] in the second tranche of the Litigation.

In addition, at the stage of submitting particulars of NGN’s case, NGN must provide a list and copies of “any further relevant documents on which it relies, or documents which adversely affect NGN’s case or support the Applicant’s case”. It has been accepted by NGN that this disclosure is intended to be the same as full disclosure under the CPR, so that Applicants in the Scheme should (in theory) be in the same position as Claimants in the Litigation.

Confidentiality

The Applicant may elect to be treated confidentially, at the time of submitting an application form. This means that the fact that the Applicant has made an application and the details of the application (and of any adjudication) will be kept confidential. It seems therefore that an Applicant in the Scheme will have a better chance of retaining confidentiality than in the Voicemail Interception Litigation, unless the Claimant has sufficient grounds and is able to successfully apply for an anonymity order.

NGN will be entitled to publish on the Scheme’s website a short summary of the adjudication without in any way revealing any of the confidential information in connection with the application. NGN and the Applicant will also be bound by any terms of confidentiality agreed.

Costs

NGN will indemnify the Applicant in respect of the fees of the solicitors and approved barristers (at prescribed rates) in acting in relation to the Scheme. Fees that are excessively and/or unreasonably incurred and/or disproportionate will not be recoverable from NGN. There is a procedure for disputed costs claims to be dealt with by agreement or by appointment of an independent costs draftsman to determine the dispute on paper.

Awards under the Scheme

The early adjudications are likely to be the subject of oral hearings, although it is probable that in due course adjudications will be dealt with on paper, once the likely scale of a range of awards has been decided upon and published. As in the Litigation, the possible award of exemplary damages in appropriate cases is still very much a live issue.

It is too early to tell how the Scheme will work in practice. There have only been preliminary procedural hearings so far. There remains the problem that once an Applicant has lodged an application in the Scheme, the individual waives the right to bring litigation and will have no right to appeal an award by the adjudicator.

In addition, it is not yet known whether NGN will pay the legal costs of Applicants entering into the Scheme at a time when they have already incurred significant costs. This is a matter still under discussion. That does seem to be a significant defect in the Scheme. Presumably NGN is hoping to persuade litigants who would pursue court action to join the Scheme. They will not be able to do so if they will not agree to pay the Claimant’s costs incurred prior to moving from a potential court claim to the Scheme.

Who will be the first to decide damages?

The Litigation has a trial date fixed in the early part of 2013.

Scheme claims are likely to move at a quicker pace, and on an individual rather than group basis. It seems likely therefore that Sir Charles Gray will be making and publishing awards in the Scheme prior to any Judgment in the Litigation.

It remains to be seen whether (as in the Litigation) offers will be made as claims progress – to avoid an adjudication or judgment.

Steven Heffer is Head of Media, Sports and Culture at Collyer Bristow LLP, and Chair of Lawyers for Media Standards

1 Comment

  1. Elaine Decoulos

    Terrible photo of Sir Charles Gray. Please get another one! He deserves better. Pity we are not having a ‘Gray Inquiry’ of some sort.

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