Untangling the Proposed Press Regulation Scheme – Exemplary and Aggravated Damages

Following negotiations between the main political parties in the UK, and threats by the opposition to introduce press regulation schemes into other legislation, the Government has published its proposals for implementing some of the recommendations of the Leveson Inquiry. There has been a great deal of comment on these, much before the details were published, and this post will attempt to set out precisely what is being put forward.

On 18 March 2013 the UK Government announced proposals to introduce a press regulation scheme. This followed the recommendations of the Leveson Inquiry into the Culture, Practice and Ethics of the Press. This post is based on the first published proposals – if or when the scheme is implemented it may be different.

It should be emphasised, perhaps more than usual, that this is not professional legal advice and should not be relied on. It is provided for information purposes only, with no guarantees as to accuracy. If accuracy and/or professional legal advice is required, a lawyer should be consulted.

There are two main limbs to the proposals; a Royal Charter to establish a Panel for recognising and monitoring Regulatory Bodies, and a series of Amendments to the Crime and Courts Bill to encourage the use of Regulators by the press.

This post will focus only on the Amendments, while a second post covers the Royal Charter.

The Amendments

Until the amended bill is published there is no consolidated version of the proposed laws. This post is based on the original Government amendments to the Crime and Courts bill (clauses NC22-26, 28-30 and schedule NS5) which can be found here (55-page pdf) and the further amendments (clauses NC21A and NC27A, replacing NC21 and NC27) which can be found here (3-page pdf).

The Amendments introduce further rules for certain civil cases against publishers. In particular, they cover three types of award a court can make:

  • exemplary damages;
  • aggravated damages; and
  • legal costs.

These are discussed individually below.

These rules will only cover cases where:

  • the defendant is a relevant publisher,
  • the case is about the publication of news-related material,
  • the case involved a specific set of laws; defamation, privacy, malicious falsehood and harassment, and
  • in the case of the damages, where the defendant publisher has lost.

Who Counts as a Relevant Publisher (NC29)

It is important to note that the definition of a Relevant Publisher here is narrower than that in the Royal Charter. To be a Relevant Publisher a person must;

  • in the course of business (whether or not for profit),
  • publish news-related material,
  • written by different authors, and
  • has some form of editorial oversight.

There are specific groups excluded from this (NS5) including the BBC, broadcasters (who are already regulated), special interest titles, scientific and academic journals, public bodies, charities and book publishers.

There are two individual subsections concerning websites which note that someone who operates a website is not necessarily an editor if they do not post material directly, even if they have a moderation system. As with many laws concerning the Internet this provision could be far clearer.

News-related material has the same broad definition as in the Royal Charter, covering news and current affairs, opinion on news and gossip about celebrities, other public figures or other people in the news.

This definition should not cover most bloggers (due to the lack of being in the course of business, having multiple authors and editorial oversight). Other blogs (such as political blogs) may be able to rely on the “special interest” exclusion. The precise scope will likely be decided by courts.

Exemplary Damages

Under the current law exemplary damages are awarded to punish a defendant. They are awarded very rarely, in a small number of specific types of case, in specific circumstances, mainly where a “public servant” has acted oppressively or unconstitutionally (beyond mere illegality) or a defendant deliberately gained some extra gain on top of the loss they caused the claimant.

The new rules (in NC21A and NC22-23) allow a court to award exemplary damages against a Relevant Publisher (in a relevant case) where their conduct showed a “deliberate or reckless disregard of an outrageous nature” of the claimant’s rights (beyond merely breaching them), that conduct should be punished, and any other remedies would be inadequate. These damages are about punishing a publisher for their conduct, and can be used as a deterrent and to create an example of a particular publisher. These damages should be the minimal needed to punish the publisher, and can be based on the loss or harm caused and any benefit derived by the publisher.

However, if a publisher is signed up to a Recognised Regulator exemplary damages can only be awarded against them if the regulator decided not to impose a sufficient penalty on them, it was “manifestly irrational” in doing so (based on what it knew at the time), and the court thinks exemplary damages could be awarded under the above rules.

The new rules also remove the court’s ability to award exemplary damages in other cases. It is unclear how this will affect other statutory forms of exemplary damages such as “additional damages” under copyright law.

Aggravated Damages

Under the current law aggravated damages are designed to compensate a claimant for “wounded feelings” where a defendant’s actions or motives caused this extra harm – i.e. where the defendant has made things worse. It is available in more types of case than exemplary damages.

The new rules (in NC26) states that in a relevant case, where a Relevant Publisher loses, aggravated damages can be awarded to compensate for “mental distress,” but cannot be used as a punishment. There are no specific provisions relating to whether or not the publisher has subscribed to a Recognised Regulator.

Costs

Under the current law courts have a wide discretion to award costs at the end of a trial. The general rule is that the loser pays (most of) the winner’s legal costs, but this can be increased or decreased depending on the circumstances, particularly the parties’ behaviour (delays, not following the court’s instructions etc.).

The new rules (in NC27A) create new default positions in relation to Relevant Publishers in relevant cases (whether or not they win);

  • If a defendant publisher is a member of a Recognised Regulator (or if there were no relevant regulators, or joining one would have been unreasonable), costs cannot be awarded against the publisher, whether or not they lose, unless they could have used (but did not use) the Regulator’s arbitration service (which must be provided for the Regulator to be recognised) to settle the dispute.
  • If a defendant publisher is not a member of a Recognised Regulator (and could have been, and it would have been reasonable for them to sign up), costs must be awarded against the publisher, whether or not they win, unless the arbitration scheme could not have been used (had they been a member).

In both cases there is a way out for the court in that it can order otherwise if doing so would be “just and equitable.”

This new rule is designed to encourage publishers to sign up to recognised regulators (or to establish them) by making litigation cheaper (or more expensive). However, it also has the effect of encouraging claimants to arbitration services provided by recognised regulators as they may find it significantly harder to recover their legal costs if they do not, and win their case.

Summary

The provisions in the amendments on exemplary damages and costs are designed to encourage the press (and other relevant publishers) to establish and join recognised regulators by imposing the risk of additional financial costs if they do not, and offering the chance for financial benefits if they do.

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