Scottish Court of Session Decisions

OUTER HOUSE, COURT OF SESSION

[2015] CSOH 30

A62/10

OPINION OF LORD JONES

In the cause

(FIRST) WILLIAM RODDIE and (SECOND) SPECTRUM PROPERTIES (SCOTLAND) LIMITED

Pursuers;

against

ASSOCIATED NEWSPAPERS LIMITED

Defenders:

Pursuers:  Henderson;  BLM

Defenders:  Dunlop QC;  Gillespie Macandrew LLP

26 March 2015

Introduction

[1]        This is a defamation action.  The defenders are the owners and publishers of the “Scottish Mail on Sunday” newspaper (“the newspaper”).  On page 45 of the newspaper’s edition of 12 January 2014, the defenders published the following article:

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[2]        The following averments are made on behalf of the pursuers:

“The main theme of the article was to suggest that, in the wake of the forthcoming Commonwealth Games in Glasgow, public money was being handed out to companies that did not deserve it.  The central complaint was that this money was handed out to the second pursuers who were run by the first pursuer who had a criminal background.  The named complainer was a councillor who had a past history of encouraging irresponsible press articles.  In the defenders' article it is said that he raised concerns ‘six years ago’. In fact his concerns were contained in an article written in the News of the World newspaper.  On page 37 of the print edition of 1st November 2009 the News of the World published an article of and concerning the pursuer.  That article contained the headline ‘Fury over Halls Bid by jailed Fraudster.’ There were two sub headlines namely ‘Fury over halls bid by fraudster’ and ‘Councillor slams William Roddie's property plan.’  The pursuer sued the publishers and accepted an ‘Offer of amends’.  He received substantial damages.”  (Article II of the condescendence)

[3]        The pursuers aver that the terms of the article “were false and calumnious”.  “The plain meaning of the article”, they say, “was that the first pursuer was a convicted fraudster who continued in criminal enterprise.”  The averments continue in the following terms:

“In the headline and first sentence of the print edition of the article there is reference to the first pursuer as a ‘fraudster’. The allegation was that he is a fraudster and not merely that he has been convicted of the crime in the past. In the fourth paragraph there was reference to his conviction and it was repeated in the caption under the photograph.  In addition the article contained a complaint regarding ‘public money being handed out to people with a criminal background.’ The picture created by the article was that the first pursuer was running his company as a vehicle for committing further fraud on the public purse; that he had caused the company to conduct itself in an irregular manner and that the auditors had resigned as a result.”  (Article III of the condescendence)

[4]        The pursuers aver that the terms of the article were false and calumnious also “in so far as it is related to the second pursuers.”  The averments continue as follows:

“The plain meaning of the article was that the second pursuers were not a company to do business with: they were run by a fraudster which rendered them a poor credit risk and their auditors had resigned in suspicious circumstances.”  (Article IV of the condescendence)

In article V of the condescendence, the pursuers aver:  “The articles contained unqualified assertions of guilt.”

Submissions for the defenders

[5]        The case came before the court for discussion on the procedure roll on 4 February 2014.  Senior counsel for the defenders moved the court to dismiss the action.  He submitted that it is settled law that it is for the pursuer in a defamation action to aver on record the meaning of the words complained of that he contends for.  If such meaning cannot be drawn from the words used, the claim is irrelevant.  It is not open to the court to draw another meaning.  In support of that proposition, counsel referred to Russell v Stubbs Ltd 1913 SC (HL) 14 (“Russell”).  At page 20 of the report, Lord Kinnear describes the relevant law as “perfectly well settled”.  “Before a question of libel or slander is submitted to the jury”, said his lordship, “the court must be satisfied that the words complained of are capable of the defamatory meaning ascribed to them.  That is a matter of law for the court.”  At page 22, his lordship observed that, if the meaning contended for by the pursuer “cannot be sustained as he states it, it is not for the court to discover some other ground which he has not found out for himself”.  Lord Shaw of Dunfermline agreed with Lord Kinnear that it is for the pursuer to aver the meaning which he alleges that the words complained of bear and said that the test is this:  “is the meaning sought to be attributed to the language alleged to be libelous one which is a reasonable, natural, or necessary interpretation of its terms?”  (Page 23)  Counsel referred, also, to James v Baird 1916 SC (HL) 158 in which Earl Loreburn and Lord Kinnear both said that is the duty of the pursuer to state on record what he undertakes to show is the true meaning of the writing complained of, taken as a whole.  (Pages 163 and 165-166)

[6]        Counsel referred next to MacLeod v News quest (Sunday Herald) Ltd 2007 Rep LR 5 in which Lord McPhail conducted an analysis of a number of authorities bearing upon the meaning of the words “reasonable, natural, or necessary” as they are used by Lord Shaw of Dunfermline in Russell.  In the course of doing so, his lordship adopted the following views of Lord Macfadyen in McCann v Scottish Media Newspapers Ltd, 2000 SLT 256, at page 261:

“These terms are not synonyms, and I take the view that a reasonable interpretation would be relevant, even if it was not the meaning which the article complained of necessarily bore.  When the matter is one of inference, it is the inference of the reasonable person that forms the test …  It is not… a matter of how the words were actually ‘intended to be construed’.  Rather the issue is objective: whether the circumstances ‘provide grounds for a reasonable inference’ that the meaning contended for was intended … Any ‘strained and sinister’ interpretation is to be left out of account … as is the inference that might be drawn by the ‘unusually suspicious’ person … ”  (Citation of authority omitted)

Lord McPhail went on to quote what is described as “valuable practical guidance consistent with Lord Macfadyen’s approach”, which is to be found in the judgment of Neill LJ in Gillick v British Broadcasting Corporation [1996] EMLR at pages 272-273, in these terms:

“(1) The court should give to the material complained of the natural and ordinary meaning which it would have conveyed to the ordinary reasonable viewer watching the programme once.

(2) The hypothetical reasonable reader (or viewer) is not naïve but he is not unduly suspicious. He can read between the lines. He can read in an implication more readily than a lawyer and may indulge in a certain amount of loose thinking. But he must be treated as being a man who is not avid for scandal and someone who does not, and should not, select one bad meaning where other non-defamatory meanings are available.

(3) While limiting its attention to what the defendant has actually said or written the court should be cautious of an over-elaborate analysis of the material in issue.

(4) A television audience would not give the programme the analytical attention of a lawyer to the meaning of a document, an auditor to the interpretation of accounts, or an academic to the content of a learned article.

(5) In deciding what impression the material complained of would have been likely to have on the hypothetical reasonable viewer the court are entitled (if not bound) to have regard to the impression it made on them.

(6) The court should not be too literal in its approach.

(7) A statement should be taken to be defamatory if it would tend to lower the plaintiff in the estimation of right-thinking members of society generally, or be likely to affect a person adversely in the estimation of reasonable people generally.”

[7]        Counsel then turned to the pleadings.  He noted that, on page 7 of the record in article III of the condescendence, it is averred on behalf of the pursuers: “The plain meaning of the article was that the first pursuer was a convicted fraudster who continued in criminal enterprise.  In the headline and first sentence of the print edition of the article there is a reference to the first pursuer as a ’fraudster’.  The allegation was that he is a fraudster and not merely that he has been convicted of the crime in the past.”  Counsel drew attention to the fact that, on page 9B-C of the record, the defenders aver that the article did represent that the first pursuer was a convicted fraudster, adding that it did so accurately, the pursuer having been convicted of fraud and sentenced to a period of imprisonment in the 1990s.  In what counsel argued was effectively an admission of that averment, at page 13B-C of the record, the pursuers aver:  “Whilst the first pursuer was convicted of the crime referred to in the article that conviction falls to be regarded as spent within the meaning of the Rehabilitation of Offenders Act, 1974 [“the 1974 Act”].”

[8]        It was submitted on behalf of the defenders that the article did not bear the meaning contended for in respect of the first pursuer.  It was said, in terms, that he was a convicted fraudster, but that is true.  It was not said that he “continued in criminal enterprise”, and the words which were used could not be said reasonably, naturally or necessarily to bear that meaning.

[9]        Counsel further contended that the article did not bear the meaning attributed to it in respect of the second pursuers, as recorded in paragraph [4] of this opinion.  There is no dispute, he argued, that the first pursuer has a conviction for fraud, nor that the auditors had resigned.  The second pursuers are not described as being a poor credit risk or that they were a poor credit risk because they were being run by the first pursuer who has a conviction for fraud.  Contrary to suggesting that the auditors had resigned in suspicious circumstances, the article quotes the auditors as “insisting” that “there were ‘no circumstances connected with our resignation’ which should be reported to members or creditors of the company.”

[10]      In answer 3, the defenders aver that the article accurately reported “the honest comment” of councillor McAllister, who described the payment of public grants by Clyde Gateway as “a disgrace”.  In response, the pursuers aver that the allegation that the payments were a disgrace “involved making a factual allegation and not a comment.”  They continue that, if the allegation was comment, “the ordinary reader would infer that the public purse had been defrauded in order to render the payment a disgrace.”  Senior counsel for the defenders submitted that, in describing the payments in the way that he did, councillor McAllister was making a value judgment, expressing criticism of the quango.  In support of that contention, counsel referred me to Curran v Scottish Daily Record and Sunday Mail Ltd 2014 SLT 377 at paragraph 37 in which temporary judge Wise QC, as she then was, borrowed from the judgment of the Court of Appeal in Branson v Bower [2001] EWCA Civ 791 [2001] EMLR 32, to describe the test as to what amounts to comment for the purposes of permitting the defence of fair comment as follows:

“… something which is or can reasonably be inferred to be a deduction, inference, conclusion, criticism, remark, observation etc.”

[11]      On the same topic, counsel also referred me to Massie v McCaig 2013 SC 343, at paragraphs [30] to [33], in which the second division drew together a number of historical observations about the nature of the defence of fair comment.  In doing so, the Lord Justice-Clerk, delivering the opinion of the court, declared the following definition to remain good law:  “in fair comment the defender must show that each statement of fact is true, that the matter is one of public interest, and that the comment on the facts is fair.”  His Lordship observed that the issue of whether something is a fair inference from the true facts is left to be determined on the basis of common sense.  Further, said the Lord Justice-Clerk, “malice is not part of the equation” on the view that, if something is fair comment derived from true fact, it is not relevant that it may be made maliciously.  In this case, argued counsel, the description of events as a disgrace was an expression of opinion as to the state of facts truly set forth on a matter of public interest.  No fact in the article, noted counsel, is challenged as untrue.  The destination of public money is plainly a matter of public interest.  If the article was carrying a criticism of true facts, the defence of fair comment is made out. 

[12]      As is noted in paragraph [7], the pursuers invoke the provisions of the 1974 Act.  Section 4 of the Act provides, among other things, that, subject to section 8, a person who has become a rehabilitated person for the purposes of the Act in respect of a conviction shall be treated for all purposes in law as a person who has not committed the offence or offences which were the subject of that conviction.  Section 8 applies to defamation actions.  In so far as it continues to extend to Scotland, it provides, among other things, that nothing in section 4 shall prevent the defender in such an action from relying on any defence of justification or fair comment or of absolute or qualified privilege which is available to him.  That provision is subject to the qualification that the defender shall not be entitled to rely on the defence of justification if the publication is proved to have been made with malice.  In the context of their reference to section 8 of the 1974 Act, the pursuers aver that the reference to the first pursuer’s previous conviction and the divorce proceedings “amounted to malice”.

[13]      Anticipating the pursuers’ argument on the application of the 1974 Act to this case, counsel for the defenders submitted that malice is usually inferred from the fact that the defamatory statement is false.  Under reference to the judgment of Griffiths LJ in Herbage v Pressdram Ltd and others 1984 1 WLR 1160 (“Herbage”), at page 1164, it was submitted that publication is made with “malice”, if it is done “with some irrelevant, spiteful or improper motive.”  To a similar effect, but in the context of qualified privilege, in Horrocks v Lowe 1975 AC 135, at page 149, Lord Diplock observed that, where a defamatory statement is made on a privileged occasion, the maker “is entitled to be protected by the privilege unless some other dominant and improper motive on his part is proved.”  Describing such a motive as “express malice" his lordship explained that ”it means malice in the popular sense of a desire to injure the person who is defamed and this is generally the motive which the plaintiff sets out to prove.  But to destroy the privilege the desire to injure must be the dominant motive for the defamatory publication; … The motive with which a person published defamatory matter can only be inferred from what he did or said or knew.”  Counsel also made reference to Silkman v Heard 2001 WL 415495 (“Silkman”), and to Gatley on Libel and Slander, 12th edition at paragraphs 18.17 and 28.6.  In Silkman, which concerned the application of the 1974 Act in a libel action, the defendant applied for summary judgment and/or an order that the claim against him be struck out, because the words complained of were admitted to be true and, as it was argued, the claimant had no evidence of malice.  In the course of his judgment, Eady J referred to Herbage, noting that the burden of proving malice in such a case rests upon the claimant and expressed the view that malice in that context “must embrace… a dominant motive to injure the claimant.”  That would entail proving that the defendant’s dominant motive for publishing the words was improper.  His lordship went on to say that judges and juries should be slow to draw the inference that the defendant misused the occasion; “the defendant’s desire to use the occasion for its proper purpose must be shown to have played no significant part in his motives if malice is to be found.”  With reference to page 151 of Horrocks, in the speech of Lord Diplock, Eady J said:  “the gravity of an allegation of malice in any context is quite clear and the standard of proof correspondingly high”.  In the course of his analysis, Eady J referred to Gatley at paragraph 8.17.  In the course of his submissions, senior counsel for the defenders relied on the following passage in paragraph 8.17, to which Eady J did not expressly refer:

“It seems likely that the court will distinguish proper from improper reasons for disclosure.  Where a defendant discloses a spent conviction merely in order to damage the claimant or to further some interest of his own, or perhaps where he knows that the information cannot be legally relevant, he should be held to be malicious. Where on the other hand he is seeking to give information which can reasonably be regarded as relevant to the recipient, he should not be held to be malicious.  For example, it has been suggested that if the defendant, believing that the claimant was unfit for some office by reason of a spent conviction which he disclosed, he should not necessarily be regarded as malicious.”

[14]      In the second paragraph in Gatley to which counsel referred, the editors address the requirements of English pleadings where malice is alleged, in the following terms:

“There is a specific role of pleading that whenever it is intended to allege in answer to a plea of honest comment or qualified privilege that the defendant was actuated by express malice, the claimant must serve a reply giving particulars of the facts and matters from which the malice is to be inferred.  Malice is a very serious allegation of intentional impropriety or bad faith and the rules of pleading allegations of this kind are strict.  It is not sufficient merely to plead that the defendant acted maliciously.  The plea must be more consistent with the presence of malice then with its absence; if it is not, it is liable to be struck out.  Generalised or formulaic statements will not be permitted.  The plea of malice must focus upon what the defendant did or said or knew… Where the defendant is a corporation, the claimant should give particulars of the person or persons through whom it is intended to fix the corporation with the necessary malicious intent, as well as pleading the facts from which malice is to be inferred. However, malice cannot be proved by amalgamating states of minds of different individuals within an organisation.”

[15]      Against that background, counsel referred to the pursuers’ pleadings at article V of the condescendence at page 13C-D, which are in the following terms:

“The pursuer is entitled to the protection afforded by [section 8 of the 1974 Act].  The defenders published reference to the conviction out of irrelevant, spiteful and improper motives.  Their reasons for mentioning the previous conviction were bad reasons.”

Senior counsel noted that the reference to “irrelevant, spiteful and improper motives” was copied from Herbage.  He contended that the averment about motive lacked specification, and submitted that no specification was given, either, of what the defenders’ alleged “bad reasons” were.  Further, and in any event, a limited company cannot be malicious, and cannot be vicariously liable for the malice of its agent or employee.  Reference was made to Curran v Scottish Daily Record and Sunday Mail Ltd in the Inner House.  (2012 SLT 359, at paragraphs [36] to [41] and [61] to [65])

[16]      Counsel for the defenders next anticipated two of the pursuers’ contentions which were contained in their note of argument.  At paragraph 4, under the heading “Qualified Privilege”, the pursuers criticise an averment of the defenders in which they contend that they are entitled to “carry the comments and concerns of politicians - local and national - as a matter of clear public interest as long as they do so without malice”.  Paragraph 5 is headed “Reynolds Privilege”.  Counsel for the defenders submitted that it appears that the pursuers regard qualified privilege as a defence which is distinct from Reynolds privilege.  In fact, contended counsel, Reynolds privilege is a species of qualified privilege.  In support of that submission, counsel referred to Jameel and another v Wall Street Journal Europe Sprl [2007] 1 AC 359, at page 360C (Jameel), and to Flood v Times Newspapers Ltd [2012] 2 AC 273.

[17]      Finally, counsel for the defenders turned his attention to the pursuers’ case in reliance on the provisions of the 1974 Act.  He reiterated the proposition that the court can have regard only to the defamatory meaning given to the words complained of by the pursuers, which is that the first pursuer is a convicted fraudster who continues in criminal enterprise.  If it is held that the words complained of are not capable of bearing that meaning, that is an end to the matter, and it will not be necessary to look at the terms of the 1974 Act.

Submissions for the pursuers

[18]      Counsel for the pursuers moved the court to sustain their first and second pleas-in-law, and to remit the action to a proof before answer, restricted to the matter of quantum.  The first plea is in these terms:

“The article complained of being defamatory of the first pursuer and having been made maliciously and without probable (or any) cause the defenders are liable to him in reparation.”

The second plea is to the same effect, in respect of the second pursuers.  The argument in support of that motion had a number of component parts.  The first was to the effect that the parties have set out in their pleadings what they claim to be the meaning of the article.  The pursuers invite the court to delete the defenders’ averments on the meaning of the article and repel their first plea in law, which is a challenge to the relevancy and specification of the pursuers’ averments.  In that event, proof would be restricted to the matter of quantum.

[19]      Counsel drew the court’s attention to Horlick v Associated Newspapers Ltd [2010] EWHC 1544 (QB) and Charman v Orion Publishing Group Ltd and another [2005] EWHC 2187 (QB) (“Charman”).  In the former, Eady J carried out his own analysis of the principles to be applied “when a judge is invited to determine meaning in a defamation case”.  His lordship said that the judge should give the article the natural and ordinary meaning which it would have conveyed to ordinary reasonable readers reading the article once.  Such a reader should not be treated as either naïve or unduly suspicious, but would be capable of reading between the lines.  The exercise is, to a large extent, one of forming an impression.  It is sometimes said that the reasonable reader does not, and should not, select the defamatory meaning where other non-defamatory meanings are available.  The question came to be how the particular article, put in its context, strikes the reader.  It would seem to follow that the judge should be wary of allowing his impression of a newspaper article to be coloured by the detailed submissions of counsel.  (See paragraphs 8-10).   In Charman, which concerned an allegedly defamatory book, Gray J cautioned against “an over-elaborate analysis of the various passages relied on by the respective protagonists”, and said that the exercise is essentially one of ascertaining the broad impression made on the hypothetical reader by the book taken as a whole.  His lordship made the point, also, that the trier of fact must take the bane and antidote of the publication together.

[20]      Counsel for the pursuers submitted that to describe someone as “a fraudster” is to allege that he or she is a career criminal.  Being a “fraudster” is what that person does.  He or she continues to commit crimes of dishonesty.  The phrase “criminal background” suggests that crime continues to be part of that person’s background.  To illustrate his point, counsel referred me to Sutherland v Stopes [1925] AC 47.  At page 74, Lord Shaw of Dunfermline observed that: “a statement of fact… which consists in the raking up of a long-buried past may, without an explanation (and, in cases which are conceivable, even with an explanation), be libellous or slanderous if written or uttered in such circumstances as to suggest that taint upon character and conduct still subsists.”  In this case, contended counsel, the reference in the article to the first pursuer’s conviction is the story.  It means that there is a taint on his character. He is the real target of the article.  The central point is whether the first pursuer is a fraudster or has simply been convicted of fraud.  I was referred to Fletcher v Wilson 12R 683, in which a newspaper had printed a piece in which it was reported that the pursuer had been convicted of assault, which was true and accurate.  The article continued, however, that he “had been seven times previously convicted of theft.”  He had, in fact, seven previous convictions for assault, and the reference to theft was the result of a clerical error.  At page 685 the Lord President expressed the view that to say that a person had been previously convicted of theft on seven occasions: “means nothing less than this, that he is notoriously habit and repute a thief, and well known to the police authorities as such.”  After trial, the defenders discovered that, 23 years previously, when the pursuer was aged 14, he had twice in the same year been convicted of theft, on one occasion of stealing an empty purse and, on another, of stealing 20 shillings.  The defenders sought a new trial on the ground, among others, that they should be allowed to establish justification.  The Lord President expressed the view that proof of these previous convictions would be no justification of the libel complained of.  Counsel referred me to a passage in TB Smith: Short Commentary on the Law in Scotland at pages 732-733, in which the author expresses the view that it would, presumably, justify a statement that a man was a “murderer” to show that he had committed one murder.  Counsel submitted that it would not be defamatory to say, if true, that a person was a “convicted murderer”, contending that that would be “an exception to the rule”.

[21]      Reference was next made to the speech of Lord Hodson in Lewis v Daily Telegraph Ltd [1964] AC 234, in which his lordship explained the difference between an imputation that someone is suspected of wrongdoing, and an allegation that he is guilty of wrongdoing.  His lordship expressed the view that it may be defamatory to say that someone is suspected of an offence, but that is not the same as saying that that person has committed the offence.  If a person says or implies that another is under suspicion of guilt, that does not imply that he is, in fact, guilty but only that there are reasonable grounds for suspicion, “which is a different matter”.  In this case, argued counsel, what is being said in the article is that the first pursuer is someone who has managed to find a gullible quango and has received money from it.  He is described twice as a fraudster, and it is easier for a fraudster to operate if he finds a gullible victim.  The ordinary reader, reading between the lines, would consider that this was a transaction that should be looked at more closely.  The allegation that someone is a fraudster cannot be justified by saying that he has one conviction.

[22]      Counsel submitted that the impression that would be created in the mind of the ordinary reader of the article is that it was about more than a spent conviction dating back to the 1990s.  In advancing that argument, counsel relied on the speech of Lord Reid in Morgan v Odhams Press Ltd 1971 WLR 1239, at page 1245, in which his lordship said that one should accept a certain amount of loose thinking on the part of the ordinary man.  He does not formulate reasons in his own mind, but forms a general impression and it is to be expected that he will look again before coming to a conclusion and acting on it.  His lordship could see no injustice in holding the publishers of newspapers liable if readers, behaving as they normally do, honestly reach conclusions which they might be expected to reach.

[23]      With reference to the defence of justification, counsel for the pursuers submitted that, if the meaning which they ascribe to the article is correct, the defenders do not offer to prove that it is true.  Consequently, there is no defence of justification.  If the defenders are correct in their interpretation, the pursuers accept that they can only succeed if they prove malice.

[24]      The pursuer’s counsel submitted that the defenders’ sixth plea-in-law should be repelled.  That plea contends for absolvitor on the ground that, insofar as the article contains comment, such comment was honest and on matters of public interest.  The plain meaning of the phrase: “people with a criminal background” was that large sums of public money were being handed out to criminals.  That was a clear reference to the pursuers.  Citing London Artists v Littler 1969 2 QB 375, counsel submitted that an allegation of criminality is an allegation of fact, not comment.

[25]      On the subject of privilege, counsel accepted that the onus is on the pursuers to aver and prove malice if that is what they contend for.  He also accepted that, where Reynolds’ privilege is invoked, malice does not arise.  If the pursuers are correct, however, in contending that the article contained a false allegation of the continuing commission of a crime, Reynolds ’ privilege does not arise, because there is no public interest in receiving false information about the commission of a crime.  In that regard, counsel referred to Grobbelaar v News Group Newspapers Ltd and another [2001] 2 AER 437, at paragraph 40.  Further, argued counsel, the defenders have insufficiently specific averments to entitle them to lead evidence in support of a Reynolds defence.  As it is put in their note of argument, the pursuers contend that such a defence requires a 10 point (non-exhaustive) list of factors to be averred.  The defenders have not done so in this case.

[26]      Counsel accepted that section 8 of the 1974 Act removes the defence of justification only where the pursuer proves that the publication was made with malice.  During the course of discussion between counsel and the bench, counsel departed from the proposition that he had averred a relevant case of malice as required by the terms of section 8.  He submitted, however, that the article not only refers to the spent conviction but to the first pursuer’s (ex- or former) wife’s claim to having “unearthed evidence her husband was having an affair with another woman when she discovered a text message on his phone.”  In article V of the condescendence, the pursuers aver that there was no good reason for mentioning the divorce “other than to convince the ordinary reader that the pursuer could not be trusted”.  Reference is made in the pursuers’ pleadings to the Judicial Proceedings (Regulation of Reports) Act 1926 (“the 1926 Act”).  Counsel cited Nicol v Caledonian Newspapers Ltd 2002 SC 493 in which Lady Paton held that the first defender had “probably” been in breach of section 1 of the Act and went on to express the view that, in any such breach “there may well be serious difficulties in establishing lack of malice.”  In looking at the terms of section 1 of the 1926 Act, counsel was unable to specify in what manner it had been breached, nor, with reference to the pursuers’ averments, what constitutes proof of malice or by whom.  At the conclusion of that part of the discussion, counsel expressly conceded that the pursuers’ averments, in which they invoke the terms of the 1974 and 1926 Acts, and which conclude: “In the circumstances the reference to the previous conviction and divorce proceedings amounted to malice” are irrelevant, and fall to be deleted.  In conclusion, counsel accepted that, if the meaning of the article was that as contended for by the defenders, the pursuers need averments of malice to make good their complaint under the provisions of the 1974 Act.  He accepted that such averments are lacking and that, consequently, the action falls.

Response for the defenders

[27]      In response to the pursuers’ contentions, senior counsel for the defenders submitted that their recourse to Reynolds privilege arises only if the meaning of the words complained of is that contended for by the pursuers.  In any event, as Lord Bingham of Cornhill put it in Jameel, at paragraph 33, the matters that were listed by Lord Nicholls in Reynolds as being those which might be taken into account in deciding whether the test of responsible journalism was satisfied were “parties” and not “a series of hurdles to be negotiated by a publisher before he would successfully rely on qualified privilege”.
Decision and reasons

[28]      As a matter of law, the article is not capable of bearing the meanings contended for by the pursuers.

[29]      The reasonable reader, possessing the characteristics ascribed to him or her in the authorities referred to earlier in this opinion, reading the piece for the first time, and taking the bane and antidote of the publication together, would regard the article as, principally, an attack on Clyde Gateway.  The payment of a grant to Spectrum Properties (Scotland) Limited was one of three transactions in which the quango had paid public money in circumstances in which questions might be said to arise as to its stewardship of those funds.  Nowhere is the first pursuer described simply as “a fraudster”.  That word is used twice.  On both occasions, it is qualified by the adjective “convicted”.  The precise meaning of the phrase “convicted fraudster” is given in the text which appears beneath his photograph: “Criminal Record: Bill Roddie was convicted of fraud in the 1990s”, and in the fifth paragraph in the left hand column:  “Mr Roddie was convicted of fraud in the 1990s and handed a nine month prison sentence”.  In the meaning ascribed by the pursuers to the words “convicted fraudster”, they have added the words “who continues in criminal enterprise”.  The phrase “convicted fraudster” communicates a single fact, the meaning of which is restricted by the explanation that the first pursuer “was convicted of fraud in the 1990s”.  The pursuers’ meaning communicates two separate facts:  that the first pursuer has a conviction for fraud, which is true; and that the first pursuer continues to commit fraud, which is untrue.  The pursuers’ two-fact meaning is not a reasonable, natural, or necessary interpretation of the words actually used, which convey a single fact.  The SNP councillor is quoted as referring to “people with a criminal background”.  Whist the reader may reasonably understand that the first pursuer was one of those “people”, it is true that he has a criminal background.  There is no other reference to the first pursuer in the article which links him to crime.  There is nothing in the article which is capable of conveying the meaning that the first pursuer continues in a course of criminal conduct.

[30]      Nor is the article capable of bearing the meaning that the pursuers ascribe to it in respect of the second pursuers.  The article contains a number of assertions of fact about them:  that the first pursuer, the sole director of the second pursuers, was a convicted fraudster; that the second pursuers' auditors, PKF, had reported a significant doubt about the ability of the second pursuers to continue as a going concern; that PKF had thereafter resigned; but that PKF had indicated that there were no circumstances connected with the resignation which required to be reported to members or creditors of the second pursuers.  None of these pieces of information is challenged by the pursuers as having been untrue.  Further, Clyde Gateway is quoted as having said that the second pursuers are the largest private sector landowner within Clyde Gateway and are, therefore, key to helping ensure the delivery of jobs, new businesses and inward investment within their regeneration efforts.  Before doing business with them, Clyde Gateway had carried out appropriate checks, and the projects that it had funded had been completed, and the sums involved had been spent in accordance with Clyde Gateway’s expectations.

[31]      It is not a reasonable, natural, or necessary interpretation of the article that the second pursuers were not a company to do business with because “they were run by a fraudster which rendered them a poor credit risk and their auditors had resigned in suspicious circumstances.”  The pursuers must be taken to have intended that the word “fraudster” as used by them in the averment under consideration here has the same meaning as contended for by them earlier in the pleadings, namely that the first pursuer continues to commit fraud.  For the reasons already given, that meaning cannot be read out of what is said in the article about the first pursuer.  The article cannot and does not, therefore, mean that the second defenders were rendered a poor credit risk because they were run by a person who continues to commit fraud.  Contrary to the article having communicated that the auditors “had resigned in suspicious circumstances”, the article reports that the auditors “insisted” that, as the auditors themselves put it, there were “no circumstances connected with (their) resignation which should be reported to members or creditors of the company.”  The article represented that the auditors resigned in undisclosed circumstances.  The pursuers do not claim that to be untrue.  The article did not represent that the auditors resigned in suspicious circumstances.

[32]      For the foregoing reasons, the defenders’ first plea in law falls to be sustained, and the action dismissed.  I shall reserve all questions of expenses.