Order 17 Litigation/Libel. Damages made good

Lawrence Abramson looks at the recent decision to allow directions on personal injury damages to assist libel juries

The awards meted out by libel juries have long been a source of concern for the profession. In the face of ever escalating awards, there is the feeling that the amounts of compensatory and exemplary damages have been out of proportion to the libels, and that these awards have no rational basis and do not correspond to an established compensatory framework. The landmark Court of Appeal decision in John v MGN (14 December 1995) has finally met these concerns head on (see page 8).

There have been similar high profile reductions in the past, such as the scaling down to £60,000 of the £600,000 award against Private Eye in Sutcliffe v Pressdram (1991).

However, the Master of the Rolls went beyond merely reducing the award. Likening members of a libel jury to "sheep loosed on an unfenced common with no shepherd", he officially sanctioned submissions to the jury from either the presiding judge or counsel on the level of damages awarded in personal injury cases as a means of giving the jury a sense of perspective when setting levels of compensatory damages.

The authoritative view has until now been that expressed in Broome v Cassell & Co (1972) that there is no satisfactory way in which conventional awards in personal injury actions could be used to provide guidance for an award in a defamation action. The concern was that juries would be told the scale for personal injury damages and make direct comparisons between, for example, a serious libel and awards for paraplegia.

While agreeing that direct comparisons with personal injury awards should be discouraged, the Master of the Rolls said judges and counsel should be free to draw the attention of juries to personal injury awards so they can properly consider whether the injury to reputation the plaintiff complained of justifies any greater compensation than that awarded in personal injury cases. He also sanctioned suggestions to the jury by judge or counsel for appropriate compensatory damages.

The court concurred with a decision in Rantzen v Mirror Group Newspapers (1986) that the jury should not be reminded of previous compensatory awards made by libel juries in comparable actions, although references might be made to awards approved or substituted by the Court of Appeal.

The Master of the Rolls said a libel jury also needed guidance on exemplary damages. It should be made clear to the jury that before such damages could be awarded they had to be satisfied that the publisher of the defamatory statement did not genuinely believe in the truth of what he had published, that they were satisfied beyond reasonable doubt the publisher had acted in the belief that he would be better off financially if he violated the plaintiff's rights, and that the compensatory award was not sufficient in itself to punish the defendant.

Defence and prosecution counsel now need to carefully study the MacNaughton rules and contemporary awards being made in the field of personal injury litigation. Following the Master of the Rolls' decision, a defence barrister would arguably be negligent if the jury's attention was not drawn to personal injury awards and prosecution counsel will also need to be aware of the other awards being referred to.

It is foreseeable that a judge's failure to draw the jury's attention to the scale of personal injury awards might be grounds for an appeal. In these circumstances, and in the interests of caution, it is hard to imagine a case where there would be no reference to personal injury awards by either the presiding judge or defence counsel.

In the first libel case since John v MGN, the notorious David Ashby libel case, Mr Justice Moreland put the Master of the Rolls' directions into practice. In his summing up he told the jury that an award of less than £50,000 would be "niggardly" and that more than £120,000 would be "extravagant". He added that in personal injury cases where the plaintiff had lost both legs a reasonable award might be £90,000 and that it would be very rare in a personal injury case for a plaintiff to receive an award exceeding £125,000 in respect of pain and suffering. The judge added that even in paraplegia cases with seven-figure damages, the awards were to reflect costs of care and treatment for the rest of the plaintiff's life rather than for pain and suffering.

The commercial position is also liable to shift as a result of John v MGN. The decision to publish will inevitably involve an assessment of the commercial risks and the Master of the Rolls' decision has effectively reduced an element of risk.

No financially viable publication actively goes out of its way to invite libel actions. Even if the libel awards drop as a result of John v MGN, the costs awards would be crippling. Moreover, if a publication can be shown to have cynically libelled in order to profit from that libel, then there is nothing in the Master of the Rolls' dicta to prevent large exemplary awards still being made. What he has offered is guidance to juries not an amnesty to libellers.