England and Wales High Court (Queen's Bench Division) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

		Royal Courts of Justice Strand, London, WC2A 2LL
		10 February 2012

HHJ Parkes QC :

1. This is an action for libel arising out of the online publication by the Defendant of three articles on a website which he operates, Balita Pinoy. The action illustrates the very great difficulties which are involved in managing and preparing for trial in the High Court a potentially complicated libel action where neither side has the benefit of legal advice or representation. Those difficulties have been significantly reduced by the courtesy and intelligence of both the Claimants and the Defendant, who have expressed themselves with polite moderation at all times, but the fact remains that effective case management is something of a chimaera where there is a complex cause of action and the parties have – through no fault of their own - no real understanding of the legal or procedural issues involved. It is very fortunate that neither side sought trial by jury.
2. The matter first came before me on 22^nd July 2011 for pre-trial review on the working day before the date fixed for the start of the trial, which was to be by judge alone. It quickly became apparent to me that the case was not ready for trial, and that a number of directions would be necessary. I therefore ordered that the trial should come out of the list, with a view to it being re-fixed. I made a number of directions, for the proper pleadings of the Statements of Case, for disclosure, service of witness statements and for a further pre-trial review, at which final directions for trial were to be given.
3. The case came back before me on Friday 20^th January 2012, when I was able to consider the amended Statements of Case. It seemed to me on that occasion, after hearing argument from the parties, and in particular after hearing what it was that Mr Hynes, the Defendant, was setting out to justify, that there might well be a substantial disconnect between the true meaning of the articles and the meaning in which Mr Hynes intended to justify them. It also seemed to me that he might have some difficulty in proving even the case which he intended to justify, having regard to his witness statements, which appeared to me to contain rather more assertion than actual evidence. That being so, I directed that he should file and serve a witness statement by Wednesday 25^th January which set out clearly the evidence on which he proposed to rely to prove his defence of justification, so that I could consider properly what it amounted to, and that the case should be adjourned to Friday 27^th January for me to hear argument as to the true meaning of the words, and to consider whether, in the light of that determination and of the material put before me by Mr Hynes, the Claimants should have summary judgment.
4. The claim relates to three online articles which the Defendant admits publishing on his website, which is aimed at Filipinos. They concerned an alleged fraud involving a company called Precision Training, which purported to supply Filipino workers and students with job placements which led, or should have led, to their obtaining NVQ qualifications. Balita Pinoy means, in the Philippine language, something to the effect of 'News for expatriate Filipinos'.
5. The Claimants claim general damages, including exemplary and aggravated damages, for libel, an order for the removal of the defamatory material from the website (which I take to be a claim for a permanent injunction), and an order for an apology. They have shown no basis for an award of exemplary damages, and I say no more about that. The court cannot order an apology. They have made it clear to me that they do not make a claim for actual loss – that is to say for special damages. I stress that because it is not entirely clear from the Re-Amended Particulars of Claim. The claim is therefore for general (including aggravated) damages for libel, and an injunction.
6. I heard argument on these matters, and gave my ruling in open court on 27^th January 2012. My ruling was that, given the meanings which the articles bore, and given the very limited scope of the plea of justification, the Claimants were entitled to summary judgment on the claim, for general (and, if the court so holds) aggravated damages to be assessed, and a final injunction. I directed that the damages should be assessed by the Master, with a preliminary directions hearing. I now give my reasons for that ruling. I informed the parties that there was no need for them to attend when judgment was handed down.
7. The Claimants' evidence, which I recite for background, although it is to an extent disputed by the Defendant, is that they were in the business, through their company Genesis Consultancy Services Ltd ('Genesis Consultancy'), of sourcing overseas students from the Philippines to come to the UK for educational and training courses. Mr Valmoria had been an occupational therapist in the NHS, and in 2007 he started a home care service in partnership with his brother's employer, Country Court Care Homes, to supply staff for residential and nursing homes. One source of staff was Filipino students, who would come to this country and take work placements as part of their training. Miss Barrameda joined him, and together they developed Country Court Care Ltd, in partnership with Country Court Care Homes. Unfortunately, Country Court Care Homes developed some financial problems as the credit crunch developed in 2008, and Mr Valmoria and Miss Barrameda decided to break the connection with them and to start up as Genesis Consultancy. One of the training companies which was supplying Country Court with students, and providing their training (Affinity Training), collapsed, and a company called Precision Training offered to take them on. Precision Training therefore helped the Claimants by providing training to the students who had been with Affinity, and offered generous incentives for the Claimants to refer new students to them. The Claimants' income came from the commission or discounts which were given by the training companies for sourcing the students. All the new students who were referred by their agents in the Philippines were enrolled with Precision Training. The Claimants' role was to find the students, through their agents in the Philippines, to enrol them with a training school or college and obtain the necessary documentation from the trainer to obtain their visas. When the visas were granted, the Claimants would arrange their travel and accommodation and provide work placements and advice. However, problems started to develop with Precision Training, and students began to complain that they were not getting the training for which they had paid. Indeed, Precision Training told the students that this was because the Claimants had not passed on to them the fees which the students had paid. This, according to the Claimants, was entirely false. They had in fact paid Precision Training. What they did not realise was that Precision Training was in the process of collapse. In the event, it did collapse, and both the Claimants (although not at the time) and Mr Hynes, the Defendant, now regard the circumstances of the company's collapse as fraudulent. The Claimants found another training provider, Concept Care College, which agreed to take on their students, but it was at that point (on their account) that the Defendant published his articles, and the arrangements with Concept Care College fell through. The Defendant maintains that the articles were published months after the Concept Care deal fell through. In any event, the Claimants say that the effect of the articles was, in short, that their business collapsed, and that their reputations have been gravely damaged and their lives ruined by the publication of the articles. They firmly deny that they were involved in any wrongdoing, let alone in defrauding any students.
8. The first article was published on 3^rd July 2009, the second on 6^th July 2009, and the third on 18^th August 2009. The claimants have not complained of the whole of each article in the Re-Amended Particulars of Claim. I will set out in this ruling the words of which they complain, but not the full articles which form the context, for they would lengthen this judgment to an unwarrantable extent.
9. I heard argument from the parties as to how they contend that the words complained of would have been understood.
10. The principles which apply to the determination of meaning in libel actions are well established and uncontentious. They were conveniently formulated by Eady J. in Gillick v Brook Advisory Centres, described by Lord Phillips MR on appeal ([2001] EWCA Civ 1263 at [7]) as an "impeccable synthesis" of the authorities:

"The court should give the article the natural and ordinary meaning which it would have conveyed to the ordinary reasonable reader reading the article once. Hypothetical reasonable readers should not be treated as either naive or unduly suspicious. They should be treated as being capable of reading between the lines and engaging in some loose thinking, but not as being avid for scandal. The court should avoid an over-elaborate analysis of the article, because an ordinary reader would not analyse the article as a lawyer or accountant would analyse documents or accounts. Judges should have regard to the impression the article has made upon them themselves in considering what impact it would have made on the hypothetical reasonable reader. The court should certainly not take a too literal approach to its task."

11. I do not think that it is necessary or even appropriate for me to set out my reasoning at great length, since my task is to give to the words complained of the meaning which they would have conveyed to the ordinary reasonable reader reading them once. I have to read the words as if I were a layman, while attempting at the same time to apply the principles which I have set out above.
12. The first article, published on 3^rd July 2009, appears to be the most serious. The parts of the first article of which the Claimants complain are as follows:

"FIFTEEN MILLION POUND NVQ TRAINING FRAUD UNCOVERED

Probably the largest NVQ training scam in the UK is uncovered as thousands of students are left high and dry by Precision Training and Genesis Consultancy Services/ Genesis Professionals of the UK

Possibly the largest NVQ training fraud perpetuated (sic) in the UK is coming to light after investigations reveal a web of companies all linked in defrauding students, employees and other companies. Besides the money the students have paid to both Precision Training and either of the two Genesis companies based in the UK, many of them were not registered with either Edexcel or the City & Guilds so they are left in many cases with no qualifications or training portfolios....

… The companies concerned, Precision Training, and Genesis Professionals/ Genesis UK, are linked inextricably....

… Precision Training's directors, husband and wife Nichola and Salim Shivji, are reported to have left the UK, possibly bound for India or Greece. Genesis in the UK along with Genesis in Cebu have been linked together, with John Valmoria, Mark Daniel Valmoria and Joselina 'Lina' Barrameda running that show, with Precision departing from their premises in Burnham some 20 miles from London, and now giving an address in Aberdeen in the far north of Scotland with a phone number that is constantly engaged. However, company records give an address in Harrow, north London. Genesis' two companies both operate from call answering services, giving in one case a Central London address and in the other a Cambridge address. Both these addresses are 'virtual' offices run by the Regus Group services...."

13. The Claimants plead (Re-Amended Particulars of Claim #6) that the words complained of mean that they (and their company, but the company is not a party) are guilty of the £15 million NVQ training fraud, and that they must have been involved in a sophisticated fraudulent operation, resulting in people and their business clients avoiding them so as not to become victims of their purported illegal activities.
14. The Defendant pointed out that the first article does not expressly say that the Claimants were guilty of fraud. That is true in a literal sense. He also argues that it is not said that the Claimants were part of the fraud. It may be that he did not intend to suggest that the Claimants were implicated in the fraud, but I have no doubt whatever that their complaint about the meaning of this article is justified. Taking matters very shortly, it is quite clear to me that the words complained of from the first article do indeed mean that the claimants were involved in the £15 million NVQ training fraud, in the course of which they were involved in defrauding thousands of students and others who paid them money for training and were left high and dry. I say that because the headline refers to the training fraud having been uncovered; the first full paragraph of the article alleges that thousands of students were left high and dry by Genesis Consultancy and Precision Training; it is said that a 'web of companies' is 'linked in defrauding students'; the only companies mentioned by name (with Genesis Professionals) are Genesis Consultancy and Precision Training, to both of which the students are said to have paid money, although, having done so, in many cases they were left with neither qualifications nor training; the three companies specifically named are said to be 'linked inextricably'; and the Claimants are identified as two of the three people alleged to be behind Genesis Consultancy.
15. The second article was headed 'The Villains – The Victims in the Precision/Genesis UK Scandal' (APOC #9). It has been complained of only to a limited extent. The passages relied on are only the headline and sub-headline and a few other sentences, as follows:

"The Villains – The Victims in the Precision/Genesis UK Scandal

The Precision/Genesis UK Scandal unfolds hour by hour

… After the initial revelations come the recriminations; and they have come in droves.... In one specific instance, a care home group who formerly employed John Eric Valmoria, Mark Valmoria and Joselina 'Lina' Barrameda of the Genesis UK combine, have contacted Balita Pinoy with the most disturbing revelations. County Court Care Ltd (CCC) are a group of care homes based in East Anglia who were disturbed when they discovered their three employees were also running the side show of Genesis UK. This is sometimes known as running 'a firm within a firm'....

… What about the other thousands of victims of both Precision and Genesis UK? Where does this leave them?"

16. The Claimants have not otherwise complained of the article in their Re-amended Particulars of Claim. What they say is that the second article is plainly a follow-up of the first and refers to it, and that it should be read in the context of the first article. It seems to me that their approach is sound. I note that at the start of the article, readers are invited to submit a complaint form if they have been a victim: plainly that assumes that the readers know what they are complaining about. Although there may have been some readers who saw the second article but not the first, they, it seems to me, will have been in a minority.
17. The meaning which the Claimants plead that these words bear is that they were involved in other fraudulent activities while employed by Country Court Care Ltd, and that they were working with Precision Training to defraud thousands of students. They argue, as I say, that the article plainly follows on and picks up from the first article, and that Genesis Consultancy (and thereby the Claimants themselves) was clearly identified as one of the villains, not as a victim. They were concerned by the allegation of 'disturbing revelations' involving Country Court Care, because they felt that some impropriety (less than fraud, they accepted) was implied in connection with Country Court Care, suggesting a pattern of wrongdoing even before the fraud. As for the Defendant, he argued that the article showed who were the 'good guys' and who were the 'bad guys', which I fear is true; and he maintained that the ordinary reader would understand that 'things were going wrong' with the First Claimant in connection with Country Court Care.
18. It seems to me that the true sting of the words complained of, read in their context, is that the claimants were, through their company Genesis UK, the villains behind a scandal by which thousands of students were defrauded of sums which they had paid. It does not seem to me that the allegation that they were employed by Country Court Care Ltd while they were carrying on these activities adds anything of weight to the main sting of the words complained of.
19. The third article complained of was published in Balita Pinoy on 18^th August 2009. The Claimants complain of the following words:

"THE FULL STORY OF PRECISION TRAINING:

THE GREAT NVQ TRAINING FRAUD

Click here for previous articles on this subject

Investigations carried out over the past six weeks have uncovered a fraud and deception scandal which has left up to £4,500 students considerably out of pocket, with British care home operators who paid for their staff to be trained to NVQ standards not being immune from this systematic theft..... For many of the Filipino victims of the Precision fraud, this is the second time they have been duped. Many who were with Genesis were originally placed with Affinity Training who went spectacularly bust last year with about 3,000 students left high and dry. They were then transferred by Genesis to Precision Training. The role of agents supplying Precision with students then becomes slightly more complicated. In the case of the Filipinos, the majority were introduced by Genesis in Manila, with an additional result that even after the Filipino students had paid vast sums of money in RP, they continued to pay over here. This was by either direct debit or standing order from their (the students) UK bank accounts. This was paid to the Valmoria's (sic) (Genesis) accounts, who then passed some of the money to Precision, after taking out their commission."

20. Readers who clicked on the hyperlink to previous articles were taken to the first and second articles complained of, and the Claimants' case is that the third article, read in the context of the earlier articles (as, they suggest, it will often have been) means that they were, in their complex role as agents for Precision Training, involved in the fraud, deception scandal and systematic theft. It seems to me that the Claimants are broadly right in the meaning which they place on the words of which they complain in the third article, in the context of the article as a whole, the series of questions and answers at the end of the article (by which readers filled in a complaint form and stated how much money they had paid to Genesis UK, which many readers will have understood to be the Claimants' operation) and the previous articles brought in by the hyperlink. Of course, not every reader will have clicked on the hyperlink, but I have little doubt that the great majority of those who read the article and had not read the first or second articles earlier will have done so.
21. The Claimants rely on publication of the articles not just within England and Wales but also in the Philippines, on the basis that in that country they are criminal offences under Articles 353 and 355 of the Philippines Revised Criminal Code. In my judgment, that is not sufficient. The double actionability rule, formulated by Lord Wilberforce in Chaplin v Boys [1971] AC 356, provides that a person may not bring a claim in England in respect of matter for which civil liability does not exist, or is excluded, under the law of the place where the wrong was committed. If publication in the Philippines is only a criminal offence and not a civil matter, the Claimants are precluded from claiming in this jurisdiction for libel published there: see Duncan & Neill on Defamation, 3^rd edition, paragraph 9.11. Thus their claim must be seen as limited to publication of the articles on the website to readers within England and Wales. The size of the Filipino population of England and Wales, and the popularity of Balita Pinoy among that expatriate population, will be important factors for the parties to deal with in evidence as to the amount of damage suffered.
22. The Defendant, Mr Hynes, filed a re-amended Defence on 12^th September 2011. I have read his Defence with care. It explains the background to the articles in Balita Pinoy, and describes in particular the developments which led to many Filipino workers coming to this country to work on the condition that their working week was no longer than 20 hours and that they also spent 15 hours of the week receiving tuition. By that means, care workers could continue to come to this country under the designation of student. A proliferation of NVQ training providers appeared in the UK to cater for this market. At the same time, regulation was light in the Philippines because agencies recruiting students to come to this country did not have to register with the Philippine Overseas Employment Authority (POEA). It is against that background that what the Defendant describes as the Precision Training NVQ fraud took place. It may well be that the Defendant has a very strong case against Precision Training, and that he has done a valuable service to the Filipino community by exposing it, but his pleaded case against the Claimants (candidly repeated to me in the course of oral exchanges) is not that they were parties to the fraud, but that they have consistently chosen unreliable training providers, that they did not take enough care to spot the problems with Precision and that they did not take enough care of their students, in particular by failing to notify them of the problems with Precision as quickly as they should have done.
23. In his witness statement dated 25^th January 2012, served in response to my directions of 20^th January, Mr Hynes elaborated his case in a helpful and accessible manner, and he addressed me at some length on his contentions. He explained what he said were the connections between Genesis Consultancy and certain Philippine companies which acted as agents to supply them with applicants for UK training. He alleged that the First Claimant Mr Valmoria's brother had at one stage been wanted for questioning in connection with alleged illegal recruitment under Philippine law (Mr Valmoria explained that his brother had been neither arrested nor charged, and the parties agreed that the relevant Philippine law had been something of a grey area at the time). He complained of difficulties in contacting the Claimants when he first sought to talk to them about Precision Training, and of their responses to his attempts to contact them, which in my judgment at the very most might have given a dogged journalist cause to investigate further (even if the Claimants agreed with his account, which they do not), but take matters no further than that. He described how the Claimants knew of problems at Precision months before its collapse, but, he claimed did nothing, as he set out to demonstrate by reference to an email from Miss Barrameda dated 2^nd May 2009 to Precision Training, expressing concerns about problems with their service. It seems to me that what the email shows absolutely clearly is that the Claimants were not involved in Precision Training's wrongdoing: Miss Barrameda was complaining on behalf of Genesis Consultancy and the students of a catalogue of problems, but concluded that she thought that the situation could still be repaired. The Claimants told me that they were aware of problems with Precision Training but they believed them to be the product of incompetence at the most, and hoped that by engaging with them they could rectify matters in the interests of the students. They did not suspect fraud until the first Balita Pinoy article was published. The Defendant asserted that students were not told by the Claimants of any problems until Precision Training notified them, and he alleged that the Claimants did not take proper care in selecting the training providers with which they worked. Again, the Claimants denied that. There were other matters which the Defendant explained to me, and I hope that he will forgive me for not setting out every single matter which arouses his concern or suspicion.
24. It is of course no part of my function on this application to make findings on disputed questions of fact, and I do not do so: I merely record the Claimants' responses for the sake of fairness. My function is to assess what the Defendant's Defence amounts to at its highest, assuming (which on the state of his evidence may be a large assumption) that it can be proved. What the Defendant said that it all added up to was that the Claimants were 'complicit' in the Precision Training scandal. That, of course, is a very imprecise charge. Plainly, the Claimants were embroiled in the affair, in the limited sense that they had placed students with Precision Training who lost money when Precision Training went out of business. But there is nothing in the Defendant's Defence or in his evidence, nor in anything which he has said to me in the course of argument, which even asserts, let alone begins to establish, that the Claimants were parties to any fraud by Precision Training, or that they behaved dishonestly. The difficulty for him is that notwithstanding the careful work which he obviously did in his well-written articles, and his very helpful explanation to me of what he intended to prove, his defence wholly fails to meet the sting of the articles complained of. His mistake, and it was a very damaging mistake both for himself and for the Claimants, whose reputations have been seriously damaged in consequence, was to allow the articles (and in particular the first article) to be published without taking proper care to explain to the readers that the Claimants and Genesis Consultancy were not themselves parties to the Precision Training fraud. Had the articles described the fraud as the responsibility of Precision Training alone, and made clear that he criticised the Claimants only for what he would assert (but they would deny) was their lack of care in selecting training providers and in spotting and communicating to their students the problems at Precision Training when they first began to develop, he would have had some chance of proving his case. But that is not the libel that he has to meet. I should stress that the Claimants do not for a moment accept the validity of the Defendant's criticism: on the contrary, they maintain that they themselves are victims of the Precision Training collapse.
25. In the circumstances, it is clear to me that the Defendant has no real prospect of successfully defending the claim. There is no other compelling reason why the case should be disposed of at a trial. I therefore give summary judgment for the Claimants in respect of the three publications complained of, in so far as those publications were published in England and Wales, for general (including, if the court finds it appropriate, aggravated) damages to be assessed (but not for special damages), and for a final injunction to restrain the Defendant from further publishing any allegation to the effect that the Claimants were parties to an alleged fraud involving Precision Training, or that they were responsible for defrauding students who suffered loss at the hands of Precision Training. The Claimants are also entitled to the costs of the action, to be subject to detailed assessment if not agreed.
26. It seems to me that the sensible and proportionate course is to direct that the matter be sent back to Master Fontaine, who was the assigned Master, for assessment of damages and for any further directions which she regards as necessary before the assessment can be carried out. I am not myself making those directions, but the parties will want to consider whether there is any other evidence which they want to place before the court on such matters as the extent of publication, that is to say the number of readers of the articles complained of in England and Wales, and the impact on the Claimants of the libels complained of. The parties will also want to bear in mind, because it is directly relevant to the process of assessment of damages, that an award of general damages for libel serves three functions: first, to act as a consolation to the Claimant for the distress and embarrassment suffered from the publication of defamatory words, secondly, to compensate for the injury to the Claimant's reputation; and thirdly, to act as vindication for that reputation. The assessment will be subject to the overriding principle that, in order to comply with Article 10 of the European Convention on Human Rights, an award of damages must be proportionate to the legitimate aim of compensating the Claimant for the injury and distress suffered and of providing vindication.