Wright v Caan [2011] EWHC 1978 (QB)

[2011] EWHC 1978 (QB)Case No HQ11D00149
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 27/07/2011
Before
JUDGE RICHARD PARKES QC(Sitting as a Judge of the High Court)
Between
Sharon WrightClaimantJames CaanDefendant
Mr Richard Munden (instructed by Debello Law) for ClaimantMr Adam Speker (instructed by Grosvenor Law LLP) for DefendantHearing Hearing dates: 19 th July 2011
Judgment

HHJ Richard Parkes QC:

[1]This is an action for libel and malicious falsehood arising out of an interview which the claimant gave to the Mail on Sunday. The claimant, who invented a device for running cables safely through walls, called a MagnaMole, was a competitor on the television programme 'Dragons' Den'. The defendant is one of the 'Dragons', successful investors who have to consider proposals made to them by individuals with business plans that may or not merit support. The defendant and another Dragon, Duncan Bannatyne, were prepared to support her venture. As it turned out, the claimant's expectations seem to have been disappointed. Her account of that disappointment was given in an interview published in the Mail on Sunday and Mail Online on 15th August 2010. It was a comprehensive critique of the defendant's behaviour. The claimant's complaints were in particular that she expected an injection of £80,000 in return for equity, whereas in the event all she was offered was a loan of £80,000, with 22.5% of the equity acquired by the Dragons for a nominal sum; that the contract which she signed provided for her to pay for the expert help and advice that she had (so it appears) expected to receive for nothing; and that she was asked by the Dragons to reduce her salary from £50,000 to £12,000. For those reasons, it appears, she decided that she did not want to continue working with the Dragons. The contract was terminated, she repaid most of the loan, and she was back in control of her company, although her objective, soon achieved, was to find an equity investor.[2]A Mail on Sunday journalist, Keri Sutherland, spoke to the defendant, apparently seeking his observations on the claimant's account. His brief response was included in the article. He was quoted as having said:
'Unfortunately, within a few months of Sharon appearing on Dragons'
Den, she decided that due to the success and positive feedback from the show she would prefer to keep 100% of her company, which Duncan and I fully supported. Occasionally the investment opportunity isn't as it appears on the show. I wish Sharon all the best'. These words were included in the Mail on Sunday article. After the article was published, the defendant published on his website a more detailed account of what had transpired between him and the claimant. The words which (for present purposes) it must be taken that he spoke to the journalist, and the account given on his website, form the basis of the claimant's proceedings against the defendant.[3]Unfortunately, the claimant's Particulars of Claim were settled by a solicitor apparently unfamiliar with the complexities of defamation and malicious falsehood. It is not easy to make out the nature of the claimant's case from the Particulars as they currently stand. However, it appears that her case as now pleaded is that the defendant was liable for the publication of his words in the Mail on Sunday article, as well as for publication of his website statements. The defendant's solicitors wrote to the claimant's then solicitors on 28th September 2010, pointing out some of the shortcomings of the pleading, but their successors nonetheless served a Defence without making any application to the court. A Reply followed. So if the Particulars of Claim are flawed, as it is accepted that they are, the statements of case which followed it are likely to require substantial amendment. In June 2011, the claimant changed her solicitors.[4]On 17th June 2011, the defendant issued an application seeking a ruling under CPR PD53 para 4.1 that the words complained of were not capable of bearing the pleaded or any defamatory meaning concerning the claimant, and, if so, seeking an order for the claim in libel to be struck out. The application also sought the striking out of the claim in malicious falsehood. It seems that the grounds of the application were that none of the statements complained of was capable of bearing any meaning defamatory of the claimant, and that the malicious falsehood claim was not properly pleaded. The application was listed for hearing on 19th July 2011.[5]The claimant's solicitors responded to the defendant's application by letter dated (it appears wrongly) 27th June 2011. It appears that it was sent on 11th July. They accepted that the Particulars of Claim required amendment, and said that counsel had been instructed to settle an amended pleading which would be ready later that week. They accepted the claimant's liability for the costs of and occasioned by the amendment. In the circumstances, they invited the defendant to withdraw his application.[6]There was then another letter from the claimant's solicitors, sent on 14th July 2011 but dated (again wrongly) 27th June, which enclosed an application dated 14th July 2011 for leave to amend the Particulars of Claim, and an amended draft pleading. Given the concessions very sensibly made about the current Particulars of Claim, it is that draft, or rather a further draft amended Particulars of Claim ('APOC') served on the defendant last night and handed to me at the hearing, which I now have to consider. The proposed case complains of two categories of publication, one by the defendant to a Mail on Sunday journalist, and the other by the defendant on his website to a potentially much larger audience. Each publication is complained of both as defamation and as malicious falsehood.[7]Although the application is now in form an application for leave to amend, I am still faced to a substantial extent with the question of whether the words complained of are capable of bearing the meanings now proposed to be pleaded. The principles which apply to the determination of meaning are well established and uncontentious, and were recently re-stated by Sir Anthony Clarke MR in Jeynes v News Magazines Ltd [2008] EWCA Civ 130. They were conveniently formulated by Eady J. in Gillick v Brook Advisory Centres, described by Lord Phillips MR on appeal ([2001] EWCA Civ 1263 at [7]) as an “impeccable synthesis” of the authorities: The proper role for the judge when adjudicating a question of this kind is to evaluate the words complained of and to delimit the range of meanings of which the words are reasonably capable, exercising his or her own judgment in the light of the principles laid down in the authorities and without any of the former Order 18 Rule 19 overtones. If the judge decides that any pleaded meaning falls outside the permissible range, then it will be his duty to rule accordingly. In deciding whether words are capable of conveying a defamatory meaning, the court should reject those meanings which can only emerge as the produce of some strained or forced or utterly unreasonable interpretation. The purpose of the new rule is to enable the court to fix in advance the ground rules and permissible meanings, which are of cardinal importance in defamation actions, not only for the purpose of assessing the degree of injury to the claimant’s reputation but also for the purpose of evaluating any defences raised, in particular, justification and fair comment. The court should give the article the natural and ordinary meaning which it would have conveyed to the ordinary reasonable reader reading the article once. Hypothetical reasonable readers should not be treated as either naive or unduly suspicious. They should be treated as being capable of reading between the lines and engaging in some loose thinking, but not as being avid for scandal. The court should avoid an over-elaborate analysis of the article, because an ordinary reader would not analyse the article as a lawyer or accountant would analyse documents or accounts. Judges should have regard to the impression the article has made upon them themselves in considering what impact it would have made on the hypothetical reasonable reader. The court should certainly not take a too literal approach to its task.

Publication to the journalist – defamation: natural and ordinary meaning

[8]The first publication complained of concerns the words which the defendant is alleged to have spoken to the Mail on Sunday journalist, which were reproduced in the article, are set out at paragraph [2] above, and are now pleaded at APOC paragraph 3. Mr Munden, who acted for the claimant, made clear that the claim under this head relates only to what the defendant said (or wrote) to the journalist in answer to her request for comments, not to the impact of those words as published in the article. So this is a claim based on publication to one person. Mr Speker, counsel for the defendant, told me that if leave to amend was granted he would be likely to make an application for the publication to be struck out on the grounds considered by the Court of Appeal in Jameel v Dow Jones [2005] EWCA Civ 75, [2005] QB 946, but in the absence of fuller submissions I do not think it would be right for me to go down that route in this judgment, and I was not asked to do so. Nor, in the event, do I need to, although I cannot resist observing that no reason has been advanced for the claimant’s decision to sue the defendant for a publication to one person, that person not on the face of it being someone whose opinion of the claimant is likely to be of great importance to her – by contrast, for example, with a potential investor in her business.[9]The meanings attributed to the words spoken to the journalist are pleaded at APOC paragraph 4 both as natural and ordinary meanings and as innuendo meanings, and they are “(a) that the claimant had lied to the Mail on Sunday and through them intended to lie to the public by giving a version of events in respect of why she ceased her business relationship with the defendant which was untrue and which she must have known was untrue, as in fact the success and positive feedback from her appearance on the show had The draft actually reads 'that led her to decide', which makes no sense. I have assumed that what was intended was 'had led her to decide' led her to decide to keep 100% of her company; (b) that the claimant had misled the defendant and the other 'Dragons' on the Dragons' Den television programme, and via that programme the public, as to the investment opportunity her business represented.”[10]As I understand him, Mr Munden contends that the defendant was giving the journalist a completely different account from that which the claimant had given. Both versions could not be right. The journalist would have realised that one of the two was not telling the truth. But as far as the natural and ordinary meaning of the words is concerned – the meaning which the words themselves, without more, would have borne to the ordinary reasonable person in the position of the publishee, namely the journalist – there is no possible basis on which the defendant's words could have been understood by her to mean that the claimant had lied, as APOC paragraph 4(a) seeks to contend. There is nothing in the words complained of which begins to support such a meaning. It would plainly be a perverse meaning for a jury to put on the words. Paragraph 4(a) is therefore unsustainable as a natural and ordinary meaning.[11]Is APOC paragraph 4(b) sustainable as a natural and ordinary meaning? Here at least there is a peg to which Mr Munden is able to attach an argument, namely the words 'Occasionally, the investment opportunity is not as it appears on the show'. Mr Munden argues that the words 'investment opportunity' could only mean the opportunity which the claimant had offered to the Dragons. I doubt that is right: in context, it is surely more likely, given what is said about the claimant's success, to refer to the opportunity offered by the Dragons to her. However, Mr Munden's argument is that the defendant was telling the journalist that the opportunity was not as they, the Dragons, had believed; so the claimant must have misled the Dragons and the programme's audience. At least, he maintains, the defendant's words are capable of bearing that meaning. However, even if it were right to posit that the words 'investment opportunity' signified the opportunity presented by the claimant to the Dragons, it would not follow that the claimant had misled them – only that the picture was more complicated than it had appeared in the course of the claimant's pitch on the programme. It seems to me that only a very suspicious publishee, anxious to see the words in an implausibly damaging light, could reach the conclusion on the defendant's words, which are expressed in entirely neutral tones, that the claimant must have misled the Dragons. That is all the more so when one considers the other words attributed to the defendant, which are complimentary of and friendly to the claimant. I therefore conclude that the natural and ordinary meaning pleaded at paragraph 4(b) of APOC is not one which the words are capable of bearing.

Publication to the journalist – defamation: innuendo

[12]I turn to the innuendo aspect of the paragraph 4 meanings, founded on the defendant's words to the journalist. The particulars of innuendo, pleaded at paragraph 4.1, are:
“The journalist had been told by the claimant about her experiences before, during and after her appearance on Dragons' Den (as were subsequently published in the Mail article), including her reasons for ceasing her business relationship with the defendant, which were not that she had decided due to the success and positive feedback from the show that she would prefer to keep 100% of the company.”
[13]Mr Munden's argument is that the journalist knew the claimant's account, now learned the defendant's rather different version of what led the claimant to want to keep control of her company, and in the light of those matters would have understood the defendant’s words to mean that the claimant must have been lying to her, and that she had misled the Dragons. Mr Speker objects that it is essential to plead that the journalist understood the words in the sense pleaded. That is correct, but Mr Munden stigmatises it as a technical point, given the pleaded words at the start of APOC paragraph 4, namely '… these words meant and were understood to mean', which he maintains is more than a ritual incantation by the pleader and means what it says. Be that as it may, the fact is that the position has been clarified by Mr Munden during argument, and his client's colours are now firmly nailed to that mast. More to the point, it seems to me, is that there appears to be nothing in the particulars of innuendo which supports the meaning of 'misleading' at APOC paragraph 4(b). That by itself must make paragraph 4(b) unsustainable as an innuendo meaning. The facts and matters relied on, namely what the claimant had told Keri Sutherland before Sutherland spoke to the defendant, do not include any reference to the representations which the claimant made to the Dragons, such as to give the reference to 'investment opportunity' a special meaning. Indeed, the whole tenor of the interview which the claimant gave to Keri Sutherland was that it was the Dragons who misled her, not the other way round.[14]The same cannot be said of the innuendo pleaded at APOC paragraph 4(a). In that case, there are stated to be facts which the claimant had told Keri Sutherland which had the effect, when the defendant spoke to her, of making her understand the defendant's words in the manner pleaded. Mr Speker argues that the particulars of innuendo at paragraph 4.1 are not proper particulars. The point of an innuendo, he contends, is that the words complained of would have been understood in a different sense from that in which they would have been understood without the help of the extrinsic facts. That, it seems to me, is exactly the effect of Mr Munden's particulars of innuendo. He is able to argue that, given the knowledge that Keri Sutherland had of the claimant's story, she understood the defendant to be saying that the claimant had lied to her. I see no objection to the innuendo. The problem lies with meaning. The question is, given the innuendo, whether the meaning is one which the words are capable of bearing. It amounts to this, that when a journalist is given one account of events by witness A, and then receives another account from witness B, she could conclude that A is lying. I suppose that she could reach that conclusion, and indeed it is Mr Munden's case that she did, but there are many other conclusions which she could reach – for example, that both witnesses had given what they believed was an honest account, although one or other of them must have been mistaken to a degree, or even that it was the defendant who was lying. Indeed, Mr Speker suggests that was very much the most probable meaning, in that the account given to Keri Sutherland by the claimant was supported as far as the loan/equity issue was concerned by a spokesman for the defendant's fellow Dragon, Duncan Bannatyne, so that any reasonable person's inclination would be to doubt the defendant rather than the claimant. There is force in that argument, but would it be perverse of a jury to conclude that a reasonable person in the position of Keri Sutherland would have understood the defendant's words to mean that the claimant was lying? I remind myself that in delimiting the range of permissible defamatory meanings, the court should rule out any meaning which can only emerge as the produce of some strained, or forced, or utterly unreasonable interpretation, and that it follows that it is not enough to say that by some person or another the words might be understood in a defamatory sense. It does seem to me that for the journalist to conclude, having heard all that the claimant had told her about her problems with the Dragons, some at least of which was corroborated by Duncan Bannatyne, that the claimant must have been lying, would indeed be a strained and utterly unreasonable conclusion.[15]I therefore conclude that the words complained of are not capable of bearing either of the meanings pleaded at APOC paragraph 4, whether natural and ordinary or innuendo. Given that this is now in substance an application for permission to amend, I refuse permission as far as the defamation claim founded on paragraphs 3 and 4 is concerned.

Publication to the journalist – malicious falsehood

[16]Mr Munden also seeks permission to amend to plead that the defendant's publication to the journalist was a malicious falsehood, 'in so far as (it) bore the meanings pleaded in paragraph 4 above'.[17]The proposed particulars of falsity are set out at APOC paragraph 12:
“12.1 The claimant did not make any false statements or otherwise misrepresent the investment opportunity her business presented during her appearance on Dragons' Den. 12.2 It was not true that the claimant 'decided that due to the success and positive feedback from the show she would prefer to keep 100% of her company: (a) The publicity the claimant received as a result of the broadcast of her appearance on Dragons' Den did not lead her to end her relationship with the defendant. (b) The defendant did not want, and could not afford, to keep 100% of her company. In fact she needed to, and did, find an alternative investor. 12.3 The claimant's version of events as to why she ceased her business relationship with the defendant, as set out in the Mail article, was true: (a) the offer from the defendant was not in the form of an equity investment as the claimant had been led to believe by his words and actions on Dragons' Den, but rather a loan, which was not what the claimant felt the business needed; (b) it had been incorporated into the agreement which the defendant had proposed that the defendant was entitled to charge the claimant's business fees for services; and (c) the claimant was asked to reduce her salary from £50,000 per annum to £12,000.” (a) The publicity the claimant received as a result of the broadcast of her appearance on Dragons' Den did not lead her to end her relationship with the defendant. (b) The defendant did not want, and could not afford, to keep 100% of her company. In fact she needed to, and did, find an alternative investor. (a) the offer from the defendant was not in the form of an equity investment as the claimant had been led to believe by his words and actions on Dragons' Den, but rather a loan, which was not what the claimant felt the business needed; (b) it had been incorporated into the agreement which the defendant had proposed that the defendant was entitled to charge the claimant's business fees for services; and (c) the claimant was asked to reduce her salary from £50,000 per annum to £12,000.”
[18]Mr Speker complains that APOC 12.1 is not a particular of falsity, because it does not identify a false statement made by the defendant. Mr Munden argues that the meaning pleaded at APOC 4(b) does identify a false statement, namely that the claimant had misled the Dragons, and that this is what is referred to. That argument seems to elevate the meaning pleaded at APOC 4(b), which is no more than the sense in which he argues that the journalist would have understood the words, to the status of a false statement by the defendant. I have, of course, decided that the meaning is unsustainable, so it seems to me that Mr Speker is right and that APOC 12.1 should not be allowed. Mr Speker does not object to the proposed amendment at APOC 12.2, which certainly does set out what is contended to be a false statement by the defendant. As for APOC 12.3, Mr Speker is right to complain that this does not identify a false statement made by the defendant. Mr Munden says that 12.3 is pleaded as an elaboration of 12.2. As pleaded, it is a little confusing, but I do not think that in substance it is objectionable. If, for instance, it was pleaded not as a separate particular but as a coda to 12.2, pointing out that the true position was very different from that claimed by the defendant, it would be difficult to challenge it.[19]The proposed particulars of malice appear at APOC paragraph 13: “13.1 The defendant knew that the claimant had not made any false statements or otherwise misrepresented the investment opportunity her business presented during her appearance on Dragons' Den. 13.2 The defendant knew, not least because it was explained to him in a face-to-face meeting with the claimant and her solicitor, of the claimant's reasons for ending her relationship with him, which were largely because of the terms he was seeking to impose on his investment, and not because of the publicity that resulted from the Dragons' Den programme; and that the claimant wanted investment in her business and did not want to keep 100% of her shares. 13.3 The defendant was motivated by the knowledge that the claimant was revealing to the Mail on Sunday, and through that newspaper the public, the truth about their business relationship, and that the truth reflected badly upon him, to give an alternative explanation for events that did not reflect so badly upon him, despite knowing that this would falsely suggest that the claimant was not telling the truth. 13.4 In the circumstances, the defendant published or caused to be published the words complained of knowing them to be false, or recklessly, not caring whether they were true or false, and/or with no honest belief that they were true”.[20]According to Mr Munden, APOC13.1 relates to 12.1. Mr Speker objects to APOC 13.1 on the footing that if 12.1 goes, so must 13.1. That must be right. APOC13.2 is not challenged. Mr Munden relies on APOC13.3 as relevant to the defendant's motive in speaking as he did: his object, Mr Munden argues, was to lie to cast himself in a better light. Mr Speker objects that this is an improper incursion of concepts of malice relevant to qualified privilege – where dominant improper motive is of great importance – into a sphere where it has no place, and that in any event it is not pleaded to have been a dominant improper motive. I am not sure that he is right, given that malice in malicious falsehood is broadly the same as malice in the context of qualified privilege: Spring v Guardian Assurance plc [1993] 2 All ER 273 (the issue did not arise in the House of Lords), Wilts United Dairies Ltd v Thomas Robinson Sons & Co [1957] RPC 220 at p237 lines 18-25, and Gatley onLibel and Slander, 11th edition, para 21.7. I can see that in some circumstances to treat malice in the one context as equivalent to malice in the other may cause difficulties (see the discussion in Gatley at 21.7), but I do not see that they arise here. It seems to me that what Mr Munden is saying at APOC 13.3 is that the defendant was lying in order to make himself appear better. It would be preferable if he spelled it out, but the sense is clear enough. As for APOC 13.4, I agree with Mr Speker that there is no basis for the allegation of recklessness. There is nothing in the preceding particulars which justifies it.[21]It is an essential part of her claim in malicious falsehood that the claimant should have suffered damage, or that, in accordance with s3(1) of the Defamation Act 1952, the words on which the action is founded are calculated to cause pecuniary damage to the claimant in respect of (inter alia) any business carried on by her at the time of publication. No actual damage is alleged - not surprisingly, perhaps, given that publication was to a single journalist, so Mr Munden wishes to rely on s3(1). 'Calculated' in this context means 'likely to produce the result' (Gatley, paragraph 21.13). Mr Speker complains that this is a bare assertion, with no attempt to set out how the publication to one person is likely to produce such a result. I agree with him, but more to the point, it seems to me, is the context in which this allegation is made. It is not contended that the defendant was responsible for the republication of his words in the Mail on Sunday article, only that he published the words complained of to Keri Sutherland. Of course, claims in malicious falsehood carry no entitlement to trial by jury, but given that there is also a defamation claim, I must assume that the tribunal at trial may well be a jury. Mr Speker submits that the court is in a similar position when considering this part of the claimant's case to that where the issue is whether words are capable of bearing a defamatory meaning, so that it is for the judge to decide whether the words are capable of giving rise to a likelihood that the claimant would suffer pecuniary damage, and for the jury to decide whether in fact they did, and he refers to Gatley at paragraph 4.16 n91. He urges that I should follow that course. I do not think that Mr Munden suggests that this approach is wrong. As for the principles which apply on applications for leave to amend, they are well known (see for example Cobbold v London Borough of Greenwich, 9th August 1999), and involve ensuring that each case is dealt with not only expeditiously but also fairly. The starting point is that amendments in general ought to be allowed so that the real dispute between the parties can be adjudicated upon, subject to considerations of prejudice and public interest. However, it is clear also that an application for leave to amend will be refused if it is clear that it has no prospect of success. It seems to me that the proposition that there is a likelihood of pecuniary damage to the claimant from the publication of the words complained of to a single journalist, absent any suggestion that the defendant is responsible for a defamatory re-publication, is absurd and has no prospect of success, or, to put it another way, that the words complained of are not capable of giving rise to such a likelihood, and that I ought to refuse leave to amend to plead s3(1) (APOC paragraph 14) as far as the words complained of at paragraph 3 are concerned.

Website publication – libel: natural and ordinary meaning

[22]I now turn to the second publication relied on. The claimant relies at APOC paragraph 6 on publication by the defendant of his account on his website. I do not propose to set out the words complained of in full, but a fair precis might be that the claimant presented a very good pitch in the Dragons' Den and impressed all the Dragons with her claims; that she accepted an offer from the defendant and Mr Bannatyne; that the due diligence exercise by the defendant's and Mr Bannatyne's teams showed that the claimant's business did not have the order for 1 million units which she had mentioned in the Den, and that there were several monthly outgoings which the business could not sustain; that the parties nonetheless concluded a shareholders' agreement; that the claimant received a huge amount of publicity and interest after the programme was broadcast; that she received requests for speaking engagements and an invitation to write a book, which were excellent for her profile but a distraction from emphasis on generating sales; that she was introduced to the defendant's team, who were made available to support her business, and that the defendant himself personally assisted her; that it became clear that the claimant and her business needed more support than the Dragons could provide, although they were keen to continue to work with her; that after a period of illness the claimant wished to own all her company again, so the Dragons returned her equity at the purchase price, and wished her every success.[23]The claimant proposes to plead, at APOC paragraph 7, that the natural and ordinary meaning of these words was that the claimant had misled the defendant and the other Dragons by stating that her business had an order for 1 million units when in fact it did not, that being a matter uncovered by the defendant. Mr Speker does not argue that the words are not capable of meaning that the claimant had misled the Dragons. However, in the course of argument it became clear that Mr Munden took the view that 'misleading' could embrace deliberate misleading. It seemed to me that if he wished to plead deliberate misleading it was necessary for him to do so in terms, and he therefore made clear that the amendment which he wished to put forward was that the claimant had deliberately misled the Dragons. Mr Speker strongly opposes that amendment, pointing out that there is nothing in the words complained of which suggests that the claimant's assertion of orders for 1 million units was a deliberate mis-statement. Moreover, Mr Speker points out that on his website the defendant first refers to the due diligence discovery, and then to the shareholders' agreement which followed it, and observes that no reasonable reader of the website would conclude that the Dragons had entered into a shareholders' agreement with someone who had deliberately misled them. That seems to me to be a powerful point. It seems to me that such a meaning would be, in the words of Eady J in Gillick, the result of a strained, forced and unreasonable interpretation. I therefore disallow the proposed amendment to plead that the misleading was deliberate, but otherwise allow APOC paragraph 7.

Website publication – libel: innuendo meaning

[24]The claimant also wishes to plead an innuendo meaning for the defendant's website publication: APOC paragraph 8. That meaning is that the claimant had lied to the Mail on Sunday (and through that newspaper to the public) by giving reasons for wanting her shares back from the defendant which were untrue, and which she must have known were untrue. In support of that meaning there are particulars of innuendo, as follows: “The claimant had given her account to the Mail on Sunday of her reasons for wanting her shares back from the defendant, which were not the reasons suggested by the defendant in the statement (ie the words complained of published on his website), such as the publicity she received from the broadcast of her appearance on Dragons' Den, the daily support she needed and illness. The claimant's account of events had been published in the Mail article. It is to be inferred that a significant but unquantifiable number of readers of the words complained of would have read the claimant's version of events in the Mail article. In support of this inference, the claimant will rely on the huge readership of the Mail on Sunday newspaper and Mail Online and This is Money website within the jurisdiction, and the fact that the Mail article related to the defendant and the same subject matter as the defendant's statement. The claimant's account of events was also published from on or around 15th August 2010 on the Business Matters website... and on the Real Business website … and on 27th August 2010 on the Dragonfly Finance website.... It is to be inferred that a significant but unquantifiable number of readers of the words complained of would have read the claimant's version of events on these websites. In support of this inference the claimant will rely on the large readerships these websites attract within the jurisdiction and the fact that these website articles related to the defendant and the same subject matter as the defendant's statement”.[25]Mr Speker objects that the innuendo meaning is defective(1) because no-one is identified as having understood the words in the meaning contended for, even though this amendment has been produced almost a year after publication, and(2) because even if it is accepted that some people will have read both the claimant's account and the defendant's statement, the innuendo meaning requires readers to disregard what the claimant said in the Mail on Sunday and conclude that it was untrue (and known by her to be untrue) because of what the defendant said.[26]For his first point, Mr Speker relies on Baturina v Times Newspapers Ltd [2011] 1 WLR 1526 at [44]ff, where Lord Neuberger MR considered the need for the pleader of an innuendo meaning to identify readers with the knowledge of the extrinsic facts relied on. He referred to Fullam v Newcastle Chronicle [1977] 1 WLR 651, where the facts were very abstruse and unlikely to be known to readers, and to Grapelli v Block [1981] 1 WLR 822, where Lord Denning MR held that there was a general principle of pleading that the claimant ought to specify the persons with the particular knowledge from which the defamatory meaning is obtained, and Dunn LJ agreed, while observing that the general rule was subject to exceptions, such as where publication was in a national newspaper with a wide circulation, and the only reasonable inference was that some of the readers must have knowledge of the relevant facts. Lord Neuberger decided that the general rule should apply in Baturina, where the court would not find for the claimant without such witnesses being called. That, however, was a case where the claimant relied on publication of the Sunday Times to Russians living in England and Wales. There was no evidence that its circulation was substantial among that group, and it was right to require the claimant to identify those who read the newspaper and were familiar with the extrinsic facts, which related to a requirement of Russian law. Here, however, the claimant relies on the proposition that very substantial numbers of people will have read the Mail article, whether in hard copy or on Mail Online or other sites, and that it is reasonable to infer that a significant number of those will then have read what the defendant had to say about the matter on his website. That seems to me to be a reasonable inference, given the numbers of readers of the Mail and the pleaded popularity of the defendant's website. It seems to me probable that some readers of the Mail article would have been interested enough in the issue to follow it up by reading what the defendant had to say. At the same time, it would surely be oppressive to expect the claimant to identify those readers. It seems to me that the proposed pleading is not defective for its failure to identify such readers, and that this case falls into an exception of the kind envisaged by Dunn LJ in Grapelli.[27]On the latter point, Mr Speker argues that there is no basis for reaching the conclusion that the claimant's account must have been untrue (and, moreover, known to be untrue) because of what the defendant said. At the highest, the reader would be left with the view that there was a business dispute and that the different sides had offered differing views of what happened. There is no doubt that that readers who read both the Mail article and the defendant's account would have been faced with differing versions of events. On the one hand, they would have had the claimant's account of her disappointment, and of the stress which she was under, and they would have seen that to a degree her account was corroborated by Duncan Bannatyne. On the other hand, they would have seen the defendant's account, which in general terms was a glowing account of the claimant's achievement. But while he did give a positive picture of the Dragons' involvement with her, it is not clear to me that he attributed a reason for the claimant's wish to own her company again (ie to part company with the Dragons). In other words, there is not the express contradiction which might have been made. He did not say that her account was untrue: he put a happier gloss on what took place, and did not deal – at least expressly - with any of her complaints, except perhaps her concerns about lack of support. In those circumstances, it seems to me that while this meaning is one in which the defendant's words might be understood by a reader (which of course is not enough), nonetheless for any reader of the claimant's account of her problems with the Dragons, some of which was corroborated by Duncan Bannatyne, who then read the defendant's account, to conclude that the claimant must have been lying, would be to reach a very strained and utterly unreasonable conclusion. In the circumstances, I disallow the proposed amendment to plead an innuendo meaning arising from the publication of the defendant's website statement.

Website publication – malicious falsehood

[28]That leaves the claim in malicious falsehood based on the defendant's website statement. The falsity (APOC paragraph 15) is said to consist in(1) the fact that the claimant did not state during her appearance on Dragons' Den that her business had an offer for 1 million units,(2) the fact that she did not want and could not afford to own all her company again (and instead found an alternative investor) and(3) the fact that she did not want her shares back for the reasons suggested by the defendant in his statement, such as the publicity which she received from the broadcast, the daily support which she needed and illness. Those particulars are not challenged.[29]The proposed particulars of malice (APOC paragraph 16) are that the defendant knew that the claimant had not stated that her business had an offer for 1 million units, and therefore that it was false to suggest that due diligence by his team led to the discovery that she did not have such an offer. So far, they are not challenged. The proposed particulars also rely on the matters pleaded at APOC 13.2 – 13.4 (set out at paragraph 19 above). They are that the defendant knew (not least from having it explained to him in a meeting) why the claimant wanted to end her relationship with him, that is to say largely because of the terms which he wanted to impose, and not because of beneficial publicity from the programme, and that she wanted investment in her business and did not want to keep 100% of her shares; and that he was in effect motivated to lie by the wish to put a positive spin, which did not reflect so badly on him, on the claimant's revelations to the Mail on Sunday, even though he knew that this would falsely suggest that she was not telling the truth. The repetition here of APOC paragraphs 13.3 – 13.4 is challenged by Mr Speker. However, I have ruled that Mr Munden should have permission to amend to plead paragraphs 13.3 and 13.4, subject to the exclusion of the averment of recklessness in 13.4.[30]The gist of Mr Speker's attack on the malicious falsehood claim arising from the defendant's website statement is very much the same as in respect of the publication of the defendant's words to the journalist: see paragraph 21 above. In this context, the publication is now (on the claimant's case) to a significant number of people who read the claimant's account and then saw the defendant's version. It is an essential part of the claimant's case that publication of the malicious falsehood must either have caused actual damage or alternatively have been calculated (in the sense of being likely to produce the result) to cause her pecuniary damage in her business. Mr Speker relies on the terms of the defendant's statement, which stated that the claimant presented one of the best pitches on the programme, based on a simple but effective product, and that her claims were impressive; that the defendant and Duncan Bannatyne were keen to work with her following due diligence even though the business did not have an order for 1 million units and even though there were outgoings that the business could not sustain, and signed an agreement with her; that she inspired female entrepreneurs across the country; that she had many offers to speak, and an offer that she should write a book; that she was a hard worker; that her business had created substantial interest and valuable orders; that she had sold 10% of her business for £100,000, at over double the valuation which she had agreed in the Dragons' Den; and that he wished her every success. Mr Speker suggests that the claimant's interview with the Mail on Sunday was far more likely to have caused her pecuniary damage than the defendant's website statement.[31]Mr Speker argues in this context, as he did in the context of the malicious falsehood claim based on the defendant's words to the journalist, that the proper approach of the court is to decide whether the words are capable of giving rise to a likelihood that the claimant would suffer pecuniary damage, and that it is for the tribunal of trial (presumptively a jury in this case, given a subsisting libel claim) to determine whether they did in fact do so. Mr Munden does not dissent from that approach, but argues that his proposed case is capable of giving rise to the relevant likelihood. He contends that there are elements of the website statement which do amount to an attack on the claimant – in particular, the reference to due diligence having discovered that the business did not have the order for one million units that she had mentioned in the Dragons' Den. That seems to me to be a very minor and politely expressed reservation about the claimant's performance (and one which plainly, on the defendant's account, did not inhibit a formal agreement) compared with the positive and supportive tone otherwise expressed by the defendant in his statement.[32]I have already referred to the principles which apply on applications for leave to amend. The starting point is that amendments in general ought to be allowed so that the real dispute between the parties can be adjudicated upon. However, an application for leave to amend will be refused if it is clear that it has no prospect of success. That, in my judgment, is the position with the claimant's case on s3(1) as it is presently pleaded. The position might be different if there were a pleaded basis for the bald assertion that s3(1) applies, but no such basis exists. It does not seem to me to be enough, on these facts, given the terms of the defendant's website statement, to rely baldly on s3(1) without pleading a clear substratum of fact from which the alleged likelihood of pecuniary damage is said to arise. By itself, on these facts, the proposition is too implausible to be sustained.[33]I therefore refuse leave to the claimant to amend her Particulars of Claim to advance a case in malicious falsehood, whether founded on the words complained of at APOC paragraph 3 (publication to the journalist) or on the words complained of at APOC paragraph 6 (the defendant's website statement).[34]I would be grateful to hear counsel on the consequences of these rulings and what orders should follow.

Cited in 1 later judgment