Lokhova v Longmuir

This is an application for permission to amend the Particulars of Claim in this action for defamation. The claimant presently complains of seven defamatory statements published in 2011. By an application notice issued nearly a year ago, in November 2015, she now seeks to add three further causes of action: two in libel arising from emails sent by the defendant in May 2011, and one in slander, arising from words allegedly spoken in February 2014. At the same time, the claimant seeks to expand by amendment her case on damages, by adding details of matters to be relied on in aggravation. The limitation period for defamation is one year: Limitation Act 1980, s 4A. So all the new causes of action alleged are, on the face of it, statute-barred.

The application raises the following main issues:-

In addressing those issues I shall have to consider the impact, if any, of the Reply served on the claimant’s behalf in the early hours of Thursday, 6 October 2016, one clear day before this hearing.

One thing that does not fall for decision is whether the court should exercise the power conferred by s 32A of the Limitation Act, to disapply the limitation period provided for by s 4A. As originally framed the application notice sought permission to amend “including if necessary permission under section 32A of the Limitation Act 1980 that section 4A of the Act shall not apply to the proposed amendments.” But in the course of a hearing before Nicola Davies J in July 2016 Mr Browne QC, Leading Counsel then appearing for the claimant, disavowed any such application. He made it clear that his client was relying only on CPR 17.4(2) and that if she did not get through that gateway that would be the end of her application. Mr Rushbrooke QC, who appears for the defendant today as he did then, was concerned by some wording in the claimant’s skeleton argument for this hearing, which he feared might indicate an attempt to row back on that concession. But that would need to be done without equivocation; I did not read the skeleton as resiling on what was said by Mr Browne QC; and Mr Sherborne has focused his argument on CPR 17.4(2).

From 2008 to 2010 the claimant, Svetlana Lokhova, worked for the investment bank Troika Dialog, now part of Sberbank CIB (“the Bank”). Having left to work for another financial institution she was approached in early 2011 with a view to rejoining the Bank, and she did so on 20 June 2011. She was a member of the Bank’s Equity Sales Team. The defendant, David Longmuir, was the Bank’s Head of UK Sales, to whom the claimant reported.

The claimant was constructively dismissed by the Bank on 18 April 2012. In May 2012 she brought proceedings in the Employment Tribunal (“the ET proceedings”) against the Bank, the defendant, and three other individuals. Her claims in the ET proceedings were for sex discrimination, harassment, victimisation and unfair dismissal. Her claim against the defendant in the ET proceedings focused on derogatory statements he had made about her during her employment.

On 14 June 2012 the claimant issued this action for defamation. In it she complains of seven publications to a total of eight individuals. The publications complained of took place in and between June and December 2011. In date order they are:

The words complained of in those publications include descriptions of the claimant as a “bi-polar coke-crazed madwoman”, and“Miss Bonkers”. The details vary but, as Mr Rushbrooke accepts, they follow a general theme of mental instability and/or drug use.

By the time the claim was issued the defendant had already apologised and offered to pay compensation and costs, and to undertake not to repeat the allegations complained of. His solicitors had written to that effect on 5 April 2012, in response to the pre-action letter sent by the claimant’s solicitors. A counter-offer was made on 8 June 2012. But no agreement was reached, and proceedings were issued.

Particulars of Claim settled by Leading Counsel were served on 26 October 2012. They made the following allegations of damage, at paragraph 10: “By reason of the said publications and each of them the Claimant has suffered serious injury to her personal and professional reputation, and has also been caused considerable distress and embarrassment.”

At paragraph 11 the Particulars of Claim asserted that the defendant was “likely to have published the same or comparable allegations on other occasions”, and that “the claimant reserves the right to claim in respect of each and every additional such publication of which she is presently unaware but which may yet be disclosed to her…”.

By letter of 22 November 2012 the defendant made a formal offer of amends pursuant to the Defamation Act 1996. The Defence was served the following day, 23 November 2012. It did not advance any positive defence. Instead, it pleaded the offer of amends as a defence. Matters were pleaded in mitigation of damages including the limited circulation of the defamatory statements, and earlier apologies and offers of settlement by the defendant. It was pleaded that the claimant’s purported reservation of rights had no effect.

If the claimant had accepted the offer of amends, the defamation proceedings would have been at an end. By s 3(2) of the 1996 Act, “The party accepting the offer may not bring or continue defamation proceedings in respect of the publication concerned against the person making the offer but is entitled to enforce the offer … as follows.” The regime contained in the remainder of s 3 ensures that any agreed steps can be enforced and that, failing agreement, compensation may be assessed by a Judge, without a jury, on the same principles as damages for defamation. By s 4(2) an unaccepted offer is a defence unless the conditions in s 4(3) are met: these are that the offeror

“knew or had reason to believe that the statement complained of

(a)

referred to the aggrieved party or was likely to be understood as referring to him, and

(b)

was both false and defamatory of that party.”

A defendant is presumed not to have known or had reason to believe these things: s 4(3). Put another way, the burden of proof lies on the claimant. “Had reason to believe” is equivalent to the recklessness or conscious indifference which amounts to malice for the purposes of qualified privilege. In substance, these provisions require a claimant to prove malice of that variety, if he is to defeat an offer of amends: Milne v Express Newspapers plc [2004] EWCA Civ 664; [2004] EMLR 24. Failure to do so will result in the dismissal of the claim.

Generally speaking, a claimant whose main aim is vindication has little incentive to take on the risks involved in rejecting an offer of amends. Ordinarily, such an offer will have a substantial mitigating effect on compensation; there is what is often referred to as a “discount” for making an offer. So claimants who accept offers of amends will normally recover less in compensation than they would if they pressed on to a trial. But the reason for that is that the offer will normally have reduced the harm to reputation and feelings that would otherwise be caused by the defamation. It will have done that because the offer involves a correction and apology, normally made by a statement in open court and often accompanied by a published repetition.

The offer of amends provisions relate to “the statement complained of.” Any offer must relate to one or more such statements. The bar on proceedings imposed when an offer is accepted relates to “the publication concerned”.

Initially Ms Lokhova neither accepted nor rejected Mr Longmuir’s offer. Her position was set out in a letter of 28 February 2013. This said that she was “minded to accept” the offer, but “subject to the issue of comprehensive disclosure”. She was not convinced that she knew the full extent of what her solicitors called the defendant’s “defamatory campaign” against her. Disclosure in the ET proceedings was said to be continuing. The solicitors wrote that they did not anticipate being in a position to respond to the offer of amends until “the employment trial has ended and the outstanding disclosure issues have been resolved”. They proposed a four week adjournment of the Case Management Conference in the defamation action, because the ET proceedings were then expected to end on 23 March 2013.

The ET proceedings were not concluded by then, and in the event the parties consented to an order made by Master McCloud on 29 May 2013 that “The Case Management Conference be stayed until four weeks after disposal (whether by hand down of judgment or settlement)” of the ET proceedings.

On 28 October 2013 the Employment Tribunal handed down its reserved judgment. It held there had been sex discrimination, harassment, victimisation and unlawful dismissal. The judgment included a finding that Mr Longmuir “had the purpose of creating an adverse environment for [the claimant] and it was not merely the effect of his comments that did so”. The Tribunal found that he had “set about his campaign in a whole hearted and vigorous manner, using any opportunity to undermine and criticise the Claimant in the most unpleasant manner”. The claimant, in her second witness statement, describes the Tribunal as having found Mr Longmuir “… guilty of discrimination and gender-related harassment against me, and of conducting a malicious and persistent campaign to ruin my reputation among my work colleagues and superiors, clients of the Bank and third parties.”

The Tribunal’s judgment on remedies was dated 5 March 2015. It awarded the claimant £1.75 million net. The damages award was principally composed of compensation for financial loss flowing from damage to the claimant’s health as a consequence of her treatment. It did include, however, £15,000 in aggravated damages in respect of an allegation made by the respondents during the proceedings that the claimant used drugs, supplied by her partner. The Tribunal held that this allegation should never have been put to her, and was “a deliberate, planned and unnecessary misuse of the proceedings…”.

The respondents and the claimant both sought to appeal the Tribunal’s decisions but in due course both sides withdrew their appeals. As I observed in the course of argument, it would seem to follow that the Tribunal’s findings of fact are conclusive and, to the extent that they bear on the issues in the present action, binding on both parties.

There was a related or parallel action brought by the claimant, Lokhova v Tymula, in which a stay order was made in terms very similar to those of Master McCloud’s order of 29 May 2013.In February 2016 Dingemans J held that on a proper interpretation of the order in Lokhova v Tymula the stay expired on 3 April 2015, four weeks after the Tribunal’s decision on remedies: [2016] EWHC 225 (QB) [43], [116]. Neither side has suggested that I should reach any different conclusion in this case, and I agree with Dingemans J for the reasons he gave.

On 26 May 2015 the claimant’s solicitors wrote further about the offer of amends. They asserted, wrongly, that the “stay of these proceedings” was still in place. But they continued as follows (the emphasis is mine):

“Having said the above, as you may have already anticipated, our client rejects your client’s offer of amends. It is clear from your client’s subsequent actions and statements both in the Employment Tribunal proceedings and elsewhere, that the offer to make amends is disingenuous. It is equally clear that he was malicious in making these statements. Our client will be relying on statements made by your client in the Employment Tribunal and to third parties to make out her claim for malice.”

The defendant did not respond.

It was not until 30 September 2015 that anything further was said or done by the claimant. By letter of that date her solicitors wrote that she would be “reactivating these proceedings” once the respondents had withdrawn their appeal against the Tribunal’s remedies judgment. They repeated the assertion of May 2015 that Mr Longmuir’s actions revealed “a clear pattern of dishonest and disingenuous conduct”. They complained that despite the offer of amends he had continued to make defamatory statements about the claimant, knowing them to be untrue “both in the Employment Tribunal proceedings and elsewhere”; that he was not genuinely remorseful; and that “his supposed apologies and expressions of regret are entirely insincere.” It was said that the “result” of this was that “vindication can only be obtained by [the claimant] pursuing her claim against your client and obtaining a judgment in her favour.”

The letter went on to advertise the claimant’s intention to make the three further claims which she now seeks to add by way of amendment: “In the light of events and further statements that have come to our client’s attention since she filed her Particulars of Claim on 26 October 2012, our client will be seeking to amend her claim…” The intended claims were outlined.

The application notice seeking permission to amend was not filed until 20 November 2015, some seven weeks later.

The application notice seeks, so far as relevant, “An order under CPR Part 17 that the claimant have permission to amend her Particulars of Claim as per the draft attached to this Order, on the grounds that such an order would be in the interests of justice and in accordance with the overriding objective ….”

The draft Amended Particulars of Claim are in fact dated 23 November 2015, as are the supporting witness statements of Mr Shanmuganathan and the claimant. The draft amendments fall into two broad categories. They seek to add the three new causes of action I have mentioned, which are:-

It is alleged in the draft pleading that the claimant’s failure to include the two libels complained of in the original Particulars of Claim “was caused solely by the failure of the Bank and the defendant to provide proper disclosure following Data Subject Access Requests and requests in correspondence made by the claimant and the defendant’s refusal to allow his computer to be examined for further publications of this nature ….”

The second main feature of the draft amendments is a lengthy plea in aggravation of damages. This is wholly new. It is unnecessary to set it out. It contains the following main features of significance.

All of this is pleaded in support of the claims for general damages and aggravated damages. No amendment is proposed to the pleaded case on injury to reputation, which would remain as set out above. No claim is made for special damage. The slander is said to be actionable without proof of special damage on the basis that the words were calculated to disparage her in her profession or business.

On 6 May 2016 the defendant filed a witness statement of his solicitor, Mr Hurst in opposition to the application. On 29 July 2016, on appeal from the Master, Nicola Davies J decided that the application should be heard by a Judge not a Master. This hearing was then fixed for 10 October 2016. It will be apparent that the hearing of the claimant’s application has been much delayed. But neither side suggests that for present purposes I should attribute any blame to the other party in respect of that aspect of the delay in this case.

I do however have to consider how to respond to the claimant’s delay in serving a Reply, and in filing evidence in response to the statement of Mr Hurst. As I have noted, an intention to allege malice was first intimated on 26 May 2015. It was implicit that a Reply would be served, setting out that allegation and the facts relied on to support it. But none was served at that time. The first intimation that such a document was in fact to be served came some 16 months later, in the week commencing 3 October 2016, when the claimant’s solicitors sent over an index to the proposed bundles for this hearing. But it was not until shortly after 1am on Thursday 6 October 2016 that the claimant’s solicitors actually served a Reply, along with two witness statements in response to that of Mr Hurst. Skeleton Arguments were due at 10am the following day, Friday 7 October. So the defendant was allowed one working day to address these documents.

This is a 4,000 word document with the following main features.

At the same time as the Reply, the claimant served 2^nd witness statements of Mr Shan and herself. Both were lengthy documents.

Mr Rushbrooke QC complains vigorously of the late service of this material, pointing out how little time he and his team have had to enable them to consider it and respond. He says that on a first appraisal his side may well want to apply to strike out parts of the Reply, and that I should disregard that document altogether for the purposes of this application. As for the evidence, Mr Rushbrooke complains in particular of the inclusion in the claimant’s statement of what he says is information about without prejudice offers, which the claimant is not entitled to disclose and the court ought not to see. But his complaint is not limited in that way. He invites me to disregard all of this material also for the purposes of my decision on the claimant’s application. But the defendant has also sought to respond through a further statement from Mr Hurst.

It would clearly be most undesirable for the court to see without prejudice material. I therefore did not read the claimant’s second statement until after her team had prepared and supplied a redacted version.

The late service of all this material was not in breach of any rule or order of the court. Since the court had made of its own motion an order that no Allocation Questionnaires were to be filed, there was no deadline under CPR 15.8 for the service of a Reply. No other regime had been laid down for that, or for the service of evidence in respect of the claimant’s application. It follows that there are no sanctions, and no application for relief from sanctions is necessary. Nonetheless, it is self-evidently unreasonable and unfair for one party to spring such a volume of material on the other party at such short notice, when there is much else to be getting on with. Not only does it leave little time for the opposite party to respond, it gives the applicant an unfair advantage as, by definition, the applicant knows in advance that the material will be served and what it will contain. Still less can it be fair and reasonable to behave in this way in relation to an application as ancient as this one, and in response to evidence filed five months earlier. I have considered what is said by way of explanation, but can see no reasonable excuse for the claimant’s conduct in this respect.

An explanation was given during the hearing, from which I draw the conclusion that a decision was taken to delay preparation of these materials pending the outcome of a proposed appeal to the Court of Appeal against the decision of Nicola Davies J, to allow the defendant’s appeal from Master McCloud. The claimant applied to adjourn this hearing meanwhile. But the application for permission was refused on the papers by Lewison LJ on 29 September 2016, and the adjournment application was dropped. It was then that the claimant’s team did the necessary work.

The claimant’s strategy was an unreasonable one. The prospects of obtaining permission for a second appeal on an issue of case management were always going to be poor. There was a real possibility that permission would be refused, for these reasons, before the date for this hearing. The Reply and the further evidence would, to the extent they were appropriate at all, have been needed for the hearing of this application, whatever the outcome of the appeal. There was no good reason to delay and thereby withhold them from the defendant. There was every reason not to. I consider the late service of the statement of case and the evidence to represent a clear breach of the duty cast on the claimant by CPR 1.3.

So far as the evidence is concerned I do not, however, consider that it is necessary or that it would be proportionate to disregard it altogether. I propose to take it into consideration, along with Mr Hurst’s rebuttal evidence. Because of the lack of any proper opportunity to respond, I shall treat the claimant’s evidence with caution when it comes to assessing the weight to give it. There may also be costs consequences. My approach to the Reply will appear from what follows.

If the claimant started a fresh action, complaining of the three further causes of action, she would be met with a limitation defence. The approach I should take to the claimant’s alternative proposal, to add the further claims to the existing action, is governed by s 35 of the Limitation Act 1980 and CPR 17.4(2).

Section 35(1) prescribes the effect of adding new claims. It provides, so far as relevant:

“For the purposes of this Act, any new claim made in the course of any action shall be deemed to be a separate action and to have been commenced—

(b)

… on the same date as the original action.”

A “new claim” is defined by s 35(2)(a), and includes any claim involving the addition of a new cause of action.

Section 35(3) to (5) set limits on the court’s power to “allow a new claim … to be made in the course of an action after the expiry of any time limit under this Act which would affect a new action to enforce that claim”. The High Court may not allow this to be done “except as provided by … rules of court”, and a new claim involving a new cause of action can only be allowed

“if the new cause of action arises out of the same facts or substantially the same facts as are already in issue on any claim previously made in the original action.”

The relevant rule of court is CPR 17.4(2). This provides that the court may allow an amendment whose effect will be to add a “new claim” but

“… only if the new claim arises out of the same facts or substantially the same facts as a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings.”

This wording differs from that of the parent Act, as it is narrower, but in Goode v Martin [2002] 1 WLR 1840 the Court of Appeal held that the principle of construction in s 3(1) of the Human Rights Act 1998 applies, so that the rule should be interpreted and applied as if it read as follows:

"… only if the new claim arises out of the same facts or substantially the same facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings." (Emphasis added.)”

(see [46]-[50]).

I cannot accept Mr Rushbrooke’s submission that this interpretation of the rule was one confined to or driven purely by the particular facts of that case. I regard Goode v Martin as clear and binding authority on the meaning to be given to the rule in general. The first issue is, therefore, whether the new claims meet the CPR 17.4(2) test, as so interpreted. In Economou v de Freitas [2016] EWHC 1218 (QB) [46] I summarised the approach to be taken, in terms to which both parties have referred:-

“The approach the court should take in determining whether a new claim arises out of facts which are the same or substantially the same facts as those in issue on an existing claim has been considered in a number of authorities. The following points of relevance emerge:

(1)

“The policy of [s 35] was that, if factual issues were in any event going to be litigated between the parties, the parties should be able to rely upon any cause of action which substantially arises from those facts.” Lloyd's Bank plc v. Rogers [1997] TLR 154 (Hobhouse LJ).

(2)

“Whether one factual basis is ‘substantially the same’ as another factual basis obviously involves a value judgment, but the relevant criteria must clearly have regard to the main purpose for which the qualification to the power to give permission to amend is introduced. That purpose is to avoid placing a defendant in the position where if the amendment is allowed he will be obliged after expiration of the limitation period to investigate facts and obtain evidence of matters which are completely outside the ambit of, and unrelated to those facts which he could reasonably be assumed to have investigated for the purpose of defending the unamended claim.” Goode v Martin [2001] 3 All ER 562 (Colman J).

(3)

“The substance of the purpose of the exception in subsection (5) is thus based on the assumption that the party against whom the proposed amendment is directed will not be prejudiced because that party will, for the purposes of the pre-existing matters [in] issue, already have had to investigate the same or substantially the same facts”: BP plc v Aon Ltd [2006] 1 Lloyd’s Rep 549 [54] (Colman J). This passage was later described as “helpful” by the Court of Appeal in Ballinger v Mercer Ltd [2014] EWCA Civ 996, [2014] 1 WLR 3597.”

As Mr Sherborne submits, the evaluative exercise referred to by Colman J in Goode involves a “qualitative judgment” or “a matter of impression”: see Chantrey Vellacott v The Convergence Group Plc [2005] EWCA Civ 290 [104] (Jonathan Parker LJ). This is a fact-sensitive exercise in comparison. In reaching a conclusion the court will inevitably need to assess what factual issues would, or would be likely to, arise if the amendment were allowed, and whether and to what extent those same matters are already in issue on an existing claim. In a defamation claim it is not enough that the new claims involve defamatory allegations the same as or similar to those already complained of; a broader assessment is required of what is and will be in issue: Komarek v Ramco Energy Plc (unreported, 21 November 2002) [62] to [65] (Eady J); Economou (above) [48]-[49].

If the new claims, or any of them, do satisfy the CPR 17.4(2) test the court has a discretion to exercise. I do not think Mr Sherborne can be right to submit, as he does, that if the threshold criterion is satisfied (as he says it is) his application must succeed. His submission is that the approach to the discretion should be simply to apply the ordinary test, that amendments ought to be allowed provided that any prejudice to the other party caused by the amendment can be compensated for in costs, and the public interest in the administration of justice is not significantly harmed. I do not agree, for three reasons.

First, Mr Sherborne’s argument overlooks the need, whenever a new claim is put forward, to consider whether it is a tenable claim which ought to be allowed to proceed. This no doubt is because the claimant’s contention is that these are self-evidently serious instances of defamation. But Mr Rushbrooke submits that none of the new claims would satisfy the serious harm requirement in s 1 of the Defamation Act 2013, nor would they cross the Jameel threshold (Jameel (Yousef) v Dow Jones Inc [2005] EWCA Civ 75, [2006] QB 946); they are so weak on their merits as to be an abuse of process which the court is duty bound to prevent. I must consider those submissions.

Secondly, amendments such as these are not like others; in most such cases, the effect of such an amendment will be to deprive the Defendant of an accrued limitation defence. That raises special considerations. Thirdly, authority is against Mr Sherborne’s submission. The issue was addressed by the Court of Appeal in Wood v Chief Constable of the West Midlands Police [2004] EWCA Civ 1638; [2005] EMLR 20. At [84] May LJ (with whom Dyson and Wall LJJ agreed) held that, in a case where permission to amend outside the limitation period was sought, and the threshold condition laid down by CPR 17.4(2) was met:-

“… the factors bearing on the exercise of the discretion … are substantially encompassed in the terms of s 32A. The judge had to decide whether it was equitable in all the circumstances… to permit this late amendment outside what would otherwise be the statutory limitation period.”

Section 32A(1) of the Limitation Act 1980 allows the court to disapply the limitation period under s 4A

“If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which—

(a)

the operation of section 4A of this Act prejudices the plaintiff …, and

(b)

any decision of the court under this subsection would prejudice the Defendant …”

When addressing these questions the court is required by s 32A(2) to have regard to all the circumstances of the case, and to three matters in particular, all of which are in my judgment relevant in the present case:-

“(a)

the length of, and the reasons for, the delay on the part of the plaintiff;

(b)

where the reason or one of the reasons for the delay was that all or any of the facts relevant to the cause of action did not become known to the plaintiff until after the end of the period mentioned in section 4A—

(i)

the date on which any such facts did become known to him, and

(ii)

the extent to which he acted promptly and reasonably once he knew whether or not the facts in question might be capable of giving rise to an action; and

(c)

the extent to which, having regard to the delay, relevant evidence is likely—

(i)

to be unavailable, or

(ii)

to be less cogent than if the action had been brought within the period mentioned in s 4A.”

It is well-established that the court will be hesitant to exercise its discretion under s 32A, for reasons most recently elaborated in Bewry v Reed Elsevier UK Ltd [2014] EWCA Civ 1411, [2015] 1 WLR 2565.

It is submitted by Mr Sherborne that the new claims arise out of facts that will be in issue in any event if I grant his client permission to amend to expand her damages claim in the manner sought. On the face of it facts cannot be already in issue on an existing claim if at the time the application is made the facts are not yet pleaded, but are only put forward as part of the same set of proposed amendments as the new claims. This seems to have been the view of Hobhouse LJ in the Lloyds Bank case, on the basis that “the statute has to be strictly construed”, but his observation was obiter and the case was decided under different rules and before the Human Rights Act. Mr Rushbrooke has not taken this point. It could be circumvented by, for instance, issuing two applications in quick succession. I do not think it would be right to decide the application on this somewhat technical basis.

I do however accept Mr Rushbrooke’s submission that the grant of permission to amend in this respect should be anything but automatic, and that I should carefully scrutinise the proposed plea in aggravation. The Claimant’s belated decision to plead a case in aggravation, coupled with reliance on that plea as a basis for adding three new statute-barred causes of action does look somewhat circular, and somewhat artificial. A claim in defamation is, or ought to be, primarily about injury to reputation. Damages for injury to feelings are parasitic; they are recoverable if but only if the publication is defamatory, and crosses the Jameel threshold. The power to allow amendments is to be exercised in accordance with the overriding objective. Pleas in aggravation can sometimes be over-elaborate, calling for factual enquiries that are disproportionate to what is truly at stake. One must be careful not to let the aggravated damages tail wag the cause of action dog. Among the court’s case management powers is the power to exclude an issue from consideration: CPR 3.1(2)(k). The scope of the case is not just a matter for the parties’ choice. If the overriding objective requires it, the court should and will rule out, or decline to permit the incorporation of, issues which it would otherwise have been legitimate to raise.

Further and in the alternative, Mr Sherborne relies on the Reply as a basis for contending that the new claims arise out of matters that are already in issue on the existing claims. This approach also smacks of tactical manoeuvring, given the very late service of the Reply, and the way it is pleaded. The facts alleged in the Reply were certainly not “already in issue” at the time the application notice was filed in late November 2015. At best, they became facts in issue just before the hearing, on 6 October 2016. The Reply came out of the blue. It bears signs (such as typographical errors and repetition) of being prepared in haste. It also came out of sequence. Ordinarily, the order of events would have been permission to amend the Particulars of Claim, consequential amendments to the Defence, and only then the service of a Reply. I find force in Mr Rushbrooke’s submission that the decision to plead a Reply in these terms, at this point in time, was evidently driven by a belated decision to rely on it in support of the application to add the new claims, in the way that Mr Sherborne now seeks to do. That approach is open to the same criticism as reliance on a late decision to plead in aggravation of damages. I can also see much force in Mr Rushbrooke’s (understandably) brief submissions as to the substantive merits of the Reply, to which I shall return. But I reject Mr Rushbrooke’s invitation to disregard the Reply altogether.

Mr Rushbrooke refers me to a decision of Langley J in Compagnie Noga d’importation et d’exportation SA v Australia & New Zealand Banking Group Ltd [2005] EWHC 225 (Comm). Langley J dismissed an application for permission to add new claims outside the limitation period on the basis that they arose out of the same facts as the claimant proposed to plead in an Amended Reply to which, it was said, no reasonable objection could be taken. The Judge agreed that the Amended Reply would normally be permitted as a response to what had already been pleaded in the Defence, but rejected the claimant’s submission. He considered that the new claims were wholly distinct in principle and amount from any claims advanced in the original claim, and that Goode v Martin was distinguishable on its facts. At [41] and [43] he held that

“… in any event I do not think it would be a proper exercise of discretion to permit service of the Amended Reply (or the amended claim on that basis) if it is to be used for seeking to avoid the time-bar consequences which would otherwise follow. That would, in my judgment, be to put the cart before the Trojan horse.

…

The consequence is that whilst I would and will permit the amendments to the Reply to be made I will not permit the claim to be amended in reliance on CPR 17.4(2).”

There has been debate about how this decision is to be interpreted. I do not accept Mr Sherborne’s submission that Noga is to be distinguished from the present case on the basis that in Noga the claimant required permission to amend its Reply. Langley J accepted that there was no reasonable objection to such permission, and granted it. My own view is that Noga provides a valuable illustration of how the tactical use of a Reply as a “Trojan horse” may lead the court to refuse permission under CPR 17.4(2) as a matter of discretion, even if the threshold test is satisfied.

The time and costs devoted to this case risk becoming disproportionate to the importance of the claim, if indeed they are not already. I do not, in saying that, mean to downplay the seriousness of the claimant’s claim, or of the issues to which it gives rise. But the evidence tells me that the claimant is prepared, according to her latest open offer, to settle for damages of £37,500 (2^nd statement paragraph 16). That, though she asserts it is considerably lower than the award she would achieve at a trial, gives some indication of what is at stake. Many of the elements of the existing claim are admitted. The main issues are (a) malice, that is to say, whether the defendant’s conduct in publishing the words presently complained of met the requirements of s 4(3) of the 1996 Act; and if so (b) the quantum of compensation, including the extent to which, if at all, the harm to reputation and feelings caused by the publications complained of has been reduced or increased by the defendant’s conduct.

As to malice, it appears to be the claimant’s case that the Tribunal has already found in her favour, or at least that its factual findings take her a long way towards a finding of malice. There has been no detailed investigation of that question on this application, and I reach no settled conclusion on it. But there does appear to be something in the point, and the parties should consider it carefully. As to quantum, there is little room for dispute about what offers have been made; the substance of the issue is what if any mitigating effect those offers have had, or should have had. Proportionality, fairness to both parties, and the need to make efficient use of the court’s resources demand that the factual investigations to be undertaken for these purposes be kept within reasonable bounds, and that there be limited if any investigation of collateral or peripheral matters.

I approach the application under CPR 17.4(2) on the basis that formally speaking, given the terms of the Reply, the new claims do arise from facts which are the same or substantially the same as facts which are in issue on the existing claims. The facts from which the new claims arise would also be in issue on the existing claims if I were to grant permission to add the aggravated damages plea in full. So if that was something I should do, it would provide a separate and additional basis for concluding that the threshold requirement in CPR 17.4(2) is satisfied. However, for the reasons that follow I exercise my discretion to refuse permission to add the new claims; I refuse permission to plead the same matters in aggravation of damages; and I shall strike out of my own initiative those parts of the Reply which rely on the same matters.

In summary, my reasons for refusing the application under CPR 17.4(2) are as follows. I expand on each of the following five points in the paragraphs which follow.

The first libel claim concerns a single publication to one individual, Mark Van Loon. The claimant’s case before the Tribunal was that Mr Van Loon was a co-conspirator with the defendant. The evidence is that shortly before he received the email Mr Van Loon had described the claimant as someone “nobody wants” and her hiring as “crazy”. The offending email was sent in response. It is hard to believe that serious reputational injury resulted. Nothing specific is pleaded in that regard. Further, whilst the new claim relates to a publication made before the claimant re-joined the Bank, she was subsequently engaged by the Bank so it plainly did not have an adverse effect in that respect. The serious harm requirement does not apply to this claim, but if it did the claim would not pass muster. As it is, the claim would fall to be dismissed on Jameel grounds.

Among the reasons for that is the fact that the claimant already has a claim on the record in respect of the publication of a similar message to Mr Van Loon. To the extent that she needs vindication in that respect, the existing claim is an adequate vehicle. Further, on the claimant’s case the publication to Mark Van Loon took place when he was in Russia. If so, the double-actionability requirement applies. The claimant’s pleaded case relies on the so-called presumption that foreign law is the same as English law. But the presumption is rebuttable. It is at least a possibility that a fair disposal of this claim, were it allowed to go forward, might involve investigation of Russian law, with the expense that would involve.

The second libel claim concerns an email to a single individual, which described the claimant as a “bi-polar coke-crazed madwoman” but did not name her. The draft Amended Particulars of Claim contain what appears to be a speculative plea that the court should infer that she was identifiable to the recipient, based on the “the recipient’s previous dealings with the defendant and/or the Bank”. The recipient’s identity was however unknown to the claimant. She therefore could not allege that serious harm to reputation resulted, and she did not, save in the general terms set out in the original pleading. There is no evidence of harm. The defendant’s evidence is that the individual was a friend of his, who did not know the claimant, did not work in the City, and has since died. If the pleading discloses a reasonable basis for a claim it barely does so. The claimant could not say she needs vindication. This claim also would fall to be dismissed on Jameel grounds.

The defendant denies that he spoke the allegedly slanderous words. There is good reason to doubt that publication could be proved. The conversation took place 2 ½ years ago. There is no recording. The claimant is evidently unable to plead the full conversation. She says she has evidence to prove the extracts she has pleaded, but there is no witness statement from Mr Dayan, and no explanation for the absence of a statement. Mr Hurst (2^nd statement) says he spoke to Mr Dayan on 18 December 2015. And was told that Mr Dayan “barely recalled” meeting Mr Longmuir in February 2014, and did not recall the words alleged. An attendance note is produced to support this evidence.

Further, this would be a publication after 1 January 2014, so the serious harm requirement applies. In my judgment the draft pleading does not sufficiently state a case that this publication caused serious harm to reputation, and thus sets out no reasonable basis for a claim. There is nothing specific to this alleged slander, and the gravity of the allegations coupled with a mere assertion of serious injury will not suffice. In any event there is no evidence that this publication, if it took place, caused serious harm to reputation. The evidence suggests the contrary. The claimant has no evidence on the point. The evidence of Mr Hurst indicates that whatever was said left no lasting impression on Mr Dayan. Even if the claim crossed the serious harm threshold it would barely do so, and would fail on Jameel grounds. The costs and time that would need to be devoted to investigating the claimant’s contentions would be out of all proportion to the value of what might be achieved as a result.

In Bewry at [5] Sharp LJ summarised the well-established jurisprudence on s 32A in this way:

“The discretion to disapply is a wide one, and is largely unfettered: see Steedman v British Broadcasting Corpn [2002] EMLR 318, para 15. However it is clear that special considerations apply to libel actions which are relevant to the exercise of this discretion. In particular, the purpose of a libel action is vindication of a claimant’s reputation. A claimant who wishes to achieve this end by swift remedial action will want his action to be heard as soon as possible. Such claims ought therefore to be pursued with vigour, especially in view of the ephemeral nature of most media publications. These considerations have led to the uniquely short limitation period of one year which applies to such claims and explain why the disapplication of the limitation period in libel actions is often described as exceptional.”

It could not be and is not disputed that there has been some delay in putting forward the new claims. The extent of the delay and the reasons for it have been hotly contested. My conclusions are these:

The “relation back” doctrine implemented by s 35(1) of the Limitation Act means that if the application were to succeed the new claims would be deemed to have been commenced on 14 June 2012. But by that date the two libel claims were both already statute-barred. The claimant has not sought to rely on s 32A of the Limitation Act; she has expressly disavowed reliance on that provision. Nor has she put forward any other basis on which she might avoid or defeat the limitation defence which would inevitably be pleaded. Given my conclusions on delay, it is hard to see how she could. It seems therefore that the grant of permission to add these claims would be pointless.

The slander claim would not be statute-barred if amendment were permitted. That is because the cause of action did not arise until some 20 months after the claim form was issued. The procedural propriety of relying on CPR 17.4(2) to add a statute-barred cause of action for slander which arose after the issue of the claim form has been questioned by Mr Rushbrooke but not explored in any depth. In view of my other conclusions it is not necessary to grapple with the point.

The defendant would be prejudiced by the need to defend one or more claims which otherwise would be time-barred. If I am right in the conclusions I have just expressed it would be only one claim: the slander claim. If I am wrong, it would be all three claims. If Mr Sherborne is right, as he may be, the defendant would not advance any affirmative defence other than a further offer of amends. The issues would be malice and compensation. But the defendant would be exposed to additional litigation time and cost and additional liability, at a relatively late stage. I do not attach weight in this respect to the fact that the defendant is being indemnified by the Bank.

I do not accept that the claimant would suffer material prejudice if I refuse permission. She has no need for these claims, in order to secure the vindication she says she seeks. It is far from obvious that, as the claimant’s solicitors assert, such vindication can only be achieved by rejecting the offer of amends and proceeding to a trial on malice as well as quantum. But assuming for present purposes that this is so, the claims that are presently pleaded seem to me to be amply sufficient for the purpose.

The claimant’s evidence explains one reason why she wishes to amend. Mr Rushbrooke submits that this is the only or main reason. It does appear to be the or a dominant reason. What the claimant says is this:

“If I am not allowed to amend my claim to add these new statements, I will be at risk for substantial costs because of offers that the Defendant has made previously. While that is irrelevant for the Defendant, as the Bank is paying his legal costs, I am an individual who is having to fund this litigation myself. This would also be rewarding the Defendant for his concealment of defamatory statements made about me and for his aggressive litigation tactics. It is therefore critical that these amendments are allowed, in order that the entirety of the Defendant’s campaign (or as much of it as I have been able to obtain through the unsatisfactory disclosure so far) can be before the Court.”

It is not easy for me to understand the point, or to assess its merit, when (for good reasons) I am not aware of the full picture so far as offers of settlement are concerned. I do not find the allegation of concealment persuasive. Whatever might be said of the periods before disclosure, the emails were made known by the defendant in early 2012 and early 2013, and the explanation for the late disclosure of the second email is on its face convincing. I note that there has been no suggestion that reliance could be placed on concealment for limitation purposes. In any event, it would not be right to grant permission to amend, if otherwise it should be refused, just because refusal might have adverse costs consequences for the claimant.

I have already identified the points I have in mind, when addressing the merits and Jameel. In a nutshell, the remaining issues in the claim can and should be disposed of in a just and proportionate way without the needless complexities that would be added by the introduction of the new claims. To allow the introduction of those complexities would, in particular, tend to undermine the objective of dealing with cases at a cost which is proportionate. Mr Sherborne may be right to say that the publication of the emails cannot be disputed, and that the defendant has no affirmative defence (such as truth). But the slander allegation can be and, I am confident would be, disputed. Even if, as one might suppose, the defendant’s response was to make a further offer of amends there would still be dispute over harm and compensation, of the kind that has been engaged in on this application. There is no justification for that.

In reaching these conclusions I have of course borne in mind the question of whether the same or substantially the same issues would arise in any event from the aggravated damages plea or the Reply. I have concluded that they will not.

I refuse permission to add anything arising from the three publications or alleged publications which are the subject of the proposed new claims. I do so in the exercise of my discretion, for these main reasons: (a) reliance on these matters is not necessary in order to make any of the points relied on in aggravation; the existing claims are sufficient basis for that; (b) further instances of the same allegations are not probative of malice; (c) it is necessary, for case management reasons, to control the scope of the aggravated damages plea within sensible bounds. The precise impact of this decision on the draft pleading will need to be worked out but that should not be difficult. It will require the elimination of any reference to the three publications in question.

I allow the claimant to rely on the first of the points listed at [30] above (gravity of allegations). She may also rely on the allegation of a “sustained campaign”, save to the extent that allegation relies on any of the three new claims. The draft will need adjustment on this account. She may not however rely on the conduct of “other members of the claimant’s team at the bank”; no or no adequate basis is pleaded for holding the defendant liable for this. For the same reason I refuse permission to rely in aggravation on the conduct of the Bank in the ET proceedings. I am, just, persuaded that it is legitimate to plead reliance on the defendant’s own conduct under cross-examination in the ET proceedings; I am somewhat uneasy about the legitimacy of such a claim in law, and the substantive merits of the point are not plain and obvious, but these issues need more careful attention than was possible on this application.

Reliance on the Tribunal findings is in principle legitimate for the purposes I have identified above, but that is not the way the case is presently put. The basis for relying on them is not and ought to be spelled out. Until it is I refuse permission for that part of the draft pleading. I also refuse permission for paragraph 10.6 which refers to “context” without any clarity as to what is meant, and again seems to rely on the conduct of others. The allegation of malice is legitimate in principle, but must not include any reference to or reliance on the three new claims, and should match the corresponding allegation in the Reply (to which I shall come). Paragraph 10.9 falls with my refusal of permission to advance the new claims.

Turning to the Reply, acting on my own initiative pursuant to CPR 3.3 I strike out all references to the three publications alleged by way of new claims; this involves the removal of paragraphs 4.3(b), (c) and (f), 5.5, part of 5.6 (the reference to what was allegedly said to Mr Dayan) and 8. I reject Mr Sherborne’s submission that I should only take such a course if persuaded that the contention in question was fanciful. I act under CPR 3.1(2)(k), to keep the issues proportionate and under sensible control. I shall also strike out of my own initiative the proposed reliance on the conduct of the Bank in the ET proceedings (paragraph 4.3(d)) and the contentions in paragraph 5 that the claimant “is and has at all times been unable to accept” the offer of amends, and that the offer of amends was “incapable of acceptance by her”. In these respects, I act under CPR 3.4(2). I do consider these contentions to be fanciful, misconceived in law, and bound to fail. The defendant is not responsible in law for the actions of his then employer, and no other basis is adequately pleaded for holding him responsible. The proposition that an offer of amends is “incapable of acceptance” if disingenuous or insincere is unsupported by any authority and in my judgment contrary to the whole scheme of ss 2-4 of the 1996 Act.

The claimant is entitled to seek to discharge or vary this last part of my order, striking out parts of the Reply. I did indicate in the course of argument that I had in mind the possibility of taking this course, and invited Mr Sherborne to address me on the principle, which he did; but I did not set out precisely what it was that I had in mind to do. In my view, therefore, this is in substance an order made of the court’s own initiative, without notice, and without giving the parties an opportunity to make representations, and there is a right to apply to discharge or vary the order pursuant to CPR 3.3(4) and (5).

Any such application should be made by notice filed within 5 days after the handing down of this judgment. If made, the application will be heard at the Case Management Conference which I shall direct to take place on a date to be fixed. At that hearing the court will deal with