Case Law: Cruddas v Calvert, Sunday Times appeal allowed in part, ex Conservative Treasurer’s damages reduced to £50,000

17 03 2015

Sunday Times CruddasThe Sunday Times and two of its journalists have been partially successful in their appeal against the decision of Tugendhat J in Cruddas v Calvert awarding damages of  £180,000 to former Conservative party treasurer, Peter Cruddas ([2015] EWCA Civ 171). The Court of Appeal unanimously allowed the appeal on one of three grounds, finding that the allegation of corrupt conduct was true.

The Judge’s conclusions on the other meanings, including the finding of malice, were upheld. The damages were reduced to £50,000.

Background

The Claimant is a businessman and in March 2012 he was the Co-Treasurer of the Conservative Party.  The First and Second Defendants are  journalists and part of the “Sunday Times”  ’Insight’ team.  The Third Defendant was the publisher of the “Sunday Times”.

The journalist defendants pretended to be agents for foreign investors who wanted to explore making donations to the Conservative Party. They hired a lobbyist called Sarah Southern and, through her, arranged to have a meeting with the Claimant on 15 March 2012. They carried concealed cameras with an audio recording facilities.

On 25 March 2012 the Sunday Times published four articles. The first began on page 1 and continued on page 2 under the headline ‘Tory treasurer charges £250,000 to meet PM.’ Page 1 also had a photograph of the Claimant. A sub-heading further reported that the day before ‘Cameron’s fundraiser [had been] forced to resign‘. The second article was on pages 8 and 9 under the headline ‘Cash for Cameron: cosy club buys the PM’s ear‘. The third article, also on page 9, had the headline, ‘Pay the money this way and the party won’t pry’. Page 9 carried the fourth article as well. This was written by Mark Adams under the headline ‘Rotten to the Core’. The Sunday Times also published an editorial in the same issue on the theme ‘Sack the Treasurer and Clean Up Lobbying‘.

The Claimant issued proceedings for libel and malicious falsehood in July 2012 complaining of the first three articles.  He pleaded that the meanings attributed to the articles (for the purpose of his claims in both defamation and malicious falsehood) were as follows:

“(1) In return for cash donations to the Conservative Party, the Claimant corruptly offered for sale the opportunity to influence government policy and gain unfair advantage through secret meetings with the Prime Minister and other senior ministers.

(2) The Claimant made the offer, even though he knew that the money offered for secret meetings was to come, in breach of the ban under UK electoral law, from Middle Eastern investors in a Lichtenstein fund; and

(3) further, in order to circumvent and thereby evade the law, the Claimant was happy that the foreign donors should use deceptive devices, such as creating an artificial UK company to donate the money or using UK employees as conduits, so that the true source of the donation would be concealed”.

The Defendants denied that the words bore these meanings and relied on a defence of justification in relation to “lesser meanings” to the effect that the Claimant’s conduct was“ inappropriate, unacceptable and wrong and gave rise to an impression of impropriety“. The Defendants did not raise a Reynolds defence nor any other defence of privilege (or public interest), nor a defence of honest comment.

In June 2013 Tugendhat J gave judgment on meaning as a preliminary issue ([2013] EWHC 1427 (QB)). The Court of Appeal allowed the Defendants’ appeal in part ([2013] EWCA Civ 748), holding in relation to the Claimant’s meaning (1), that the word “corruptly” should be interpreted not as connoting a criminal offence, but as meaning “inappropriate, unacceptable and wrong” [16].

The trial took place before Tugendhat J in July 2013.  He handed down judgment on 31 July 2013 ([2013] EWHC 2298 (QB)).  He found each of the meanings untrue and that the Defendants were malicious in that the journalist knew that they were false in the meanings they knew them to bear.  The Defendants appealed to the Court of Appeal.  The hearing took place on 9 to 11 December 2014.  Another hearing was listed for 6 March 2015 but did not take place.

Judgment

The leading judgment was given by Jackson LJ (with whom Ryder and Christopher Clarke LJJ agreed).  He summarised what he described as the Defendant’s “essential argument” as follows

i) For the purposes of libel, meaning 1 was true. This is apparent from the transcript of the meeting on 15th March 2012.

ii) The defendants are not liable for malicious falsehood in respect of meaning 1, because they did not intend readers to place the alternative (incorrect) interpretation on the articles which has been identified by the Court of Appeal.

iii) Meanings 2 and 3 are true. Therefore the defendants are not liable for either libel or malicious falsehood in respect of those meanings.

iv) In any event, the defendants were not malicious in respect of meanings 2 and 3. [54]

Jackson LJ considered the transcripts of the conversations between the Claimant and the two journalists in considerable detail and concluded as follows:

“Mr Cruddas was effectively saying to the journalists that if they donated large sums to the Conservative Party, they would have an opportunity to influence Government policy and to gain unfair commercial advantage through confidential meetings with the Prime Minister and other senior ministers. Mr Cruddas was not suggesting any form of criminal offence under the Bribery Act 2010. Nevertheless, what he proposed was unacceptable, inappropriate and wrong. Therefore meaning 1 was substantially true”. [85]

He said that there were “many shortcomings in The Sunday Times articles” which were “in some respects unfair to Mr Cruddas” but the issue was simply whether the Defendants had justified the first meaning.  In his view, they had [93] and they succeeded on this issue.

The Claimant sought to argue that he should, nevertheless, succeed in malicious falsehood in relation to the first meaning.  The Judge had held that the journalists realised that some cynical readers would understand the articles to mean that the Claimant was proposing criminal bribes, even though this was not the “natural and ordinary meaning” of the article and the journalists knew it was not.  This argument was available because in relation to the tort of malicious falsehood, the single meaning rule does not apply: see Ajinomoto Sweeteners Europe SAS v Asda Stores Ltd ([2011] QB 497).

This argument was rejected by Jackson LJ.  He held that

“If the claimant succeeds on his claim for malicious falsehood, it would greatly expand the ambit of that tort. A defendant should only be liable for malicious falsehood if the falsehood represents one of the possible correct meanings of the defendant’s words and the defendant intended to convey that falsehood. The Court of Appeal’s decision in Ajinomoto does not expand the tort of malicious falsehood any wider than that” [114].

In relation to the judge’s decision in rejecting the defence justification in relation to meanings 2 and 3, Jackson LJ held that it was “plainly correct” [117].  Those allegations were false.  He held that there was no basis for overturning the judge’s decision in relation to malice.

On damages, Jackson LJ concluded that the Judge’s award of general damages should be treated as comprising £100,000 in respect of meaning 1 and £65,000 in respect of meanings 2 and 3 [134].  The latter award had to be reduced to reflect the fact that the defendants had justified meaning 1.

Jackson LJ held that

“The allegation that the claimant was countenancing criminal conduct is a serious matter and of a different character to the ‘cash for access’ allegation. The damage in respect of meanings 2 and 3 should be reduced by £22,000 in order to reflect the fact that the defendants have justified meaning 1. I therefore assess general damages for libel in the sum of £43,000” [138].

In addition, he reduced the award of aggravated damages to £7,000.  This gave a total award of damages of £50,000.

Comment

This appeal did not turn on any substantial legal issue but on an analysis of what the Claimant said when he was secretly recorded by Sunday Times journalists.  After analysing a large quantity of material the Court of Appeal, unusually, took a different view of the facts from the trial judge.

The parties expressed somewhat different views on the result of this appeal. In a statement released shortly after the judgment Mr Cruddas said

“Naturally I am disappointed that the Court of Appeal has allowed part of the Sunday Times’ appeal, but it is some consolation that I remain the overall winner of my action … This is no victory for the Sunday Times when they still have to pay me damages, and their journalists remain condemned as malicious”.

In contrast the Sunday Times said

“The Sunday Times and two of its journalists, Jonathan Calvert and Heidi Blake, are today completely vindicated for reporting that Peter Cruddas corruptly offered access to David Cameron and other leading members of the government in exchange for donations to the Conservative party.  … This was an important public interest story. Our journalists acted with professionalism and integrity and with the full support of the newspaper’s editors and lawyers. They and the newspaper have fought this case for three years”.

The true position was somewhere in between the two.  The Court of Appeal decided that the tapes showed that the Claimant’s proposals were “unacceptable, inappropriate and wrong” and were therefore, in the ordinary language sense, corrupt.  However, the judgment is not a ringing indorsement of the Sunday Times journalists who were found to have been malicious in making the other allegations against the Claimant.

In short, the story is one of unacceptable conduct in relation to political donations and unacceptable conduct in relation to political journalism.  It is difficult to see how either side can take any comfort from the conclusion to this case.


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