Civil Justice Council publishes report on Defamation Costs

On 18 April 2013, the Civil Justice Council (CJC) Working Group published its report with recommendations on costs protection in defamation and privacy claims.  The Government had delayed the implementation of reform in these types of cases after the publication of the Leveson Report.  In other civil cases, reforms were brought into effect from 1 April 2013 which has changed the nature of Conditional Fee Agreements.  Defamation and privacy claims are often brought on the basis of these agreements due to the high costs associated with these actions.

Justice Minister Lord McNally requested that the CJC consider the cost issues in these cases ahead of the Defamation Bill passing into law.   The Working Group was formed in December 2012 and asked to ˜identify whether there are meritorious actions for defamation and privacy, which could not properly be brought or defended without some form of costs protection.  If the Group identified such actions they were to go on to advise on:

(i) in which types of cases (or stages of cases) some form of costs protection should apply; and

(ii) what options for costs protection might be considered, with their advantages and disadvantages

John Pickering, Chairman of the Working Group and Partner at Irwin Mitchell, recognised the difficulties of the task that they were set.  He said:

˜Defamation and privacy law is fast changing and complex, not least because of the advent of social media and online publication.  Ideally we would have had much more time (for example not all members were able to sign off the report), than the Ministerial timetable permitted, to both consider the issues and consult widely.  Our deliberations were also hampered by examining the issues without knowing what model of arbitration would develop in response to the Leveson Inquiry.

Nonetheless we have done our best to weigh up the pros and cons of various methods of protecting parties from major adverse costs in bringing or defending a defamation or privacy claim, as without such protection there is a real risk of people not receiving access to justice.

The Working Group made several recommendations that included:

a) A greater level of judicial case management that would mean that case budgets were approved at an early stage and that specialist judges would be allocated to cases to monitor progress;

b) The introduction of ˜Variable Costs Protection which mirrors qualified one way costs shifting but is available to both claimants and defendants;

c) Agreement on the circumstances when a party would lose its cost protection e.g. if a claim is struck out or a party has been found to have been fundamentally dishonest.

d) The use of cost budgeting measures, as introduced in other areas, to ensure that parties consider the costs in advance and adhere to them;

e) The court should continue to utilise the cost capping measures available to it under the CPR.

The full report can be accessed at:

http://www.judiciary.gov.uk/about-the-judiciary/advisory-bodies/cjc/working-parties/costs-in-defamation-proceedings.htm