THIRD PARTY DEFAMATION

Wallis and GHP Securities Ltd v Meredith

To succeed in a libel claim, the complainant has to show that as a result of being defamed, they could not carry on their trade or profession or would be less well thought of by a reasonable person. In Wallis and GHP Securities Ltd v Meredith, the High Court said that it was not defamation when an employee sent a letter alleging unlawful conduct by his employer to their solicitor.

Basic facts

Following his dismissal on 23 December 2009, Mr Meredith telephoned his former boss Mr Wallis on 10 February to ask about money that he alleged was owing to him.

This resulted in a letter from the company’s solicitors, Mishcon de Reya (MDR) alleging various breaches of obligations of confidence and fidelity. Mr Meredith replied saying that following a heated telephone conversation with Mr Wallis, he had received a visit from “two burly men with East European accents” who threatened him and told him to phone the man he had offended and say “sorry”. He accused GHP of being behind the visit and asked for an assurance that it would not be repeated.

MDR promptly sent another letter about this “serious and false” allegation, demanding to know if he had repeated it to anyone else. Mr Meredith agreed to give an undertaking not to repeat the allegation, but MDR said it wanted the names of any third parties to whom he had already made the allegation.

After a further exchange of correspondence, MDR started legal proceedings for defamation, damages and aggravated damages. The firm also sent an application for discovery of documents “evidencing publication of the Allegation to third parties”.

Mr Meredith applied to strike out the application as an abuse of process, arguing that it was contrary to the public interest to allow his former employer to bring a claim for libel in relation to a letter he had written to MDR during pre-action correspondence.

High Court decision

And the High Court agreed. Dismissing the claim for libel, the judge held that there were no grounds to suspect that Mr Meredith had repeated the allegation to any third party and concluded that the application for disclosure was a fishing exercise.

He pointed out that letters exchanged between parties in these circumstances were likely to contain defamatory statements about each other. If he made the order that MDR wanted, other litigants would make similar applications “in respect of almost any letter written by a party in the circumstances of the defendant to the claimants' solicitors”.
The court had to decide whether any “real and substantial” harm had been done by reference to the “wrong” complained of. As Mr Meredith had only repeated the allegation to his former employer’s solicitors, the judge concluded that they were unlikely to have thought any worse of their clients.

He also pointed out that solicitors routinely receive “defamatory imputations about their clients (since most allegations of unlawful conduct are likely to be defamatory). 
“Whilst such publication is likely to be covered by qualified privilege on the basis of a common and corresponding interest, and perhaps of absolute privilege, so that any claim based on them will in the end be likely to fail, it seems to me that the court is entitled, in the light of the overriding objective and the interests of proportionality, to discourage and prevent the use of its time, at great expense, on actions in which the only publishee is the claimant's solicitor and thus someone in the claimants' camp”.