Case Law: Brett Wilson LLP v Persons Unknown, corporate damages and injunction against unknown operators of website – Hugh Tomlinson QC

21 09 2015

Solicitors from HellIn the case of Brett Wilson LLP v Persons Unknown ([2015] EWHC 2628 (QB))(16 September 2015) Warby J granted a permanent injunction against the unknown operators of the “Solicitors from Hell UK” website.  He also awarded damages of £10,000.  This is the first case under the Defamation Act 2013 in which a court has made an award of damages to a “body that trades for profit”.

Background

The claimant, Brett Wilson LLP, is a boutique firm of solicitors which acted for the claimants in the litigation in which orders were made that closed down the notorious “Solicitors from Hell” website: Law Society v Kordowski [2011] EWHC 3185 (QB).  Since then a number of copy cat websites have been published.

In late 2014 or early 2015 the claimant was the victim of a defamatory listing on a new website denouncing members of the legal profession, known as “Solicitors from Hell UK” (“SFHUK.com”).  When a Google search was carried out on the claimant’s name it produced, within the top five listings, the following result

SFHUK

The claimant tried to identify the operators of SFHUK.com without success.  The WHOIS registry listed “Anonymous Speech” as the website owners. This is a proxy registrant service which has email contact addresses and postal addresses in Tokyo and Panama.  No response was received from communications to these addresses.

The claimant and the Law Society obtained a Norwich Pharmacal order against Anonymous Speech requiring it to identify the owner of SFHUK.com but received no response.

As a result, the claimant commenced proceedings against a defendant described as

“Person(s) Unknown, Responsible for the Operation and Publication of the website http://www.solicitorsfromhelluk.com”.

The claimant obtained permission to serve the claim form, Particulars of Claim, application notices and other documents by an alternative method, namely by email on the addresses given by Anonymous Speech.

On 19 August 2015, the claimant issued and served an application seeking default judgment under CPR 12.3(1) and 12.4(2) and summary disposal of the case pursuant to section 8 of the Defamation Act 1996 seeking damages, an injunction and costs.

Judgment

The first issue was whether it was right to hear and dispose of the application in the absence of the defendants.  The Judge applied the approach which he took in Sloutsker v Romanova ([2015] EWHC 545 (QB) [22]-[23]).

He was satisfied that the claimant had taken all reasonable steps to notify the defendants who had, in fact, had notice and an adequate time to respond if they chose.  He inferred that the defendants had decided not to attend because they wished to remain anonymous and were “hiding” [16].  There were good reasons to proceed in their absence.

The claimant was entitled to default judgment on the basis of the unchallenged particulars of claim (see Sloutsker [84]).

Although it was not alleged that the defendants were the authors or publishers under section 10 of the Defamation Act 2013, on the pleaded case the “persons unknown” were within the definition of “editor” in section 10(2) [23].

The Particulars of Claim alleged and the Judge accepted ([25]) that the words which the defendants published or caused to be published on SFHUK.com bore the following defamatory meanings:

“(a) The Claimant is a shameless, corrupt, fraudulent, dishonest, unethical, incompetent and oppressive firm of solicitors which does not provide competent services, has had a justified complaint made against them and whose wrongdoing should be exposed to prevent others from suffering by instructing them.

(b) The Claimant unscrupulously inflates costs.

(c) The quality of the Claimant’s work is sub-standard and poor value for money.

(d) The Claimant’s staff and/or partners are guilty of committing the imprisonable offence of harassment contrary to section 1 of the Protection from Harassment Act 1997.

(e) The Claimant breaches its professional obligations and acts contrary to the Solicitors Regulation Authority’s Code of Conduct.

(f) The Claimant’s staff and/or partners are rude, threatening, intimidating and unprofessional.

(g) The Claimant ‘strong-armed’ payment from a former client that was not owed or warranted and thus committed an offence contrary to section 40 of the Administration of Justice of Act 1970.

(h) Prospective clients seeking to instruct the Claimant will receive sub-standard advice and lose out financially.”

These words were plainly defamatory at common law however the claimant was a “body which trades for profit” under section 1(2) of the Defamation Act 2013.  It, therefore, had to show that the words had caused or were likely to cause “serious financial loss”.

The pleaded case on “serious financial loss” included contentions that ([29]):

  • The publication has been read and will continue to be read by prospective clients considering instructing the claimant.
  • It was inevitable that a number of prospective clients who have read (or will read) the publication have decided (or will decide) not to instruct the claimant.
  • The claimant believed that there had been a noticeable drop in the conversion of enquiries from prospective clients to instructions over the past 6 months.
  • In July 2015 a prospective client withdrew instructions as a result of the publication.
  • The claimant had suffered financial loss – though no figures were given.

Although the Judge criticised the reliance on a statement of belief rather than one of fact, he concluded that these allegations were sufficient to make out a case of serious financial loss.

The Judge was prepared to grant mandatory and prohibitory injunctions – to remove specified webpages from the internet and to restrain further publication.

Finally, the claimant sought summary disposal under sections 8 and 9 of the Defamation Act 1996.  Following Robins v Kordowski ([2011] EWHC 1912 (QB) the judge accepted that this procedure could be used after default judgment had been entered.

The Judge said that the words complained of had a clear tendency to put people off dealing with the claimant – this was their evident purpose [42].  In the circumstances, it was appropriate to make an award of damages of £10,000, the maximum possible under the summary disposal procedure.

A copy of the Judge’s order for injunctions and damages can be found here.

Comment

This case has a number of interesting features.  Although it seems highly unlikely that the judgment will ever be enforced, the claimant solicitors’ firm clearly thought it of importance to obtain a vindicatory award which will then produce articles which will be seen by prospective clients conducting Google searches.

Most interestingly, this is the first case in which a court has addressed the “serious financial loss” threshold for bodies which trade for profit under section 1(2) of the Defamation Act 2013.  Although the defendants were not represented the case gives a first indication as to the way in which the courts will approach cases under this provision.

A number of commentators had suggested that “serious financial loss” is a high hurdle for claimants, requiring direct evidence of actual or threatened financial damage, supported by figures.  In this case it was pleaded that one prospective client had withdrawn instructions as a result of the publication but no figures were put on the resulting loss.

Warby J was prepared to find “serious financial loss” established on limited materials (set out in [25]) even though:

  • There was no pleaded factual case as to any actual drop off in the conversion of inquiries into instructions or as to any financial loss actually suffered by the claimant.
  • The total number of Google searches for the claimant’s name over a 6 month period to July 2015 was only 276 ([40]) – it is plain that not all of these would have been prospective clients and that not all of those would have been deterred from instructing the claimant by the SFHUK.com publication.

In making his finding Warby J emphasised that the meaning of the word “serious” depended on the context and he may well have been influenced by the fact that the “evident purpose” of the published words was to put people off dealing with the claimant. In these circumstances it was easy to infer that the words were “likely” to achieve this purpose, thus causing serious financial loss to the claimant.

Nevertheless, this case suggests that – consistently with the approach taken by the same judge in Lachaux v Independent Print ([2015] EWHC 2242 (QB)) – the courts will, in appropriate cases, be ready to draw inferences of serious financial loss from without specific proof of actual damage to finances.

Finally, this appears to be the first case in which an English court has made an award of damages against “persons unknown”.  As already indicated, this is of symbolic value only but demonstrates that a claim may obtain “vindicatory damages” without knowing the identity of the defendant.

Prior to the closing down of the original “Solicitors from Hell” website there were several libel actions against its then publisher, Rick Kordowski (see our posts here and here). After a number of such cases Henriques J urged the professions to take action.  The claimant law firm was instructed by the Law Society in the case which led to the site being shut down (see Eddie Craven’s case comment).  It will be interesting to see whether this case leads to a new round of claims against SFHUK.com.

Hugh Tomlinson QC is an editor of Inforrm.  He was counsel for the claimants in the case of Law Society v Kordowski.


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3 responses

21 09 2015
21 09 2015
truthaholics

Reblogged this on | truthaholics.

21 09 2015
daveyone1

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