Should public authorities be able to sue for libel?

The remarkable legal advice given to Rutland County Council suggests that councils can now sue - and threaten to sue - for libel. We should worry about the potential "chilling effect" of this.

It is a principle of the common law of England and Wales that a public authority cannot bring an action for defamation.  And this is right and proper, as being able to sue for libel (and thereby threaten to sue for libel) would have an unwelcome "chilling" effect on public criticism of governmental bodies.  Individual councillors and officers can sue for defamation, but not the authorities themselves.

However, this sensible legal safeguard appears to be under threat.  The City lawyers advising Rutland County Council are saying that the recently enacted Localism Act has changed the legal position, and now it is open to public bodies to freely sue - and threaten to sue - for libel.

Section 1 of the Localism Act provides for a "general power of competence".  In particular, the Act says that a "local authority has power to do anything that individuals generally may do"

It is not clear what this actually means, and the use of the imprecise word "generally" makes the scope of the provision inherently uncertain.  But what the external lawyers to Rutland County Council have taken it to mean is that a council can sue for defamation when it could not do so before.  And, interestingly, it is three of Rutland Council's own councillors which the council is considering whether to sue.

The advice of the lawyers is set out in full here (pdf).  The possibility of an action in defamation is set out at paragraph 11:

Some 20 years ago the Court of Appeal held that a local authority is not entitled to issue a defamation claim in its own name in connection with statements that damage the reputation of the authority as a whole (rather than the reputation of its individual officers or members)4 and this has been the accepted law.  However, in our view, this principle has been overturned by the general power of competence granted to local authorities by section 1 of the Localism Act 2011 (“the 2011 Act”).  This provision was brought into force on 18 February 2012 and gives a local authority the power to do anything which an individual generally may do.  An individual has the power to issue a defamation claim in its own name, and the 2011 Act contains no restriction which would prevent an authority from doing so.  Given the extent to which a local authority is now dependent on its public reputation for its ability to secure external funding, to attract competitive tenders for provision of services, or to recruit outstanding officers, it seems quite appropriate that the 2011 Act should now have brought the law up to date with the commercial reality.

However, this advice is not only illiberal, it seems misconceived.

First, it was not the Court of Appeal which made the ruling which is referred to, it was in fact the House of Lords.  The case was Derbyshire County Council v Times Newspapers and it was a unanimous decision of five Law Lords - including Lord Goff and Lord Browne-Wilkinson, two of the greatest common law judges of the post-war era.

The Law Lords held that, as a matter of public policy, Derbyshire County Council was not able to sue for defamation.  There would be, the Law Lords explained, an adverse effect on freedom of expression if a public body could sue in respect of unwanted criticism.  The point could not have been made more clear: "a local authority does not have the right to maintain an action of damages for defamation".

So does section 1 of the Localism Act now "overturn" this unequivocal statement of a very strong House of Lords?  Are the external lawyers of Rutland Council right?

With the proviso that law is ultimately what the courts say it is, and so any view on what is an untested point of law is a matter of opinion, it would appear that Rutland Council's lawyers have got this important point badly wrong.

The Law Lords in Derbyshire did not decide the case on what lawyers would call the "vires" (or powers) of a public body.  It was instead decided on an altogether different basis: that it should be public policy that councils cannot sue.  The Lordships did not doubt that corporations could, in principle, sue for libel; it was just that a certain class of corporations were not able to do so because it would not be in the public interest.  The 1972 case which said otherwise - Bognor Regis Urban District Council v Campion -  was expressly stated to have been wrongly decided.  In effect, their Lordships said "Bugger Bognor" and in a comprehensive review of domestic and foreign case law held that freedom of expression was always more important.

Accordingly, the Localism Act is irrelevant to the Derbyshire decision.  It deals with a different legal issue.  Section 1 does not create a right of action in tort which the House of Lords said no longer existed.  Neither does it refer to public policy.  In fact, it has nothing to do with whether a council can sue for libel, and it is worrying that a public authority is being advised that such a course of action is available to it.

Rutland Council is clearly divided.  A small group of councillors - "the Rutland Anti-Corruption Party" - is noisily calling for transparency and openness in the council's dealings.  Their latest statement accuses the council of significant wrongdoing.  This in turn is denied by the council, who make counter accusations.   At a distance, it is difficult to form a view on the merits of any of the accusations - and Rutland matters should, of course, be determined by Rutland people.

But what makes the matter of wider concern is the council's resort to legal advice on how to sue or otherwise legally threaten its very own councillors.  For if Rutland Council can sue its critics for libel, then it would follow that any council would be able to also do so, and it would be a brave citizen that would want to be a test case in any action for libel.  The 'chilling effect' will be enough to deter certain criticism.

Rutland Council meets this evening to discuss the legal advice it has received.  Anyone with an interest in free expression and libel reform should follow what now happens.  For if the majority of councillors vote for the council to sue for libel, then other councils will undoubtedly be tempted to follow the lead of Rutland, and it could be as if the Bognor case had never been buggered by their Lordships at all.

 

David Allen Green is legal correspondent of the New Statesman

Bognor - whose case was buggered by the House of Lords in 1993. Photo: Getty

David Allen Green is legal correspondent of the New Statesman and author of the Jack of Kent blog.

His legal journalism has included popularising the Simon Singh libel case and discrediting the Julian Assange myths about his extradition case.  His uncovering of the Nightjack email hack by the Times was described as "masterly analysis" by Lord Justice Leveson.

David is also a solicitor and was successful in the "Twitterjoketrial" appeal at the High Court.

(Nothing on this blog constitutes legal advice.)

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR