Spencer v Sillitoe & Anor

Judgment

There are before the court two actions in which applications are made, namely HQ01X02720 ("the libel action") and HQ03X00424 ("the contract action"). Both claims originate in a dispute that arose between the Claimant, Mr Warren Spencer, and his former employers Fujitsu Services Limited (formerly ICL) during 2000.

The applications to some extent overlap, in that Miss Addy appearing for the Defendants in each action seeks to strike out parts of the particulars of claim which are common to both actions as being prolix, irrelevant, embarrassing and vexatious. There are also other submissions which are peculiar to the defamation proceedings only.

Mr Spencer has been representing himself throughout the proceedings. He is a lawyer who is qualified both in the United States, being a member of the New York Bar and of the Bar of the United States Supreme Court, and a solicitor within this jurisdiction. He worked for a number of years in the legal department of ICL and it does not seem to be disputed that his work was competent and of a high standard. He adopted the practice from about the middle nineties of working from home because it was not perceived necessary for him to attend at the offices. He was, however, as I understand it, always contactable via email, telephone or fax. In or about September 1999 a Mr Richard Allnutt became "Group Counsel", having previously been a partner in Simmons and Simmons. He was superior to Mr Spencer within the ICL structure, and reported directly to Mr Richard Christou who was the Legal Director. It appears that he took the view that Mr Spencer should cease his previous working arrangement and be based at the Finsbury Square headquarters of ICL.

There were various points of disagreement between Mr Allnutt and Mr Spencer, as a result of which the Human Resources Department was asked to become involved. The head of the department was a Miss Colquhoun, and one of its staff was Mr David Sillitoe, who is the First Defendant in the libel action. There was an off-the-record confidential meeting in June 2000 between Mr Sillitoe and Mr Spencer, in order to see whether the points of disagreement could be resolved. During the course of this meeting, Mr Spencer made certain criticisms of Mr Allnutt, and discussion took place about three possible options for dealing with Mr Spencer’s relationship with ICL. There may well be some disagreement as to what the three proposals were, as envisaged by Mr Spencer, but they were recorded in a note of a meeting which was produced at some point by Mr Sillitoe.

The first option was, it appears, that Mr Spencer should be allowed to continue as before.

Secondly, it was mooted that he should be given a different position without having to move to Finsbury Square.

Thirdly, an offer could be made to him to leave the company on terms which recognised that he would be losing the position which he would have otherwise occupied up to the date of his retirement.

According to the note, although this is disputed by Mr Spencer, the meeting continued in the following vein:

As was recognised by the Court of Appeal when the matter came before it on 22 October 2002, there is no room for mistake so far as that note is concerned. It is Mr Spencer’s case that the passage I have cited was simply untrue. According to him, he did not say what is attributed to him and, in particular, he did not make the threats to "fix" the company. It follows, on his case, that Mr Sillitoe must have fabricated those allegations which, not surprisingly, Mr Spencer regards as defamatory.

In the defamation claim, various causes of action are relied upon. First, it is said that on 14 July 2000 Mr Sillitoe telephoned Mr Allnutt and "took the opportunity to inform [him] of the threats [Mr Spencer] had made at the meeting with regard to his fixing contracts that would have a damaging effect on [the second defendant]". The natural and ordinary meaning attributed to the words spoken is that Mr Spencer had threatened to sabotage the Second Defendant’s contracts.

It is also said that on or about 15 August 2000 Mr Sillitoe appointed as an "independent investigator" a Miss Shirley Phillips in order to go through the requirements of the Second Defendant’s published disciplinary procedures (and in accordance with the ACAS Code of Practice). The allegation is that Mr Sillitoe told her, at the time of her appointment, of Mr Spencer’s "threat that he could damage the business". Again, the meaning attributed to his words is that he was a potential "saboteur".

Thirdly, on or about 24 August 2000, Miss Phillips requested "some tangible evidence to serve as the basis for her investigation". Shortly thereafter, she was supplied with a copy of the note of the June meeting between Mr Spencer and Mr Sillitoe, to which I have already referred. It is Mr Sillitoe’s case, apparently, that the notes came into existence shortly after the meeting as a record or memorandum. The notes no longer exist in their original manuscript form and all that is available is a typed-up version prepared by Mr Sillitoe’s secretary. Mr Spencer alleges that the notes were hurriedly written up in the middle of August to comply with Miss Phillips’ request. They are headed "Notes of meeting held with [Mr Spencer] in late June". Once again, the natural and ordinary meaning attributed is that Mr Spencer had threatened to sabotage the Second Defendant’s contracts.

As the Court of Appeal identified last October, the issues in the defamation claim would appear to be relatively straightforward. The primary defence raised by Mr Sillitoe and the Second Defendant is that of justification. In other words, Mr Spencer made the comments and uttered the threats attributed to him in Mr Sillitoe’s notes. That surely can only be resolved in light of the conflicting evidence of the two men present.

Secondly, there is a plea of qualified privilege which can only be defeated if Mr Spencer succeeds in proving, on the balance of probabilities, that Mr Sillitoe was motivated to make these defamatory allegations by malice.

It is clear that both these defences turn, in effect, upon the resolution of the conflicting accounts presumably to be given at trial of what took place at the one-to-one June meeting. If Mr Sillitoe made it all up, in order to provide bogus disciplinary grounds, not only would the defence of justification fail but there would almost certainly be a finding of malice in consequence.

It was observed by the Court of Appeal that the particulars of claim in the defamation action, as they then stood, contained a good deal of "irrelevant" matter (see paragraph 12, per Buxton L.J.) and also that Mr Spencer had shown "readiness to make wild allegations against various members of the [Second Defendant’s] staff in the course of these proceedings" (see paragraph 30, per Simon Brown L.J.). The pleading has subsequently changed in the light of a hearing before Morland J on 27 February 2003. Nevertheless, Miss Addy contends that the present form of pleading still contains much that is irrelevant.

She attacks, in particular, part of paragraph 1 of the amended particulars of claim which alleges, in short, that the Second Defendant had been wrongfully withholding, for a full year, a large amount of information to which Mr Spencer was entitled, and which he had repeatedly asked for in accordance with the "subject access" provisions of the Data Protection Act 1998. As a result of this, it is said, the Second Defendant was successful in withholding from him material showing that Mr Christou had played a role in his "mistreatment". I agree that this material has no place in particulars of claim based on the three publications which I have identified.

In paragraph 3, there is also what I might call a "side swipe" at Mr Sillitoe, referring to his sobriquet "Stiletto". That too should come out.

There is then a lengthy series of allegations (paragraphs 6-11) which Miss Addy attacks in their entirety. These deal with the complicated history of a project known as "Pathway", which was intended to be achieved under the then government’s private finance initiative. This involved the provision by the Second Defendant of computer equipment and services to post offices throughout the United Kingdom to facilitate a more secure system for the payment of DSS benefits. It has been described in the pleading as a "£1 billion project". I can summarise the allegations, I hope not unfairly, by saying that Mr Spencer wishes to have them pleaded and proved in the litigation in order to demonstrate why Mr Christou had it in for him.

It is suggested that Mr Christou resented the fact that Mr Spencer maintained his high ethical standards and refused to participate in a deception intended to mislead various people over the commercial viability of the Pathway project. It is largely for this reason, he says, that Mr Christou eventually wished to be shot of him in the summer of 2000. Accordingly, he instructed Mr Sillitoe to find a method of dispensing with Mr Spencer’s services "as cheaply as possible". The next stage in the development of Mr Spencer’s case is that Mr Sillitoe made the false allegations about the conversation he had had with him in June – the object being to provide grounds to dismiss him for a disciplinary offence.

I could understand Mr Spencer’s wish to trace through the supposed genesis of Mr Christou’s resentment of him if it were the case that Mr Christou was himself alleged to have participated in one or more of the defamatory publications, or if he had passed on to Mr Sillitoe the true reasons for his (Mr Christou’s) desire to be shot of him. It might then be relevant to show that the privileged communication of the defamatory words was tainted by malice.

As it happens, however, no such allegation is made. It is not said that Mr Christou came up with the idea of Mr Spencer having threatened to "fix" the second Defendant; nor that he passed on to Mr Sillitoe his resentment over the Pathway project.

Accordingly, it seems to me that Miss Addy is correct in submitting that this complicated history of the Pathway project has no place in the defamation pleading. It would undoubtedly complicate and prolong the trial, with the inevitable consequence of increased cost. Additionally, Miss Addy has submitted that the inclusion of this material in the pleading is vexatious. Evidence has been produced by her instructing solicitor, Mr Edward Goodwyn, of various press coverage anticipating embarrassing publicity for the Second Defendant when the litigation comes to trial – all in the context of the Pathway project. There is no need for me to identify it or set it out in the course of this judgment, but it is Miss Addy’s submission that the inference can be drawn that Mr Spencer has included the Pathway project in his pleading for the collateral purpose of pressurising the Defendants to settle the case on generous terms for fear of publicity.

Mr Spencer told me that he had no control over this press coverage but regarded unfavourable publicity as a "legitimate weapon" in litigation, and he felt "free to enjoy it".

If it were the case that Mr Spencer had in fact orchestrated this publicity, or part of it, there would be a strong argument that he was abusing the court’s process by bringing improper pressure to bear upon the Defendants. Although he has made the point that, since his concession in February, the defamation proceedings (now to be consolidated with the contract claim) will not be tried by jury, it is necessary to remember that prejudicing a jury is not the only form of contempt that can be committed in respect of civil proceedings. Improper pressure on a litigant can also, in some circumstances, be so classified. In the result, however, it is enough to dispose of Miss Addy’s present application with regard to these paragraphs that the material is oppressive, prolix and irrelevant. I accede to her submission.

I agree also with her criticism of the second sentence in paragraph 12. This contains an irrelevant "side-swipe" at Mr Allnutt.

So too, there is another side-swipe in paragraph 18 referring to Mr Allnutt’s supposed "insecurity" and I would also strike that out.

In paragraph 20 there is another passing reference to the Pathway project and, for the sake of consistency, that too should come out.

Much of what has been considered so far applies not only to the defamation proceedings but also to the contract claim. This was launched in February 2003 and is based upon the conduct during the summer of 2000 as giving rise to a claim for breach of contract and of confidence. It is said by Miss Addy that here too the background of the Pathway project is irrelevant, since the issues ought to be capable of confinement in a way broadly comparable to those in the defamation proceedings. I agree.

There now arises, however, a new point (based on what Miss Addy calls the "Friend principle") which is unique to the defamation claim.

She invited my attention to the decision of the Court of Appeal on 29 January 1998 in Friend v. Civil Aviation Authority (unreported). This case provides authority for the proposition, at least, that where someone invokes his employer’s disciplinary procedures, provided for in his contract of employment, in respect of an allegation against him, he must be taken to consent to the repetition of that allegation during and for the purposes of the disciplinary proceedings. In some ways, this principle is analogous to the absolute privilege which covers steps taken in court proceedings. Nonetheless, the rationale is not that of privilege but of consent or volenti non fit injuria.

Miss Addy seeks to argue that this Friend principle would be sufficient to dispose of the defamation allegations from mid-August onwards, after the appointment of Miss Shirley Phillips to carry out her investigation. Miss Addy suggests that the oral communication to her on 15 August, and the provision to her of the typed-up notes of the meeting on or about the 24 August 2000, are properly to be regarded as part of the internal disciplinary proceedings. Mr Spencer should be treated as having given his consent – not in the sense that he invoked the disciplinary procedure himself, as had Captain Friend, but on the basis of having accepted the disciplinary procedures more generally by entering into his contract of employment.

Various matters have to be considered in testing the validity of this analogy, and perhaps the first issue to address is the point at which the disciplinary proceedings can be regarded as having commenced. I believe Miss Addy accepts that her argument would only prevail after that point in time. She suggests that the relevant procedure was implemented from the moment Mr Sillitoe appointed Miss Phillips to carry out the investigation.

As the Court of Appeal emphasised in Friend, "in this branch of the law the decision turns on the particular facts". It is thus clear that a judge needs to be wary of deciding matters prematurely if there are facts in dispute, requiring to be resolved at trial, which might affect the outcome. A factor which was clearly thought significant in Friend was the specific obligation upon the investigating officer "to check the motives of any informant". There was thus inbuilt protection against the risk of malicious motivation. Here the investigating officer was a newly appointed employee, answering directly to the initiator of the enquiry process (i.e. Mr Sillitoe). It is he who is accused by Mr Spencer of manufacturing the complaint and, in effect, "stitching him up".

Against that rather different background, I am not sure that I can rule at this stage that the "Friend doctrine" is dispositive of the claims in respect of the 15 and 24 August publications. I cannot be as confident as the Court of Appeal was that there was adequate protection against malicious instigation. Miss Phillips asked for "tangible evidence" to form the basis for her investigation, and what she received was Mr Sillitoe’s note of the June conversation – its origin being controversial at this stage. For the moment, therefore, I do not feel able to strike out the parts of Mr Spencer’s pleading which relate to the August publications. It does not seem to me to be clear, beyond argument, that the formal enquiry process had begun prior to the moment when that document reached Miss Phillips’ hands.

Miss Addy also had submissions to make on the subject of disclosure. These fell into two parts. First, it was said that relevant documents were being withheld. To this Mr Spencer responded that he had not yet decided on their relevance, which would depend on the witnesses he chose to call. He agreed with me, however, in argument that anything he regards as potentially relevant to pleaded issues should be disclosed forthwith.

Secondly, Miss Addy says that much that is irrelevant has been disclosed (e.g. relating to the Pathway project and to unpleaded issues, such as the circumstances surrounding a contract performed in Thailand in or about 1991). She seeks to overcome the problem by asking that Mr Spencer serve a list in compliance with the CPR; that is to say, one that only contains the relevant documents. I believe that Mr Spencer wishes to rely on these documents as part of a detailed history of his own career, in order to establish his record for probity, truthfulness and high ethical standards. It is necessary, however, to remember that claimants in libel proceedings are entitled to a presumption of good reputation. Were it not so, there might be a danger of each and every libel action turning into an extended biography of the claimant. I am not persuaded that the Pathway issue, the Thailand contract, or any other unpleaded issue, gives rise to a need for disclosure. I will therefore adopt Miss Addy’s suggestion that a new and much reduced list should be served.

Mr Spencer also agreed that he would return any documents belonging to Fujitsu that are still in his possession. I see no reason to believe that an order is required to achieve this. I will accept Mr Spencer’s assurance in this respect.