19:13 - The House divided: - Ayes: 298 / Noes: 230 - Question accordingly agreed to.
The Parliamentary Under-Secretary of State for Justice (Mrs Helen Grant)
I beg to move, That this House disagrees with Lords amendment 1.
Mr Deputy Speaker (Mr Nigel Evans)
With this it will be convenient to discuss the following:
Lords amendment 2, and Government motion to disagree.
Lords amendment 3, and amendment (a) thereto.
Lords amendments 4 to 14.
Lords amendment 15, and Government motion to disagree.
Lords amendment 16, and Government motion to disagree.
Mrs Grant
I am delighted that the Defamation Bill has returned to this House for us to consider the amendments made in the other place. Lords amendments 1, 15 and 16 constitute a partial enactment in statute of several recommendations made by Lord Justice Leveson in his report on the culture, practices and ethics of the press. In particular, they create a press recognition body and require the creation of an arbitration service within recognised self-regulators for defamation and related civil claims. However, the requirements set out in these amendments for the press recognition body do not specify fully or clearly Lord Justice Leveson’s requirements for the self-regulator.
Paul Farrelly (Newcastle-under-Lyme) (Lab)
Is the hon. Lady aware that these amendments have been overtaken by events and will not be pressed? We only have one hour in which to discuss all the amendments to the Defamation Bill. Before she launches into a long speech, will she take account of this and perhaps conclude her remarks relating to past events so that we can move on?
Mrs Grant
I am very aware of time scales and if the hon. Gentleman could bear with me for 30 seconds longer, we might be able to move from this section to the next section.
Moreover, the amendments were tabled at a time when cross-party talks were well under way to identify an agreed response to Leveson’s recommendations, including careful efforts to develop a set of workable criteria for the self-regulatory body. The amendments before us pre-empted the outcome of those talks. As the House will be aware, on 18 March cross-party talks were resolved successfully and a draft royal charter was agreed as a vehicle by which the recognition body should be set up. Detailed criteria by which self-regulators would be assessed were also agreed, and provisions to enact Lord Justice Leveson’s recommendations on incentives in costs and exemplary damages have subsequently been included in the Crime and Courts Bill. Further, a “no change” clause has been included in the Enterprise and Regulatory Reform Bill as a safeguard against political intervention with the royal charter.
I note that my hon. Friend the hon. Member for Worthing West (Sir Peter Bottomley) has tabled a motion to agree with amendment 16, which introduces a requirement for an independent regulatory body to provide an arbitration service. I should like to reassure my hon. Friend and this House that the recognition criteria contained within the agreed draft royal charter include just that. To retain amendment 16 in the Bill, alongside the provisions within the royal charter, risks creating duplication and uncertainty around these requirements. The package of measures identified to enact Lord Justice Leveson’s recommendations have cross-party support. As Lord Puttnam, who tabled these amendments, said:
“Nothing in the world will delight me more than to see the Defamation Bill pass in its original form.”—[Official Report, House of Lords, 25 March 2013; Vol. 744, c. 880.]
On that basis, I hope that the House will agree to the removal of Lords amendments 1, 15 and 16.
I also ask the House to disagree with Lords amendment 2. A motion to that effect has been tabled by my hon. and learned Friend the Member for Harborough (Sir Edward Garnier). The amendment concerns two distinct but related issues, which have already featured extensively in debates in both Houses during the passage of the Bill.
Dr Julian Huppert (Cambridge) (LD)
I thank the Minister for giving way so early in her speech. She is presumably aware that the Joint Committee on the draft Defamation Bill, on which I served, said that it favoured the approach that limits libel claims to situations where the corporation can prove the likelihood of substantial financial loss. Does she understand the reasons behind that, and can she give us any reassurances on that?
Mrs Grant
I fully understand those reasons, and if the hon. Gentleman will bear with me and allow me to progress on to an explanation of those amendments, I hope that all will be revealed to him.
The separate but related issues are whether there should be any restrictions on the rights of bodies corporate and other non-natural persons to bring an action in defamation and whether any non-natural person, which is performing a public function, should be prevented altogether from bringing a claim in relation to a statement concerning that function. In relation to the first issue, the amendment would mean that in order to bring a claim, a non-natural person would first have to obtain permission of the court. The court would be required to strike out any such application, unless the claimant could show that the publication of the statement complained of had caused, or was likely to cause, substantial financial loss. We believe that a permission stage for this purpose would create unnecessary duplication and additional costs for both parties.
If the claimant was required to show substantial financial loss in order to satisfy the permission requirement, it would in effect mean that the claimant would satisfy the serious harm test introduced by clause 1. We have asked the civil procedure rules committee to consider rule changes to support a new early resolution procedure under which either party could apply at the outset of proceedings for the court to decide certain key issues, including whether the serious harm test is satisfied. The addition of a permission stage would therefore add little or nothing, because any case where the existence of serious harm was disputed could have that issue resolved at a very early stage in any event.
Sir Peter Bottomley (Worthing West) (Con)
I am grateful to the Minister for taking us through this matter. The problem comes when a body—not a person—sends a threatening letter to an ordinary member of the public. Were I to go to a pop concert and be abused by security staff, and then tell my friends not to go to anything organised by those people, and if they then issued and served a writ, what chance would I have, with no money? Do I go straight to court and say, “They’ve shown no loss. Cut it out. They are not a person. They’ve got no feelings. They should not be allowed to do it.”?
Mrs Grant
No, in a moment. I want to make some progress first.
If the claimant succeeded at the permission stage, an early resolution hearing would often still be needed to enable the court to give a ruling on other key aspects of the claim—in particular, what the meaning of the words complained of was and whether they were statements of fact or opinion. This would mean that two sets of applications and hearings could often be needed, whereas under our proposals one would be sufficient. We have consistently made it clear that we are fully committed to taking action to help reduce the cost of defamation proceedings. The amendment would have precisely the opposite effect.
In addition to the early resolution proposals, the Civil Justice Council has recently submitted to the Secretary of State its recommendations for cost protection in defamation and privacy proceedings. We are considering these carefully, with a view to introducing measures to give protection to parties with limited means when they are faced by an opponent with substantially greater resources. The amendment would undermine these initiatives and in many cases create unnecessary additional costs for both claimants and defendants.
Paul Farrelly
I thank the Minister for her generosity in giving way. The amendment would be the only place in the Bill that provides for an early strike-out procedure. One of the problems has been that we have not seen the changes to the civil procedure rules throughout all this. How, then, can we be confident that what is promised will happen? In the case that the hon. Member for Worthing West (Sir Peter Bottomley) will no doubt refer to in due course—of Peter Wilmshurst and NMT—an early strike-out procedure was necessary to prevent one company from abusing our libel laws. It was an example of libel tourism and all the worst excesses. The amendment would be the only place in the Bill providing for early strike-out.
Mrs Grant
I hear what the hon. Gentleman says, but the early resolution procedure will not fix the problem of the chilling effect and equality of arms that he is obviously concerned about. It is one of many measures and although I fully accept that the chilling effect is an issue, we also have to recognise that companies must have the right to protect their reputation. One therefore has to consider not just our request for an early resolution procedure, but the serious harm test and our proposals on cost protection and exemplary damages and costs. Altogether, all those things will, I hope, ensure that defamation proceedings are not manipulated by the party with considerably more financial needs against the party with less financials means.
Sadiq Khan (Tooting) (Lab)
I am grateful to the Minister for giving way—I know she wants to get into the flow of her speech—but she misunderstands what clause 1 will do. A trial judge will be able to decide whether serious harm has been caused only at the final trial, after costs have been expended, as indicated by her hon. Friend the Member for Worthing West (Sir Peter Bottomley). The purpose of the clause introduced in the Lords is to allow the issue to be resolved at an early stage, before the defendant has faced too much cost and stress. What has she got against that?
Mrs Grant
I have just explained that we have requested that an early resolution procedure should be looked into, and if we have an early resolution procedure, we do not need a permission stage. As I have explained, having a permission stage and an early resolution procedure would create far too much delay and cost, which is not what anyone wants. I would have thought that the shadow Minister, having been a solicitor, would know the effect that can have on claimants.
Mrs Grant
I would also like to make the point—I can hear that there are concerns about this issue—that I am, however, aware of the strength of feeling that exists on this matter and on whether the Bill should contain a provision requiring non-natural persons trading for profit to show substantial financial loss. As we have made clear at earlier stages in the Bill, in order to satisfy the serious harm test, such bodies are likely in practice to have to show actual or likely financial loss anyway. However, I can confirm that we are prepared to consider actively that aspect of the Lords amendment further, and we will listen carefully to the views expressed in both Houses.
Sir Edward Garnier
I listened with care to what the shadow Secretary of State said just now. Although it is true that clause 1 might be a retrospective application, the ordinary rules of strike-out and the ordinary rules of court that police abusive cases are not altered. If the court is faced with an abusive claim by a company, it will be dealt with. One does not need legislation to police the administration of such proceedings.
Sir Peter Bottomley
Just two names: Peter Wilmshurst and the hundreds of thousands of pounds by a corrupt organisation, a company that had not allowed clinical research to be published properly; and Dr Simon Singh and the half a million pounds of costs over £5,000 of damages, and the court could not find a way of dismissing the case. That is the problem: such cases should not be allowed to start.
Mrs Grant
As I intimated earlier, fixing the problem of fairness and creating the right balance between the claimant and defendant is not just about an early strike-out procedure. It is about a package of proposals that create fairness, are proportionate and allow for freedom of expression while protecting the reputations of individuals.
Simon Hughes (Bermondsey and Old Southwark) (LD)
Before my hon. Friend leaves this issue and following the intervention by our hon. Friend the Member for Worthing West (Sir Peter Bottomley), will she say whether the implication of what she said a few minutes ago is that she and the Government are willing to look at how we reflect the Lords amendment, but in a different way, to deal with corporate actions against vulnerable individuals, which is clearly a concern on both sides of the House?
Mrs Grant
In relation to serious financial harm—that aspect and that aspect alone at the moment.
I now turn to the second element of the Lords amendment. In the case of Derbyshire county council v. Times Newspapers, the House of Lords held that local authorities and government bodies were already prevented from bringing actions for defamation. The amendments seek to extend that principle and prevent claims by any non-natural person performing a public function. We do not consider that appropriate, as it would remove completely the right of a wide range of businesses and other organisations to protect their reputation. Although the provision focuses on criticisms in connection with the exercise of public functions, that criticism could of course have a wider impact on the reputation of the business more generally.
Our view is that a rigid, restrictive statutory provision that would remove the right to claim from a wide range of bodies does not represent a proportionate approach. We consider it much better to allow the courts to develop the Derbyshire principle, as they consider appropriate and necessary in the light of individual cases. The removal of the amendment will not affect the Derbyshire principle, which will continue under the common law as it does now. I hope that the House will therefore agree to reject Lords amendment 2.