Lord Justice Leveson’s Report on the Culture, Practices and Ethics of the Press recommends that claims against the press be resolved fairly, quickly and cheaply by means of an arbitration scheme established by a new self-regulatory body.A central theme of the Leveson report is the importance of access to justice. The judge’s solution to this problem is for the new regulator to establish an arbitration scheme, which would give all claimants, whatever their means, a route to pursue claims against the press. This is not without precedent, and similar schemes already established include the arbitration scheme set up by News International to allow victims of phone hacking by the News of the World to claim compensation.
However, Leveson’s proposal is a step change: all newspapers are expected to commit to the scheme under the new regulatory framework, and claimants will be pressured into pursuing arbitration rather than court proceedings by potentially being penalised in legal costs at court if they refuse to arbitrate.
Leveson is proposing arbitration as a true alternative to court, with claims siphoned off into a separate legal process, providing a legally binding result.
There is nothing in principle to prevent arbitration being extended to media disputes in the way contemplated Leveson, although important details have yet to be worked out. Claims for breach of privacy, confidence and data protection, such as the allegations of phone hacking and other abusive behaviour that resulted in the Leveson Inquiry, would be covered, as would defamation claims. Other complaints for breach of the proposed new standards code would be handled separately by the regulator.
It would defeat the purpose of the scheme if rulings were routinely appealed to court, but parties to arbitration have certain statutory appeal rights, for example if the arbitrator exceeds his or her authority, or fails to follow due process, and these would have to be taken into account. The Civil Procedure Rules which govern litigation would need to be changed by directing judges not to award costs to those who pursue claims through the court instead of the recognised arbitration route. Arbitration is usually, but not necessarily, confidential, and it would need to be decided whether claims submitted to the scheme should be public. Often, it will be in both parties’ interests for a media dispute to be resolved confidentially, but it is important for the principle of open justice and the development of the law that rulings are published.
All of these are practical points that can be resolved as the details of the scheme are formulated. The bigger issue is that arbitration is not a panacea; it can be just as complex and expensive as court, and establishing a workable scheme will not necessarily guarantee that it is accessible by the most vulnerable claimants, who are unable to pay for legal representation.
Leveson proposes the scheme will be free for claimants to use. The only costs the claimant could be ordered to pay would be the costs of the arbitrator in cases where the claim was frivolous or vexatious. Importantly, this would mean a claimant would not be at risk of paying the newspaper’s legal costs if its claim was unsuccessful.
The report does not deal explicitly with the question as to whether claimants would be able to recover their own legal costs in arbitrations if they were successful. If they can recover such costs then the advantages for the press are very limited – the costs of arbitrations are often as high as those of court proceedings. But if claimants cannot recover costs then this gives rise to access to justice issues – unrepresented claimants are likely to be at a disadvantage when taking on in house newspaper lawyers. But it is anticipated that the arbitration procedure will be more streamlined than court procedure, and that the arbitrators will be inquisitorial – charged with proactively uncovering the truth of the matter, rather than simply evaluating each side’s arguments.
If claimants do not instruct lawyers it will place a heavy onus on arbitrators to level the playing field between self-representing claimants and newspapers with their legal teams. Leveson suggests that the arbitrators will be leading media lawyers and this throws up two other issues. First, arbitrators must be neutral, and this may affect the number of practicing media lawyers who can act as arbitrators, many will have strong links to media organisations, or will have practiced principally as claimant lawyers. Second, the level of input required effectively to run an arbitration on an inquisitorial basis should not be underestimated. A way to address this could be to offer arbitrators the support of more junior lawyers acting as clerks to do the procedural legwork, but this will add extra cost.
Leveson has himself commented that the proposal to penalise claimants who refuse to arbitrate is one of the most controversial parts of his recommendations. Having a fair trial in court is a fundamental human right and some will be concerned if the rules of court are changed so that the arbitration scheme has the effect of forcing parties out of court. And it would be wrong to characterise arbitration as a cut-price form of justice. It can equally be gold plated. Ultimately, whether the arbitration process is fair and efficient depends on how individual arbitrators handle individual cases.
In any event, the arbitration scheme provides a viable route for less wealthy claimants to enforce their rights when none currently exists. On the newspaper side, the provision of an arbitration service is one of the elements of the Leveson report that the national newspaper editors have reportedly agreed in principle to support (and pay for) – a quick and cost efficient way to resolve claims will have advantages for them over the expense of court proceedings. While Leveson may not have formulated the ideal solution he has put forward a workable one which takes into account all of the stakeholders’ interests.
Ned Beale is a Partner in the Litigation group in Trowers & Hamlins LLP’s London office
This is a revised version of a piece which appeared in Guardian Law. It is reproduced with permission and thanks.