24 November 2008
The recession has had an impact on most sectors of society, with the legal industry being no exception. With unemployment on the up, people and companies are more focused than ever on maintaining their reputations, which in turn gives rise to more defamation cases, says industry expert Rob Dadak.
Earlier this year, Tesco was involved in a high-profile case of this nature. It sought damages from the Guardian over claims it had made over the supermarket's tax planning strategies.
The allegation was that Tesco had established an offshore tax avoidance structure to evade paying £1 billion in corporation tax. It also suggested that the company had already avoided £500 million worth of taxes through the measures.
"It is not uncommon to use offshore companies for the purpose of joint ventures with third parties," the supermarket chain said.
The Guardian stated in a statement: "The articles were in the context of a series of articles on taxation issues in a globalised world. They clearly raised serious matters of public interest in relation to tax avoidance and tax management.
"We have never claimed Tesco behaved illegally. These are matters of considerable political importance at present, debated by all parties."
Lucy Neville-Rolfe, executive director of Tesco, said the decision to sue the publication was "very regrettable", highlighting previous attempts to request the paper issued an apology.
This particular instance saw the issue resolved through a front page apology in the Guardian , which was accepted by Tescos.
In recent years, new measures were put into place to protect informants of the police against defamation claims. Anyone who informs the police about an alleged incident under the law will now be protected against being sued from the moment the police complaint is made.
This led to success for B P Collins in the case of Westcott v Westcott. Dr Westcott accused her father-in-law, Mr Richard Westcott, of striking her son during a visit to the accused's home. The CPS did not take the case any further, although it did result in Mr Westcott issuing a defamation claim.
Mr Westcott, a magistrate and a regular chair of the family panel at Worcester magistrates' court was keen to protect his professional reputation. At the hearing, Lord Justice Sir Stanley Burnton of the Court of Appeal said: "A man is considered to be innocent unless proved guilty. That must be sufficient for him."
On the basis of absolute privilege, the Courts did not pursue the matter. Rod Dadak, who writes for the Solicitors Journal, states that Dr Westcott's comment was protected by absolute privilege in its form of both a written and oral complaint. Absolute privilege applies to statements made in parliamentary and judicial proceedings and matter of public interest.
The recession is putting financial pressure on people, which may make cases such as these more costly for th e individual. However, with unemployment at a reported 11-year high, people are going to be more likely to want to hold onto their jobs and, more importantly, their reputations.
Matthew Brandis, Partner in B P Collins' litigation and dispute resolution team states: "We have seen an increase in the number of defamation claims. There has also been a noticeable rise in the number of actions being considered by companies. Companies who need to protect their reputation are no longer happy to sweep any defamatory comments under the carpet.
"Any defamatory statements should be taken seriously especially in the current economic climate. Otherwise, individuals and companies could face damage to their reputation, which could subsequently lead to financial difficulties for the company/ person involved." |
