Paradise and Prostitutes: Time for a Sectional Standards Test? – Adam Speker

16 11 2017

Is it defamatory to mistakenly call a Remainer a Brexiteer or a Brexiteer a Remainer? Surely not you would say and you would be right. After all, in 1907 it was not defamatory to describe a Free Trader as a Protectionist or a Protectionist as a Free Trader. But why would you be right?

We all know people who say they thought less of someone when they discovered that that person had voted differently to them in the EU referendum. In some communities or workplaces, to be labelled wrongly could result in the type of loss that would constitute special damage: of entertainment or the hospitality of friends, for instance.

The present state of English defamation law means that words must amount to disparagement (sufficient to overcome section 1 of the Defamation Act 2013) to the reputation of right-thinking people generally. So whilst to be wrongly labelled a Remainer or a Brexiteer may damage your reputation in the eyes of some, it is not actionable.

But have we reached the stage where we cannot tell what right-thinking people generally think anymore? And if so, what do we do?

With that introduction, I move on to paradise and prostitutes.

Paradise

The Paradise Papers are financial documents stolen (not leaked) from a Bermuda law firm and provided to the German newspaper Suddeutsche Zeitung who called in the International Consortium of Investigate Journalists (ICIJ). The ICIJ shared the papers with around 100 media organisations around the world. Information from these stolen documents has been published prominently over the past days, including by The Guardian and BBC Panorama.

On the BBC’s website its ‘Paradise Papers: Everything you need to know about the leak’ page provides information about the investigation. It explains that there have been number of stories exposing how ‘politicians, multinationals, celebrities and high-net-worth individuals use complex structures to protect their cash from higher taxes.

In response to the question, ‘Why is it in the public interest?’ the BBC says this: “The media partners say the investigation is in the public interest because data leaks from the world of offshore have repeatedly exposed wrongdoing. The leaks have led to hundreds of investigations worldwide, resulting in politicians, ministers and even prime ministers being forced from office.”

In almost all of the news reports, the media companies have explained that what the papers show is not tax evasion but avoidance and that nothing illegal has been done. Yet apparently what has been demonstrated, and is said to justify the revelation of private financial information about individuals, is ‘wrongdoing.

In The Effect and Origins of the Great War, the historian AJP Taylor remarked that,

Until August 1914 a sensible, law-abiding Englishman could pass through life and hardly notice the existence of the state, beyond the post office and the policeman. He could live where he liked and as he liked…

The sensible, law-abiding Englishman distrusted the state. Provided he was not acting illegally in withholding what was due the sensible Englishman would not have been criticised for using the means at his disposal to avoid giving to the state more than required or for living as he liked.

This view was by no means confined to the middle and upper classes.

In Welcome to Everyman: A Journey into the English Mind the philosopher Julian Baggini decided to live in Rotherham in South Yorkshire for 6 months in 2005 ‘in an attempt to understand the English mind.’ In the chapter, Illiberal Democrats, Baggini explored the English belief in ‘fair play.’ He wrote,

‘..the land of people who play by the rules is also the land of people who will never pay the authorities any more than they are forced to, whatever the rules say. I came across this time and time again, and it cuts across all social classes and even political convictions. I know middle-class left-wing professionals who are officially disappointed that New Labour isn’t really socialist, yet they still open tax-free ISAs and the like in their children’s names in order to avoid giving money to the Exchequer. The accountant for The Philosophers’ Magazine, which we run as a partnership, was frankly baffled when we told her that we just weren’t interested in setting up a corporate structure in such a way as to make us pay less tax: such a thing was unheard of. In [Rotherham], they would also think you were mad if you paid taxes you weren’t forced to.’

Mad to pay taxes you weren’t forced to. Do you recognise or sympathise with that view? The pop singer, Adele, who comes from a working class background, does. She echoed it in 2011:

“I’m mortified to have to pay 50%! [While] I use the NHS, I can’t use public transport any more. Trains are always late, most state schools are shit, and I’ve gotta give you, like, four million quid – are you having a laugh? When I got my tax bill in from [the album] 19, I was ready to go and buy a gun and randomly open fire.”

Yet the assumption made and fed by the media these days, through exposés such as the Paradise Papers, is that the ‘poor’ are disgusted that the ‘rich’ do not pay their ‘fair share’. Anyone who seeks to protect his or her money from the taxman through legal means is not sensible but disreputable or immoral.

Where are the courts on this subject? It depends, of course, on the precise words used and their context but we appear to be more judgmental about money matters. In Lait v Evening Standard Limited [2010] EWHC 3239 (QB), a case concerned with the parliamentary expenses scandal, Eady J had to consider capable meanings. He said at [8],

In the light of all that has taken place over the past 12 months, it is in my judgment unreal to suggest that readers would not think the worse of a member of Parliament who had taken advantage of (or “milked”) the expenses system simply because he or she had stayed within the letter of the law or of the rules. … That is because they are perceived now as having behaved disreputably.

The parliamentary expenses scandal has an additional element to it which may explain the reaction: the money MPs were obtaining was public money. The same is true of the banking scandal of 2008-9. But both scandals may have changed the attitudes of many people generally about whether tax avoidance is ‘fair play’, at least for the ‘rich.’

In Pirtek (UK) v Jackson [2017] EWHC 2834, on a judgment in default application where the defendant was not represented and hence did not put forward any arguments, Warby J said at [44] of the third and least serious meaning complained of:

“Tax avoidance” refers to a lawful activity, distinct from tax evasion which is unlawful. An allegation of “tax avoidance” may or may not be defamatory, according to the context.

The Judge explained that, in its context, he was ‘inclined’ to accept it had ‘defamatory overtones’. His conclusion was cautious.

Prostitutes

Whether accusations about lawful sexual activity are defamatory these days is also a sensitive subject and here we appear to wish to strive to be less judgmental.

In Brown v Bower [2017] EWHC 2637 (QB) Mr Justice Nicklin was troubled by a concession from the defendant that an accusation that a cabinet minister had been accused by the News of the World of paying £100 to rent boys in order to be kicked around a room was defamatory and sufficiently so to overcome the section 1 test. Nicklin J said at [46]

The issue of whether it is defamatory to say of someone that s/he has paid individuals (male or female) for consensual sex is controversial.

Later at [47]-[48] the Judge said,

By the same token, judged by 2017 standards, do ‘right-thinking people’ regard as defamatory an allegation that someone has or enjoys ‘rough sex’ (in the sense of consensually violent)?

… These are difficult questions. …. Whatever the Court’s decision on these questions were to be, it may prove to be controversial. There may be people who would disagree (perhaps very strongly) with a decision either way. That is the nature of pluralism in a democratic society but it tends to show that, on this topic (and in the words of Browne-Wilkinson V-C in Stephens), there is no “generally accepted code of sexual morality”.

What to do?

If the courts are troubled by defamatory complaints of some legal sexual and financial behaviour, they are right to be so. People do disagree. All judges used to have to do was decide whether such allegations were capable of being defamatory and then they could leave it to juries to decide, who did so in private. Now judges must decide, and do so in public.

One solution to this difficulty can be found in the introduction of section 1 of the Defamation Act 2013. This raises the bar on whether a statement is sufficiently serious to be considered defamatory. In cases involving business, there may be a regulatory standard that allows only a limited role to the right-thinking person test (see Thornton v Telegraph Media Group Ltd [2011] 1 WLR 1985 at [34(iii)]). Or the Data Protection Act could be used to found a cause of action in respect of inaccurate data whether or not they are defamatory.

Another would be more controversial: for the appellate courts to develop the common law to introduce a sectional standards test. In Arab News Network v Khazen [2001] EWCA Civ 118 the Court of Appeal had to consider whether it was defamatory to accuse an Arab broadcasting company and its chairman of being tools of the Americans or Israelis by peddling their line. It accepted that such accusations would be highly damaging to their reputations among fellow Arabs. At the end of the lead judgment, Keene LJ said, at [30],

should [whether a statement is defamatory] …be judged by the reaction of ordinary reasonable people in our society as a whole or by that of such people within a particular community within that society… …. … we are today a much more diverse society than in the past and … the reputation of a person within his own racial or religious community may be damaged by a statement which would not be regarded as damaging by society at large. This is an issue which may need to be addressed at some stage in the future

The converse and orthodox view was expressed by Warby J in Monroe v Hopkins [2017] EMLR 16 at [50]-[51] and echoed by Nicklin J in Brown v Bower:

….The demands of pluralism in a democratic society make it important to allow room for differing views to be expressed, without fear of paying damages for defamation. Hence, a statement is not defamatory if it would only tend to have an adverse effect on the attitudes to the claimant of a certain section of society.

Whilst due regard has to be paid to pluralism it is easy to see how the reputation of an MP can be damaged in the eyes of voters or his constituents or political party members by a statement that he legally avoids paying taxes or that he engages in lawful but embarrassing or sleazy sexual activity. If such a person cannot obtain a remedy – and I express no opinion on Mr Brown’s case – because of uncertainty over what right-thinking people might think, then we may have reached the stage for the courts to address whether a sectional standards test would be more acceptable in a modern society and less controversial for judges to apply.

Adam Speker is a member of 5RB.


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27 03 2018
The Duty to Hack, Steal and Betray Confidences? Press Freedom and the ‘Paradise Papers’ affair – Paul Wragg | Inforrm's Blog

[…] According to the claimant these documents detailed the lawful means by which their clients minimised their tax liability in the UK (for background: see Adam Speker’s previous post on the Paradise Papers). […]

28 03 2018
The Duty to Hack, Steal and Betray Confidences? Press Freedom and the ‘Paradise Papers’ affair – Paul Wragg – CCTV Installer Near Mear

[…] According to the claimant these documents detailed the lawful means by which their clients minimised their tax liability in the UK (for background: see Adam Speker’s previous post on the Paradise Papers). […]

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