Morgan v Associated Newspapers Ltd

I have given two interim judgments in relation to this claim previously. The first, on 28 June 2018 ([2018] EWHC 1850 (QB)) in relation to the determination of meaning and whether the words complained of made allegations of fact or were expression of opinion (“the first judgment”). The second on 6 July 2018 ([2018] EWHC 1725 (QB)) in relation to serious harm (“the second judgment”).

The article that gives rise to this claim for libel is set out in [4] of the first judgment. The applications that I now have to deal with mean that it is convenient for me to set out the meaning that I found the article bore in its natural and ordinary meaning from [3] of the second judgment –

“(a)

the Claimant was able to take advantage of an opportunity to purchase six houses built by his company that were intended to be sold for less-well off buyers as affordable homes – but which had failed to sell - after his company had been successful in getting local authority planning rules changed;

(b)

he purchased the six properties at a substantial discount, £860,000 against a market value of £2.1m and, as a result, stood to make a very large personal gain; and

(c)

in consequence, the Claimant had exploited his position to line his own pockets in a greedy, unethical and morally unacceptable way.”

As to fact or opinion, I was satisfied that element (a) and (b) from that meaning were factual in nature and not themselves defamatory. I found element (c) to be an expression of an opinion based on the conduct of the Claimant in (a) and (b).

The Defendant filed a defence on 9 March 2018, that was before the court had determined meaning and the fact or opinion question. The reverberations of that decision continue to complicate matters as I shall explain below. In the original defence, the Defendant advanced substantive defences of honest opinion in paragraph 5 and truth in paragraph 6. The original meaning, "the Control Risks meaning", sought to defend as honest comment:

The Control Risks meaning was significantly different from the one found to be the single meaning of the article. In particular, no element of meaning (b) was to be found in the Control Risks meaning.

The facts the Defendant, at that stage, relied upon in support of its honest opinion defence was set out in paragraphs 5.1-5.25. Naturally, they directed at supporting the Control Risks meaning I have set out. In consequence, they did not include any factual averment as to whether the Claimant had purchased the relevant houses at a substantial undervalue.

The honest opinion defence has now been placed on a statutory footing. s.3 of the Defamation Act, 2003 provides, so far as material to this case,

Any facts relied upon under subsection 4(a) must be true facts that existed at the time the statement was published. The burden of establishing that is on the defendant. CPR Party 53, Practice Direction para. 2.6 provides:

The original Application Notice of the Claimant, dated 18 May 2018, seeking to have meaning and fact and opinion determined as preliminary issues, additionally sought the following further orders –

By order dated 19 June 2018, I directed that these issues would not be determined at the same time as the meaning and fact opinion preliminary issues. The reason for that was that the parties would, I thought, benefit from a period of consideration of where they stood following the determination of the preliminary issues.

Following determination of the preliminary issues, the consequent order provided for service of amended Particulars of Claim and the service by the Defendant of a draft amended Defence. This is the first of the reverberations that I referred to above. If the Defendant had not served a defence, then it would not have needed permission to amend. It would simply have served its Defence in response to the amended Particulars of Claim. Additionally, I ordered that, if the Claimant objected to any of the proposed amendments, such objections were to be indicated by the Claimant by 23 July 2018.

Given the state of flux, no Reply has yet been served. The extent to which there is a factual dispute as to the matters pleaded in the existing Defence is not clear on the face of the pleadings, but some of the issues of contention have become clearer as a result of the service of a large number of witness statements.

Objections were taken to some of the proposed amendments and so, on 17 October 2018, the Defendant issued an Application Notice seeking permission to amend its defence.

Strictly, the correct way to approach these two applications would be to deal with the application to amend first. However, for reasons that will become apparent, I have decided to deal with them together because there is a substantial overlap in the submissions that are made in support of and against the amendments sought in the context of the Claimant's application for summary judgment.

Before turning to the particular amendments for which the Defendant seeks permission, I need to summarise the factual case advanced on the existing statement of case.

Paragraphs 5.1-5.2 set out matters relating to the Claimant; that he is the owner of Carden Hall Estate, which includes Carden Park a hotel with golf facilities and that he founded Redrow Homes Limited, said to be one of the UK's largest home builders. Specifically, it is contended that the Claimant is the Chairman of Redrow and has, "overall responsibility for the management and governance" of Redrow and is also a "controlling shareholder".

Some care needs to be taken about these corporate entities because there is a Redrow Plc and also a Redrow Homes Ltd. It is in relation to the former that I understand that the Claimant has management responsibility or control as alleged, not in relation to the latter company which is the company that built the homes that are at the centre of these proceedings.

Paragraphs 5.3-5.4 set out the basic legislative and policy framework arrangements for affordable housing. Specifically, it is contended that, "the primary vehicle for the development of new affordable housing in the UK is by way of deed of planning obligations pursuant to s.106 of the Town and Country Planning Acts, 1990", referred to as a s.106 agreement. Such agreements require a proportion of those homes built in private developments to be affordable housing as a condition of the grant of planning permission.

Paragraphs 5.5-5.6 set out the Defendant's case as to the particular needs for affordable housing in the Cheshire West and Chester area. Paragraphs 5.7-5.13 set out details of the Defendant's case as to the original grant of planning permission to Redrow in August 2012 to build 31 residential units on a site on the edge of the village of Stretton in Cheshire. The golf courses, part of the Carden Park Hotel, are said to be adjacent to the development site.

The original s.106 agreement agreed between Cheshire West and Chester Borough Council and Redrow contained terms as to the provision of affordable housing in the development. The Defendant alleges that the Council "reluctantly" agreed to the provision of 6 affordable housing units as part of the development. It is alleged that the Council's stated target is to ensure provision of a minimum of 35% of affordable housing in new developments. The original s.106 agreement provided that the 6 units were to be shared ownership which was required to be sold to a registered provider of social housing. Paragraph 5.11 identifies those who are registered providers and their duties and responsibilities. The registered provider was then required to sell the unit on a shared ownership lease basis for a minimum of 125 years to persons who were –

The original s.106 agreement defined the local connection criteria as those living in particular parishes, or those who had a strong local connection with those parishes. In the event that no applicants came forward from those groups, the geographical area could be progressively expanded.

Paragraphs 5.14-5.20 set out the Defendant's case as to the subsequent variation of the original s.106 agreement in around January 2016. It is alleged expressly that the variation was sought, "in order to facilitate the claimant's purchase of the affordable homes and they are used by him as staff accommodation for his estate and hotel."

The Deed of Variation, dated 24 March 2016, it is alleged to –

The Defendant contends that the variation was "strikingly unusual" and contrary to the social purpose of social affordable housing namely to provide affordable housing to local people who could not afford to rent or buy on the open market. It is contended that the effect of the variation was to enable the Claimant's employees to rent the affordable homes even though they might have had sufficient resources to access the local private sector rental market.

The Defendant also contends that the effect of the variation and particularly his being approved as a registered provider, was to leave the 6 affordable housing units outside the established regulatory and policy framework for the allocation of housing in the Borough and, in particular, the Claimant was not under a duty to cooperate with the Council in the implementation of its allocation scheme.

In the original paragraphs 5.21-5.23, the Defendant set out its case on the sale of the 6 affordable homes to the Claimant in June 2016. The original benefit that the Claimant was said to achieve was limited to –

Paragraph 5.23 drew together the strands of the Defendant's factual case in support of the honest opinion defence to allege that the Claimant –

The thrust of the original particulars was that the variation of the s.106 agreement had disadvantaged those who would have benefited from the provisions of the original s.106 agreement in the way set out in paragraphs (a)-(f) as I have set them out and to the Claimant's personal advantage.

The first paragraph to which the Defendant seeks to make amendment is paragraph 5.22. The alleged benefit that was obtained by the Claimant by the variation to the s.106 agreement is widened expressly to include "material benefit to him". Added to the three identified benefits is a fourth, alleged to be the ability "to buy the six affordable homes at a lower price than he would have had to pay for the houses on the open market". Two new paragraphs, 5.22A and 5.22B are then sought to be added by amendment under the new heading, "Discount to their true value" and they are in the following terms:

Finally, amendments are sought to be made to paragraph 5.23 to add the underlined words in the passage:

As this is an amendment application, the Defendant has filed evidence upon which it relies:

I cannot but express the view that much of this prodigious output of evidence would have been unnecessary had the preliminary issues been determined first and then the parties considered what consequences flowed from that. As it is, the determination of the preliminary issues arrived belatedly as a sort of unwelcome interruption and a row about the underlying facts. The consequences are very real however, the costs of both sides in getting this case to nearly the end of the pleadings are already in excess of £500,000. Because pleadings are not complete, there has been no formal costs budgeting, I required the filing of costs budgets for the hearing on 28 June 2018, but the matter came to court too late for any costs management order to be made.

What has been achieved in that period has been the determination of two preliminary issues which could have been determined in about a day at any time after the Particulars of Claim had been served. The parties are now deeply mired in arguments about the terms of amendments to a Defence that need not have been served prior to the determination of the preliminary issues.

The broad principle can be taken from the judgment of Peter Gibson LJ in Cobbold v Greenwich London Borough Council (“Cobbold”) (an unreported judgment of the Court of Appeal of 9 April 1999):

The commentary in The White Book draws attention to subsequent authorities that have reminded the court of other factors that need to be considered under the overriding objective when considering applications to amend.

The basic requirement that a party applying for permission to amend must show is that the proposed amendments have a real prospect of success. That is the same test as is applied when considering summary judgment.

CPR 3.4(2) provides, so far as material:

Practice Direction 3A gives further guidance:

The general approach is that evidence is not considered when an application to strike out under CPR 3.4(2) is made. Unless demonstrably and patently hopeless, the Court proceeds on the assumption that the relevant factual averments will be established by evidence at trial. A claim or defence should not be struck out unless the Court concludes either that it is bound to fail, or that the relevant factual averments do not disclose a proper basis of claim or defence. Where a statement of case is found to be defective, the Court should consider whether the defects might be cured by an amendment and, if it might be, the Court should consider refraining from striking it out without first giving the party concerned an opportunity to amend: Soo Kim -v- Youg [2011] EWHC 1781 (QB).

I consider that, in the exercise of its case management powers, the Court can and should utilise CPR 3.4(2)(b) to strike out parts of a case that are likely to obstruct the just disposal of the case. In defamation cases, that principle finds clear expression in the requirements that where misconduct is alleged against a Claimant, particulars of truth must be set out with the precision of an indictment: Higginbotham -v- Leech [1842] 10 M&W361, 363.

Historically, one of the reasons for keeping tight control of a statement of case in libel proceedings was because they were usually destined to be tried by a jury. The pleadings not only set out the issues, but they were the gateway to disclosure and then to evidence. The objective of keeping libel actions within proportionate bounds started with making sure that the statements of case were clear and contained only matters relevant to the fair adjudication of the claim. Juries may have gone now, but pursuit of the same principle remains a requirement of proper case management under the overriding objective.

That principle from Higginbotham was held to apply equally to particulars under a plea of honest opinion by the Court of Appeal in Ashcroft -v- Foley [2012] EMLR 25. The case clearly sets out the principles to be applied and the reason why the court insists on precision and clarity in pleadings. Echoing the principle from Cobbold, at first instance, Eady J noted –

When meaning was at large, pending determination by the jury, the Defendant had an opportunity to cast its own Control Risks meaning and then provide particulars to support it. The more general the meaning, the greater the parameters of what could be pleaded in the particulars. Of this, the Court of Appeal said:

As to the application of the requirement of precision to particulars to support a defence of honest opinion the Court of Appeal said:

“[60] It was suggested … that it was particularly inappropriate to rely on this rule in the context of the defence of honest comment …given the nature of that defence and its importance in the context of freedom of expression. We do not think it was. The point at issue in this case was one of clarity. Defendants are required to set out the facts on which they rely to 'warrant' the comment; see CPR 53PD para 2.6(2), and further Cunningham-Howie -v- Dimbleby [1951] 1 KB 360 and Lord -v- Sunday Telegraph [1971] 1 QB

235…" …

[71] A defendant relying on a defence of honest comment has to identify the facts on the basis of which it is said a person could honestly express the relevant comment. The importance of the defence in relation to freedom of expression and its breadth having regard to the objective test of the 'fairness' of the comment i.e. whether any person, however prejudiced, exaggerated or obstinate his views, could have honestly expressed it on the proved facts or on alleged facts protected by privilege, does not however obviate the need for the facts which are relied on to be properly pleaded in accordance with the normal requirements of clarity, nor does it alter the judge's task in ensuring that cases are fought in a proportionate way on the matters which are in issue between the parties as some of the defendants' submissions have tended to suggest. In short, it does not follow from the breadth of the defence of honest comment that a defendant is entitled to advance a loose and ineffective pleading, and we repeat what we have said earlier in relation to the need for specificity and what we have said at [60]."

Mr Rushbrooke QC has also referred me to a paragraph from Eady J's judgment at first instance in Ashcroft v Foley [2011] EMLR 30 [38], referring to the importance of the meaning pleaded by the defendant:

The parties are agreed that the principles are conveniently summarised by Lewison J in Easyair Ltd (t/a Openair) -v- Opal Telecom Ltd [2009] EWHC 339 (Ch) [15] (approved by the Court of Appeal in AC Ward and Son -v- Catlin (Five) Ltd and Others [2009] EWCA Civ 1098; [2010] Lloyd's Rep. IR 301 [24]):

“(i)

The court must consider whether the claimant has a ‘realistic’ as opposed to a ‘fanciful’ prospect of success: Swain -v- Hillman [2001] 2 All ER 91;

(ii)

A ‘realistic’ claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products -v- Patel [2003] EWCA Civ 472 at [8];

(iii)

In reaching its conclusion the court must not conduct a ‘mini-trial’: Swain -v- Hillman;

(iv)

This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products

-v- Patel [10];

(v)

However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust -v- Hammond (No. 5) [2001] EWCA Civ

550;

(vi)

Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd -v- Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63;

(vii)

On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v- TTE Training Ltd [2007] EWCA Civ 725.

Mr Rushbrooke, for the Claimant, has set out in his skeleton argument his submissions in a nutshell –

Putting it more colloquially he says, "the defence is on analysis a matter of smoke and mirrors". As to the underlying facts he submits that the true position is simple and incontrovertible –

He also makes further discrete points as to particular paragraphs of the defence. In relation to the proposed amendment to paragraph 5.22, Mr Rushbrooke submits that the amendments are a recognition that the key factual component of the meanings found by the Court, indeed, the central premise of the article, namely the proposition that the Claimant purchase the 6 properties at a substantial discount to their market value, is false. It is in consequence of this fact (meaning (b)) that the Claimant is accused of exploiting his position to "line his own pockets in a greedy, unethical and morally unacceptable way" in meaning (c).

He contends that, absent any attempt to prove this fact, the honest opinion defence will be bound fail because it would be impossible for the Court to hold, for the purposes of s.3(4) of the Act, that an honest person could have held the opinion at meaning (c) on the basis of the other facts pleaded, whether alone or in combination. There would have been no lining of the Claimant's own pockets, let alone exploitation by the Claimant of his position so as to do so.

Further, he submits that the allegation that the properties were purchased "at a substantial discount" is lacking in clarity and particularity and to the extent that it is clear what is being alleged, it is qualified in such a way that it manifestly falls short of being a coherent case as to the market value of the houses.

He draws attention to what he says are three different relevant allegations in this regard:

Mr Rushbrooke argues that the Defendant has failed to spell out what price it contends the Claimant would have had to pay for the houses on the open market. He complains that Mr Dando's fourth witness statement in support of the amendment application dismisses these objections by stating simply that there is:

Secondly, Mr Rushbrooke submits that the Defendant's case is not improved where Mr Dando then states in his witness statement that the Defendant contends that:

However, Mr Rushbrooke argues that this contradicts the pleaded case, at paragraph 5.22A, which indicates that the true value of the homes lies somewhere between £860,000 and £1.375 million without saying where. This inconsistency only adds to the obscurity of the case that he says the Claimant would be facing were the amendments to be permitted.

Finally, on this point, he submits that even if the Defendant were now to re-amend its case to plead that the "true value" of the houses was in fact £1.375 million, such a case would have no real prospect of success. His skeleton argument sets out by reference to the evidence which I have been taken through, why the figure of £1.375 million could not remotely be regarded as the true market value of the houses.

Certainly, on the evidence that I have seen it does appear that £1.375 million could only be regarded as the notional value before any allowance was made for the impairment of value as a result of the encumbrances placed on them by the s.106 agreement.

Mr Rushbrooke also raises a series of further points that can be summarised as follows –

In paragraphs 5.24 and 5.25 of the original Defence, the Defendant relied upon the reaction of locally elected representatives, including a named counsellor who was alleged to have described the Claimant's conduct as "immoral". Mr Rushbrooke submits that these paragraphs are illegitimate and should be struck out because they are of no legal relevance to the issue of honest opinion. The test under s.3(4) of the 2013 Act is an objective one, and the Court can derive no assistance on the issue from the criticisms voiced by others, whether locally elected representatives or not. He submits that the position is made even worse by the fact that those criticisms were elicited, he says, by the Defendant on the basis of what, on the Claimant's case, was a materially false account of the facts surrounding the Claimant's purchase. Finally, the alleged criticisms were not directed against the Claimant but against Redrow.

Ms Evans for the Defendant summarises her response in support of the application for permission to amend as follows –

As to the parameters of the statutory defence of honest opinion, Ms Evans argues –

Ms Evans argues that the section is clear. A defendant can succeed by proving a single fact regardless of the broader factual context, otherwise the intended liberal approach to the sufficiency of the factual basis will be diluted.

I shall start by dealing with the point on the proper ambit of the facts that can be relied upon to support a defence of honest opinion. The points argued by Ms Evans as to the proper construction of s.3 are interesting. An alternative view is argued by the authors of Blackstone's Guide to the Defamation Act, 2013 (Oxford University Press) in paragraphs 4.47-4.50.

I do not need to decide the point, but I would be inclined to accept the view of the authors of the Blackstone's Guide. If the section now permits a commentator to get all the facts to the publication wrong and yet still to have available a defence of honest opinion if another entirely unrelated fact could be proved true and upon which an honest person could express the opinion, this would represent a radical change in the law. Paragraph 22 of the Explanatory Notes as I have already noted states that condition three under s.3 was "intended to retain the broad principles of the common law defence" not overturn them in key respects.

I recognise, as the Court of Appeal did in Ashcroft, that the defence of honest opinion is one of the ways that English law protects freedom of expression. The immediate practical effect of the defence is that it relieves the commentator of the obligation to show that his or her opinion is correct. There must be a factual foundation for the opinion, but a very wide ambit is then given to express opinions based upon those facts.

The common law was progressively widened to allow a defendant to rely upon facts about which he was unaware at the time. That development is reflected in s.3. The requirement, now found in s.3(3), that the statement complained of should indicate whether in general or specific terms the basis of the opinion is an important safeguard for reputation. As His Honour Judge Parks QC noted in Burki -v- Seventy Thirty Ltd & Ors [2018] EWHC 2151 (QB) [228], this requirement, which mirrored requirements in the common law, was "not so that readers can judge for themselves whether or not it was well-founded, but so that they can understand what the comment is about". It requires there to be a nexus between the opinion and the subject upon which it is expressed.

Ms Evans has not gone so far as to suggest that an honest opinion defence could be advanced on facts entirely unrelated to those stated in the article. She accepts that a plea of honest opinion which did not address meanings (a) and (b) would fail at this hurdle. But she contends the defence does so. Meanings (a) and (b) do not limit, she says, the facts upon which the Defendant can rely, but it seems to me that they, or something very close to them, are required to be proved if the defence of honest opinion can have a real prospect of success.

Ms Evans accepts that there has to be some nexus, but she argues that the court should be careful not to constrain the parameters of an honest opinion defence to the facts stated in the article.

I think there is some force in Mr Rushbrooke's argument that the meaning that the article has been found to bare is not disjunctive, to be separated out into constituent parts that can stand in isolation. Meaning (c) starts with the words, "in consequence". That is an essential part of the meaning. It was the fundamental and expressed factual premise of the criticism that the claimant had "lined his own pockets".

I would be inclined to accept Mr Rushbrooke's submission, but not deciding the point, that for any defence of honest opinion to have a real prospect of success it must have, as one of the supporting facts, the factual averment that the claimant stood to make, "a very large personal gain" from his purchase of the houses from Redrow. Without that, the central premise of the criticism is missing. There is a permissible ambit for other facts to be relied upon as demonstrating this personal gain and how it was obtained, so long as, in the final assessment, the facts have a real prospect of demonstrating that an honest person could express the view in meaning (c) that, "in consequence the Claimant had exploited his position to line his own pockets in a greedy, unethical and morally unacceptable way".

The reason that I do not need to decide the point today is that I have reached the very clear view that the current defence should be struck out and the amendments refused, with the Defendant having the opportunity to reconsider the pleading of the honest opinion defence with a blank sheet. However, I cannot at this stage reach the conclusion that the honest opinion defence has no real prospect of success. I therefore refuse the summary judgment application and my reason for these decisions are as follows.

One of the problems with the defence is that it was originally drafted to support a meaning that the words have not been found to bare. Indeed, it was so far adrift the only commonality between the two was a contention that the Claimant had "acted unethically". Instead of reflecting upon the meaning found by the court, the Defendant has deleted practically nothing from the original pleading and simply grafted on some additional particulars purporting to defend the expression of the opinion that “the Claimant had exploited his position to line his own pockets in a greedy, unethical and morally unacceptable way.

The current pleading in my judgment presents a similar vice to that identified by the Court of Appeal in Ashcroft -v- Foley. In material respects, the current particulars fail to provide "a succinct and clear summary of the essential and relevant facts relied upon". As presently drafted and advanced, the particulars are loose and ineffective. They fail to concentrate upon, and particularise properly, the important facts. Instead, they advance loose factual assertions, the effect of which is to obscure the real issues. It is not easy clearly to identify which facts are said to support which parts of the opinion set out in meaning (c).

In their present form, if allowed to form the basis of this case, they would be likely to produce the results identified in [50] of the Ashcroft decision. The Claimant is entitled to expect, and

The Defendant may have a viable plea that the effect of the variation to the s.106 agreement was to enable the 6 properties to be removed from the available housing stock in the locality and given to the employees of the Claimant - on the Defendant's case even temporary employees. There are arguments as to the proper construction of the variations and their effect, but Mr Rushbrooke argues strongly (1) that the Claimant was not involved in the negotiations that led to those variations; and (2) in practice, this is not what has happened. At least two of the properties have been rented out to lower income families. These are not matters that I can resolve now.

However, in order for this factual case to have a real prospect of supporting the opinion that the Claimant had exploited his position, the Defendant needs to allege clearly and precisely what the Claimant is alleged to have done. In argument, Ms Evans said that this was a matter of inference: that the variation was made in the terms it was because this is what the Claimant wanted. As an inference, that might be viable, but it is not presently pleaded, and it is denied by the Claimant. It is for the Defendant to assess whether it can legitimately advance that inference verified by a statement of truth against the Claimant's denial in his witness statement.

As to the alleged ‘benefit’ that the Claimant obtained, the fundamental issue is that the current particulars, including those sought to be added by amendment, do not clearly state what benefit the Claimant obtained from the variations to the s.106 agreement. There appears to me to be presently two contentions advanced in the current defence as to the ‘benefit’ that the Claimant obtained that are capable of supporting the opinion that he had "lined his own pockets". The first is the alleged sale of the properties to him at an under-value, the second is the value that these houses represented to the Claimant as being available to him to accommodate workers from his estate or hotel.

Mr Dando is right in his witness statement to the extent that there is clearly a dispute between the parties as to the proper valuation of these properties, but that does not excuse lack of clarity as to how the Defendant puts its case. This is an area that is highly likely to need expert evidence. That, more than ever, requires precision as to what the expert evidence is directed at. Currently, as the issues are so ill-defined and appear to be a moving target, that this is a recipe for confusion and the clear risk of substantial costs will be wasted.

In any revised Defence, the Defendant must make its case perfectly clear. The valuation of these houses is subject to parameters. They were in perpetuity to be sold with restrictions on their sale and rental. To that extent, any reference to their market value must take that into account. Evidence of what these houses are worth unencumbered is almost entirely irrelevant; they could not have been sold on that basis.

Equally, the case as to the valuation of the ‘benefit’ to the Claimant of obtaining what are described as "tied houses" requires a clearly particularised case. If it is premised on the contention that the existence of the tied houses enhanced the value of the hotel and/or the estate, then that must be pleaded clearly. How does it enhance the value and by how much? If it is to be premised on the contention that, having acquired the six houses, the Claimant avoided having to acquire accommodation for his workers, then the case needs to be set out clearly. What would the capital cost of buying suitable accommodation have been, alternatively, could the claimant have rented accommodation for his employees, if so at what cost?

Ms Evans suggested during argument that the Defendant has not had enough material upon which to ascertain evidence of the calculation of benefit. Mr Rushbrooke responded that this was an attempt by the Defendant to reverse the burden of proof. He took me through the large number of documents that had been put into evidence which provide a very firm basis upon which to ascertain at least the true market value of these six houses.

I consider that Mr Rushbrooke is largely correct in his submissions. It is for the Defendant to advance a clear and specific case. I am sceptical that the Defendant does not have sufficient information and evidence to instruct an expert now to value these properties. Nevertheless, if an expert instructed by the Defendant were to identify further information that s/he required, I should expect the Claimant would readily provide it.

One of the consequences of the diffuse nature of the case against the Claimant is, as the evidence deployed for this hearing has demonstrated, that he has sought to disprove a series of hypotheses that may lurk within the vague pleading of the alleged benefit to him. That is, indeed, to reverse the burden of proof.

It is not for me to tell the Defendant how to plead its defence, but the objective is clear. The particulars must be clear and precise; they must demonstrably be capable of supporting or providing a realistic basis of supporting the opinion in meaning (c). A good start would be having headings in the pleadings setting out the facts relied upon to the case: (1) that the Claimant had exploited his position; and (2) had lined his own pockets, i.e. the very large personal gain it is alleged he stood to make. It should not require a substantial skeleton argument to explain how the particulars do, in fact, support the honest opinion defence. It should be plain on the face of the pleading.

I have considered whether this is a case where I could refuse these amendments and let the Defendant have another attempt, if it can, to produce an amended pleading that complies with these rules. In the end, I have reached the same conclusion as the Court of Appeal in Ashcroft. This is not a case where either pruning or a request for further information will solve the problem. In respect of the latter, I am quite sure that further information would not provide clarity. The pruning should, in fact, have been done by the Defendant as part of carrying out a full reappraisal of his its particulars of honest opinion following the determination of meaning. The ‘graft on’ approach was inappropriate, and it has failed.

The Defendant should return to the drawing board with a blank page and then, if it can, set out particulars of its defence of honest opinion from scratch, consistent with the Court's ruling as to the proper parameters of that defence.

I also strike out paragraphs 5.24 and 5.25 on the basis advanced by Mr Rushbrooke. It is entirely irrelevant what other people thought of what the Claimant had done. The test is objective. These paragraphs or anything similar must not reappear in any amended Defence.

Finally, there has been some argument about the issues of serious harm that arises from some of the amendments to paragraphs 7 and 8. I have ruled in the second judgment that the seriousness of the defamatory meaning has raised the inference of serious harm. The Claimant does not need to demonstrate, by evidence, anything further. If he chooses to do so, this goes to the issue of damages, not to s.1.

It is open to the Defendant, in theory, to attempt to rebut the inference of serious harm, but in mass media publications this is virtually impossible. If the Defendant intends to take on that burden then it must set out its case clearly, lest this turn out to be another area of imprecision

Insofar as paragraph 8 responds to the Claimant's case on damages generally, then provided that is made clear it would be permissible.

The final result of my decision for the reasons I have given is as follows –

The Defendant can have a further opportunity, if it can, to replead its honest opinion defence consistent with this ruling. If the repleaded particulars advance a valuation of the properties, then the application to amend must be supported by proper evidence of that valuation. On an amendment application the court must be satisfied that, evidentially, the factual case being advanced has a real prospect of being established at trial. I will hear further submissions on how long should be allowed for that process.

Finally, I refuse the summary judgment application. I cannot, at this stage, conclude that there is no real prospect of a defence of honest opinion succeeding if it can be put properly in shape. __________