Freely Available British and Irish Public Legal Information
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]
European Court of Human Rights
You are here: BAILII >> Databases >> European Court of Human Rights >> FAYED v. THE UNITED KINGDOM - 17101/90 [1994] ECHR 27 (21 September 1994)
URL: http://www.bailii.org/eu/cases/ECHR/1994/27.html
Cite as: (1994) 18 EHRR 393, 18 EHRR 393, [1994] ECHR 27
[New search] [Contents list] [Help]
In the case of Fayed v. the United Kingdom*,
The European Court of Human Rights, sitting, in accordance
with Article 43 (art. 43) of the Convention for the Protection of Human
Rights and Fundamental Freedoms ("the Convention") and the relevant
provisions of the Rules of Court, as a Chamber composed of the
following judges:
Mr R. Ryssdal, President,
Mr R. Bernhardt,
Mr C. Russo,
Mr S.K. Martens,
Mr R. Pekkanen,
Mr A.N. Loizou,
Sir John Freeland,
Mr L. Wildhaber,
Mr J. Makarczyk,
and also of Mr M.-A. Eissen, Registrar, and Mr H. Petzold, Deputy
Registrar,
Having deliberated in private on 25 March and 25 August 1994,
Delivers the following judgment, which was adopted on the
last-mentioned date:
_______________
* Note by the Registrar. The case is numbered 28/1993/423/502. The
first number is the case's position on the list of cases referred to
the Court in the relevant year (second number). The last two numbers
indicate the case's position on the list of cases referred to the Court
since its creation and on the list of the corresponding originating
applications to the Commission.
_______________
PROCEDURE
1. The case was referred to the Court by the European Commission
of Human Rights ("the Commission") on 12 July 1993, within the
three-month period laid down by Article 32 para. 1 and Article 47
(art. 32-1, art. 47) of the Convention. It originated in an
application (no. 17101/90) against the United Kingdom of Great Britain
and Northern Ireland lodged with the Commission under Article 25
(art. 25) on 30 August 1990 by Mr Mohamed Al Fayed, Mr Ali Fayed and
Mr Salah Fayed, who are Egyptian citizens, and by a company they owned,
namely House of Fraser Holdings PLC.
The Commission's request referred to Articles 44 and 48
(art. 44, art. 48) and to the declaration whereby the United Kingdom
recognised the compulsory jurisdiction of the Court (Article 46)
(art. 46). The object of the request was to obtain a decision as to
whether the facts of the case disclosed a breach by the respondent
State of its obligations under Articles 6 para. 1 and 13 (art. 6-1,
art. 13) of the Convention.
2. In response to the enquiry made in accordance with
Rule 33 para. 3 (d) of the Rules of Court, the applicants stated that
they wished to take part in the proceedings and designated the lawyers
who would represent them (Rule 30).
3. The Chamber to be constituted included ex officio
Sir John Freeland, the elected judge of British nationality (Article 43
of the Convention) (art. 43), and Mr R. Ryssdal, the President of the
Court (Rule 21 para. 3 (b)). On 25 August 1993, in the presence of the
Registrar, the President drew by lot the names of the other seven
members, namely Mr R. Bernhardt, Mr L.-E. Pettiti, Mrs E. Palm,
Mr A.N. Loizou, Mr F. Bigi, Mr L. Wildhaber and Mr J. Makarczyk
(Article 43 in fine of the Convention and Rule 21 para. 4) (art. 43).
Subsequently, Mr S.K. Martens, Mr R. Pekkanen and Mr C. Russo,
substitute judges, replaced respectively Mr Pettiti, who had withdrawn,
and Mr Bigi and Mrs Palm, who were prevented from taking further part
in the consideration of the case (Rules 22 para. 1 and 24 paras. 1
to 3).
4. As President of the Chamber (Rule 21 para. 5), Mr Ryssdal,
acting through the Registrar, consulted the Agent of the United Kingdom
Government ("the Government"), the applicants' lawyers and the Delegate
of the Commission on the organisation of the proceedings
(Rules 37 para. 1 and 38). Pursuant to the orders made in consequence,
the Registrar received the Government's memorial on 10 January 1994 and
the applicants' memorial on 24 January 1994, the applicants'
supplementary memorial on 1 March 1994, the Government's supplementary
observations on 16 March 1994, and the applicants' and the Government's
comments on the claims for just satisfaction on 10 and 18 March
respectively. In a letter received on 3 March 1994 the Secretary to
the Commission had informed the Registrar that the Delegate did not
wish to submit argument in writing.
5. On 5 October 1993 the British company, Lonrho PLC (see
paragraphs 10 and following below) sought leave to submit written
comments under Rule 37 para. 2. However, by letter received at the
registry on 17 November 1993 the company withdrew its request.
6. In accordance with the President's decision, the hearing took
place in public in the Human Rights Building, Strasbourg, on
23 March 1994. The Court had held a preparatory meeting beforehand.
There appeared before the Court:
(a) for the Government
Mrs A.F. Glover, Legal Counsellor, Foreign and
Commonwealth Office, Agent,
Mr M. Baker, QC,
Mr J. Eadie, Barrister-at-law, Counsel,
Mrs T. Dunstan, Department of Trade and Industry,
Mr R. Burns, Department of Trade and Industry,
Mr J. Gardner, Department of Trade and Industry, Advisers;
(b) for the Commission
Sir Basil Hall, Delegate;
(c) for the applicants
Lord Lester of Herne Hill, QC,
Mr P. Goulding, Barrister-at-law, Counsel,
Mr R. Fleck,
Ms L. Hutchinson, Solicitors,
Mr D. Marvin, Attorney-at-law (Washington, DC,
USA),
Mr R. Webb, Legal Director, House of Fraser
Holdings PLC, Advisers.
The Court heard addresses by Sir Basil Hall, Mr Baker and
Lord Lester, and also replies to questions put by the President.
On the day of the hearing and subsequently on 12 April 1994
the applicants produced to the Court a number of documents referred to
in argument by Lord Lester.
AS TO THE FACTS
I. The particular circumstances of the case
A. The applicants
7. The three applicants, Mr Mohamed Al Fayed, Mr Ali Fayed and
Mr Salah Fayed, are brothers. They are businessmen.
B. Takeover of the House of Fraser PLC
8. In March 1985 the applicants acquired ownership of the House
of Fraser PLC ("HOF"), a public company, for about £600 million in
cash. HOF was then, and is now, one of the largest groups of
department stores in Europe and includes one particularly well-known
London store, Harrods. The acquisition of HOF was effected through a
public company called House of Fraser Holdings PLC ("HOFH"), which at
all material times was owned by the applicants. HOFH had previously
been known as the Al Fayed Investment Trust (UK) Limited and assumed
its present name in December 1985.
9. Prior to the HOF takeover, in or about early November 1984,
the applicants appointed public relations consultants. With the
latter's assistance, the brothers and their direct advisers led the
press to receive and present a positive picture of their origins,
wealth, business interests and resources. Upon the basis of this
picture, which they had a part in painting, they enjoyed, for a time,
an esteem or reputation which was highly valuable to them. Between
2 and 10 November 1984 the first applicant gave separate interviews to
The Observer, The Sunday Telegraph and The Daily Mail. A further
interview involving the brothers took place on 10 March 1985. In
these interviews the brothers described a wealthy, distinguished and
established family background. They gave a similar picture to their
merchant banker, who accepted it and, acting on their behalf, conveyed
that picture by a press release in November 1984 and in a television
interview in early March 1985. There were other press interviews about
the family background for which the applicants were responsible.
They thus took active steps to promote their own reputations
in the public domain. The acceptance of the brothers by the City of
London and by the Government was later considered to be crucial to an
understanding of the events surrounding their takeover of HOF.
10. The takeover was vigorously but unsuccessfully opposed by
Lonrho PLC ("Lonrho") and, in particular, its Chief Executive,
Mr Rowland, a former business associate, turned rival, of the
applicants.
From about 1981, if not earlier, it had been Lonrho's wish to
acquire HOF. In December 1981, following a report from the Monopolies
and Mergers Commission the Secretary of State for Trade and Industry
("the Secretary of State") had sought and obtained from Lonrho
undertakings not to acquire or control any further shareholdings beyond
its then level of 29.9% of HOF. Thereafter Lonrho had sought to be
released from these undertakings.
In 1984 Lonrho had sold its share-holding in HOF to the
applicants, but when those directors representing Lonrho's interests
were obliged to resign from HOF's Board and the applicants bid to take
over HOF completely, relations between Lonrho and the applicants
deteriorated. Lonrho proceeded to launch an acrimonious campaign
against the applicants. In opposing the applicants' bid for HOF,
Lonrho had made submissions to Ministers concerning unfair competition
and the undesirability of HOF falling into foreign hands. It was
alleged that the applicants were fraudulently claiming that the funds
for the acquisition were theirs personally. Lonrho asserted that the
brothers were lying about their money and themselves and that they
should not be permitted to acquire HOF without a thorough inquiry.
However, the applicants' bid was cleared by the Department of Trade and
Industry ("DTI") and accepted by the HOF Board. In March 1985 the
Secretary of State decided, on the recommendation of the Director
General of Fair Trading, not to refer the applicants' proposed
acquisition to the Monopolies and Mergers Commission, as had been done
in the case of the earlier bid by Lonrho. The decision of Government
clearance was expressly described at the time by the DTI as having been
influenced by the statements made and assurances given by and on behalf
of the Fayed brothers about their bid. Lonrho nevertheless campaigned
on through the media and other publications, and in particular through
The Observer, a newspaper it owned.
11. The applicants instructed their solicitors to threaten and,
if necessary, institute libel proceedings if anything were published
putting in doubt their claim to be the beneficial owners of the funds
used to acquire HOF. This policy affected several publications,
including The Observer. In almost every instance the threat of action
led to the publication of a retraction. The applicants instituted
three libel actions against The Observer in 1985 and 1986 for articles
written about them. One central issue in these actions was the truth
or not of The Observer's allegation that the funds used by the
applicants in their takeover of HOF were not their own.
12. In March 1987 Lonrho commenced legal proceedings against the
applicants and their bankers alleging wrongful interference with
Lonrho's business, and conspiracy and negligence in connection with
HOFH's acquisition of HOF. In particular, it was alleged that the
applicants, by false statements about their financial capacity to
acquire the share capital and develop HOF's business, had persuaded
HOF's Board of Directors to accept their bid and had convinced the
Secretary of State not to refer their bid to the Monopolies and Mergers
Commission. It was claimed that the applicants had thereby tortiously
interfered with Lonrho's right to bid for the shares or, alternatively,
they had conspired against Lonrho.
Lonrho unsuccessfully sought leave to apply for judicial
review of the Secretary of State's refusal to refer the applicants'
acquisition of HOF to the Monopolies and Mergers Commission.
C. Appointment of the Inspectors and their investigation
13. On 9 April 1987, after two years of unrelenting pressure by
Lonrho upon the Government, the Secretary of State appointed two
Inspectors to investigate the affairs of HOFH and, in particular, the
circumstances surrounding the acquisition of shares in HOF in 1984 and
1985. The appointment of the Inspectors was made by the Secretary of
State under section 432 (2) of the Companies Act 1985 (see paragraph 36
below). They were told at the time of their appointment, and they so
informed the applicants, that an area of particular concern to the
Secretary of State was the validity of the assurances given by the
applicants and their advisers in March 1985 (Inspectors' report,
paragraphs 1.10, 23.1.9 and 26.19).
14. In their subsequent report the Inspectors described the
applicants' takeover bid as being unusual, not least because it was a
bid involving huge sums of money by three individuals and, since the
offerers were individuals, the corporate balance sheets and other
financial statements which are customary on such occasions were totally
absent (Inspectors' report, paragraph 21.1.1). In order to establish
what had occurred during the takeover, they had been obliged to make
findings on vigorously contested issues of fact (Inspectors' report,
paragraph 1.7).
The principal questions they addressed when investigating the
affairs of HOFH were listed in their report as follows:
"(i) Were the Fayeds who they said they were, and
if not who were they?
(ii) Did they acquire HOF with their own
unencumbered funds?
(iii) Did they deliberately mislead, whether
directly or indirectly, those who represented them to the
authorities and the public?
(iv) If so, did they seek to frustrate those who
tried to establish the true facts, and if so how?
(v) What steps did the Board of HOF and its
advisers take before they gave the comfort that they appeared
to give to those who relied on their words or actions?
(vi) Were the authorities - the officials of the
[Office of Fair Trading] and the DTI and, eventually,
Ministers - or the public misled about the Fayeds? If so,
how and why?"
(The Inspectors' report, paragraph 1.11)
The Inspectors also stated that, throughout their
investigation, they were not concerned solely with simple questions
relating to the direct control of the purchase money which was used to
buy HOF. They were also concerned about the veracity of the statements
which the applicants made, or which they allowed others to make on
their behalf, which had the effect of influencing people to act
favourably towards them (Inspectors' report, paragraph 1.12; and also
chapter 9).
15. During the course of the investigation, the Inspectors
identified matters upon which they wished to receive evidence. If any
uncertainty or issue arose in relation to the provision of such
evidence, these were discussed in the course of meetings or through
correspondence between the Inspectors' staff and the applicants'
solicitors. Thereafter, information was provided to the Inspectors by
way of memoranda, together with copy documentation. In addition, the
Inspectors received oral evidence by interviewing witnesses on oath.
Mr Mohamed Al Fayed and Mr Ali Fayed were interviewed, in the presence
of their lawyers, on 14 October 1987 and again on 8 and 9 March 1988.
All proceedings were conducted in private. There was no opportunity
for the applicants to confront or cross-examine witnesses, it being
well-established as a matter of English law that the Inspectors were
not obliged to afford such an opportunity to anyone.
16. It was agreed between the Inspectors and the applicants that,
having assimilated the factual information supplied, the Inspectors
would notify the applicants of the provisional conclusions they had
reached and the material upon which they had relied in reaching such
conclusions. The Inspectors would then consider such submissions as
the applicants might make in respect of these conclusions.
17. Respect for personal privacy was known to be a matter of
especial concern to the applicants. The Inspectors' approach to
matters of privacy and confidentiality is summed up in their report
(at paragraphs 26.44 - 45) as follows:
"[I]f private people incorporate a company, in which they
become directors, and which makes public representations
about their affairs, Inspectors who are appointed to
investigate the truth of those representations must balance
their concern to preserve the directors' privacy as far as
practicable ... against their duty to do the job which they
were appointed to perform.
If the Fayeds had chosen to say nothing this might have
created evidential difficulties for us. But because they
wished us to make findings in their favour they brought
witnesses to see us ... and gave us evidence about their
private affairs which it was then our duty to test."
18. At the start of the investigation the applicants expressly
accepted that the Inspectors were entitled to inquire into the accuracy
of statements which had been made by them or on their behalf in late
1984 and early 1985. These were the statements at the heart of the
investigation. Only at the very end of the investigation, when they
were confronted by the Inspectors with "overwhelming evidence" that
they had been telling lies, did they resile from that stance and
challenge the Inspectors' entitlement to look into certain aspects of
their private life (Inspectors' report, paragraph 26.28).
The Inspectors rejected the challenge and gave their reasons
for so doing (see generally chapter 16 of the Inspectors' report). The
Inspectors were entitled to seek confidential information from third
parties, but before doing so they gave the applicants an opportunity
to satisfy them as to the accuracy of the statements "in whatever
manner was least obtrusive to their privacy" (Inspectors' report,
paragraphs 16.2.5 and 16.6.2). The law did not permit them to compel
the applicants to produce personal bank statements (which would have
gone far to confirm or refute the accuracy of the statements) nor, save
to a very limited extent, did the applicants consent to such
production. The Inspectors considered that the applicants were in
breach of their duty to give all the assistance which they were
reasonably required to give. By virtue of section 436 of the 1985 Act
the Inspectors could have certified this to a court, which could then
have taken steps to sanction the applicants if, after hearing evidence,
it was satisfied that they were in breach of their duty (see
paragraph 38 below). The Inspectors were, however, of the opinion that
they could complete their task without the need to resort to such a
serious measure and chose to pursue the matter without making such a
certificate. They made clear that if the applicants chose not to give
evidence, they, the Inspectors, would be entitled to draw inferences
from such failure.
19. In October 1987 and thereafter Lonrho publicly criticised the
conduct of the investigation by the Inspectors and sought an additional
two-month period in which to assemble and submit evidence to them.
Through its lawyers, Lonrho argued that the rules of natural justice
required the Inspectors to allow Lonrho access to the information the
Inspectors had received from the applicants because Lonrho's commercial
reputation would suffer if the Inspectors dismissed the complaints
which it had made so publicly. The Inspectors dismissed Lonrho's
application for access to the applicants' evidence, but permitted
Lonrho to have a longer period in which to adduce evidence to them,
relating primarily to the personal background of the applicants and
their family. The applicants' solicitors in turn protested to the
Inspectors vigorously about this latter decision. The written material
provided to the Inspectors by Lonrho ran to thousands of pages. The
Inspectors accepted that Lonrho and its directors had pursued their
ends in a remarkably single-minded manner, and they described the
applicants and Lonrho as "bitterly antagonistic parties" (Inspectors'
report, paragraph 26.71).
D. The Inspectors' report and its follow-up, including
consideration of criminal and civil proceedings
20. The Inspectors' provisional conclusions, which exceeded
500 pages of text and were, in large part, unfavourable to the
applicants, were made available to the applicants on 12 April 1988.
The Inspectors had previously made known to the applicants the gist of
the adverse evidence received and the conclusions that they, the
Inspectors, might be disposed to draw from that evidence.
Between 12 April and 17 June there was no significant response
from the applicants. On the latter date the applicants' solicitors
informed the Inspectors that they were not even in a position to
discuss the procedural situation of the inquiry. The Inspectors told
the applicants' solicitors on 20 June that by 15 July the Inspectors
would consider that they had had ample time to respond to the
provisional conclusions. On that date the applicants lodged detailed
submissions running to 571 pages and containing a mixture of factual
analysis and legal argument and, quite often, new evidence. The
argument sought to limit the scope of the inquiry very drastically.
The applicants' solicitors requested the Inspectors, as "the basic
minimum which fairness required", to deal with certain questions raised
and, if rejecting any of their principal submissions, to state reasons
before issuing any report (Inspectors' report , paragraph 1.23 and
chapter 17).
21. On 23 July 1988 the Inspectors delivered their report to the
Secretary of State, in broadly the same terms as their provisional
conclusions. They explained that they had not acceded to the
applicants' ultimate procedural request because they were of the view
that otherwise the completion of their report might be indefinitely
delayed:
"It appeared to us that the appropriate course for us to take
would be to consider the written submissions we had received
and to express our views on them when we submitted our report
to the Secretary of State. Our findings would not be
dispositive of anything, we had given HOFH, HOF, the Fayeds
and their advisers ample time to make their submissions,
which they had chosen to make in this way at this extremely
late stage and we considered that it was in the public
interest that we should now complete our work and submit our
report."
22. The Inspectors concluded that the applicants had dishonestly
misrepresented their origins, their wealth, their business interests
and their resources to the Secretary of State, the Office of Fair
Trading, the press, the HOF Board and HOF shareholders and their own
advisers; that during the course of their investigations, the
Inspectors had received evidence from the applicants, under solemn
affirmation and in written memoranda, which was false and which the
applicants knew to be false; in addition, that the applicants had
produced a set of documents they knew to be false; that this evidence
related mainly, but not exclusively, to their background, their past
business activities and the way in which they came to be in control of
enormous funds in the autumn of 1984 and the spring of 1985 (see
especially Inspectors' report, chapter 2). The Inspectors were
satisfied that the main thrust of Lonrho's attack on the applicants was
well founded on a sound basis of substantiated fact (Inspectors'
report, paragraph 1.20).
However, the Inspectors did not reject the entirety of the
applicants' evidence and praised part of their work. Thus the report
included, for example, findings that "the departure of the Lonrho
directors and their replacement by the Fayeds brought harmony to a
board where previously discord had existed" (Inspectors' report,
paragraph 6.6.9); and that "the Fayeds' considerable ability to
identify assets with a potential for capital appreciation has
undoubtedly been an important element in their business success"
(Inspectors' report, paragraph 12.6.10). In the final chapter of the
report the Inspectors made complimentary findings of fact and expressed
favourable opinions about HOFH. They regarded the management of HOF
since its acquisition as, subject to certain reservations,
"law-abiding, proper and regular".
23. The Secretary of State passed the report to the Director of
Public Prosecutions and the Director of the Serious Fraud Office. On
29 September 1988 the DTI announced that publication of the report
would be delayed until the Serious Fraud Office had completed its
investigations. In the summer of 1988 the Secretary of State also sent
copies of the report to the Bank of England, the City Panel on
Takeovers and Mergers (which is an integral part of the system of
regulation of business in the United Kingdom), the Inland Revenue, the
Office of Fair Trading and the Monopolies and Mergers Commission.
24. On 9 November 1988 the Secretary of State announced that,
consistent with the advice of the Director General of Fair Trading, he
had decided against the referral of HOFH's acquisition of HOF to the
Monopolies and Mergers Commission, even though the Inspectors' report
did disclose new material facts.
Also in November 1988 Lonrho made an application for judicial
review of the Secretary of State's decisions (i) not to publish the
report immediately and (ii) not to refer the acquisition to the
Monopolies and Mergers Commission in the light of the report. In the
context of these proceedings the Director of the Serious Fraud Office
and the Director of Public Prosecutions submitted affidavits in
December 1988 stating their opinion that publication of the report
would prejudice the criminal investigation and run the risk of
preventing a fair trial in the event of criminal proceedings
subsequently being brought against the applicants. Lonrho's
application was ultimately rejected by the House of Lords in May 1989.
25. On 30 March 1989 The Observer newspaper published a
sixteen-page special midweek edition devoted solely to extracts from
and comments on a leaked copy of the Inspectors' report. On the same
day, Lonrho posted between 2,000 and 3,000 copies of the special
edition to persons named on a mailing list to whom Lonrho had been
regularly sending literature hostile to the applicants. The High Court
immediately granted injunctions, on the applications of the Secretary
of State and HOFH, restraining any further disclosure of the report or
its contents.
26. During the course of a radio interview broadcast on
4 April 1989, the Secretary of State stated, prior to its publication,
that the Inspectors' report "clearly disclosed wrongdoing". This gave
rise to substantial press coverage.
27. On 1 March 1990 the Director of the Serious Fraud Office and
the Director of Public Prosecutions announced that their inquiries into
the matter were complete (see paragraph 23 above) and that they would
not be taking further action. In a joint statement issued on that date
they said:
"The directors are now satisfied that all lines of inquiry
have been pursued and that the evidence available is
insufficient to afford a realistic prospect of conviction for
any criminal offence relating to any matter of substance
raised in the report."
The Attorney General expressed himself satisfied that
the conclusion reached by the two directors was the correct one on the
basis of the admissible and available evidence. On 12 March 1990 he
stated to the House of Commons, in reply to a question (Hansard, House
of Commons, 12 March 1990, column 14):
"Whereas it was open to the Inspectors to take account of
hearsay evidence if they thought that it was reliable - and
of course it was open to them to reach the conclusion that
they did - it would not have been open to a jury in a
criminal case to convict upon evidence of the same character.
The Inspectors are entitled to take account of evidence
covering a wider scope than that available in criminal
proceedings in an English court ... Inquiries were pursued
in every part of the world indicated by the Inspectors'
report, but the [Director of the Serious Fraud Office and the
Director of Public Prosecutions] had to conclude, as they
said in their joint statement issued on 1 March, that there
was insufficient evidence available for use in an English
court in English criminal proceedings on any matter of
substance raised in the Inspectors' report to warrant the
bringing of criminal proceedings."
E. Publication of the Inspectors' report
28. On 1 March 1990 the Secretary of State had announced his
intention to publish the report on 7 March 1990. It is general policy
to publish reports on public companies, of which HOFH was one (see
paragraph 41 below). In addition the Government considered that in the
particular case there were specific grounds of general public interest
justifying publication. In their pleadings before the Commission they
described these grounds as follows:
"There had been a complex and lengthy investigation, and the
public were entitled to learn the result of that
investigation unless there were compelling reasons why they
should not. There were important lessons to be learnt by
those involved in takeovers from studying the report. ...
The report contained a recommendation that certain features
of part XIV of the 1985 Act (which deals with the
investigation of companies and their affairs) deserved to be
reconsidered in the light of difficulties encountered by the
Inspectors ... It was appropriate to acknowledge that the
Secretary of State, the [Office of Fair Trading], the DTI,
certain journalists and sections of the press, the Board of
HOF, the regulatory authorities, and the applicants'
professional advisers had been misled by the applicants.
Lonrho considered that its interests and reputation had been
seriously and adversely affected by the preparedness of the
Secretary of State to allow the HOFH bid to go forward in
March 1985 without a reference to the [Monopolies and Mergers
Commission]. Lonrho would have had a legitimate grievance if
the explanation for this was suppressed without compelling
reasons. There was a need to dispel continuing speculation
as to the events which had given rise to the investigation.
Rumours and speculation were rife. Publication of the report
would provide employees and creditors with information
concerning the way in which HOF and Harrods had been run and
might be expected to be run in future. (The Inspectors were
largely prepared to accept the sincerity of the brothers'
assurances for the future.) The brothers had been prepared
before the Inspectors to attempt to discredit Lonrho,
Mr Rowland, The Observer, its editor and others. It was
deemed to be in the public interest to publicise both the
fact that these attempts had been made and the conclusion of
the Inspectors that they were ill-founded."
29. On 2 March 1990, the applicants were provided with
pre-publication copies of the report in confidence, in order to enable
them to consider their position.
Throughout the period between submission of the report to the
Secretary of State in July 1988 and its publication on 7 March 1990 the
applicants' solicitors had adopted, in extensive correspondence with
the DTI and the Treasury Solicitor, the position that judicial review
or other court proceedings were likely to be taken, on the basis, inter
alia, that the Inspectors' report did not constitute a valid report
under the Companies Act 1985 because of the scope of the investigation
and alleged procedural unfairness (including departures from what the
applicants alleged was an agreed procedure). By letter dated
1 March 1990 the DTI undertook that if the applicants were to apply for
judicial review to challenge the validity of the report, publication
would be held up pending the final determination by the courts of their
application. In the event no such proceedings were commenced.
According to the applicants, the possibility of applying for judicial
review to prevent publication was kept under consideration by them and
their advisers, but the unanimous view at all stages was that such
proceedings were almost inevitably bound to fail.
30. On 7 March 1990, the day the report was published, the
Secretary of State stated to the House of Commons (Hansard, House of
Commons, 7 March 1990, column 873):
"I should explain to the House that in this matter I have
three main responsibilities as Secretary of State: first, to
decide whether to publish the report. This I have now done
as soon as possible after I was informed by the prosecution
authorities that they had withdrawn their objection to
publication. Second, I had to consider whether to apply to
the court to disqualify any director under section 8 of the
Company Directors Disqualification Act 1986. I have
concluded that it would not be in the public interest to do
so. Anyone who reads the report can decide for themselves
what they think of the conduct of those involved. Third, I
also have responsibility for decisions on whether to refer
mergers to the Monopolies and Mergers Commission. That
responsibility was fully discharged by my predecessor. He
had six months from July 1988 in which to consider the
findings of the Inspectors' report and to decide whether to
refer the matter. He concluded in November 1988 that a
reference to the Monopolies and Mergers Commission would not
be appropriate ...
No other matters require action from me. I have passed the
report to all those authorities concerned with enforcement
and regulation so that they may consider whether to take
action under their various powers."
The Secretary of State considered that the publication of the
report and the ensuing publicity would enable people who might have
dealings with the applicants in their capacity as directors to judge
whether their interests were likely to be at risk from the type of
conduct described in the report (ibid., column 878).
31. The Secretary of State also publicly expressed his own view
as to the correctness of the Inspectors' findings. On 28 March 1990
he told a Parliamentary Select Committee (House of Commons Trade and
Industry Committee report on company investigations, 2 May 1990, HC 36,
Annex 6, p. 183, paras. 938, 940A):
"... the allegations in the report have not been
substantiated in a court of law. We can all take our view
about them and I think that the balance of probability is
extremely strong that they are accurate, but there is no
proof of this.
...
I am not required to say that every fact and opinion in the
report is true. These were outside Inspectors who were
appointed to look into these matters, and they published
their report. I have no means of checking it word for word.
I myself and I think most people are inclined to believe that
the events revealed are correct, but we have no proof - that
is all I am saying.
...
[Question:] It appears that [the applicants] even told a
succession of lies to the Inspectors themselves, who were
then investigating the lies they had already told. Is that
right?
[Secretary of State:] It so appears."
The Select Committee accepted the Inspectors' findings as
authoritative, referring in its subsequent report to the
"misinformation concerning the financial status of the Fayed brothers"
recounted in the Inspectors' report (Trade and Industry Committee
report, loc. cit., p. xxvi, para. 126).
32. On the day of the publication of the report the applicants
issued a press communiqué through HOFH commenting on, inter alia, the
contents of the report and the conduct of the Inspectors. Part of this
press release read as follows:
"It is appalling to discover that two people in such a
position could have gone so badly off the rails in the
conduct of this investigation.
...
The Inspectors misled us.
They misled our lawyers. Indeed they were not even honest
with them.
They demonstrated prejudice towards us and they did not treat
us even-handedly.
They reneged on their agreements with us.
They have employed language which has no place in such a
document.
They have reached conclusions which they do not support with
facts.
They have dishonoured themselves and the whole procedure of
Department of Trade inquiries.
These Inspectors went far beyond their legal powers,
enquiring into matters that were no legitimate concern to
them.
They completely disregarded the principles of natural
justice. In simple terms they did not give us a fair
hearing. They reversed the burden of proof in a denial of
the basic tenet of British justice. They have held us to be
guilty, unless proven innocent."
33. On 28 March 1990, in the course of a debate in the House of
Lords, the Minister of State for Trade and Industry stated (Hansard,
House of Lords, 28 March 1990, columns 946-47):
"Although the Inspectors concluded that the Fayeds lied to
the competition authorities at the time of the merger - I
have no reason to believe that they were wrong, but it is for
individuals to make up their own minds once they have read
the report - the Inspectors did not criticise the Fayeds for
the way they were running the House of Fraser which they
already owned and which cannot be taken away from them. In
these circumstances, [the Secretary of State] considered that
publication of the report, which would allow people to judge
for themselves whether they wished to do business with the
Fayeds, would be a severe blow to their reputation, as indeed
I think it has proved."
F. Aftermath of publication
34. The report and its findings were widely reported on
television, radio and in the national press. The applicants claimed
that it very seriously damaged their personal and commercial
reputations as the Minister had predicted.
In August 1990 they abandoned their libel actions against
The Observer newspaper and paid the latter's £500,000 legal costs. At
the time the Court of Appeal was about to hear an appeal brought by the
applicants on a preliminary procedural question. Failure in this
appeal would have had the consequence of obliging the applicants to
disclose a number of crucial documents bearing on the issue of the
possible financing of the acquisition of HOF by third-party funds.
According to the applicants, they discontinued the libel actions as a
result of legal advice that publication of the Inspectors' report had
deprived them of any effective remedy (see paragraph 11 above).
One month after the publication of the report the Bank of
England served notice of restrictions on Harrods Bank Ltd in relation
to the applicants' positions within that company. The Parliamentary
Select Committee considered that the Secretary of State had not taken
sufficient action against the applicants (Trade and Industry Committee
report on company investigations, loc. cit., pp. xxv-xxvii,
paras. 118-40). The City Takeover Panel subsequently disciplined the
applicants, in reliance on the report. As the Takeover Panel made
clear, it did not seek to conduct its own investigation into the facts,
but relied on the Inspectors' report. The penalty imposed was public
censure.
35. Lonrho persisted with its attacks. In May 1990 it applied for
judicial review of the Secretary of State's refusal to apply to the
High Court for an order disqualifying the three applicants as
directors. This application was dismissed on 21 October 1991.
In October 1993 it was announced that a settlement had been
negotiated between the applicant brothers and Lonrho, the terms of
which included the discontinuance of all proceedings between the two
parties.
II. Relevant domestic law and practice
A. Basis and scope of a section 432 (2) investigation
36. The investigation of HOFH was conducted under section 432 (2)
of the Companies Act 1985 in relation to the circumstances surrounding
the acquisition of shares in HOF in 1984 and 1985. Section 432 (2)
empowers the Secretary of State to appoint Inspectors to investigate
the affairs of a company and to report on them in such manner as he
directs if it appears to him that there are circumstances suggesting
wrongdoing, within the categories of wrongdoing defined as follows:
"(a) that the company's affairs are being or have been
conducted with intent to defraud its creditors or the
creditors of any other person, or otherwise for a fraudulent
or unlawful purpose, or in a manner which is unfairly
prejudicial to some part of its members, or
(b) that any actual or proposed act or omission of the
company (including an act or omission on its behalf) is or
would be so prejudicial, or that the company was formed for
any fraudulent or unlawful purpose, or
(c) that persons concerned with the company's formation
or the management of its affairs have in connection therewith
been guilty of fraud, misfeasance or other misconduct towards
it or towards its members, or
(d) that the company's members have not been given all
the information with respect to its affairs which they might
reasonably expect."
37. The Secretary of State is under no statutory obligation to
disclose to the company concerned the reasons for the appointment of
Inspectors to investigate its affairs (Norwest Holst Limited v.
Secretary of State [1978] 3 Weekly Law Reports 73 (Court of Appeal));
nor does he generally do so. In the present case, when requested by
the House of Lords to do so in the course of Lonrho's judicial review
applications, counsel for the Government stated that the Secretary of
State had acted under section 432 (2) (a) in appointing the Inspectors.
B. Inspectors' powers to obtain information
38. Section 434 confers wide powers upon the Inspectors to obtain
information, if necessary by compulsion, from officers and agents of
the company whose affairs are being investigated. An answer given by
a person to a question put to him in exercise of powers conferred by
section 434 may be used in evidence against him (section 434 (5)).
Under section 436 obstruction of the Inspectors may be certified by
them to a court, which may, after enquiry, treat it as a contempt of
court punishable by imprisonment or fine.
C. Inspectors' duty to act fairly
39. The Inspectors are bound by the rules of natural justice; they
have a duty to act fairly and to give anyone whom they propose to
criticise in their report a fair opportunity to answer what is alleged
against them (In re Pergamon Press Ltd [1971] 1 Chancery 388 (Court of
Appeal)). The Inspectors in the present case accepted as applicable
to them the principle of natural justice whereby a person exercising
an investigatory jurisdiction must base his or her findings on material
having probative value (Inspectors' report, paragraphs 26.23 and 26.25
- citing Mahon v. Air New Zealand [1985] Appeal Cases 808
(Privy Council), at pp. 820-21).
However, proceedings before the Inspectors are administrative
in form, not judicial; the Inspectors are not a court of law and they
are masters of their own procedure (In re Pergamon Press Ltd, loc.
cit., pp. 399-400, per Lord Denning MR; pp. 406-07, per Buckley LJ).
Except for the duty to act fairly, Inspectors are not subject to any
set rules or procedures and are free to act at their own discretion.
There is no right for a person who is at risk of being criticised by
the Inspectors to cross-examine witnesses (ibid., p. 400B, per
Lord Denning MR). It is not necessary for the Inspectors to put their
tentative conclusions to the witnesses in order to give them a chance
to refute them. It is sufficient in law for the Inspectors to put to
the witnesses what has been said against them by other persons or in
documents to enable them to deal with those criticisms in the course
of the investigation (Maxwell v. Department of Trade and Industry
[1974] 1 Queen's Bench 523 (Court of Appeal)).
D. Publication of the report of an investigation
40. The Secretary of State is empowered by section 437 (3) (c) to
decide whether or not to print and publish the Inspectors' report.
Although he has a very wide discretion in deciding whether or not to
publish the whole report, he is precluded by section 437 (3) (c) from
deciding to publish only parts or a synopsis of it.
Publication may be deferred if there is a possibility that
criminal proceedings may be taken, in order to avoid the possibility
of prejudice to such proceedings.
41. The question whether an Inspector's report should be published
is considered in each case on its merits. The DTI's general policy is
to publish reports on public companies wherever possible, as being
matters of public interest.
Members of a limited company are in a privileged legal
position because their liability is limited. In view of this
privilege, where the Secretary of State has decided that the affairs
of a large public company should be investigated under the provisions
of section 432 of the 1985 Act, because he is satisfied that the
circumstances are of sufficient concern to warrant the substantial cost
of an inspection, it is important that the Inspectors' report
explaining the underlying facts and the conclusions that they draw from
them should be made public unless there are overriding reasons to the
contrary.
E. Inspectors' liability in defamation
42. The defence of privilege or immunity in defamation cases rests
upon the idea that conduct which would otherwise be actionable escapes
liability because the defendant is acting in furtherance of some
interest of social importance which is entitled to protection, even at
the expense of uncompensated harm to the plaintiff's reputation. If
the interest is one of paramount importance, considerations of policy
may require that the defendant's immunity for false statements be
absolute, without regard to his purpose or motive or the reasonableness
of his conduct. Such is the nature of the absolute protection afforded
to judicial and parliamentary proceedings. Also on grounds of public
policy, a defence of qualified privilege may lie when the publication
is made by a person in good faith and in the discharge of some public
or private duty. The condition attached to qualified privilege is that
it must be exercised in a reasonable manner and for a proper purpose.
A publisher with malicious intent would lose the defence of qualified
privilege.
43. In re Pergamon Press Ltd (loc. cit., at p. 400G) Lord Denning
MR stated:
"Inspectors should make their report with courage and
frankness, keeping nothing back. The public interest demands
it. They need have no fear because their report, so far as
I can judge, is protected by an absolute privilege ..."
Even if, contrary to Lord Denning's observation, the
Inspectors' report is subject to a qualified rather than an absolute
privilege, neither the Inspectors nor the Secretary of State could be
successfully sued for defamation in publishing the report, except upon
proof of express malice (that is, the desire to injure as the dominant
motive for the defamatory publication: see Horrocks v. Lowe [1975]
Appeal Cases 135 (House of Lords), at p. 149, per Lord Diplock).
F. Judicial review
44. The grounds on which administrative action (such as the
Secretary of State's decision to publish the report) is subject to
judicial control are the three traditional grounds of judicial review
described by Lord Diplock in Council of Civil Service Unions v.
Minister for the Civil Service ([1985] Appeal Cases 375 (House of
Lords), at pp. 410-11). These grounds are illegality, irrationality
and procedural impropriety.
"Illegality" means that the decision-maker must understand
correctly the law that regulates his decision-making power and must
give effect to it.
"Irrationality", or what is often also referred to as
"Wednesbury unreasonableness" (see Associated Provincial Picture Houses
Ltd v. Wednesbury Corporation [1947] 1 King's Bench 223 (Court of
Appeal)), applies to a decision which is so outrageous in its defiance
of logic or of accepted moral standards that no sensible
person who had applied his mind to the question to be decided could
have arrived at it. "'Irrationality' or 'Wednesbury unreasonableness'
is a narrowly restricted ground of judicial review of an administrative
decision. Where the existence or non-existence of a fact is left to
the judgment and discretion of a public body and that fact involves a
broad spectrum ranging from the obvious to the debatable to the just
conceivable, it is the duty of the court to leave the decision of fact
to the public body to whom Parliament has entrusted the decision-making
power save in a case where it is obvious that the public body,
consciously or unconsciously, are acting perversely" (per Lord
Brightman, in R. v. Hillingdon LBC, ex parte Puhlhofer [1986] Appeal
Cases 484 (House of Lords), p. 528).
"Procedural impropriety" covers failure to observe basic rules
of natural justice or failure to act with procedural fairness towards
the person who will be affected by the decision, as well as failure to
observe procedural rules that are expressly laid down even where such
failure does not involve any denial of natural justice.
45. Judicial review would, for example, provide a remedy if
Inspectors under the Companies Act were prejudiced or biased against
the subjects of their report (Franklin v. Minister of Town and County
Planning [1948] Appeal Cases 87 (House of Lords)); or if the Inspectors
reached conclusions which there were no facts to support, or took into
account irrelevant considerations, or failed to take account of
relevant considerations, or reached conclusions which no reasonable
person in their position could have reached (the Wednesbury case, loc.
cit.); or if their findings have not been properly based on material
which has probative value (Mahon v. Air New Zealand, loc. cit.); or if
the Inspectors were dishonest or acted in bad faith (the Wednesbury
case, loc. cit.); or if the Inspectors acted ultra vires or beyond
their legal powers (the Wednesbury case, loc. cit.); or if the
Inspectors acted against the legitimate expectations of those concerned
(Council of Civil Service Unions v. Minister for the Civil Service,
loc. cit.); or if the Inspectors acted contrary to the rules of natural
justice (Wiseman v. Borneman [1971] Appeal Cases 297 (House of Lords));
or if the Inspectors acted unfairly (In re Pergamon Press, loc. cit.;
Maxwell v. Department of Trade, loc. cit.; R. v. Panel on Takeovers
and Mergers, ex parte Guinness PLC [1990] 1 Queen's Bench 146 (Court
of Appeal)).
However, a mistake of fact could not form the basis of a
challenge to an administrative decision by the Inspectors or the
Secretary of State unless the fact was a condition precedent to an
exercise of jurisdiction, or the fact was the only evidential basis for
a decision, or the fact was as to a matter which expressly or impliedly
had to be taken into account (R. v. London Residuary Body, ex parte
Inner London Education Authority, Times Law Reports, 24 July 1987
(Divisional Court)).
PROCEEDINGS BEFORE THE COMMISSION
46. The three applicant brothers and the company HOFH lodged an
application (no. 17101/90) with the Commission on 30 August 1990.
The applicants contended that, in violation of Article 6
para. 1 (art. 6-1) of the Convention, the Inspectors' report had
determined their civil right to honour and reputation and denied them
effective access to a court in determination of this civil right. They
further alleged a denial of effective domestic remedies to challenge
the findings of the Inspectors, contrary to both Article 6 para. 1 and
Article 13 (art. 6-1, art. 13) of the Convention.
In addition, they claimed that the making and publication of
the Inspectors' report had determined criminal charges against them and
violated the presumption of innocence, in breach of Article 6
paras. 1 and 2 (art. 6-1, art. 6-2); and had unjustifiably interfered
with their honour and reputation, protected as part of their right to
respect for private life under Article 8 (art. 8) of the Convention,
and with the peaceful enjoyment of their possessions as guaranteed
under Article 1 of Protocol No. 1 (P1-1).
47. On 15 May 1992 the Commission declared admissible the
complaint of the three applicant brothers under the "civil" branch of
Article 6 para. 1 (art. 6-1) of the Convention, both on its own and in
relation to Article 13 (art. 13) of the Convention. The remainder of
the application, including the grievance of the fourth applicant
company, was declared inadmissible.
48. In its report of 7 April 1993 (Article 31) (art. 31) the
Commission expressed the opinion that there had been no violation of
Article 6 para. 1 (art. 6-1), either as regards the making and
publication of the Inspectors' report (twelve votes to one) or as
regards the applicant brothers' access to court whether for proceeding
against the Inspectors and the Secretary of State (ten votes to three)
or for proceeding against others (twelve votes to one). The Commission
further concluded (unanimously) that no separate issue arose under
Article 13 (art. 13).
The full text of the Commission's opinion and of the three
separate opinions contained in the report is reproduced as an annex to
this judgment*.
_______________
* Note by the Registrar. For practical reasons this annex will appear
only with the printed version of the judgment (volume 294-B of
Series A of the Publications of the Court), but a copy of the
Commission's report is obtainable from the registry.
_______________
FINAL SUBMISSIONS TO THE COURT
49. At the public hearing on 23 March 1994 the Government
maintained in substance the concluding submission set out in their
memorial, whereby they invited the Court to hold
"(1) that the application is inadmissible because of failure
by the applicants to exhaust domestic remedies;
(2) alternatively, (a) that there has been no violation of
Article 6 para. 1 (art. 6-1) of the Convention and (b) that
there has been no violation of Article 13 (art. 13) of the
Convention or that no separate issue arises for examination
under Article 13 (art. 13)".
50. On the same occasion the applicants likewise maintained in
substance the conclusions formulated at the close of their memorial,
whereby they requested the Court
"to decide and declare that they are the victims of breaches
of Article 6 (art. 6), and to afford just satisfaction to
them under Article 50 (art. 50) of the Convention".
AS TO THE LAW
I. THE GOVERNMENT'S PRELIMINARY OBJECTION
51. The Government submitted that the applicants had failed to
exhaust their domestic remedies in a number of respects. The Delegate
of the Commission explained at the hearing that this plea, although not
adverted to in the admissibility decision of 15 May 1992 because the
Commission assumed that it had not been maintained, had been raised
before the Commission at the appropriate time. The Court therefore has
jurisdiction to entertain it (see the Artico v. Italy judgment of
13 May 1980, Series A no. 37, pp. 12-13, paras. 24 and 27).
52. According to the Government, the applicants failed to exhaust
their domestic remedies (a) by not having applied for judicial review
either of the Inspectors' conduct of the inquiry or of their decision
to submit their report to the Secretary of State; (b) by not having
applied for judicial review of the Secretary of State's decision to
publish the Inspectors' report; and (c) by not having pursued the libel
proceedings commenced against The Observer newspaper.
53. The grounds on which judicial review may be sought (see
paragraphs 44 and 45 above) are such that it would not have ensured
access to a court for determination of the truth of statements made
about the applicants in the Inspectors' report, the absence of such
access being the essence of their complaints under the Convention. Nor
would the libel actions against The Observer, although to some extent
concerned with the same subject-matter (see paragraph 11 above), have
provided a remedy against the Inspectors or the Secretary of State as
regards the publication of the damaging statements contained in the
Inspectors' report.
The Court therefore agrees with the Delegate of the Commission
and the applicants that the plea of non-exhaustion of domestic remedies
has not been made out by the Government.
II. ALLEGED VIOLATION OF ARTICLE 6 PARA. 1 (art. 6-1)
54. The applicants contended that the Inspectors' investigation
and, above all, the publication of the Inspectors' report gave rise to
a violation of Article 6 para. 1 (art. 6-1), which, in so far as
relevant, provides:
"In the determination of his civil rights and obligations
..., everyone is entitled to a fair and public hearing ... by
an independent and impartial tribunal established by law ..."
In their submission, the making and the subsequent publication
of the Inspectors' report in its entirety seriously damaged their
reputations, thereby determining their civil right to honour and
reputation, and the state of English law was such that they were denied
effective access to the courts to challenge the resultant interference
with that civil right.
This contention was accepted neither by the Government nor by
the majority of the Commission.
A. Investigation by the Inspectors
55. The first stage of the applicants' argument, which was
disputed by the Government and not accepted by the Commission, was that
Article 6 para. 1 (art. 6-1) was applicable to the investigation by the
Inspectors.
56. In order for an individual to be entitled to a hearing before
a tribunal, there must exist a "dispute" ("contestation") over one of
his or her civil rights or obligations. It follows, so the Court's
case-law has explained, that the result of the proceedings in question
must be directly decisive for such a right or obligation, mere tenuous
connections or remote consequences not being sufficient to bring
Article 6 para. 1 (art. 6-1) into play (see, inter alia, the Le Compte,
Van Leuven and De Meyere v. Belgium judgment of 23 June 1981,
Series A no. 43, pp. 20-22, paras. 44-50).
57. The applicants claimed to identify three different disputes
(contestations) arising in and during the investigation by the
Inspectors: firstly, the dispute between the applicants and Lonrho,
which the applicants described as giving rise to and forming the
subject-matter of the proceedings conducted by the Inspectors;
secondly, a dispute between the applicants and the Inspectors, in that
the applicants had contested the Inspectors' actions in investigating
their honesty and then arriving at conclusions in this regard; and,
thirdly, a dispute between the applicants and the Secretary of State,
in that, notwithstanding their opposition, the Secretary of State had
initially considered there to be circumstances suggesting dishonest
conduct by them, and had thereafter adopted the contents of the
Inspectors' report, so they asserted, and decided to publish it.
In the applicants' submission, one of the objects of the
inquiry by the Inspectors was to make findings as to whether the
applicants were guilty of misconduct and the central conclusion of the
report was that the applicants had dishonestly misled the authorities.
Even though the Inspectors' role may in theory have been investigative,
the manner in which they performed their functions in the present case
was in fact determinative. The Inspectors' report, published to the
world at large, had the force of a judgment convicting the applicants
of dishonesty. The result of the inquiry was thus directly decisive
for the applicants' civil right to a good reputation. In short, so
they argued, the Inspectors' report effectively "determined" their
civil right to reputation without any of the procedural guarantees of
Article 6 para. 1 (art. 6-1) being respected.
58. Having regard to the cases of Golder v. the United Kingdom
(judgment of 21 February 1975, Series A no. 18, p. 13, para. 27) and
Helmers v. Sweden (judgment of 29 October 1991, Series A no. 212-A,
p. 14, para. 27), the respondent Government did not dispute the
existence and "civil" character of the right under English law to a
good reputation.
However, they submitted that neither the investigation by the
Inspectors nor the publication of the report "determined" the
applicants' civil right to a good reputation or, indeed, any right at
all. The principal purpose of the investigation and report of the
Inspectors, they maintained, was to acquire, marshal and set down
factual information which would enable the various competent
authorities - such as the Director General of Fair Trading, the
prosecuting authorities, the Bank of England, the Takeover Panel and
the Secretary of State (see paragraphs 23, 27, 30 and 34 above) - to
decide what action, if any, to take. Four further purposes also
existed, none of which, however, included ascertaining whether the
applicants merited their good reputation. These additional purposes
were dispelling public speculation about the events surrounding the
takeover, enabling those concerned in takeovers to learn lessons,
laying the foundations for reform of company law and practice, and
providing information to HOF's employees, shareholders and creditors.
59. The Commission, after analysing the purposes served by the
preparation and publication of the Inspectors' report, came to the
conclusion that the Inspectors had an "investigative rather than
determinative" role (paragraph 64 of the Commission's report). The
Commission was therefore of the opinion that Article 6 para. 1
(art. 6-1) was not applicable to the proceedings conducted by
Inspectors because those proceedings did not determine any civil right
or obligation of the applicants.
60. The Court notes that under the terms of section 432 (2) of the
Companies Act 1985 Inspectors can only be appointed if it appears to
the Secretary of State that there are circumstances suggesting one or
more types of specified wrongdoing or unlawful action in the conduct
of a company's affairs (see paragraph 36 above). The Act confers on
the Inspectors wide powers to obtain information and obstruction of the
Inspectors may, upon reference by them to a court, be treated by it as
a contempt of court and punished accordingly (sections 434 and 436 of
the Act - see paragraph 38 above). The principal question addressed
by the Inspectors in the instant case can be reduced to whether the
Fayed brothers had dishonestly misled the authorities and the public
in order to obtain Government clearance and acceptance by the HOF Board
of their bid (see paragraphs 13 and 14 above). The Inspectors'
published findings - that the applicants had indeed made dishonest
representations concerning their origins, their wealth, their business
interests and their resources and had thereafter knowingly submitted
false evidence to the Inspectors (see paragraph 22 above) - undoubtedly
damaged the applicants' reputations. The competent Ministers and a
Parliamentary Select Committee - quite apart, it can be supposed, from
a substantial section of public opinion - showed a disposition to
accept as correct these findings, publication of which was seen as a
kind of sanction (see paragraphs 26, 30, 31, 33 and 34 above).
Such elements or consequences are, it is true, not
infrequently found in the context of adjudicatory proceedings.
61. However, the Court is satisfied that the functions performed
by the Inspectors were, in practice as well as in theory, essentially
investigative (see the similar analysis by the Supreme Court of the
United States of America of the function of the Federal Civil Rights
Commission in the case of Hannah v. Larche (363 US 420 (1960)). The
Inspectors did not adjudicate, either in form or in substance. They
themselves said in their report that their findings would not be
dispositive of anything (see paragraph 21 above). They did not make
a legal determination as to criminal or civil liability concerning the
Fayed brothers, and in particular concerning the latter's civil right
to honour and reputation. The purpose of their inquiry was to
ascertain and record facts which might subsequently be used as the
basis for action by other competent authorities - prosecuting,
regulatory, disciplinary or even legislative.
Lonrho admittedly exhibited a clear interest in the inquiry
and its outcome, by being instrumental in bringing about the
appointment of the Inspectors, by submitting evidence and by seeking
to prompt action by the Secretary of State (see paragraphs 12 in fine,
13, 19, 24, 25 and 35 above). The Inspectors described Lonrho and the
Fayed brothers as "bitterly antagonistic parties" (see paragraph 19 in
fine above). Nonetheless, whilst there was a close connection between
Lonrho's grievance against the Fayed brothers and the matters
investigated by the Inspectors (see, inter alia, paragraphs 10-13 and
22 above), the object of the proceedings before the Inspectors was not
to resolve any dispute (contestation) between Lonrho and the
applicants. Those disputes, and in particular the applicants' libel
claims that Lonrho, through The Observer, had wrongfully damaged their
reputations, were being adjudicated by the ordinary courts (see
paragraphs 11 and 12 above). Likewise, no dispute (contestation)
between the Secretary of State or the Inspectors and the applicants as
to the lawfulness of any alleged interference with the applicants'
right to reputation arose merely because the applicants contested the
grounds on which the Minister decided to appoint the Inspectors and on
which the Inspectors conducted their lines of inquiry.
In short, it cannot be said that the Inspectors' inquiry
"determined" the applicants' civil right to a good reputation, for the
purposes of Article 6 para. 1 (art. 6-1), or that its result was
directly decisive for that right.
62. Acceptance of the applicants' argument would entail that a
body carrying out preparatory investigations at the instance of
regulatory or other authorities should always be subject to the
guarantees of a judicial procedure set forth in Article 6 para. 1
(art. 6-1) by reason of the fact that publication of its findings is
liable to damage the reputation of the individuals whose conduct is
being investigated. Such an interpretation of Article 6 para. 1
(art. 6-1) would in practice unduly hamper the effective regulation in
the public interest of complex financial and commercial activities.
In the Court's view, investigative proceedings of the kind in issue in
the present case fall outside the ambit and intendment of Article 6
para. 1 (art. 6-1).
63. The Court accordingly concludes that the investigation by the
Inspectors was not such as to attract the application of Article 6
para. 1 (art. 6-1).
B. Proceedings to contest the Inspectors' findings
64. The Inspectors' report, published to the world at large,
contained statements damaging to the applicants' reputations.
The applicants argued that English law denied them their
entitlement under Article 6 para. 1 (art. 6-1) to access to a court to
have determined whether there was any justification for this attack on
their reputations. In particular, they stated, there was no
opportunity under English law, whether by way of defamation proceedings
or by way of judicial review, to challenge the Inspectors' condemnatory
findings of fact or conclusions before a tribunal satisfying the
requirements of Article 6 para. 1 (art. 6-1).
1. Relevant principles
65. In the words of the Court's Golder judgment, "... Article 6
para. 1 (art. 6-1) secures to everyone the right to have any claim
relating to his civil rights and obligations brought before a court or
tribunal. In this way the Article (art. 6-1) embodies the 'right to
a court', of which the right of access, that is the right to institute
proceedings before courts in civil matters, constitutes one aspect
only" (loc. cit., p. 18, para. 36). This right to a court "extends
only to 'contestations' (disputes) over (civil) 'rights and
obligations' which can be said, at least on arguable grounds, to be
recognised under domestic law; [Article 6 para. 1] (art. 6-1) does not
in itself guarantee any particular content for (civil) 'rights and
obligations' in the substantive law of the Contracting States" (see,
inter alia, the James and Others v. the United Kingdom judgment of
21 February 1986, Series A no. 98, pp. 46-47, para. 81; and the Powell
and Rayner v. the United Kingdom judgment of 21 February 1990, Series A
no. 172, p.16, para. 36).
Whether a person has an actionable domestic claim may depend
not only on the substantive content, properly speaking, of the relevant
civil right as defined under national law but also on the existence of
procedural bars preventing or limiting the possibilities of bringing
potential claims to court. In the latter kind of case
Article 6 para. 1 (art. 6-1) may have a degree of applicability.
Certainly the Convention enforcement bodies may not create by way of
interpretation of Article 6 para. 1 (art. 6-1) a substantive civil
right which has no legal basis in the State concerned. However, it
would not be consistent with the rule of law in a democratic society
or with the basic principle underlying Article 6 para. 1 (art. 6-1)
- namely that civil claims must be capable of being submitted to a
judge for adjudication - if, for example, a State could,
without restraint or control by the Convention enforcement bodies,
remove from the jurisdiction of the courts a whole range of civil
claims or confer immunities from civil liability on large groups or
categories of persons (see the Commission's admissibility decision of
9 October 1984 on application no. 10475/83, Dyer v. the United Kingdom,
Decisions and Reports 39, pp. 246-66 at pp. 251-52).
The relevant principles have been stated by the Court as
follows:
"(a) The right of access to the courts secured by Article 6
para. 1 (art. 6-1) is not absolute but may be subject to
limitations; these are permitted by implication since the
right of access 'by its very nature calls for regulation by
the State, regulation which may vary in time and in place
according to the needs and resources of the community and of
individuals'.
(b) In laying down such regulation, the Contracting States
enjoy a certain margin of appreciation, but the final
decision as to observance of the Convention's requirements
rests with the Court. It must be satisfied that the
limitations applied do not restrict or reduce the access left
to the individual in such a way or to such an extent that the
very essence of the right is impaired.
(c) Furthermore, a limitation will not be compatible with
Article 6 para. 1 (art. 6-1) if it does not pursue a
legitimate aim and if there is not a reasonable relationship
of proportionality between the means employed and the aim
sought to be achieved."
(Lithgow and Others v. the United Kingdom judgment of
8 July 1986, Series A no. 102, p. 71, para. 194, citing the
Ashingdane v. the United Kingdom judgment of 28 May 1985,
Series A no. 93, pp. 24-25, para. 57)
These principles reflect the process, inherent in the Court's
task under the Convention, of striking a fair balance between the
demands of the general interest of the community and the requirements
of the protection of the individual's fundamental rights (see, inter
alia, the Sporrong and Lönnroth v. Sweden judgment of
23 September 1982, Series A no. 52, p. 26, para. 69).
2. Applicability of Article 6 para. 1 (art. 6-1)
66. In the Government's submission, the defence of privilege
delimited the very content of the applicants' right to a good
reputation as protected under English law. They maintained that,
unlike procedural barriers to access to court, such an exercise by the
State of the power to fix the content of a particular civil right did
not bring into play Article 6 para. 1 (art. 6-1), although it might on
occasions raise an issue in relation to one or other of the substantive
rights protected by the Convention (such as the right to respect for
private life under Article 8) (art. 8). In the circumstances, they
concluded, the applicants had no actionable claim to a civil right
under English law so as to attract the application of
Article 6 para. 1 (art. 6-1).
The Commission and the applicants, on the other hand,
considered that the defence amounted to a limitation on the right to
bring defamation proceedings and, as such, a restriction on effective
access to court.
67. It is not always an easy matter to trace the dividing line
between procedural and substantive limitations of a given entitlement
under domestic law. It may sometimes be no more than a question of
legislative technique whether the limitation is expressed in terms of
the right or its remedy.
In the present case the Court does not consider it necessary
to settle the question of the precise nature of the defence of
privilege for the purposes of Article 6 para. 1 (art. 6-1), since it
is devoid of significance in the particular circumstances. If the
Court were to treat the facts underlying the complaints declared
admissible by the Commission as raising a substantive, rather than a
procedural, complaint going to the right to respect for private life
under Article 8 (art. 8) of the Convention - as it has jurisdiction to
do (see the Handyside v. the United Kingdom judgment of 7 December
1976, Series A no. 24, pp. 19-20, para. 41) -, the same central issues
of legitimate aim and proportionality as under Article 6 para. 1
(art. 6-1) would be posed.
The Court therefore proposes to proceed on the basis that
Article 6 para. 1 (art. 6-1) is applicable to the facts of the case,
the argument before the Court having been directed solely to this
Article.
68. On this approach, it has to be ascertained whether the
contested limitation on the applicants' ability to take legal
proceedings to challenge the findings and conclusions in the
Inspectors' report which were damaging to their reputations satisfied
the conditions stated in the Court's case-law.
3. Legitimacy of the aims pursued by the contested
limitation
69. The legitimacy of the limitation complained of cannot be
divorced from its context, namely the system of investigation and
reporting under the Companies Act 1985.
The underlying aim of this system is clearly the furtherance
of the public interest in the proper conduct of the affairs of public
companies whose owners benefit from limited liability. Considerations
of public interest dictate both the appointment of Inspectors and the
publication or not of their report (see paragraphs 36, 40 and 41
above). The system contributes to safeguarding the interests of the
various parties concerned in the affairs of public companies such as
investors, shareholders, especially small shareholders, creditors,
customers, trading partners and employees, as well as ensuring the
overall soundness and credibility of the country's company law
structures. In the words of the Commission's report (at paragraph 64),
"it is ... necessary in a democratic society that governments exercise
supervisory controls over large commercial activities in order to
ensure good management practices and the transparency of honest
dealings".
As regards the particular facts complained of by the applicant
brothers, the Court accepts as accurate the Government's analysis of
the purposes served by the making and publication of the Inspectors'
report (see paragraphs 28 and 58 above - see also paragraphs 13, 14 and
30 above as regards the particular facts).
The investigation into the affairs of HOFH and the publication
of the resultant report in themselves therefore pursued legitimate
aims.
70. As to the contested limitation on the ability to take legal
proceedings, it was common ground that any defamation action brought
by the applicants against the Inspectors or the Secretary of State
would have been successfully met with a defence of privilege, be it
absolute or qualified (see paragraphs 42 and 43 above). The rationale
of this defence is that statements which harm an individual's
reputation and which would otherwise give rise to liability should
benefit from total or partial immunity because their author or
publisher is acting in furtherance of some overriding interest of
social importance (see paragraph 42 above). As regards more
specifically investigations under the Companies Act, the British courts
have explained that "the public interest demands" that "Inspectors
should make their report with courage and frankness" (per Lord Denning
in re Pergamon Press Ltd - see paragraph 43 above).
Like the Commission, the Court has no difficulty in accepting
that the underlying objective in according Inspectors freedom to report
in this manner is likewise legitimate.
4. Proportionality of the means employed
71. It remains to be determined whether in the circumstances of
the particular case there was a reasonable relationship of
proportionality between the means employed and the legitimate
objectives pursued by the contested limitation.
72. Before the Court the applicants appeared to shift the emphasis
of their argument as compared with their submissions to the Commission.
Whilst continuing to maintain that the means employed were
disproportionate to the aim pursued, they stressed that their complaint
was not directed against the defence of privilege as such. They were
not asserting a right to hold the Inspectors or the Secretary of State
personally liable for damages in a suit for defamation; nor were they
arguing that such independent reports into the affairs of public
companies should never be prepared or published. Rather their claim
was that where a report by organs of the State has branded an
individual as being guilty of wrongdoing such as dishonesty after a
procedure not attended by the procedural guarantees of a fair trial,
Article 6 para. 1 (art. 6-1) grants the individual whose reputation is
at stake the right to challenge the findings against him or her in a
court of law before publication of the report. Accepting that a cause
of action based on libel was barred and that judicial review did not
provide the desired remedy, some other form of effective access to the
courts should have been available to them for this purpose by virtue
of Article 6 para. 1 (art. 6-1).
The English legal system, in their view, lacked adequate
safeguards to protect their civil right to honour and reputation
against misuse of their powers by the Inspectors and the Secretary of
State. They submitted that means which involved denying them any
effective remedy at all for the attack on their reputations caused
disproportionate harm to them. They suggested that the requisite fair
balance between the competing interests would be secured by the
Government adopting a system which satisfied the aim pursued in a
manner less harmful to their human rights, such as publication of the
report only following full judicial scrutiny of the Inspectors'
findings of fact.
73. In its report, the Commission expressed the opinion that the
principle of proportionality had not been transgressed in the
applicants' case. In its view, judicial review, whilst not affording
complete protection against possibly erroneous conclusions by the
Inspectors, did "provide sufficient guarantees for persons affected by
the report, which [were] proportionate to the general public interest
in inquiries of the present kind" (paragraph 75 of the report).
74. In so far as the defence of privilege was taken to be a
procedural bar on access, the Government agreed with the Commission's
analysis. As they perceived it, the applicants' claim was really based
on the impracticable proposition that a person aggrieved at any
conclusion of fact reached by Inspectors acting under section 432 (2)
of the Companies Act 1985 because of some detrimental effect on his or
her reputation ought, by virtue of Article 6 para. 1 (art. 6-1), to
have a right of appeal to a court to challenge that conclusion.
75. The Court recognises that limitations on access to court may
be more extensive when regulation of activities in the public sphere
is at stake than in relation to litigation over the conduct of persons
acting in their private capacity. As to enforcement of the
right to a good reputation under domestic law, the limits of acceptable
criticism are wider with regard to businessmen actively involved in the
affairs of large public companies than with regard to private
individuals, to paraphrase a principle enunciated by the Court in the
context of the State's power to restrict freedom of expression in
accordance with Article 10 para. 2 (art. 10-2) of the Convention (see
the Oberschlick v. Austria judgment of 23 May 1991, Series A no. 204,
p. 26, para. 59). Persons, such as the applicants, who fall into the
former category of businessmen inevitably and knowingly lay themselves
open to close scrutiny of their acts, not only by the press but also
and above all by bodies representing the public interest (ibid.).
76. An additional point to note as concerns the particular
circumstances of the present case is that the findings in the
Inspectors' report to which the applicants took exception related to
matters which the applicants themselves had made great efforts to bring
into the public domain, namely their family background, their personal
wealth and their business activities (see paragraphs 9 and 22 above).
The beneficial public reputation which the applicants enjoyed in late
1984 and early 1985 was largely the result of an active public
relations campaign which they undertook with the assistance of their
advisers, and it played a crucial role in facilitating clearance of
their bid for HOF. Thereafter the applicants were at pains to stifle
any publicity adverse to this favourable reputation which they had
themselves largely created, as is shown by their threatened or actual
libel actions against various newspapers, notably The Observer (see
paragraph 11 above). The contested limitation was thus concerned with
an investigation of circumstances offered to public scrutiny by persons
who had themselves sought a public profile through their bid to take
over a large public company.
77. Like the Commission, the Court does not find it decisive
whether the Inspectors' report benefited from absolute or merely
qualified privilege (see paragraphs 42 and 43 above). In any event,
in their argument to the Court the applicants did not suggest that
either the Inspectors or the successive Secretaries of State had acted
with malicious intent, which would have destroyed a defence of
qualified privilege.
78. In arriving at their findings of fact or conclusions, the
Inspectors were under a duty to act fairly and to give anyone whom they
proposed to criticise in their report a fair opportunity to answer the
allegations against them. Although the investigation was
administrative and not judicial in nature, the Inspectors were bound
by what are known under English law as "the rules of natural justice"
(see paragraph 39 above). The remedy of judicial review was available
to the applicants against the Inspectors or the Secretary of State to
challenge the appointment of the Inspectors, the making of the report,
its content or its publication if it could be claimed that there had
been unfairness or breach of the rules of natural justice or that the
findings or conclusions were unreliable on a number of other grounds
(see paragraphs 44 and 45 above). In the latter connection, judicial
review would have provided relief if it could have been established
that the Inspectors had made findings of fact not properly based on
material with probative value, or reached conclusions which there were
no facts to support, or taken into account irrelevant considerations
or failed to take account of relevant considerations, or reached
conclusions which no reasonable person in their position could have
reached (ibid.).
Judicial review would not, it is true, have provided the
applicants with "the effective remedy" to which they were claiming to
be entitled under Article 6 para. 1 (art. 6-1), namely a remedy
enabling them to argue before a court that the Inspectors' findings of
fact were simply erroneous. Nonetheless, the manner in which findings
detrimental to a person's reputation are arrived at in an
administrative investigation, as well as the objectives pursued by the
investigation, is relevant for assessing the permissibility under
Article 6 para. 1 (art. 6-1) of a limitation on the person's
opportunities to go to court to enforce his or her civil right to
reputation.
Whilst Inspectors are accorded broad freedom in reporting on
the affairs of public companies, the performance of their investigative
functions is attended by not inconsiderable safeguards intended to
ensure a fair procedure and the reliability of findings of fact.
79. Extremely serious accusations were levelled against the
Inspectors by the applicants in the press release issued by them on the
day of the publication of the Inspectors' report, including accusations
of dishonesty, prejudice, non-respect of agreed procedures, unfairness
and total disregard of the principles of natural justice (see
paragraph 32 above). In correspondence with the authorities the
applicants had previously been consistently threatening to take legal
action to contest the report and its publication; yet in the event they
did not do so, despite a formal undertaking on behalf of the Secretary
of State to hold up publication if proceedings were brought (see
paragraph 29 above). As the Government pointed out, a reading of the
Inspectors' report shows that the applicants were made aware of the
information required of them and were given every reasonable
opportunity to respond to the allegations made against them and to
furnish evidence, notwithstanding their last-minute procedural request
to the Inspectors (see paragraphs 20 and 21 above). Safeguards
afforded to the applicants throughout the investigation included
constant consultation by the Inspectors as regards the structure,
procedure and lines of inquiry of the investigation, the professional
representation of the applicants, at interviews as well as in the
submission of evidence and argument, and the Inspectors' concern to
respect the applicants' personal privacy as much as possible (see
paragraphs 15 to 18 and 20 above).
80. The applicants pointed out that the Inspectors' report
containing findings of dishonesty was published, with the benefit of
protection from liability in defamation, even though the authorities
decided that there was no cause for instituting either criminal or
civil proceedings (see paragraphs 23, 27, 28 and 30 above). The Court
has also taken note of the evidence submitted by the applicants showing
that there is a body of informed opinion in the United Kingdom which
believes that these consequences of the system enacted by Parliament
in the Companies Act 1985 are not desirable.
81. It is not, however, for the Court to substitute its own view
for that of the national legislature as to what would be the most
appropriate policy in this regard. The risk of some uncompensated
damage to reputation is inevitable if independent investigators in
circumstances such as those of the present case are to have the
necessary freedom to report without fear, not only to the authorities
but also in the final resort to the public. It is in the first place
for the national authorities to determine the extent to which the
individual's interest in full protection of his or her reputation
should yield to the requirements of the community's interest in
independent investigation of the affairs of large public companies.
The applicants' argument would amount to reading into Article 6 para.
1 (art. 6-1) an entitlement to have a report such as the one in the
present case not published until after a full judicial hearing
repeating, doubtless over a longer time-scale, the same fact-finding
exercise as that already carried out by the Inspectors. Such an
entitlement could effectively destroy the utility of informing the
public of the results of the administrative investigations provided for
under section 432 (2) of the Companies Act 1985. Having found the aim
of not only making but also publishing Inspectors' reports to be
legitimate, the Court cannot apply the test of proportionality in such
a way as to render publication impracticable.
82. In the light of the foregoing considerations, the Court cannot
find that, in the exercise of their responsibility of regulating the
conduct of the affairs of public companies, the national authorities
exceeded their margin of appreciation to limit the applicant brothers'
access to the courts under Article 6 para. 1 (art. 6-1), either as
regards the state of the applicable law or as regards the effects of
the application of that law to the brothers. Having regard in
particular to the safeguards that did exist in relation to the impugned
investigation, the Court concludes that a reasonable relationship of
proportionality can be said to have existed between the freedom of
reporting accorded to the Inspectors and the legitimate aim pursued in
the public interest.
5. Conclusion
83. In the Court's view, the limitation on the applicants'
opportunity, before and after publication of the Inspectors' report,
to take legal proceedings to challenge the Inspectors' findings
damaging to their reputations did not involve an unjustified denial of
their "right to a court" under Article 6 para. 1 (art. 6-1).
C. Proceedings against others
84. A further issue addressed in the Commission's report was
whether the publication of the Inspectors' report rendered impossible
a fair and unbiased trial of the libel actions brought by the
applicants against The Observer newspaper (see paragraphs 13 and 34
above), such that they were thereby denied effective access to court
for the determination of a dispute over their civil right to honour and
reputation.
This complaint was not pursued by the applicants in their
pleadings before the Court, and the Court sees no cause, in law or on
the facts, to examine it of its own motion.
D. Recapitulation
85. The Court finds no violation of Article 6 para. 1 (art. 6-1)
in the present case under any of the heads of complaint.
III. ALLEGED VIOLATION OF ARTICLE 13 (art. 13)
86. Before the Commission the applicants alleged that, contrary
to Article 13 (art. 13) of the Convention, no effective remedy was
available under English law in respect of their complaint of a
violation of Article 6 para. 1 (art. 6-1) of the Convention.
Article 13 (art. 13) provides:
"Everyone whose rights and freedoms as set forth in [the]
Convention are violated shall have an effective remedy before
a national authority notwithstanding that the violation has
been committed by persons acting in an official capacity."
87. The Commission concluded in its report that no separate issue
arose under Article 13 (art. 13). In their memorial to the Court, the
applicants announced that they would not be seeking to contest the
Commission's conclusion.
88. In view of the applicants' effective withdrawal of this
complaint, the Court does not find it necessary also to examine the
case under Article 13 (art. 13).
FOR THESE REASONS, THE COURT UNANIMOUSLY
1. Dismisses the Government's preliminary objection;
2. Holds that there has been no breach of Article 6 para. 1
(art. 6-1) of the Convention;
3. Holds that it is not necessary also to examine the case under
Article 13 (art. 13) of the Convention.
Done in English and in French, and delivered at a public
hearing in the Human Rights Building, Strasbourg, on 21 September 1994.
Signed: Rolv RYSSDAL
President
Signed: Herbert PETZOLD
Acting Registrar
In accordance with Article 51 para. 2 (art. 51-2) of the
Convention and Rule 53 para. 2 of the Rules of Court, the concurring
opinion of Mr Martens is annexed to this judgment.
Initialled: R. R.
Initialled: H. P.
Concurring opinion of Judge Martens
1. The applicants submitted that Article 6 para. 1 (art. 6-1) was
violated because the defence of privilege amounted to a restriction on
their right of access to court with respect to the statements in the
Inspectors' report which were damaging to their reputation
(paragraph 64 of the Court's judgment).
2. The Government denied the applicability of Article 6 para. 1
(art. 6-1) since in their opinion the applicants had no actionable
claim to a civil right under English law (paragraph 66).
3. The outcome of the Court's reasoning in paragraphs 65-67 of
its judgment is that the Court "proposes to proceed on the basis that
Article 6 para. 1 (art. 6-1) is applicable to the facts of the case".
I support that modus procedendi, although I find it difficult to
subscribe to the reasoning which led to it.
4. The starting-point for the Court's reasoning is its doctrine
that Article 6 (art. 6) "extends only to 'contestations' (disputes)
over (civil) 'rights and obligations' which can be said, at least on
arguable grounds, to be recognised under domestic law" (paragraph 65).
5. In my concurring opinion in the case of Salerno v. Italy
(judgment of 12 October 1992, Series A no. 245-D, pp. 57 et seq.),
I examined the genesis of this doctrine. In paragraph 3.4 of that
opinion I recalled that the doctrine had been fundamentally criticised
on repeated occasions by several judges (1), but I left open whether
I too subscribed to that criticism. I came to the conclusion that in
any event there was no room for the "arguable claim" test where the
applicant has in fact had access to a court which has decided on the
merits of his claim: a decision on a non-arguable claim should also
meet the requirements of Article 6 para. 1 (art. 6-1).
_______________
(1) See, inter alios, the separate opinion of Judge De Meyer in the
case of H. v. Belgium (judgment of 30 November 1987, Series A
no. 127-B, pp. 48 et seq.).
_______________
6. The present case demonstrates that also within the context of
an access-to-court issue the "arguable claim" test is an unfortunate
feature of the Court's case-law (2). It has obliged the Court to adopt
a reasoning whose subtleness, to my mind, seems hardly convincing. Nor
clear, for what does it mean to say that "Article 6 para. 1 (art. 6-1)
may have a degree of applicability" and in what cases will this
extraordinary phenomenon occur? When does the answer to the question
whether a person has an actionable domestic claim depend not only on
the substantive content of the relevant right as defined under national
law but also on the existence of procedural bars?
_______________
(2) I note incidentally that I also share Judge De Meyer's opinion as
to the role of the requirement that there must be a "dispute"
("contestation"); from which it follows that I am not happy with
paragraphs 56 et seq. either.
_______________
7. In my opinion the Court's reasoning would have been simpler
and more persuasive without all this meandering necessitated by its
maintaining the "arguable claim" test: there could be no doubt as to
the applicants' right to reputation having been damaged. Whether or
not a right to reputation is enshrined in Article 8 (art. 8) of the
Convention is immaterial, since such a right does exist, at least in
principle, under all our national laws and it has not been contended
that in this respect English law makes an exception by clearly and
fully excluding such a right. Neither can there be doubt as to the
right to reputation being a "civil" right within the autonomous meaning
of that notion under Article 6 para. 1 (art. 6-1). It follows that
under this provision, whenever a person's reputation has been
interfered with, he or she is in principle entitled to access to a
court meeting its requirements. Consequently, the question whether
under English law the defence of privilege constitutes a substantive
limitation on the content of the right to reputation or a procedural
barrier to access to court is immaterial. On this approach the Court
could have gone into the essential question whether the contested
limitation was justified under the conditions stated in its case-law
(paragraph 68) almost immediately.