England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN'S BENCH DIVISION
(MR JUSTICE EADY)
[2009] EWCA Civ 667

		Royal Courts of Justice Strand, London, WC2A 2LL
		20th July 2009

Lord Justice Pill:

1. This is an interlocutory appeal against a decision of Eady J, who is hearing in the High Court a libel action. It is brought by Mr Richard Desmond, a newspaper proprietor, against Mr Tom Bower, who is a journalist and author, and arises out of a book written by Mr Bower called Conrad and Lady Black: Dancing on the Edge.
2. The background is more fully set out in the judgment of this court given on 7 July 2009. It is hoped that the trial may proceed at 2pm and, accordingly, the court is giving judgment before the short adjournment, having heard oral submissions this morning. The order was made by the judge on Friday last. We received written submissions early this morning.
3. The appeal involves the admissibility of a telephone conversation which it is claimed Mr Desmond, whom I will describe as "the respondent" to this appeal, which the respondent had with Mr Omid on 10 July 2008.
4. Reference has been made at the trial to litigation known as "the Pentagon litigation", which involved the respondent and Mr Omid and others, in that case the present respondent being the defendant.
5. That action was settled and it was what was said in relation to the settlement and at about the time of the settlement that forms the basis for the present application. The appellant, Mr Bower, seeks to place before the jury at the trial evidence of that telephone conversation.
6. There has been a previous interlocutory appeal in this case following the disclosure by the appellant of what are described as "Voluntary Particulars of Evidence" to be adduced in relation to the Pentagon case. The potential bearing of that case upon the present one is that it is claimed that the respondent acts upon grudges.
7. The constitution of this court which heard the first appeal on 7 July was Rix LJ and my Lord, Wilson LJ. The present constitution has been convened because Rix LJ has thought it right to recuse himself from the present appeal, and I refer to that briefly.
8. It appears to me he did so out of an abundance of caution, following discussion before the judge and reference in the judgment to a Mr Ronson. He had become a potential witness in the event of the disputed telephone conversation being admitted. Rix LJ disclosed, when application for permission to appeal was made on Friday last, that he knew Mr Ronson and Mr Winter QC, who appears for the respondent, invited Rix LJ to recuse himself.
9. In the course of his ruling now challenged, Eady J said that he was "not terribly convinced by the importance of the Ronson matter." It is possible that if the ruling of this court went against the respondent he would want to call Mr Ronson. Whether he would do so or not and, if he did, which side his evidence would favour we need not consider and indeed it appears to me to be questionable. This is not a case in which knowledge that Rix LJ had of Mr Ronson, as a potential witness, was likely to affect the outcome of the present appeal as between its parties.
10. Rix LJ gave the judgment of the court, the other member being my Lord, Wilson LJ. Submissions were made by Mr Winter to the court that the Pentagon affair was wholly collateral, irrelevant, non-probative and thus inadmissible in the present action. Further, it was submitted any probative value was wholly outweighed by its negative aspects of prejudice to the respondent and to the proportionate conduct of the trial: see paragraph 20 of the court's judgment.
11. Rix LJ continued:

"The Pentagon affair, as it is presented to the court, is about a published story in which Mr Desmond had a personal interest, where he was motivated by an animus against a person or business with which he had dealings. The story was published without putting the allegations to the parties concerned, and where in consequence Mr Desmond chose to or had to settle as best he could. The same editor, Mr Townsend, was in post in both cases. "

12. Rix LJ continued:

"There may be some differences, but there are striking similarities. Assuming the transcript of the telephone conversation can be proved, which of course we cannot know at present, there cannot be doubt about what was said by Mr Desmond to Mr Omid. There cannot in any event be dispute about what Mr Desmond accepted in his settlement Statement in Court. It seems to us, therefore, contrary to Mr Winter's submission, there is a cogent argument to the effect that this is material which is well within O'Brien. [being a reference to the decision of the House of Lords O'Brien v Chief Constable of the South Wales Police [2005] UKHL 26; [2005] 2 AC 534, the leading speech given by Lord Bingham of Cornhill]…

The jury, it may be said, are entitled to ask themselves whether Mr Desmond is the kind of man who would act towards Lord Black and his company, Hollinger, in the way in which the pleading of justification alleges. Standing back from the formalities and taking a broad and non-technical approach to the case, one might conclude that that is the "real issue at the trial". Moreover, the Pentagon affair may be said to fall within a limited compass and not to expand the length or complexity of the trial to any great extent and Mr Desmond cannot be said to be unfairly or unduly prejudiced by exploration of a matter for which he accepted personal responsibility."

13. I regard that as a strong statement by this court leaning towards the admissibility of the entire voluntary particulars. Rix LJ went on to say that all matters are for the judge at the trial, at paragraph 21. The judge would adjudicate on the O'Brien questions of relevance and admissibility "in the light of our judgment". That appears to me to be a strong indication from this court as to the course which should be taken.
14. The issue came before the judge on 13 July before the trial had commenced. The Voluntary Particulars included five paragraphs, the presently disputed one being paragraph 1:

(Checked to audio as bundle retained by judge)

"On 10 July 2008 the claimant had a telephone conversation with Mr Omid in which exchanges took place [the claimant being the present respondent]. As recorded in a tape recording made by Mr Omid, including the claimant demanding £75,000 that had been invested on behalf of his son in funds managed by Pentagon Capital Management Limited (Pentagon) and saying the following words in threatening and menacing terms. 'Let me tell you something Jafar, as good a friend as I am, I am the worst f-ing enemy you will ever have."

15. The other paragraphs recite the settlement of the issue, the respondent accepting liability for publishing libels. Mr Winter said that that was a commercial decision on the respondent's part.
16. In the course of the statement made in court the parties agreed references which I need not set out fully. Paragraph 5 provided that the respondent accepted that it was his comments in the presence of Sunday Express journalists that prompted the Sunday Express to publish the defamatory article.
17. The judge declined to admit paragraph 1. He stated, and it is at page 19 of the first volume of transcripts:

"It seems to me that in all the circumstances of this case, given that we are about to start trial and the jury is now waiting it is appropriate that the matters canvassed in paragraphs 3 to 5 can be introduced, but not paragraph 1 which I think would involve delays because I would have to give Mr Winter, in my judgment, an opportunity of giving his evidence in order to address the full context of the matters contained in paragraph 1."

18. Following discussion between counsel the learned judge added at page 26:

"That may need to be revisited at some future point in the trial, but I do not at the moment see any reason to change the ruling I gave a few moments ago."

19. The trial then proceeded and the respondent gave evidence. When the respondent's evidence was complete, and that included calling the editor, Mr Townsend, Mr Thwaites QC, who appears for the appellant, submitted that paragraph 1 of the Voluntary Particulars should now be admitted. He did so on the basis of an answer which the respondent had given in cross-examination. The judge summarised it at page 27, 28 of his ruling. It was in relation to similar fact evidence. That was said to be a similar occurrence in 2008 to the central issue in the case as to whether or not Mr Desmond exercised a grudge in directing the publication of articles in November 2002 about Conrad Black. It was said that there was an example in 2008 of his doing a very similar act, namely venting a grudge so far as Mr Omid was concerned. In the course cross of cross-examination of the respondent he was asked a question by Mr Thwaites and gave the answer that he did not have a grudge. It was put to him in these terms:

Question Is this not an example, Mr Desmond, of you putting something in the paper that you wanted to be there?

Answer: No, it is not an example.

Question: Is it not an example, Mr Desmond, of you getting back at someone against whom you had a grudge?

Answer: I did not have a grudge. I would've liked, my son to get his life savings back. I don't have a grudge."

20. Mr Thwaites, on behalf of the appellant, submits that paragraph 1 is plainly admissible as similar fact evidence. He refers to the proximity in time between the telephone conversation and the publication of the article. He submits that the judge's ruling on 13 July has robbed the appellant of a central point of his case and he submits the central concern expressed by this court at paragraph 20 of the judgment on the earlier occasion.
21. He seeks permission to put in the tape recording. The mechanics of that, I am confident, has no difficulty. We can hear any further submissions about it when judgments have been given.
22. For the respondent Mr Winter submits, as he did before the court on the previous occasion, that this is a collateral matter and should not be admitted. He further submits that, the matter having rightly been referred by this court to the trial judge, it was a case management decision which the judge was entitled to make. This court should be extremely reluctant, he submits, to interfere with a case management decision of a judge, particularly one as experienced in libel matters as this judge is. He further submits that the main issue in the case is whether it was the respondent who ordered the publication of the article, in his position as proprietor and it was on that issue that paragraph 4 and 5 of the Voluntary Particulars would be relevant. There is no necessary link, Mr Winter submits (and of course will seek to argue this if the matter proceeds), between the telephone conversation and the appearance of the article.
23. I regard the relationship between the ordering and grudge as itself a somewhat peripheral issue at present but, insofar as it is important in the present decision, it appears to me that one cannot properly assess the question of ordering without at the same time assessing the question of whether there was a grudge.
24. When giving his ruling, the judge plainly expressed sympathy for the submissions being put forward by Mr Thwaites. He acknowledged the force of the point which Mr Thwaites was making at page 28:

"I can understand the frustration of Mr Thwaites in this regard because the answer "I did not have a grudge" would appear to be something which ought to be assessed alongside the words 'Let me tell you something Jafar. As good a friend as I am, I am the worst f-ing enemy you'll ever have.' It seems to me, however, that at this very late stage, the claimant's case having closed, it would be unfair to the claimant for me to reopen this question since the tape was not put in cross-examination to the claimant."

25. Mr Thwaites could not put the tape in cross-examination to the claimant without being disloyal to the ruling which the judge had given. The same point can be made, and Mr Winter makes it, as to the timing of the renewed application by Mr Thwaites.
26. The judge again said, at page 29, that by Friday the application to admit paragraph 1 was:

"…too late and unfortunately although I am not terribly convinced by the importance of the Ronson matter it would involve Mr Winter having been faced with the embarrassment that was sought to avoid by my ruling on Monday morning and it might again involve delay and an adjournment. In those circumstances with some reluctance I feel obliged to reject the current application to introduce the tape afresh."

27. Asked why he had not made the application as soon as the answer was given by the respondent in the witness box, Mr Thwaites referred to the disadvantages from the point of view of continuity and fair trial of interrupting his cross-examination. He submits that the appellant was entitled to know the respondent's case in full including any evidence which the editor, Mr Townsend, may give before deciding when and on what basis to renew the application, the judge having left open in his ruling of the 13^th the possibility of a further application being made. Mr Winter submits that the judge was correct to say that the application was too late. He refers to the extensive matters which it is possible may arise if the telephone conversation is admitted.
28. The judge, it appears to me, has concentrated upon the delay issue in the judgment that he gave. In my judgment Mr Thwaites was entitled, on that issue, to delay the making of the application as he did. A second interlocutory appeal immediately following the ruling of the 13^th had its advantages and disadvantages. I do not think Mr Thwaites can be blamed for waiting.
29. Moreover, deferring until the claimant had completed his case, was in my judgment a tenable position to take. Mr Thwaites tells us that also other witnesses were, by consent, interposed, which caused the further lapse of time between the evidence of the respondent and the application.
30. It does not appear to me that Mr Winter has made any successful submission as to why he is worse off, the application having been made on Friday, than if it had been made days earlier. He says this opens the door on broad matters. It would have opened the door on equally broad matters had it been made earlier in the week, including the 13^th. I have come to the conclusion that the evidence should be admitted. I am conscious of the need to respect the rulings of trial judges and that appeals to this court on interlocutory matters such as the admission of evidence will only rarely succeed and should not be regarded as routine.
31. However, in this case it appears to me that, with respect, the decision of Eady J in context was plainly wrong. Mr Winter accepted the point my Lord, Hooper LJ, put to him, that the question the court has to ask is whether it is manifestly unjust to exclude this evidence. Mr Winter did not dissent from that approach, but submitted that, in considering whether it was manifestly just, full regard must be had to timing and circumstances. I have regard to Lord Fraser's statement in G v G  (Minors: custody appeal) [1985] 1 WLR 647 and 652, cited by Mr Carter:

"…the appellate court should only interfere when they consider that the judge of first instance has not merely preferred an imperfect solution which is different from an alternative imperfect solution which the Court of Appeal might or would have adopted, but has exceeded the generous ambit within which a reasonable disagreement is possible."

32. The judge in this case was required essentially to consider the justice or injustice of permitting the evidence to be introduced. I have referred to its approach to this question. The timing question cannot, in my judgment, be decisive as the learned judge appeared to consider it was.
33. Moreover there is a further important factor in this case and that is the previous decision of this court. It is clear from paragraph 20 of the judgment that the court had the telephone conversation in the forefront of its mind when giving the ruling it did.
34. In any event, I find it extremely difficult, once the Pentagon evidence is admitted at all, to distinguish between the admission of paragraphs 4 and 5 and the decision not to admit paragraph 1. The court gave a very clear indication on 7 July as to the approach which the judge should take to the Voluntary Particulars. Rightly, the court accepted that case management decisions were for the judge but the court stated, at paragraph 21, that they needed to be taken in light of the ruling of this court on the previous interlocutory appeal.
35. In my judgment, the tape should be admitted and I would allow the appeal.

Lord Justice Hooper:

36. I agree and wish to say something further. The appellant seeks an order from this court, the effect of which would be that a tape recording could be played to the jury in the current trial. The background to that tape recording can be found set out in paragraph 11 of the decision of the Court of Appeal, [2009] EWCA Civ 667.
37. Mr Omid is the managing director of a hedge fund called Pentagon Capital Management Plc, which I shall hereafter call "Pentagon". Mr Desmond, the claimant, had invested substantial sums in Pentagon for himself and a relatively small sum of £50,000 for his son. In 2007 Mr Desmond withdrew his personal investments but retained the investment for his son.
38. After the recent market collapse, Pentagon was required to suspend the ability to repay its investors pending an orderly winding down of its assets. Nevertheless Mr Desmond wanted his son's investment to be repaid. Mr Omid explained that Pentagon could not show any preference to any particular investor.
39. On 10 July 2008 Mr Omid telephoned Mr Desmond. The call was recorded, and a transcript of the telephone conversation is set out in the Particulars of Claim, which Mr Omid was thereafter to serve. Mr Desmond said that the £75,000 was on his mind all the time, the reference to £75,000 being to the fact that the original sum of £50,000 had apparently increased in value.
40. Mr Desmond, according to the tape, demanded a cheque for £50,000 or:

"we are going to be enemies… the worst f-ing enemy you'll ever have."

41. Mr Desmond put down the telephone as Mr Omid began to respond. On the same day Mr Omid sent Mr Desmond a conciliatory email with an explanation and said that he looked forward to a meeting scheduled for a fortnight later. Mr Desmond responded briefly to say there was no point in a meeting.
42. On 13 July an article appeared in the Sunday Express which is set out in Mr Omid's Particulars of Claim and which was alleged to be defamatory of the claimants. The Particulars allege that in all the circumstances the irresistible inference is that the defendant was behind the publication of the article. It is a further irresistible inference that the reference to "next week" at the end of the article was intended to send a message to the claimants that if they did not pay there would be further negative publicity.
43. It was said that the natural and ordinary meaning of the article was that the claimants are intending to keep for themselves £1 billion of their investors' money while dishonestly promising to return it to them. There was also an allegation that the natural and ordinary meaning of the article was that the claimants had a longstanding and cynical business practice of exploiting their long-suffering small investors.
44. At the beginning of February 2009 a settlement statement was read out in court which will be found in paragraph 13 of the Court of Appeal judgment.
45. I turn to the litigation with which this appeal is concerned. It is said that in a book published in November 2006 the defendant made defamatory allegations against the claimant. According to the Particulars of Claim, the meaning of a passage in the book was that the claimant was:

"motivated entirely by his personal desire to get revenge against Conrad Black for losing an earlier court battle with him"

The passage meant that the claimant had directly ordered the editor of the Sunday Express to run a horrifically damaging story about Mr Black's Holliger's financial dealings, wholly indifferent as to whether the story was in fact true or false.

46. As Mr Thwaites points out in his skeleton argument, the substance of one of the two alleged defamatory meanings was that the claimant had ordered the Sunday Express to run a damaging story being indifferent as to its truth.
47. The claimant has, so we are told, repeatedly asserted that he had no involvement in the content of these newspapers and never has had, and he manages the business only. That evidence is supported by evidence given by Mr Townsend, the editor of the Sunday Express.
48. It is submitted on behalf of the appellant that the evidence regarding Mr Omid and the taped conversation shows that the claimant is a man who is prepared to have false stories published in his newspapers to settle scores; in the Omid case the score being the failure to pay back his son's investment notwithstanding that other investors were not being paid out.
49. The defendant wanted to issue a witness summons requiring Mr Omid to attend to give evidence and produce the tape. Eady J refused that witness summons. That decision was appealed and the defendant succeeded. The matter was then sent back to Eady J.
50. On Monday 13 July counsel for the defendant sought to put in the evidence, the tape and other matters as reflected in paragraphs 1, 2, 3, 4 and 5 of the document called the defendant's Voluntary Particulars of Evidence to be adduced in relation to the Pentagon case. Paragraph 1 referred to the telephone conversation itself; paragraph 2 to an exchange of emails; and then paragraph 3, 4 and 5 refer to the publishing of the article three days after the conversation and to the terms of the settlement.
51. The judge permitted the defendant to put in evidence only the material in paragraphs 3, 4 and 5. The appellant naturally wanted to put in all of the material covered in those paragraphs.
52. That ruling made on 13 July was not there and then appealed because the judge also made it clear that he may have to revisit the matter in the light of any evidence given by the claimant and/or the editor. Why then did the judge on 13 July refuse to allow the material contained in paragraphs 1 and 2 to go before the jury? The answer is, as one can see in his ruling of that day, that he was persuaded by Mr Winter QC that, if the tape was played, the claimant would wish to call a lot of other evidence and that this might lead to a delay in the trial. It was said that the claimant might wish to call evidence about an inquiry in the United States into the financial affairs of the company, Pentagon. It was said that he the claimant might also wish to call Mr Gerald Ronson. We have looked at the pleadings in the Omid case and in my view, it is very difficult to see how Mr Ronson could in any way help the claimant. Indeed the judge expressed doubts about the help that Mr Ronson could give, doing so in a judgment on 7 July when this matter was revisited.
53. The ruling of 13 July is now the subject matter of this appeal. I have no doubt that the judge was wrong to exclude the evidence of the telephone call contained in paragraph 1. Indeed, I would go further and say not to allow it would risk the possibility of a miscarriage of justice. In my view, the defendant was clearly entitled to rely on that evidence to show, (if the jury accepted it to be the case), that the claimant was prepared to order his newspaper to run a damaging story indifferent to its truth. The only way that that point could be made to the jury, if it be a good point, is by putting the evidence of the taped conversation before the jury as well as the settlement of the terms thereof.
54. It is said on behalf of the claimant by Mr Winter that the appellant should have made an immediate application for permission to appeal on 13 July. I do not accept that submission. The judge left it open for the matter to be revisited and, as Mr Thwaites said, the defendant had only just succeeded in the Court of Appeal and it was sensible to wait to see what thereafter happened.
55. The second ruling which is appealed is that on Friday 17 July. I agree with the reasons given my Lord, Pill LJ for saying that that ruling was also wrong.
56. It follows that unless this court interferes the jury will not hear evidence, the absence of which, in my view, might lead to a miscarriage of justice.
57. In my view this is not a case of interfering with a case management decision or interfering with some discretionary decision of the judge. It is taking steps to ensure that a possible miscarriage of justice does not occur.
58. I therefore would allow the appeal and allow the defendant to rely upon the tape-recorded conversation and so much of the surrounding circumstances as to make that tape recording comprehensible to the jury.
59. It may be that Mr Winter will make an application for an adjournment; Mr Thwaites has signalled that that might happen. I am sure that the judge will treat any such application with all the care it deserves, as well as with that degree of scepticism which trial judges show when applications for adjournment are made.

Lord Justice Wilson:

60. In the skeleton argument filed on behalf of Mr Desmond for today's appeal, Mr Winter and Mr Sherbourne have written:

"Both decisions, the subject of this appeal, were made by a senior and highly respected High Court judge with specialist knowledge of conducting libel trials, within his discretion and made as part of his essential CPR case management responsibility. The Court of Appeal is not well placed to second-guess such decisions and should only do so in exceptional circumstances, where the trial judge's decision can be clearly shown to be wrong or otherwise to have produced injustice."

61. In my view, that submission is entirely correct and apposite. I subscribe to this decision to allow the appeal only because I am entirely persuaded that the judge's refusal to allow the tape of the telephone conversation between Mr Omid and Mr Desmond to be admitted into evidence is plainly wrong, it being an apparently important adjunct to the similar fact evidence already admitted.
62. In his judgment given on 17 July the judge said that it was "with some reluctance" that he felt obliged to reject the application. It is not surprising that the judge expressed some reluctance about the conclusion which he had reached. He had already observed that the denial by Mr Desmond that he had a grudge against Mr Omid and Pentagon would appear to be something which ought to be assessed by the jury alongside the words recorded in the telephone conversation.
63. In his skeleton argument filed for today's appeal, Mr Winter now suggests that the issue is not whether his client bore Mr Omid a grudge, but rather whether, as a result of bearing him a grudge, Mr Desmond issued an order for the story to be published. But it would be possible for a jury to find that the questions of Mr Desmond's possible grudge and of his possible order are linked.
64. The specific evidence of Mr Desmond to the jury was that he did not bear Mr Omid a grudge. Indeed, although the evidence of the editor of the paper, Mr Townsend, to the jury was that he overheard Mr Desmond speaking about Pentagon in quite an agitated manner and in quite a loud voice, the evidence given by and on behalf of Mr Desmond does not support Mr Winter's current argument that there is no relevant issue as to whether Mr Desmond bore Mr Omid a grudge. Whether he bore Mr Omid a grudge, such that, in the light of all the other evidence, it is probable that the publication three days later was as a result of his order is a question which the jury may wish to answer, by reference in part to the evidence in the telephone conversation, and, in particular, of what they could consider to be a dark threat made in the course of it.
65. My Lord, Pill LJ has made clear that the judge felt driven to reach his conclusion substantially by reference to the alleged lateness of the application on behalf of Mr Bower to include, in Mr Omid's proposed evidence, his evidence, by production of the tape, of his telephone conversation with Mr Desmond. I have come to the conclusion that the judge was plainly wrong to conclude that the application should fail for having been made ultimately on the morning of 17 July (albeit that it had briefly been raised before the judge shortly before he rose on 16 July), rather than in the afternoon of 15 July, immediately after Mr Desmond's denial that he bore a grudge against Mr Omid.
66. In our judgment, dated 7 July, Rix LJ and I allowed Mr Bower's appeal against the judge's refusal to allow him to issue a witness summons against Mr Omid upon the following specific basis:

"That would at least ensure that the witness's evidence would be available to the court, and the court would then adjudicate on the O'Brien questions of relevance and admissibility in the light of our judgment; the submissions, if any, on behalf of Mr Omid and the evidence that will by then have been given by and on behalf of Mr Desmond."

67. We therefore had in mind that the judge would adjudicate on the issue as to whether any reference to what we called "the Pentagon affair" should qualify as similar fact evidence in the light of our judgment, and the evidence that would by then have been given by and on behalf of Mr Desmond. In our judgment we summarised the relevant evidence as being to the effect that a full story had been published in the Sunday Express relating to a matter in which Mr Desmond had a personal interest and "where he was motivated by an animus against a person or business with which he had dealings". We suggested that there was, at any rate, a cogent argument to the effect that the evidence qualified as similar fact evidence.
68. Our reference to Mr Desmond's alleged motivation by animus was a reference to the evidence in the telephone conversation between him and Mr Omid.
69. By our reference to evidence given not only by Mr Desmond but also on his behalf we recognised that the evidence of Mr Townsend, as well as of Mr Desmond in relation to the Pentagon affair, might need to be weighed before the judge could properly rule on the questions raised about the admissibility of Mr Omid's evidence. In the event, the judge found it convenient to consider the question of inadmissibility of the evidence at an early stage. I certainly understand why that was regarded as a convenient course, provided that the judge did not, as in the event he did not, foreclose further argument at a later stage. The judge first considered the issue as to the admissibility of the evidence at a pre-trial review on 10 July and, more particularly, prior to the commencement of the trial on 13 July.
70. On that date an important decision was reached, namely that a significant part of the evidence relating to the Pentagon affair, namely paragraphs 3 to 5 of Mr Bower's voluntary particulars, did indeed qualify as similar fact evidence and should be adduced before the jury.
71. Nimble advocate as he is, Mr Winter, no doubt recognising the judge's likely decision (particularly in the light of our judgment), conceded that paragraphs 3-5 so qualified but he consistently sought to describe his concession as a "compromise" in order to suggest that the quid quo pro for his concession about those paragraphs was that there should be no adduction in evidence of the tape referred to in paragraph 1.
72. A reading of the transcript of the submissions on 13 July makes it entirely clear that there was no compromise in this respect in the sense either that Mr Thwaites or indeed the court acted on the concession about paragraphs 3-5 only on the basis that the material in paragraph 1 would not be admitted. Although even in his written argument before us today Mr Winter has sought to stress the alleged compromise, the judge himself on 17 July rejected the suggestion that there had been a compromise in any relevant sense.
73. In the event, on 13 July the judge made a ruling against the admissibility of the tape, and he did so because he then accepted the spectre which Mr Winter had raised of the necessity that further evidence would need to be called on behalf of Mr Desmond to put the material in the tape in context, in particular evidence from Mr Ronson, who on the previous day had himself conducted a telephone conversation with Mr Omid, (which again the latter had taped) in relation to Mr Desmond's concern about Pentagon.
74. Importantly, however, the judge on 13 July added that his ruling against the admissibility of the tape "may need to be revisited at some future point in the trial".
75. In my judgment it was permissible for Mr Thwaites to raise, after closure of Mr Desmond's case, the question of whether, in the light of the evidence which had by then been given by Mr Desmond and Mr Townsend, permission to adduce evidence from Mr Omid should be enlarged so as to include the telephone conversation. As I have indicated, that was in fact the moment when Rix LJ and I had anticipated that the issue would be determined. It is unnecessary to assert that that was the only moment at which the issue might properly have been debated; but I am unable to accept that it was neither a permissible nor a reasonable moment at which to do so; and, of course, on the basis that any permission to adduce the evidence of the conversation should be attended by permission to Mr Desmond to return to the witness box and be questioned by his own counsel and by Mr Thwaites in relation to it.
76. In fact, as I have said, there had been some discussion about the issue even on the afternoon of 16 July, which was the very day upon which Mr Townsend had given his evidence. When counsel returned to the issue on the morning of 17 July, Mr Thwaites took the opportunity to try to disabuse the judge that the need for fairness to Mr Desmond raised any real spectre that the admission of the telephone conversation should lead to a substantial enlargement of the evidence at Mr Desmond's request. Mr Thwaites, for example, suggested that the evidence of Mr Ronson, at any rate if the tape recorded conversation which he had had with Mr Omid was anything to go by, clearly fortified Mr Bower's contention that Mr Desmond's agenda was to cause trouble for Pentagon through his newspapers. In my view it would at any rate be open to the jury to take that view if Mr Desmond was to choose to call Mr Ronson and if his conversation with Mr Omid was then to be put to him.
77. Mr Thwaites also suggested to the judge that the spectre of substantial evidence about an SEC investigation into Pentagon was unreal in that that investigation was not into any alleged cheating of investors in Pentagon, whether large or small, but was rather into a particular mode of investment by Pentagon, said by Mr Thwaites to have been beneficial to its investors but which, so the SEC alleged, had been unlawful. Mr Thwaites also pressed the obvious fact that, in the proceedings brought by Pentagon and Mr Omid, the falsity of the story had been acknowledged Mr Desmond, as indeed it had been by Mr Townsend in the course of his oral evidence in these proceedings on 16 July.
78. In my clear view, the spectre about substantial enlargement of the evidence, raised on behalf of Mr Desmond, was not so real as reasonably to have deterred the judge from admitting the tape. It will, of course, be for the judge to determine the consequences of our decision in terms of the admission of further evidence on the application of Mr Desmond. But, properly analysed, the prejudice to Mr Desmond of the admission of a short, taped telephone conversation with him, in circumstances in which the judge will no doubt permit him, (if on reflection he wishes) to return to the witness box and deal with the matter, is small, whereas the risk that, without access to the tape, the jury might reach a false conclusion about the existence of a grudge and the genesis of the article relating to Pentagon is substantial.
79. For those reasons, as well as for those articulated by my Lords, I subscribe to the allowing of the appeal.

Order: Appeal allowed