George v Cannell & Anor

Appellant

David Price KC

Jonathan Price

(Instructed by Brabners LLP (Liverpool))

Respondent

William Bennett KC

Godwin Busuttil

(Instructed by Thomson Heath & Associates (London))

Lord Leggatt (with whom Lord Hodge and Lord Richards agree):

Introduction

1. We are concerned on this appeal with a tort with many names. It embraces actions which have variously been called slander of title, slander of goods, disparagement of goods and trade libel. By the turn of the twentieth century these actions were coming to be seen as examples of a more general wrong, for which Sir John Salmond coined the name "injurious falsehood": see Salmond, The Law of Torts: A Treatise on the English Law of Liability for Civil Injuries, 1st ed (1907), p 417. That name is still used by many legal writers; but courts in England and Wales have generally preferred the term "malicious falsehood", which I will use. Whatever name is used, the nature of the wrong is not in doubt. As stated by the Court of Appeal in the leading case of Ratcliffe v Evans [1892] 2 QB 524, 527:

"an action will lie for written or oral falsehoods ... where they are maliciously published, where they are calculated in the ordinary course of things to produce, and where they do produce, actual damage ..."

2. Equally clear is that "actual damage" in this context means pecuniary damage - that is, loss that can be estimated in money (rather than merely being compensated by an award of money). A more modern term which I will use to mean the same thing is "financial loss." Because financial loss is the basis or "gist" of the tort, malicious falsehood is generally classified as an "economic tort": see eg Hazel Carty, An Analysis of the Economic Torts, 2nd ed (2010), p 1.
3. In this case the trial judge found that the first defendant maliciously published falsehoods about the claimant to two individuals; but also that neither publication caused the claimant any financial loss. The claimant asserts that the publications nevertheless caused injury to her feelings for which she is entitled to compensation. Admittedly under the common law such a claim cannot be maintained. But the claimant argues that a statutory modification of the tort made by section 3(1) of the Defamation Act 1952 changed this. She contends that this statutory provision applies here and, where it applies, enables damages to be recovered for injury to feelings even when no financial loss has been sustained.
4. If section 3(1) of the 1952 Act has this radical effect, it had gone unnoticed for 70 years. The Court of Appeal, however, accepted that it does. They decided, first, that section 3(1) applies here but that, as the claimant suffered no financial loss, only nominal damages could be awarded on that account. I agree with this. They then held that it would be open to the judge, on an assessment, to award substantial (as opposed to nominal) damages to the claimant for her…