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Cite as: (2001) 3 LGLR 45, [2001] UKHL 29, [2002] 2 AC 122, [2001] 3 All ER 193, [2001] 2 WLR 1789

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JISCBAILII_CASE_TORT

Judgments - Kuddus (AP) v. Chief Constable of Leicestershire Constabulary

(RESPONDENT)

ON 7 JUNE 2001

[2001] UKHL 29

LORD SLYNN OF HADLEY

My Lords,

It seems to me that in this case the issues of law which have been raised could have been more satisfactorily dealt with after the facts had been found. Your Lordships, however, have to deal with the case on the basis that the recorder and the majority of the Court of Appeal (Auld LJ dissenting) in this case struck out a claim for exemplary damages on the basis that it disclosed no cause of action.

The relevant pleaded facts are short. The appellant plaintiff told a police constable that he had come back to his flat where a friend had been staying to find that a lot of property was missing. The officer said that the matter would be investigated but some two months later he forged the plaintiff's signature on a written statement withdrawing the complaint of theft. Accordingly the police investigation ceased.

The defendant Chief Constable admits the forgery and that the officer's conduct amounts to misfeasance in a public office. He successfully contended, however, that exemplary damages are not recoverable for the tort of misfeasance by a public officer so that that part of the claim should be struck out. He accepts that there is a viable claim for aggravated damages for such misfeasance.

The parties agree that an award of exemplary damages may be made in appropriate cases in English law even though, being punitive in nature, such an award is inconsistent with the principle that damages are intended to be compensatory. As the law now stands that agreement in my view is well founded.

In Rookes v Barnard [1964] AC 1129, 1223 Lord Devlin, with whom on this point other members of the House agreed, having considered early cases concluded:

"These authorities clearly justify the use of the exemplary principle; and for my part I should not wish, even if I felt at liberty to do so, to diminish its use in this type of case where it serves a valuable purpose in restraining the arbitrary and outrageous use of executive power."

Having reviewed further cases he said, at pp 1225-1226:

"These authorities convince me of two things. First, that your Lordships could not, without a complete disregard of precedent, and indeed of statute, now arrive at a determination that refused altogether to recognise the exemplary principle. Secondly, that there are certain categories of cases in which an award of exemplary damages can serve a useful purpose in vindicating the strength of the law and thus affording a practical justification for admitting into the civil law a principle which ought logically to belong to the criminal. I propose to state what these two categories are; and I propose also to state three general considerations which, in my opinion, should always be borne in mind when awards of exemplary damages are being made. I am well aware that what I am about to say will, if accepted, impose limits not hitherto expressed on such awards and that there is powerful though not compelling, authority for allowing them a wider range. I shall not, therefore, conclude what I have to say on the general principles of law without returning to the authorities and making it clear to what extent I have rejected the guidance they may be said to afford.

"The first category is oppressive, arbitrary or unconstitutional action by the servants of the government. I should not extend this category—I say this with particular reference to the facts of this case—to oppressive action by private corporations or individuals. Where one man is more powerful than another, it is inevitable that he will try to use his power to gain his ends; and if his power is much greater than the other's, he might, perhaps, be said to be using it oppressively. If he uses his power illegally, he must of course pay for his illegality in the ordinary way; but he is not to be punished simply because he is the more powerful. In the case of the government it is different, for the servants of the government are also the servants of the people and the use of their power must always be subordinate to their duty of service…

"Cases in the second category are those in which the defendant's conduct has been calculated by him to make a profit for himself which may well exceed the compensation payable to the plaintiff."

Lord Devlin also referred, at p 1227, to a third category in which exemplary damages are expressly authorised by statute which it is not necessary to consider in the present case.

It is equally accepted by the parties that exemplary damages are not precluded by the fact that aggravated damages may be awarded though it is clear that before the decision of the House in Rookes v Barnard [1964] AC 1129 the distinction between the two was not fully appreciated. In that case Lord Devlin, at p 1228, drew attention to the difference of purpose of compensatory damages and punitive or exemplary damages:

"In a case in which exemplary damages are appropriate, a jury should be directed that if, but only if, the sum which they have in mind to award as compensation (which may, of course, be a sum aggravated by the way in which the defendant has behaved to the plaintiff) is inadequate to punish him for his outrageous conduct, to mark their disapproval of such conduct and to deter him from repeating it, then it can award some larger sum."

Lord Devlin stressed that a judge should not allow a case for exemplary damages to be left to the jury unless he is satisfied that it can be brought within the categories he had specified and that a plaintiff can only recover exemplary damages if he is "the victim of the punishable behaviour" p 1227. The means of the parties are material in the assessment of exemplary damages. "Everything which aggravates or mitigates the defendant's conduct is relevant" (p 1228).

It seems to me that there is nothing in Lord Devlin's analysis which requires that in addition to a claim falling within one of the two categories it should also constitute a cause of action which had before 1964 been accepted as grounding a claim for exemplary damages.

In AB v South West Water Services Ltd [1993] QB 507, the court was concerned with claims for public nuisance and breach of statutory duty. Exemplary damages were claimed on the basis that servants or agents of the defendants as employees of a statutory body had acted in an arrogant and high-handed way and had deliberately misled their customers. It was contended that exemplary damages did not lie for nuisance and that the allegations in the case did not fall within either of Lord Devlin's "categories". But in addition it was said, at p 517, that the combined effect of Rookes v Barnard [1964] AC 1129 and Broome v Cassell & Co Ltd [1972] AC 1027 was that the claim must be "in respect of a cause of action for which prior to 1964 such an award had been made".

Stuart-Smith LJ accepted, at p 519, that this last limitation was not to be found in the speech of Lord Devlin in Rookes v Barnard [1964] AC 1129 but was to be deduced from the majority of speeches in Broome v Cassell & Co Ltd [1972] AC 1027. Having said, at p 523, that the question whether exemplary damages for nuisance were available prior to 1964 depended on a proper view of Bell v Midland Railway Co (1861) 10 CB(NS) 287, he held that exemplary damages could not be awarded for damage flowing from public nuisance, such a claim not having been recognised for such purpose before 1964. He also rejected the contention that the defendants' servants or agents were exercising executive power derived from government, central or local. The claim did not fall accordingly within either of Lord Devlin's two categories.

Sir Thomas Bingham MR accepted, at p 529, that:

"According to the traditional classification of the law of tort, such misuse of power [ie that referred to in Lord Devlin's first category] could give rise to any one of a number of courses of action, which Lord Devlin was not at pains to identify".

Having referred to passages in the speeches in Broome v Cassell & Co Ltd [1972] AC 1027 dealing with the question of whether the claim had to be founded on a cause of action recognised as grounding a claim for exemplary damages before 1964, the Master of the Rolls said, at p 530:

"I cannot pretend to find the answer at all clear, but I incline to think that a majority of the House regarded an award of exemplary damages as permissible only where (a) a course fell within one or other of Lord Devlin's categories and (b) was founded on a tort for which exemplary damages had been awarded before Rookes v Barnard [1964] AC 1129. This may involve a misreading of their Lordships' speeches in Broome v. Cassell & Co Ltd [1972] AC 1027, but I think it is the basis upon which the Court of Appeal should, until corrected, proceed."

That was also the approach of the majority in the Court of Appeal in the present case.

I share the Master of the Rolls' view that it is not easy to be sure whether the House in Broome v Cassell & Co Ltd [1972] AC 1027 ruled that the "pre-1964 test" had to be satisfied but that is the core of the question on this appeal so that it is necessary to look carefully at what was said.

Lord Hailsham of St Marylebone LC, with whom Lord Kilbrandon agreed, thought, at p 1076, that Lord Devlin was not intending to add to the list of torts for which exemplary damages was available though he considered, at p 1068, that the law before 1964 was not settled: "In point of fact, it was nothing of the kind." "Speaking for myself, and whatever view I formed of the categories, I would find it impossible to return to the chaos which is euphemistically referred to by Phillimore LJ [1971] 2 QB 345, 399, as 'the law as it was before Rookes v Barnard'" (p 1070). Moreover it is to be noted that in considering the first of Lord Devlin's categories Lord Hailsham said, at pp 1077-1078, that he would be surprised if the list included only servants of the Government in the strict sense of the word. It could cover the police and local and other officials exercising search or arrest without a warrant:

"and it may be that in the future it will be held to include other abuses of power without warrant by persons purporting to exercise legal authority . . . I am not prepared to say without further consideration that a private individual misusing legal powers of private prosecution or arrest . . . might not at some future date be assimilated into the first category." (Emphasis added.)

He also thought, at p 1078, that the second category should be broadly construed and, at p 1080 "even though in the absence of authority I am of the opinion that exemplary damages cannot be awarded in an action for deceit, I cannot claim that the matter has been finally determined."

It seems to me, therefore, that Lord Hailsham was prepared in some respects to be more flexible than a rigid adherence to the "pre 1964" test suggests.

Lord Reid stressed, at p 1085, that Lord Devlin was not laying down "rules" but stating "principles". He added, at p 1086:

"But we thought and I still think it well within the province of this House to say that that undesirable anomaly [punitive damages] should not be permitted in any class of case where its use was not covered by authority."

But Lord Devlin:

"set out two categories of cases which in our opinion comprised all or virtually all the reported cases in which it was clear that the court had approved of an award of a larger sum of damages than could be justified as compensatory. . . We were confronted with an undesirable anomaly. We could not abolish it. We had to choose between confining it strictly to classes of cases where it was firmly established, although that produced an illogical result, or permitting it to be extended so as to produce a logical result. In my view it is better in such cases to be content with an illogical result than to allow any extension". (pp 1086-1087).

Lord Reid also thought, at p 1088, that the first "category" should be read as extending to all those who by common law or statute are exercising functions of a governmental character. He said, however, that: "I would, logic or no logic, refuse to extend the right to inflict exemplary damages to any class of case which is not already clearly covered by authority. On that basis I support this category". (emphasis added).

Lord Wilberforce, at p 1119, did not consider that Lord Devlin had intended to limit punitive damages in defamation actions to cases where a profit motive was shown. As to the first category he said, at p 1120:

"There is not perhaps much difficulty about category 1: it is well based on the cases and on a principle stated in 1703—'if public officers will infringe men's rights, they ought to pay greater damages than other men to deter and hinder others from the like offences': Ashby v White (1703) 2 Ld Raym 938, 956 per Holt CJ. Excessive and insolent use of power is certainly something against which citizens require as much protection today: a wide interpretation of 'government' which I understand your Lordships to endorse would correspond with Holt CJ's 'public officers' and would partly correspond with modern needs. There would remain, even on the most liberal interpretation, a number of difficulties and inconsistencies as pointed out by Taylor J. in Uren v John Fairfax & Sons Pty Ltd (1966) 117 CLR 118.

On all other points not expressly dealt with, Lord Wilberforce agreed with Lord Hailsham.

Lord Diplock agreed, at p 1131:

"that Rookes v Barnard was not intended to extend the power to award exemplary or aggravated damages to particular torts for which they had not previously been awarded; such as negligence and deceit. Its express purpose was to restrict, not to expand, the anomaly of exemplary damages."

He said, however, at pp 1123-1124:

"It was necessary as a matter of decision of the cross-appeal for this House to determine whether the facts in Rookes v Barnard brought it within a category of cases in which exemplary damages were recoverable at common law. This House determined that they did not and ordered a new trial.

"There were two different processes of reasoning by which it would have been possible to reach this conclusion of law. One, which was not adopted by this House, was to hold that the particular tort of intimidation was one in which the common law did not permit of exemplary damages. The other, which was adopted by this House, was to state the categories of cases in which alone exemplary damages might be awarded at common law and to determine whether the facts in Rookes v Barnard brought it within one of these categories."

and, at p 1128:

"Lord Devlin's analysis of previous decisions disclosed three kinds of cases in which the courts had recognised the right of a jury to award damages by way of punishment of the defendant in excess of what was sufficient to compensate the plaintiff for all the harm occasioned to him. The categorisation was new. Its purpose has, I think, been misunderstood. No one suggests that judges, when approving awards of exemplary damages in particular cases in the past consciously differentiated between one kind of case in which exemplary damages could be awarded and another. They dealt with them all as falling within a single nebulous class of cases in which the defendant's conduct was such as to merit punishment. The purpose of Lord Devlin's division of them into three categories was in order to distinguish between factual situations in which there was some special reason still relevant in modern social conditions for retaining the power to award exemplary damages, and factual situations in which no such special reason still survived.

"With this end in view Lord Devlin extracted from the single nebulous class which appeared to be all that had been consciously recognised as justifying an award of exemplary damages at common law, two categories of cases in which this House decided that there were special reasons why the power to award exemplary damages should be retained. These two (apart from cases where exemplary damages are authorised by statute) are generally referred to as 'the categories'. But there is also to be found in the previous cases a third category, consisting of the remainder of the single nebulous class in which this House decided that the anomalous practice of awarding exemplary damages in civil proceedings ought to be discontinued."

My Lords, Lord Hailsham and Lord Kilbrandon appeared to attach importance to the existence of the pre-1964 cause of action test. It is arguable that Lord Reid and Lord Wilberforce took the same view. I am not, however, satisfied that it was their intention. Lord Reid lays much emphasis on "principles" and "categories" and "class of case" rather than on specific or precise causes of action. It seems to me, despite his general agreement with Lord Hailsham that Lord Wilberforce contemplated a wide interpretation of both "government" and the excessive use of executive power. Accordingly although I well understand the approach of the Court of Appeal in AB v South West Water Services Ltd [1993] QB 507. I do not consider that the House is bound by a clear or unequivocal decision in Broome v Cassell & Co Ltd [1972] AC 1027 to hold that the power to award exemplary damages is limited to cases where it can be shown that the cause of action had been recognised before 1964 as justifying an award of exemplary damages. It is certainly not bound by anything said by Lord Devlin in what is after all the basic statement of the law.

I do not consider that in principle it should be so limited. In any event, like Auld LJ, I do not think that courts should be required to undertake a trawl of the authorities in order to decipher whether awards of damages for misfeasance pre-1964 might have included an award for exemplary damages. Such a task would be all the more difficult given the fact, as indicated above, that the distinction between exemplary and aggravated damages was not until Rookes v Barnard [1964] AC 1129 clearly articulated. To adopt such a rigid rule seems to me to limit the future development of the law even within the restrictive categories adopted by Lord Devlin in a way which is contrary to the normal practice of the courts as referred to by Lord Evershed in Rookes v Barnard, at p 1185, and by Lord Diplock in Broome v. Cassell & Co Ltd [1972] AC 1027, 1127. Such a restrictive approach also justifies the comments in Winfield and Jolowicz on Tort, 15th ed, (1998) p 746 in relation to the pre-1964 test:

"In other words, that decision [Rookes v Barnard] was not a 'new start' for the law under two rationalised categories but a further restriction upon then existing authority. Whatever one's views on exemplary damages this is an unfortunate state of affairs because it commits the law to an irrational position in which the result depends not on principle but upon the accidents of litigation (or even of law reporting) before 1964, at a time, moreover, when the distinction between exemplary and aggravated damages was by no means so clearly drawn as it is now."

It is also to be borne in mind that the Law Commission in its Report on Aggravated, Exemplary and Restitutionary Damages (1997) (Law Com No 247), para 5.49 recommended that the availability of punitive damages be extended for most torts, which would entail the rejection of "the rationally indefensible position which the common law reached" in deciding claims on the basis of the existence or absence of pre-1964 precedents.

I do not think that the Government's view (HC Debates), 9 November 1999, col 502 that it was right to defer a decision on further legislation on this issue coupled with the comment "It may be that some further judicial development of the law in this area might help clarify the issues" should inspire your Lordships to the view that the whole matter should be reopened and the Law Commission's Report revisited. It is no more than a comment that issues might become clearer as decisions on particular facts emerge.

For my part I do not consider that it would be right in this case to consider reopening the whole question as to whether exemplary damages should be available at all. The House clearly refused in Rookes v Barnard [1964] AC 1129 and Broome v Cassell & Co Ltd [1972] AC 1027 to abolish the rule that exemplary damages are in some cases available and in Broome v Cassell & Co Ltd the House refused to reopen the basic decision in Rookes v Barnard.

There are obviously strong views as to whether exemplary damages should or should not ever be awarded. It has not been contended in this case that your Lordships should hold that in principle they can never be awarded. In my view therefore the starting point is that the two decisions of the House already accept that exemplary damages may be awarded in some cases. The task of the House in the present appeal is to say whether it is arguable that they can, and if the facts are established should, be awarded in the present case for the tort of misfeasance in public office. In Lord Devlin's speech in Rookes v Barnard [1964] AC 1129 it seems to me that it is the features of the behaviour rather than the cause of action which must be looked at in order to decide whether the facts fall into the first category. In Broome v Cassell & Co Ltd [1972] AC 1027 Lord Diplock was also recognising that the task of the judge was to decide whether the facts brought the case into one of the categories.

So on the present appeal the question is whether the exemplary damages claimed are on the basis of facts which if established fall within the first category. For the purpose of the strike-out application, it is accepted that they do so fall. The claim is not excluded because it is not shown that a case on the basis of misfeasance in a public office had been decided before 1964. I would therefore allow the appeal. The claim for exemplary damages should not have been struck out on the basis argued before the House. The question whether in principle the Chief Constable can be vicariously liable has not been argued and I do not think it right to discuss or to rule on it in this case.

LORD MACKAY OF CLASHFERN

My Lords,

The pleaded facts in this case are that on 14 June 1996 the appellant plaintiff discovered that a theft had taken place at his home in Leicester. On the same day the plaintiff reported the theft to a police constable serving with the Leicestershire Constabulary and for whose actions in the course of his police functions the respondent defendant was responsible.

In reporting the theft the plaintiff made a written statement explaining that when he left the flat at 11 a m on 14 June 1996 there remained an acquaintance of his who had stayed the night in the flat as the plaintiff's guest. On leaving his flat the plaintiff locked the front door behind him. When the plaintiff returned at 1245 p m he found the front door open and damaged and a large number of items of property missing. The plaintiff suspected that the property had been stolen by his guest and so informed the police constable. He gave the constable details of the property that had been taken from the flat. The plaintiff to the knowledge of the police constable was willing to co-operate with any police investigations and the constable assured the plaintiff that the offence would be investigated. In fact unknown to the plaintiff and without his consent on or about 18 August 1996 the police constable forged the plaintiff's signature on a written statement prepared by the constable which purported to be a withdrawal by the plaintiff of his complaint of theft. As a result of the forged withdrawal statement the police investigation into the complaint of theft ceased and the plaintiff did not discover the fact of the forged statement until on or about 5 December 1996.

The facts I have narrated are the basis of the plaintiff's case that the police constable's conduct amounts to the tort or misfeasance in public office. The defendant admits the fact of the forgery and that the constable's conduct as pleaded amounts to the tort of misfeasance in public office. The plaintiff raised an action in Leicester County Court and in the course of proceedings there the defendant applied for an order that "the plaintiff's claim for exemplary damages as pleaded … be struck out". The grounds of this application were that this part of the plaintiff's claim disclosed no cause of action as exemplary damages are not recoverable for the tort of misfeasance. Mr Recorder Waine on 26 November 1998 acceded to the application and struck out the plaintiff's claim for exemplary damages for misfeasance in public office. The claim for aggravated damages was struck out by mistake and the defendant agrees that the action must proceed so far as claiming damages including aggravated damages but excluding exemplary damages. The plaintiff appealed to the Court of Appeal and on 10 February 2000 the Court of Appeal by a majority (Beldam LJ and Sir Christopher Staughton, Auld LJ dissenting) dismissed the appeal and granted the plaintiff leave to appeal to your Lordships' House.

Neither party in this appeal was prepared to argue that exemplary damages should no longer form part of the law of England nor on the other hand that the principles enunciated by Lord Devlin in Rookes v Barnard [1964] AC 1129 should be extended. Both parties were content to proceed on the basis that the decisions of this House in Rookes v Barnard and Broome v Cassell & Co Ltd [1972] AC 1027 should be followed.

In Rookes v Barnard [1964] AC 1129 Lord Devlin, in a part of his speech adopted by the other members of the appellate committee, held that for the court to have a discretion to award exemplary damages in tort, either the facts of the case must fall within one or other of two broad factual categories, or the award of exemplary damages in the circumstances of the case must be expressly authorised by statute. The two factual categories are:

Oppressive, arbitrary or unconstitutional actions by servants of the Government,

and

Conduct (by the defendant) calculated to make a profit for himself which may well exceed the compensation payable to the plaintive.

It is accepted by the defendant that the pleaded and agreed facts fall within Lord Devlin's first category. At first sight it seems remarkable that the defendant can accept this as the position and at the same time accept that the House should follow the decision in Rookes v Barnard and yet that this appeal should be dismissed. The justification for this position lies in the decision of the Court of Appeal in AB v South West Water Services Ltd. [1993] QB 507 which laid down that before an award of exemplary damages can be made by any court or tribunal the tort must be one in respect of which an award was made prior to 1964, the date of the decision in Rookes v Barnard.

The genius of the common law is its capacity to develop and it appears strange that the law on this particular topic should be frozen by reference to decisions that had been taken prior to and including Rookes v Barnard. This has led Professor W. V. H. Rogers to comment in the 15th edition of Winfield and Jolowicz on Tort, at p 746, that this decision "commits the law to an irrational position in which the result depends not on principle but upon the accidents of litigation …".

If one takes the view that exemplary damages are an anomaly in the law which has been introduced by authority which should be allowed to stand but that it should not be extended beyond the limits to which it has already been introduced then a freeze of this kind would be a logical consequence of that position although the very existence of the anomaly is itself illogical. Put another way, if one has accepted that damage has been done to the rationality of the law by the introduction of an anomaly which cannot be removed but which should not be enlarged, the consequence that the extent to which the anomaly persists is determined by the extent to which it has prevailed prior to the decision to limit it is a perfectly natural and reasonable result. In my opinion therefore criticism of AB v South West Water Services Ltd [1993] QB 507 on the basis that it is illogical is not well founded. However it remains to consider whether the decision is justified by the reasons on which it was based.

This consideration requires the House to examine the principles on which Rookes v Barnard [1964] AC 1129 in so far as it dealt with exemplary damages is based. Since neither party in this appeal was prepared to challenge Rookes v Barnard nor to examine the basis in principle for allowing exemplary damages at all the House is put in the position of having to approach the important question of whether exemplary damages should be available for the tort of misfeasance in public office without the benefit of a full examination of the principles by reference to which that decision should be taken. However the Law Commission in its Report on Aggravated, Exemplary and Restitutionary Damages (1997) (Law Com No 247) after a very full and thorough consultation, has reached the view that exemplary damages should continue to be part of the law of England and Wales although on a more extended basis than it is at present. By written answer of 9 November 1999 (HC Debates), 9 November 1999, col 502 the Government has stated that it does not propose to take forward the draft legislation giving effect to this recommendation of the Law Commission having regard to the balance of opinion disclosed at consultation; the answer further stated: "It may be that some further judicial development of the law in this area might help clarify the issues." We were informed that originally the defendant in the present appeal had indicated an intention to raise this issue but on mature consideration had decided not to do so and that preliminary preparations by the plaintiff to meet such an argument had accordingly been departed from for this reason. Both parties to this appeal start from the premise of acceptance of Lord Devlin's speech in Rookes v Barnard [1964] AC 1129 as setting out the law on this subject which the House should follow in deciding this particular case.

Much water has flowed under the bridge since Rookes v Barnard was decided. Many statutory duties have been created and the Human Rights Act 1998 has been enacted which give rise to claims of damages the principles of which may well affect the propriety of and the necessity for a power to award exemplary damages to continue to be recognised in the law of England. However in the absence of fuller argument on this point and the fact that the Law Commission after a full consultation has recommended that the power to award exemplary damages should not be removed from the law of England I am content to decide this appeal in the light of the arguments that have been presented. Rookes v Barnard is an authority decided in this House. While under the Practice Statement of 1966 (Practice Statement (Judicial Precedent) [1966] 1 WLR 1234) the House could now for good reason decline to follow it, since neither party was prepared to advance reasons for declining to follow it, in my opinion, the duty of the House is to follow it in deciding the present appeal.

It is perhaps worthwhile adding that in his Principles of the Law of Damages (1962) referred to by Lord Devlin in his speech in Rookes v Barnard [1964] AC 1129, 1221 Professor Street, after summarising the arguments against and for exemplary damages concludes, at p 36:

"It is believed that in the present state of knowledge, one cannot say whether exemplary damages are desirable. That study of the law in action which would show how efficiently they contribute to the attainment of the several purposes examined above remains to be done. And the practical usefulness of exemplary damages is the basic question, and one to which no amount of theorising can provide an answer."

So far as I understand the Law Commission's report it proceeded on views derived from a very full and careful consultation but it may be that the study which Professor Street desiderated remains to be done.

In the forefront of the defendant's argument is the proposition that the power to award exemplary damages in tort depends upon the tort upon which the action is based and that, while a number of torts carry with them the power in the court to award exemplary damages in cases falling within these torts, for example false imprisonment, assault and battery, trespass to land or goods there are others, for example, negligence, public nuisance, and deceit which do not. On a reading of Lord Devlin's speech in Rookes v Barnard which was concerned not to set out a code but to state the principles upon which in the light of the previous authorities the power to award exemplary damages should be based I find no trace of the idea that the precise form of the cause of action should determine the matter, although that position had been clearly put in argument. Rather what Lord Devlin was indicating were situations in fact which would justify the court having power to award exemplary damages rather than determining this matter by reference to the cause of action. There is no mention whatever in Lord Devlin's speech of a cause of action test and surely when he was setting out principles if that was part of the essential qualification for the existence of the power he would have mentioned it. Indeed one of the difficulties of applying the pre-1964 decisions is to provide rational grounds for distinguishing between torts in which the power was and was not available.

When Lord Devlin came to apply his general principles to the facts of Rookes v Barnard itself he made no mention whatever of the tort of intimidation as qualifying or disqualifying for the exercise of the power for exemplary damages. Counsel for the defendant argued persuasively that Mr. Gardiner, (counsel for the defendants) in Rookes v Barnard had in effect conceded that intimidation was a qualifying tort but even if one accepts this argument if the nature of the tort is a crucial factor in determining whether or not exemplary damages could be awarded I would certainly have expected Lord Devlin to have mentioned it as part of his application of the principle even if up till then it could have been implicitly regarded as an essential prerequisite. As Lord Diplock said in Broome v Cassell & Co Ltd [1972] AC 1027, 1123-1124:

"it was necessary as a matter of decision of the cross- appeal for this House to determine whether the facts in Rookes v Barnard [1964] AC 1129 brought it within a category of cases in which exemplary damages were recoverable at common law. This House determined that they did not and ordered a new trial.

"There were two different processes of reasoning by which it would have been possible to reach this conclusion of law. One, which was not adopted by this House, was to hold that the particular tort of intimidation was one in which the common law did not permit of exemplary damages. The other, which was adopted by this House, was to state the categories of cases in which alone exemplary damages might be awarded at common law and to determine whether the facts in Rookes v. Barnard brought it within one of these categories."

In my opinion this is the essential character of Lord Devlin's approach in Rookes v Barnard [1964] AC 1129. If the cause of action is a vital prerequisite then Lord Devlin's approach would surely have been in two stages: first to determine even if doing so by reference to the concession of counsel whether intimidation was a tort which carried with it the power to award exemplary damages and then to consider whether within that framework the facts of the instant case justified the exercise of the power. If that were the correct structure of the law as Lord Devlin envisaged it I cannot think that he would not have adopted that analysis.

A great deal of time and effort was devoted in the argument to the analysis of the speeches in Broome v Cassell & Co Ltd [1972] AC 1027. It is an interesting feature of these that Lord Reid indicated a difference of opinion from Lord Devlin's speech in Rookes v Barnard [1964] AC 1129 although he had in that case itself concurred with it. Lord Devlin took the view that the existence of the power to award exemplary damages is a factor in promoting respect for and the effectiveness of the law, a point of view strongly echoed by Lord Wilberforce in Broome v Cassell & Co Ltd (which Professor Street's study (Principles of the Law of Damages, p 36) would elucidate.

Although Lord Reid in Broome v Cassell & Co Ltd indicated that in his opinion this was not a sufficiently important part of Lord Devlin's reasoning in Rookes v Barnard [1964] AC 1129 to require him to dissociate himself from it I consider that it could have a considerable effect on the degree to which one would wish to confine an anomaly within the law. A pointless anomaly even if accepted ought to be more closely confined than an anomaly which could have beneficial effects. We cannot know the extent to which the other members of the House who participated in Rookes v Barnard shared Lord Devlin's view on this point rather than that of Lord Reid but I do not think we can proceed on the assumption that they were with Lord Reid on this rather than with Lord Devlin. In any event I regard Lord Devlin's speech as indicating the sort of confinement of the anomaly which he considered right, namely the need for the power to be exercised only in the categories of factual situation which he had expressed. On this point all their Lordships who sat in Rookes v Barnard were agreed.

The difficulty of adequate reason for distinguishing between torts in respect of which the power to award exemplary damages should exist and those in which it should not is exemplified by Lord Hailsham's treatment in Broome v Cassell & Co Ltd [1972] AC 1027 of the tort of deceit. The reliance on history and the relationship of the tort of deceit to a breach of contract while leading Lord Hailsham to his then opinion does not seem powerfully persuasive and Lord Hailsham appears to have recognised that in the somewhat tentative nature of his conclusion.

I have not found the dicta in Broome v Cassell & Co Ltd particularly easy to construe but I believe that in so far as they appear to suggest that Lord Devlin did not mean to extend the law to particular torts which had not already been covered by pre 1964 authority that can be accepted as their effect on the basis that Lord Devlin's approach was not concerned with particular torts but rather with factual situations which might exist across a range of torts. In my opinion there is no basis in Rookes v Barnard [1964] AC 1129 for the view that the power to award exemplary damages exists only in torts which had been decided to have that character prior to 1964. A fair reading of the dicta in Broome v Cassell & Co Ltd [1972] AC 1027 do not effectively insert such a basis into the law and accordingly I am of opinion that AB v South West Water Services Ltd [1993] QB 507 was wrongly decided.

It follows from what I have said that I consider that the question whether the tort of misfeasance in public office carries the power to award exemplary damages should be answered by saying that the mere fact that the tort sued upon is that of misfeasance in public office does not determine the issue. The issue is determined by whether the factual situation is covered by either of Lord Devlin's formulations. In the present case it is accepted that the factual situation does come within Lord Devlin's first category and although on the facts so far as pleaded I regard this as extremely doubtful, for the purposes of this appeal I would be prepared to accept it and accordingly I am of the opinion that the appeal should be allowed and that the claim for exemplary damages should proceed without in any way restricting the judge in his consideration of this issue.

I add some further considerations in respect of legislation such as the discrimination legislation and the data protection legislation. Exemplary damages would be available only if the legislation expressly authorises exemplary damages in relation to any particular breach. So far as the 1998 Act is concerned it was submitted on behalf of the defendant that this legislation reduces any need that may have been thought to exist previously for a deterrent factor in damages but for my part until these matters have been more developed I would reach no conclusion upon the point. In so far as a conclusion can be reached upon it at the present time I feel the work of the Law Commission (Report on Aggravated, Exemplary and Restitutionary Damages (1997) (Law Com No 247)) is the best indication that the impact on the desirability of retaining the power to award exemplary damages in appropriate cases may not be great.

Finally I have found the consideration of the measure of exemplary damages in vicarious liability cases somewhat perplexing. The present is a case of exemplary damages against the Chief Constable of Leicestershire Constabulary. It seems to me that while the defendant's means may be important in considering an award of exemplary damages against the defendant personally where the case is one of vicarious liability I find it somewhat difficult to accept that the relevant means are those of the defendant rather than those of the wrongdoer but since the point has not been argued I express no concluded view upon it. The Law Commission note in their Report, at paragraph 4.102, that there is no reported English case which goes beyond mere assumption, and specifically considers the question whether, and if so how, the doctrine should apply. However the decision in Broome v Cassell & Co Ltd [1972] AC 1027, 1029, holding (4) that the lowest sum for which any defendant could be liable where more than one defendant was sued is the proper figure requires to be taken into consideration.

I would allow the appeal on the basis that the claim should not have been struck out, but leaving open the issues with regard to exemplary damages which have not been argued in this appeal for determination as the case proceeds.

LORD NICHOLLS OF BIRKENHEAD

My Lords,

On this appeal your Lordships' House is being asked to decide whether exemplary damages may be awarded against a defendant who commits the tort of misfeasance in public office. The leading case on exemplary damages was decided by your Lordships' House in 1964: Rookes v Barnard [1964] AC 1129. At that time the law was in a state of considerable disarray. Lord Devlin's treatment of this difficult subject received the approval of all members of the House. But in one respect, crucial for the purposes of this appeal, Lord Devlin's observations are not altogether clear.

Rookes v Barnard

Exemplary damages are a controversial topic, and have been so for many years. Over-simplified, the matter may be summarised thus. Awards of damages are primarily intended to compensate for loss, whether pecuniary or non-pecuniary. Non-pecuniary loss includes mental distress arising from the circumstances in which the tort was committed, such as justified feelings of outrage at the defendant's conduct. Damages awarded for this type of loss are sometimes called aggravated damages, as the defendant's conduct aggravates the injury done. Sometimes damages may also be measured by reference, not to the plaintiff's loss, but to the profit obtained by the defendant from his wrongdoing: see the discussion in Attorney General v Blake [2001] 1 AC 268, 278-280.

Exemplary damages or punitive damages, the terms are synonymous, stand apart from awards of compensatory damages. They are additional to an award which is intended to compensate a plaintiff fully for the loss he has suffered, both pecuniary and non-pecuniary. They are intended to punish and deter.

Punishment is a function par excellence of the criminal law, rather than the civil law. But in Rookes v Barnard [1964] AC 1129 the House recognised that there are circumstances where, generally speaking, the conduct is not criminal and an award of exemplary damages would serve a useful purpose in vindicating the strength of the law. This purpose would afford 'a practical justification for admitting into the civil law a principle which ought logically to belong to the criminal': see per Lord Devlin, at p 1226. Lord Devlin identified two sets of circumstances ('categories of case') where this was so: oppressive, arbitrary or unconstitutional acts of government servants, and wrongful conduct calculated to yield a benefit in excess of the compensation likely to be payable to the plaintiff. A further, self-evident category, on which nothing turns, comprises cases where exemplary damages are expressly authorised by statute.

Lord Devlin's categorisation is open to two different interpretations. One interpretation is that the sets of circumstances identified by him were thenceforth to constitute the sole criteria for determining whether a court might in its discretion make an award of exemplary damages in respect of tortious conduct. In future, whatever the nature of the claim, whatever the particular tort involved, if the facts fell within one of his two categories the court had power to award exemplary damages.

The other interpretation attributes a more limited effect to Lord Devlin's categorisation. According to this second interpretation, Lord Devlin did not seek to rationalise the whole law of exemplary damages. His aim was less ambitious. He sought to do no more than identify the factual circumstances in which alone exemplary damages might be awarded. He set out two categories of factual prerequisites one or other of which must always exist before the court has jurisdiction to award exemplary damages. When imposing these limits on the availability of exemplary damages Lord Devlin did not intend thereby to widen the availability of exemplary damages. He did not intend that exemplary damages should be available in future as a remedy for torts which, under the established law, did not attract this remedy. There are several such torts. Deceit and negligence are two instances. Lord Devlin intended to leave this area of the existing law untouched.

Thus, on this second interpretation, two prerequisites have to be satisfied before exemplary damages may be awarded. First, the facts must fall within one of Lord Devlin's two categories. This is the so-called 'categories' condition. Secondly, and standing quite apart from Lord Devlin's categories condition, the cause of action relied upon must not be one in which, under the established law, exemplary damages are unavailable. The latter condition, the so-called 'cause of action' condition, has attracted much criticism. Rightly so, because it represents in practice an arbitrary and irrational restriction on the availability of exemplary damages.

Perhaps not surprisingly, in Mafo v Adams [1970] 1 QB 548, a case concerning the tort of deceit, Widgery LJ, at pp 558-559, preferred the first of the two interpretations of Lord Devlin's speech. The circumstances in which exemplary damages might be obtained had been drastically reduced by Rookes v Barnard, but the effect of Lord Devlin's formulation was to remove the existing limits on the range of wrongs for which exemplary damages might be granted.

Broome v Cassell & Co Ltd

In Broome v Cassell & Co Ltd [1972] AC 1027 your Lordships' House decided otherwise. The House rejected this interpretation of Lord Devlin's speech. Differing views were expressed on the desirability of exemplary damages. But those of their Lordships who addressed this point spoke with one voice in declaring the current state of the law. When doing so, they openly recognised its lack of principle. Lord Hailsham of St Marylebone LC, at p 1076, expressly disagreed with Widgery LJ's observations in Mafo v Adams. He stated that by listing the categories Lord Devlin was not intending to add to the number of torts for which exemplary damages can be awarded. Lord Diplock was similarly unambiguous and forthright, at p 1131:

'Rookes v Barnard was not intended to extend the power to award exemplary or aggravated damages to particular torts for which they had not previously been awarded; such as negligence and deceit. Its express purpose was to restrict, not to expand, the anomaly of exemplary damages.'

The principle that, following Rookes v Barnard, exemplary damages may be awarded for some torts but not for others was also explicit in Lord Wilberforce's speech when he referred, at p 1114, to the 'range of torts for which punitive damages may be given (trespass to person or property, false imprisonment and defamation being the commonest) …'.

. Lord Reid's observations, not specifically addressed to this point, are less explicit. Lord Reid had been a party to the decision in Rookes v Barnard, but in Broome v Cassell & Co Ltd he disagreed with Lord Devlin's view that in certain classes of case exemplary damages serve a useful purpose in vindicating the strength of the law. Lord Reid's approach was wholly restrictive, confining exemplary damages to 'classes of cases' where its use was covered by authority. In Rookes v Barnard the House had been confronted with 'an undesirable anomaly'. Lord Reid continued, at 1087:

'We could not abolish it. We had to choose between confining it strictly to classes of cases where it was firmly established, although that produced an illogical result, or permitting it to be extended so as to produce a logical result. In my view it is better in such cases to be content with an illogical result than to allow any extension.'

I can detect nothing in these observations to suggest that Lord Reid understood, or accepted, that in future exemplary damages would be available in torts such as deceit where under the established law exemplary damages were currently not available.

The view of the law expressed by Lords Hailsham, Wilberforce and Diplock has held sway ever since. It was faithfully applied by the Court of Appeal in AB v South West Water Services Ltd [1993] QB 507 when deciding that exemplary damages are not available in claims, arising out of contamination of drinking water supplies, for public nuisance and negligence.

Whither now?

. Broome v Cassell & Co Ltd was decided in 1972. Since then the legal landscape has much changed. Needless to say, it is well within the province of this House to decide that the law relating to exemplary damages should now be understood in accordance with the first interpretation of Lord Devlin's speech in Rookes v Barnard: the interpretation preferred by Widgery LJ in Mafo v Adams [1970] 1 QB 548 but rejected by the House in Broome v Cassell & Co Ltd. That is one course open to the House. But, as also goes without saying, the House will not follow this course unless satisfied that, in the conditions of today, that is the direction the law should take. The House will wish to be satisfied on this score, because such a decision would represent a significant change in the law. It would mean departing from the law as enunciated in Broome v Cassell & Co Ltd. It would mean overturning the law as it has been understood and acted upon for some years. Such a change in the law would affect other torts as well as the newly-resurgent tort of misfeasance in public office. It would mean that in future, if the necessary factual circumstances are present, exemplary damages will be available across the board in every tort, including those torts where the absence of exemplary damages has long been established. This would revolutionise the law's approach to exemplary damages. It would mean that, far from being an undesirable anomaly whose use is to be restricted, exemplary damages are now regarded as a convenient tool which the law should seize and be able to use more widely.

Is this the direction in which the law should be moving? This question raises three separate issues. The first is whether the present state of the law on exemplary damages is satisfactory. In my view it is not. This view is shared by all your Lordships. The second issue is whether, nonetheless, this is a matter best left to Parliament. Again, I understand that all your Lordships are minded not to leave the law as it presently stands, including as it does a requirement that a claim must satisfy the cause of action condition before exemplary damages may be awarded. In its report, Aggravated, Exemplary and Restitutionary Damages (1997) (Law Com 247), the Law Commission looked to Parliament for the necessary reforms. The present state of the law 'cries aloud for parliamentary intervention': see para 5.3. But parliamentary intervention seems unlikely, at least for the foreseeable future. On 9 November 1999 (HC Debates), 9 November 1999, col 502, in a written answer to a question in the House of Commons, the government stated that, in the absence of a clear consensus on the way ahead, it had decided not to take forward the Law Commission's proposals for legislation on exemplary damages.

The options

So the third issue which arises is what should now be the law relating to exemplary damages. The starting point must be to consider whether exemplary damages, regarded as an anomaly in 1964, ought still to have a place in the law at all.

The arguments for and against exemplary damages need no rehearsing. They are familiar enough, and they are set out clearly in the Law Commission's report. In the end, and in respectful agreement with the views expressed by Lord Wilberforce in Broome v Cassell [1972] AC 1027, 1114, the feature which I find most striking is the extent to which the principle of exemplary damages continues to have vitality. The availability of exemplary damages has played a significant role in buttressing civil liberties, in claims for false imprisonment and wrongful arrest. From time to time cases do arise where awards of compensatory damages are perceived as inadequate to achieve a just result between the parties. The nature of the defendant's conduct calls for a further response from the courts. On occasion conscious wrongdoing by a defendant is so outrageous, his disregard of the plaintiff's rights so contumelious, that something more is needed to show that the law will not tolerate such behaviour. Without an award of exemplary damages, justice will not have been done. Exemplary damages, as a remedy of last resort, fill what otherwise would be a regrettable lacuna.

This experience has not been confined to this country. Exemplary damages continue to discharge a role, perceived to be useful and valuable, in other common law jurisdictions. Indeed, the restrictions on exemplary damages imposed by Rookes v Barnard and Broome v Cassell & Co Ltd did not strike a receptive chord, for instance, in Canada, Australia or New Zealand. Outside the United Kingdom Rookes v Barnard received a generally negative reception.

If exemplary damages are to continue as a remedial tool, as recommended by the Law Commission after extensive consultation, the difficult question which arises concerns the circumstances in which this tool should be available for use. Stated in its broadest form, the relevant principle is tolerably clear: the availability of exemplary damages should be co-extensive with its rationale. As already indicated, the underlying rationale lies in the sense of outrage which a defendant's conduct sometimes evokes, a sense which is not always assuaged fully by a compensatory award of damages, even when the damages are increased to reflect emotional distress.

In Rookes v Barnard [1964] AC 1129, 1226 , Lord Devlin drew a distinction between oppressive acts by government officials and similar acts by companies or individuals. He considered that exemplary damages should not be available in the case of non-governmental oppression or bullying. Whatever may have been the position 40 years ago, I am respectfully inclined to doubt the soundness of this distinction today. National and international companies can exercise enormous power. So do some individuals. I am not sure it would be right to draw a hard-and-fast line which would always exclude such companies and persons from the reach of exemplary damages. Indeed, the validity of the dividing line drawn by Lord Devlin when formulating his first category is somewhat undermined by his second category, where the defendants are not confined to, and normally would not be, government officials or the like.

Nor, I may add, am I wholly persuaded by Lord Devlin's formulation of his second category (wrongful conduct expected to yield a benefit in excess of any compensatory award likely to be made). The law of unjust enrichment has developed apace in recent years. In so far as there may be a need to go further, the key here would seem to be the same as that already discussed: outrageous conduct on the part of the defendant. There is no obvious reason why, if exemplary damages are to be available, the profit motive should suffice but a malicious motive should not.

. As I have said, difficult questions arise here. In view of the limited scope of the submissions made by the parties on this appeal, this is not the occasion for attempting to state comprehensive conclusions on these matters. For the purposes of the present appeal it is sufficient, first, to express the view that the House should now depart from its decision in Broome v Cassell & Co Ltd [1972] AC 1027, in so far as that decision confirmed the continuing existence of what has subsequently been described as the 'cause of action' condition and, secondly, to note that the essence of the conduct constituting the court's discretionary jurisdiction to award exemplary damages is conduct which was an outrageous disregard of the plaintiff's rights. Whether the conduct of PC Cavendish satisfies that test in this case is a matter to be resolved at trial. I would allow this appeal.

Vicarious liability

The only defendant in this action is the Chief Constable of Leicestershire Constabulary. The claim against him is made solely on the basis of vicarious responsibility for the conduct of PC Cavendish as a serving police officer. On this appeal the Chief Constable has not sought to say that, as a matter of law, his vicarious liability stops short of any claim there may be for exemplary damages. This was not one of the issues raised on the appeal. In the circumstances I express no view on this topic.

LORD HUTTON

My Lords,

The issue which arises on this appeal is whether exemplary damages can be awarded where a plaintiff establishes that the defendant has committed the tort of misfeasance in public office. The facts which it alleged constitute the tort in the present case are set out in the speech of my noble and learned friend Lord Mackay of Clashfern.

There has been considerable debate on the question whether exemplary damages should continue to be a part of the law of England. The opinion has been expressed that exemplary or punitive damages should have no place in the awarding of damages which are intended to compensate the plaintiff for the loss or injury which he has suffered by reason of a tort. The matter has been considered by the Law Commission in its Report on Aggravated, Exemplary and Restitutionary Damages (1997) (Law Com No 247), and its recommendation was that exemplary damages should continue to be part of the law of England although on a more extensive basis than at present. However the Government has stated that it does not propose to bring forward legislation to give effect to this recommendation and the Government has further observed that further judicial development of the law in this area may help to clarify the issues.

The parties have chosen not to present arguments on the issue whether exemplary damages should continue to be awarded but have been content to approach the appeal on the basis that the law as stated by the House in Rookes v Barnard [1964] AC 1129 and Broome v Cassell & Co Ltd [1972] AC 1027 should govern the present case. Therefore the preliminary question arises whether your Lordships should express an opinion on the important issue which arises on this appeal, when the House has not had the advantage of hearing argument on the fundamental question whether exemplary damages should continue to be awarded at all and on the principles which can be advanced to justify the award of exemplary damages or to oppose such an award.

My Lords, whilst the speeches in Rookes v Barnard and Broome v Cassell & Co Ltd recognised that the award of exemplary damages is anomalous, the speeches nevertheless accepted that exemplary damages constitute part of the law of England. Thus in Rookes v Barnard [1964] AC 1129, after considering the authorities, Lord Devlin stated, at pp 1225-1226:

"These authorities convince me of two things. First, that your Lordships could not, without a complete disregard of precedent, and indeed of statute, now arrive at a determination that refused altogether to recognise the exemplary principle."

And in Broome v Cassell & Co Ltd [1972] AC 1027 Lord Reid, referring to Lord Devlin's speech in Rookes v Barnard, said, at p 1087:

"Critics appear to have thought that he was inventing something new. That was not my understanding. We were confronted with an undesirable anomaly. We could not abolish it. We had to choose between confining it strictly to classes of cases where it was firmly established, although that produced an illogical result, or permitting it to be extended so as to produce a logical result. In my view it is better in such cases to be content with an illogical result than to allow any extension."

Moreover, in Rookes v Barnard Lord Devlin gave guidance, with which the other members of the House concurred, as to the categories of cases in which exemplary damages should be awarded. In these circumstances, whilst I recognise that it would have been more helpful if the House had heard argument on the fundamental question whether exemplary damages should continue to be awarded, I consider that it is right that the House should express an opinion on the issue raised before it and on which the Recorder and the Court of Appeal have given judgments, the opinion to be given on the basis that the parties accept that the law on exemplary damages is that stated in Rookes v Barnard and Broome v Cassell & Co Ltd. But I consider that if on a future occasion a party sought to argue that the law should be changed and that exemplary damages should no longer be awarded, it would be open to the House under the Practice Statement of 1966 (Practice Statement (Judicial Precedent) [1966] 1 WLR 1234) to hear such an argument and to rule upon it.

As the point has not been argued I express no concluded opinion on the question whether exemplary damages should continue to be awarded in England, but I think that a number of cases decided by the courts in Northern Ireland during the past 30 years of terrorist violence give support to the opinion of Lord Devlin in Rookes v Barnard [1964] AC 1129, 1223, 1226 that in certain cases the awarding of exemplary damages serves a valuable purpose in restraining the arbitrary and outrageous use of executive power and in vindicating the strength of the law. Members of the security forces seeking to combat terrorism face constant danger and have to carry out their duties in very stressful conditions. In such circumstances an individual soldier or police officer or prison officer may, on occasion, act in gross breach of discipline and commit an unlawful act which is oppressive or arbitrary and in such cases exemplary damages have been awarded. I refer to two of these cases.

In Lavery v Ministry of Defence [1984] NI 99, on a morning after a night of rioting in some areas of Belfast, an Army patrol stopped a young man of 16 who was walking along a street. A soldier of the patrol asked him his name and address and where he was coming from and going to. He gave this information and the soldier told him to sit down on the ground. He asked "what for?" and the soldier's response was to strike him in the groin with his knee and then to strike him on the head with the butt of his rifle, which knocked the young man to the ground and cut his head so that it bled freely. The soldier then handcuffed his ankles. The young man sued the Ministry of Defence in the County Court for damages for assault and battery committed by the soldier. The Ministry of Defence admitted liability and at the hearing no mitigating circumstances were suggested and there was no suggestion that the plaintiff had been guilty of any provocative conduct. The County Court judge awarded damages of £1,000 which included a sum for aggravated damages but not for exemplary damages. On appeal to the High Court, Kelly LJ sitting in the Queen's Bench Division increased the damages to £2,500 which included exemplary damages. In awarding exemplary damages, after citing passages from the speech of Lord Devlin in Rookes v Barnard [1964] AC 1129, the Lord Justice said, at p 106:

"I ask the question what total sum is sufficient not only to compensate the plaintiff for the assault suffered in all the circumstances, but to teach the defendant that this sort of conduct does not pay and hopefully deter its repetition.

"I think the conduct of the soldier concerned, some of which was acquiesced in by the other members of the patrol, was a deliberate and unjustifiable abuse of the lawful power to stop and question a citizen. This power is a necessary one, entrusted to the security forces to aid their difficult task of maintaining law and order in the streets of this city and elsewhere throughout the Province. It is a power which at times must be exercised frequently to maintain an efficient standard of peace-keeping. Inevitably it involves confrontation between soldier and citizen and police officer and citizen and a sensitive confrontation at that with the power to stop search and question delicately poised against the rights of the citizen. The lawful exercise of these powers demands moderation and tact on the part of the security forces at all times and when they seek to exercise them in confrontation with unco-operative citizens in hostile and dangerous areas, it demands forbearance and discipline, as well. Nevertheless the security forces must be reminded that these powers which necessarily and lawfully reduce the freedom and privacy of the subject must not be abused. The present case was a blatant and quite unjustified abuse of lawful powers. It should not happen again, the defendants should be told.

"I do not think that the award of £1,000 by the learned county court judge is adequate to include the elements of punishment or deterrence.

"My conclusion is that a proper award to include exemplary damages, should be £2,500."

In Pettigrew v Northern Ireland Office [1990] NI 179 there had been a mass escape of convicted terrorist prisoners from H Block 7 in the Maze Prison. In the course of the escape one prison officer died, one prison officer in H Block 7 was shot in the head and seriously wounded and other prison officers were injured. When the prisoners escaped from H Block 7 they left a number of prison officers tied up. It was clear that some of the prisoners who remained in H Block 7 had helped in varying degrees those who succeeded in escaping. After the escape the remaining prisoners in H Block 7 were moved to H Block 8.

The plaintiff, who was one of the remaining prisoners moved to H Block 8, brought an action against the Northern Ireland Office for damages for assault and battery by prison officers, alleging that in the course of the move he had been kicked and punched by prison officers and that prison officers who were dog-handlers had not restrained their dogs from nipping and biting him. In the High Court it was held that it was probable that prison officers, angered by the death of a colleague and the wounding of other colleagues in the course of the escape, had given vent to their anger by kicking or punching the plaintiff and that dog handlers had failed adequately to restrain their dogs. The plaintiff was awarded exemplary damages and I refer, if I may, to what I said in giving judgment, at pp 181-182:

"In this case I consider that the conduct of the dog handlers who deliberately did not restrain their dogs from nipping or biting the plaintiff and the conduct of the prison officers who kicked or punched the plaintiff was oppressive conduct by servants of the Government. Notwithstanding that the prison officers had real and understandable grounds for anger, it was their duty to restrain that anger, and in my opinion their conduct calls for an award of exemplary damages to mark the disapproval of the court, to teach that such conduct does not pay, and to act as a deterrent against this type of conduct against prisoners being repeated in the future.

"Mr Campbell submitted that as the purpose of awarding exemplary damages is to punish a defendant whose conduct was oppressive and in the opinion of the court deserves punishment, exemplary damages should not be awarded against the Northern Ireland Office because it had done nothing deserving of punishment. There could be no suggestion that the Northern Ireland Office connived at or condoned the conduct of the prison officers responsible for the attacks on the plaintiff, and when allegations were made of attacks upon the prisoners the Northern Ireland Office caused an investigation to be carried out.

"I accept Mr Campbell's submission that there are no grounds upon which exemplary damages could be awarded against the Northern Ireland Office in respect of its own conduct as a Government department. But there are a number of decisions in this jurisdiction which make it clear that exemplary damages can be awarded against a defendant where that defendant is vicariously liable for the conduct of its or his servants or agents and the conduct of those servants or agents calls for exemplary damages. These cases are Lavery v Ministry of Defence [1984] NI 99, Walsh v Ministry of Defence [1985] 4 NIJB and Hamilton v Chief Constable of the Royal Ulster Constabulary [1986] 15 NIJB. The same view of the law is implicit in the judgments of the Court of Appeal in England in Holden v Chief Constable of Lancashire [1987] QB 380."

In my opinion the power to award exemplary damages in such cases serves to uphold and vindicate the rule of law because it makes clear that the courts will not tolerate such conduct. It serves to deter such actions in future as such awards will bring home to officers in command of individual units that discipline must be maintained at all times. In my respectful opinion the view is not fanciful, as my noble and learned friend Lord Scott of Foscote suggests, that such awards have a deterrent effect and such an effect is recognised by Professor Atiyah in the passage from his work on Vicarious Liability cited by Lord Scott of Foscote in his speech. Moreover in some circumstances where one of a group of soldiers or police officers commits some outrageous act in the course of a confused and violent confrontation it may be very difficult to identify the individual wrongdoer so that criminal proceedings may be brought against him to punish and deter such conduct, whereas an award of exemplary damages to mark the court's condemnation of the conduct can be made against the Minister of Defence or the Chief Constable under the principle of vicarious liability even if the individual at fault cannot be identified.

In Rookes v Barnard [1964] AC 1129 in the well known passage of his speech, at p 1226, Lord Devlin stated that (in addition to cases in which exemplary damages are expressly authorised by statute) there are two categories of cases where exemplary damages can be awarded. The first category is where there is oppressive, arbitrary or unconstitutional action by the servants of the government. The second is where the defendant's conduct had been calculated by him to make a profit for himself which may well exceed the compensation payable to the plaintiff. The question debated by counsel on this appeal is whether a plaintiff, to be entitled to recover exemplary damages, must establish not only that his case falls within one or other of Lord Devlin's categories, but also that his claim is in respect of a tort for which exemplary damages had been awarded before 1964 when Rookes v Barnard was decided.

It is clear from Lord Devlin's speech, at p 1226, that he was intending to restrict the range of cases in which exemplary damages could be awarded, but I can see nothing in the speech which suggests that if a case fell within one of the two categories, Lord Devlin intended that an award of exemplary damages should not be made unless the tort for which the plaintiff sued was one for which such damages had been awarded in the past. In my opinion, in referring to certain categories of cases, and particularly in referring to the first category, Lord Devlin was referring to the manner in which the defendant committed the tort, to his behaviour and conduct in carrying out the tort, and not to the particular cause of action upon which the plaintiff relied.

Mr Mansfield QC for the defendant relied on the point that it appears from the report of the argument of counsel, at p 1164, that in Rookes v Barnard Mr Gerald Gardiner QC for the defendants conceded that intimidation by threat of breach of contract may be a tort for which exemplary damages can be awarded. But in my opinion Lord Devlin did not base his judgment on a concession made by counsel but was concerned to state, as a matter of principle, the approach which the courts should take in future to the award of exemplary damages. Therefore, if the present case fell to be determined by the application of Lord Devlin's judgment, I consider (assuming that the conduct of the police constable constituted conduct of the nature described in Lord Devlin's first category) that the plaintiff should succeed in this appeal.

Mr Mansfield submitted, however, that the requirement that the plaintiff must establish that exemplary damages had been awarded for the tort prior to 1964 (the cause of action test), whilst not laid down expressly in Lord Devlin's judgment, was implicit in it and was made express by the dicta in the speeches of the members of the House in Broome v Cassell & Co Ltd [1972] AC 1027. As Sir Thomas Bingham MR recognised in AB v South West Water Services Ltd [1993] QB 507, 530 F-G, this submission gives rise to a difficult point, as is apparent from the difference of opinion in the carefully reasoned judgments of the Court of Appeal in this case and in AB v South West Water Services Ltd. I regard the point as a difficult one because, like my noble and learned friend, Lord Mackay of Clashfern, I find it difficult to obtain clear guidance from the dicta in Broome v Cassell & Co Ltd [1972] AC 1027.

The passage in Broome v Cassell & Co Ltd which gives most support to Mr Mansfield's submission is the passage in the speech of Lord Hailsham of St Marylebone LC, at p 1076:

"Did Rookes v Barnard extend exemplary damages to fresh torts?

"Having rejected the theory that Lord Devlin's speech can be pushed aside as having been delivered per incuriam, I hope I may now equally dispose of another misconception. I do not think that he was under the impression either that he had completely rationalised the law of exemplary damages, nor by listing the 'categories' was he intending, I would think, to add to the number of torts for which exemplary damages can be awarded. Thus I disagree with the dictum of Widgery LJ in Mafo v Adams [1970] 1 QB 548, 558 (which, for this purpose can be treated as an action for deceit) when he said:

'As I understand Lord Devlin's speech, the circumstances in which exemplary damages may be obtained have been drastically reduced, but the range of offences in respect of which they may be granted has been increased, and I see no reason since Rookes v Barnard [1964] AC 1129 why, when considering a claim for exemplary damages, one should regard the nature of the tort as excluding the claim.'

"This would be a perfectly logical inference if Lord Devlin imagined that he was substituting a completely rational code by enumerating the categories and stating the considerations. It is true, of course, that actions for deceit could well come within the purview of the second category. But I can see no reason for thinking that Lord Devlin intended to extend the category to deceit, and counsel on both sides before us were constrained to say that, though it may be paradoxical, they were unable to find a single case where either exemplary or aggravated damages had been awarded for deceit, despite the fact that contumelious, outrageous, oppressive, or dishonest conduct on the part of the defendant is almost inherently associated with it. The explanation may lie in the close connection that the action has always had with breach of contract: see the discussion in Mayne and McGregor on Damages 12th ed (1961) chapter 41, especially at paragraph 968 (p 809)."

But the weight of this passage is somewhat lessened by the subsequent recognition by Lord Hailsham, at p 1080B-C, that the question whether exemplary damages can be awarded in an action for deceit has not been finally determined.

However, as Auld LJ observed in the Court of Appeal, Lord Reid, Lord Wilberforce and Lord Diplock placed emphasis on Lord Devlin's reference to categories or classes of cases and did not refer to causes of action. Lord Reid said, at p 1086, referring to Rookes v Barnard [1964] AC 1129:

"We thought we had to recognise that it had become an established custom in certain classes of case to permit awards of damages which could not be justified as compensatory, and that that must remain the law. But we thought and I still think it well within the province of this House to say that that undesirable anomaly should not be permitted in any class of case where its use was not covered by authority.

"In order to determine the classes of case in which this anomaly had become established it was of little use to look merely at the words which had been used by judges because, as I have said, words like punitive and exemplary were often used with regard to damages which were truly compensatory. We had to take a broad view of the whole circumstances

See also the passage already cited (ante, para 4), at p 1087.

Lord Wilberforce also referred to a category of cases and to the excessive and insolent use of power, and not to causes of action. He said, at p 1120:

"There is not perhaps much difficulty about category 1: it is well based on the cases and on a principle stated in 1703— 'if public officers will infringe men's rights, they ought to pay greater damages than other men to deter and hinder others from the like offences': Ashby v White (1703) 2 Ld Raym 938, 956 per Holt C.J. Excessive and insolent use of power is certainly something against which citizens require as much protection today: a wide interpretation of 'government' which I understand your Lordships to endorse would correspond with Holt CJ's 'public officers' and would partly correspond with modern needs."

Lord Diplock also referred to categories of cases and to factual situations, at p 1128:

"The purpose of Lord Devlin's division of them into three categories was in order to distinguish between factual situations in which there was some special reason still relevant in modern social conditions for retaining the power to award exemplary damages, and factual situations in which no such special reason still survived."

See also at p 1124B.

Earlier in his speech Lord Diplock said, at pp 1123-1124:

"It was necessary as a matter of decision of the cross-appeal for this House to determine whether the facts in Rookes v Barnard brought it within a category of cases in which exemplary damages were recoverable at common law. This House determined that they did not and ordered a new trial.

"There were two different processes of reasoning by which it would have been possible to reach this conclusion of law. One, which was not adopted by this House, was to hold that the particular tort of intimidation was one in which the common law did not permit of exemplary damages. The other, which was adopted by this House, was to state the categories of cases in which alone exemplary damages might be awarded at common law and to determine whether the facts in Rookes v Barnard brought it within one of these categories."

In my opinion in this passage Lord Diplock stated, in effect, the two tests, the cause of action test and the categories of cases test, and recognised that in Rookes v Barnard [1964] AC 1129 the House did not accept the cause of action test. I recognise, as Mr Mansfield submitted, that the defendant can seek to rely on a later passage in Lord Diplock's speech, at p 1130-1131:

"Finally, on this aspect of the case I would express my agreement with the view that Rookes v Barnard was not intended to extend the power to award exemplary or aggravated damages to particular torts for which they had not previously been awarded; such as negligence and deceit. Its express purpose was to restrict, not to expand, the anomaly of exemplary damages."

But in my respectful opinion in this later passage, Lord Diplock was not endorsing the cause of action test and was not intending to depart from the view he had expressed in the earlier passage, and I incline to the view that Lord Diplock was of the opinion that negligence and deceit did not fall within Lord Devlin's first and second categories. Accordingly, I would hold that a plaintiff is entitled to recover exemplary damages if the circumstances in which the tort of misfeasance in public office is committed bring it within Lord Devlin's first category and I consider that in AB v. South West Water Services Ltd the Court of Appeal was in error in holding that the cause of action test must be applied.

The defendant admits that the conduct of the police constable as pleaded amounts to the tort of misfeasance in public office. The essence of the tort is abuse of power. In Rookes v Barnard [1964] AC 1129 1228, Lord Devlin stated:

"In a case in which exemplary damages are appropriate, a jury should be directed that if, but only if, the sum which they have in mind to award as compensation (which may, of course, be a sum aggravated by the way in which the defendant has behaved to the plaintiff) is inadequate to punish him for his outrageous conduct, to mark their disapproval of such conduct and to deter him from repeating it, then it can award some larger sum."

I think that the use of the adjective "outrageous" shows that the conduct which falls within Lord Devlin's first category as being oppressive or arbitrary or unconstitutional is conduct of such a nature that it calls for exemplary damages to mark disapproval, to deter and to vindicate the strength of the law, and I further think that not every abuse of power which constitutes the tort of misfeasance will come within the first category. If the point had arisen for decision I am very doubtful if I would have held that the conduct of the police constable in the present case calls for exemplary damages.

Submissions were advanced to the House on the point whether exemplary damages could be awarded where a plaintiff is entitled to recover compensation or damages under the discrimination legislation or the Human Rights Act 1998, but I would wish to reserve my opinion on this point until the matter arises directly for decision.

I have referred in this speech to two Northern Ireland cases where I consider that the award of exemplary damages served a valuable purpose in vindicating the strength of the law, and in these cases the awards were made against the Ministry of Defence and the Northern Ireland Office on the basis of vicarious liability. In his speech Lord Scott of Foscote has developed a powerful argument against the awarding of exemplary damages on the basis of vicarious liability. This issue was not raised in this appeal and was not addressed by counsel, and therefore I wish to reserve my opinion on this important and interesting question discussed by my noble and learned friend

I would allow this appeal for the reasons which I have given.

LORD SCOTT OF FOSCOTE

My Lords,

The function of an award of damages in our civil justice system is to compensate the claimant for a wrong done to him. The wrong may consist of a breach of contract, or a tort, or an interference with some right of the claimant under public law. But whatever the wrong may consist of the award of damages should be compensatory in its intent. Measured by this fundamental principle of damages, an award of exemplary damages, the intention of which is not to compensate the victim of a wrong but to punish its perpetrator, is an anomaly.

The anomalous character of exemplary damages was recognised in Rookes v Barnard [1964] AC 1129. Lord Devlin, at p 1221, invited your Lordships' House to consider "whether it is open to the House to remove an anomaly from the law of England". But having referred to various authorities he said, at p 1223:

"These authorities clearly justify the use of the exemplary principle; and for my part I should not wish, even if I felt at liberty to do so, to diminish its use in this type of case where it serves a valuable purpose in restraining the arbitrary and outrageous use of executive power."

And, at pp 1225-1226, after reviewing further authorities, he said:

"These authorities convince me of two things. First, that your Lordships could not, without a complete disregard of precedent, and indeed of statute, now arrive at a determination that refused altogether to recognise the exemplary principle. Secondly, that there are certain categories of cases in which an award of exemplary damages can serve a useful purpose in vindicating the strength of the law and thus affording a practical justification for admitting into the civil law a principle which ought logically to belong to the criminal. I propose to state what these two categories are; and I propose to state also three general considerations which, in my opinion, should always be borne in mind when awards of exemplary damages are being made."

The first of Lord Devlin's two categories was "oppressive, arbitrary or unconstitutional action by the servants of the Government". His second category covered cases "in which the defendant's conduct has been calculated by him to make a profit for himself which may well exceed the compensation payable to the plaintiff". The three considerations always to be borne in mind were, first, at p 1227, that:

"the plaintiff cannot recover exemplary damages unless he is the victim of the punishable behaviour."

second, that:

"the power to award exemplary damages constitutes a weapon that, while it can be used in defence of liberty, as in the Wilkes case (Wilkes v Wood (1763) Loftt. 1) can also be used against liberty."

and, third, at p 1228, that:

"the means of the parties, irrelevant in the assessment of compensation, are material in the assessment of exemplary damages."

It is relevant in considering the attention paid by Lord Devlin to the authorities that Rookes v Barnard pre-dated the 1966 Practice Statement (Judicial Precedent) [1966] 1 WLR 1234, under which your Lordships' House became free in certain circumstances to depart from previous decisions of the House. It is relevant, also, to notice that each of the three considerations that Lord Devlin warned should be kept in mind draws attention to the anomalous character of exemplary damages.

The anomalous character of exemplary damages was stressed by Lord Reid in Broome v Cassell & Co Ltd [1972] AC 1027. He had been a member of the committee that had heard Rookes v Barnard [1964] AC 1129 and he had concurred in Lord Devlin's speech. In Broome v Cassell & Co Ltd, he explained, at p 1086:

"We thought we had to recognise that it had become an established custom in certain classes of case to permit awards of damages which could not be justified as compensatory, and that must remain the law. But we thought and I still think it well within the province of this House to say that that undesirable anomaly should not be permitted in any class of case where its use was not covered by authority."

Lord Morris of Borth-y-Gest remarked, at p 1100, on some of the illogicalities of an award of exemplary damages:

"Logical analysis forces the conclusion therefore that in the result there would in a civil action have been punishment for conduct not particularised in any criminal code and that such punishment had taken the form of a fine not receivable by the state but as a sort of bonus by a private individual who would, apart from it, be solaced for the wrong done to him. There may be much to be said for making it permissible in a criminal court to order in certain cases that a convicted person should pay compensation. There is much to be said against a system under which a fine becomes payable in a civil court without any of the safeguards which protect those charged with crimes."

Viscount Dilhorne commented, at p 1108:

"Power to award exemplary damages may be an anomaly, but I doubt whether it is beneficial to the law to seek to reduce the area of that anomaly at the price of creating other anomalies and illogicalities."

Lord Wilberforce pointed out, at pp 1114-1115, out that English law contained a "heavy, indeed exorbitant, punitive element in its costs system". He regarded the costs system as the strongest argument against the principle of punitive damages and said: "One or other must clearly be reformed, and it is Parliament alone that can do it". In the event, neither has been reformed.

And, finally, Lord Diplock, also recognising the anomalous character of exemplary damages, said this of Lord Devlin's first category, at pp 1129-1130:

"My Lords, had I been party to the decision in Rookes v Barnard I doubt if I should have considered it still necessary to retain the first category. The common law weapons to curb abuse of power by the executive had not been forged by the mid-18th century. In view of the developments, particularly in the last 20 years, in adapting the old remedies by prerogative writ and declaratory action to check unlawful abuse of power by the executive, the award of exemplary damages in civil actions for tort against individual government servants seems a blunt instrument to use for this purpose today."

These several statements underlining the anomalous nature of awards of exemplary damages constitute the backcloth to the appeal that is now before your Lordships' House. The issues presented to your Lordships are expressed in the statement of facts and issues signed by counsel for the plaintiff and defendant respectively. The issues can be summed up in this question: "Is an award of exemplary damages a possible remedy for the tort of misfeasance in public office?" In inviting your Lordships to consider and answer this question, counsel, on both sides, instructed us that we were to assume that the speech of Lord Devlin in Rookes v Barnard [1964] AC 1129 and the speeches in Broome v Cassell & Co Ltd [1972] AC 1027 correctly stated the law. We were to decide whether the judgment of the Court of Appeal in AB v South West Water Services Ltd [1993] QB 507, which was followed by the Court of Appeal in the present case, correctly applied the law as established by the two cases in your Lordships' House to which I have referred. Counsel had not come prepared to assist your Lordships in a re-examination of the propriety of exemplary damages in the civil law or in a consideration of their propriety in misfeasance in public office cases in particular. Mr Harris, counsel for the plaintiff, told us that if we proposed to consider those broader issues he would apply for an adjournment in order to enlist the valuable services of Professor Andrew Burrows as a member of his team.

My Lords, this is not, in my view, an appropriate manner in which to bring before your Lordships an important issue of principle. I share the dismay expressed by my noble and learned friend, Lord Nicholls of Birkenhead, about the lack of assistance that your Lordships have had in considering the general issues about exemplary damages that this appeal has raised, many of which were mentioned in the course of the hearing but, no doubt for the reason I have given, not examined in any depth.

I agree with Lord Nicholls that the question whether exemplary damages are available in misfeasance in public office cases cannot be answered without first asking whether exemplary damages should be available in misfeasance cases. And that question cannot be answered without considering the role and propriety of exemplary damages in the civil law. The law regarding exemplary damages did not become fossilised and set in stone when Lord Devlin pronounced in 1964 (Rookes v Barnard [1964] AC 1129) or when the seven members of the House pronounced in 1972 (Broome v Cassell & Co Ltd [1972] AC 1027). Since then the common law has flowed on. One of the great developments of the common law since the time of Rookes v Barnard has been in the area of public law and judicial review to which Lord Diplock referred. Oppressive, arbitrary and unconstitutional acts by members of the executive can be remedied through civil proceedings brought in the High Court. The remedies the court can provide include awards of damages, declarations of right and, in most cases, injunctions. The developments since Lord Diplock's remarks in Broome v Cassell & Co Ltd have transformed the ability of the ordinary citizen to obtain redress. The continuing need in the year 2001 for exemplary damages as a civil remedy in order to control, deter and punish acts falling within Lord Devlin's first category is not in the least obvious.

My noble and learned friend, Lord Hutton, has referred, as examples, to two cases in Northern Ireland where in his view the award of exemplary damages served a valuable purpose in restraining the arbitrary and outrageous use of executive power and in vindicating the strength of the law. In one case (Lavery v Ministry of Defence [1984] NI 99) a soldier was the wrongdoer. The Ministry of Defence was the defendant. In the other case (Pettigrew v Northern Ireland Office [1990] NI 179), prison officers were the wrongdoers. The Northern Ireland Office was the defendant. In each case the conduct of the wrongdoer, or wrongdoers, was outrageous and fell squarely within Lord Devlin's first category. But I do not follow why an appropriate award of aggravated damages would not have served to vindicate the law just as effectively as the fairly moderate awards of exemplary damages that were made. The condemnation by the trial judge of the conduct in question would have been expressed no differently. As to deterrence, in a case where the defendant is not the wrongdoer, and the damages are in any event going to be met out of public funds, how can it be supposed that the award of exemplary damages adds anything at all to the deterrent effect of the trial judge's findings of fact in favour of the injured person and his condemnation of the conduct in question? The proposition that exemplary damage awards against such defendants as the Ministry of Defence or the Northern Ireland Office, or, for that matter, the Chief Constable of Leicestershire Constabulary, can have a deterrent effect is, in my respectful opinion, fanciful. It is possible that exemplary damages awards against the actual wrongdoers which they would have to meet out of their own pockets would have a deterrent effect upon them and their colleagues. But that is not what happened in either of the two cases. As to the propriety in principle of exemplary damages awards in vicarious liability cases, I will return to the point later.

Lord Devlin's second category, cases in which the defendant' wrongful conduct has made a profit for himself which exceeds the compensation payable to the victim of the conduct, has been largely overtaken by developments in the common law. Restitutionary damages are available now in many tort actions as well as those for breach of contract. The profit made by a wrongdoer can be extracted from him without the need to rely on the anomaly of exemplary damages: see the discussion of the topic in Attorney General v Blake [2001] 1 AC 268, 278-280 by Lord Nicholls of Birkenhead.

Whatever may have been the position in 1964, when Rookes v Barnard [1964] AC 1129 was decided, or in 1972, when Broome v Cassell & Co Ltd [1972] AC 1027 was decided, there is, in my opinion, no longer any need for punitive damages in the civil law, or, at least, no need sufficient to offset the disadvantages to which Lord Morris of Borth-y-Gest in Broome v Cassell & Co Ltd cogently referred. These disadvantages are the more prominent now that, via the Human Rights Act 1998, article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1953) (Cmnd 8969) has become part of our domestic law.

Thus far I have been considering some of the general issues that are prompted by the present appeal. For the reasons I have outlined, I would be receptive to a submission that exemplary damages awards should no longer be available in civil proceedings. However, Mr Mansfield, counsel for the defendant, has not made that submission and, having had the advantage of reading the texts of my noble and learned friends' speeches on this appeal, it is apparent that mine is a minority view. It is, therefore, necessary for me to consider the narrower question, namely, whether in order to qualify for an award of exemplary damages the claim must not only fall within one or other of the two categories identified by Lord Devlin in Rookes v Barnard [1964] AC 1129, 1126 but also be a claim based on a cause of action that, pre-Rookes v Barnard, had been recognised in the case law as grounding a claim for exemplary damages.

Express support for the need to satisfy the cause of action criterion is not to be found in the speech of Lord Devlin itself. He formulated the two types of conduct that might attract an award of exemplary damages in a tort action. He recognised, at p 1227, that exemplary damages awards for breaches of statutory duty might be expressly authorised by statute but plainly regarded the two types of conduct as comprehensively covering all tortious conduct that might justify an exemplary damages award.

The requirement for the additional cause of action criterion comes not from Lord Devlin in Rookes v Barnard but from Broome v Cassell & Co Ltd [1972] AC 1027 and, in particular, the speeches of Lord Hailsham of St Marylebone LC, Lord Reid and Lord Diplock.

Lord Hailsham said, at p 1076, that he did not think that Lord Devlin "by listing the 'categories' was … intending … to add to the number of torts for which exemplary damages can be awarded". In Mafo v Adams [1970] 1 QB 548 Widgery LJ had said, at p 558:

"As I understand Lord Devlin's speech . . . the range of offences in respect of which [exemplary damages] may be granted has been increased, and I see no reason … why, when considering a claim for exemplary damages, one should regard the nature of the tort as excluding the claim."

Lord Hailsham expressed his dissent from Widgery LJ's view.

Lord Diplock said, at p 1131, that:

"Rookes v Barnard was not intended to extend the power to award exemplary or aggravated damages to particular torts for which they had not previously been awarded; such as negligence and deceit."

Lord Reid made the comment, at p 1086, that I have cited at paragraph 6 of this opinion.

And, in addition, Lord Wilberforce referred, at p 1114, to:

"the range of torts for which punitive damages may be given (trespass to person or property, false imprisonment and defamation being the commonest, …"

thus at least suggesting a cause of action test.

It seems to me, therefore, that the Court of Appeal, both in AB v South West Water Services Ltd [1993] QB 507 and in the judgment under appeal in the present case, were on firm ground in concluding that the authoritative case law required that a claim for exemplary damages should not only fall within one or other of the two Devlin categories (Rookes v Barnard [1964] AC 1129, 1226) but should also satisfy the cause of action test. The passages from the speeches of Lord Hailsham, Lord Wilberforce and Lord Diplock cited above were cited in the AB case as authority for giving the answer 'No' to the question "Did Rookes v Barnard extend exemplary damages to fresh torts?"

My Lords, I am in respectful agreement with much of the criticisms of the cause of action test that are to be found both in academic writings and in the speeches of my noble and learned friends on this appeal. I agree that the cause of action test "commits the law to an irrational position in which the result depends not on principle but upon the accidents of litigation": Winfield and Jolowicz on Tort, 15th ed, p 746, cited by my noble and learned friend Lord Mackay of Clashfern (ante, para xx); and I agree that the cause of action test appears to encourage a tedious trawl through ancient authority in an attempt to unearth an award of damages that can be categorised as exemplary in a case based upon a particular cause of action.

The present case is an example. Misfeasance in public office is a cause of action discovered, or rediscovered, relatively recently. But it is only since Rookes v Barnard [1964] AC 1129 that exemplary damages have been clearly distinguished from aggravated damages. The task of discovering whether, pre-Rookes v Barnard, exemplary damages had been awarded in a misfeasance in public office case has shown itself to be, and was always likely to be, lengthy and inconclusive. The cause of action criterion for an award of exemplary damages as an addition to the requirement that the conduct of the defendant fall within one or other of Lord Devlin's two categories does no credit to the law.

On the other hand the exemplary damages principle is itself an anomaly in the civil law and, as Lord Mackay has pointed out, it should not come as a matter of too much surprise that anomalies are to be found in the criteria that determine the availability of an anomalous remedy.

Your Lordships are, it seems to me, caught on the horns of a dilemma. On the one hand, the cause of action test is not based on principle and has serious practical difficulties. On the other hand, the removal of the cause of action test would expand the cases in which exemplary damages could be claimed. Claims could be made in cases of negligence and cases of deceit provided only that the conduct complained of fell within one or other of the two Devlin categories (Rookes v Barnard [1964] AC 1129, 1226). Claims could probably also be made, subject to the same proviso, in actions based upon breach of statutory duty whether or not the statute had expressly authorised such claims.

My Lords, I view the prospect of any increase in the cases in which exemplary damages can be claimed with regret. I have explained already why I regard the remedy as no longer serving any useful function in our jurisprudence. Victims of tortious conduct should receive due compensation for their injuries, not windfalls at public expense.

Faced with the unattractive alternatives of leaving the cause of action test in place or removing it, I would, for my part, favour a pragmatic solution under which, on the one hand, the cause of action test were removed but, on the other, exemplary damages were declared to be unavailable in cases of negligence, nuisance and strict liability, and also liability for breach of statutory duty except where the statute in question had expressly authorised the remedy. In this way the main objections to the cause of action test would be met and tedious research into pre-1964 case law would be avoided but existing authority as to cases where exemplary damages cannot be claimed would be left broadly unaltered. It will be noticed that I have not included deceit among the nominate torts where, on authority, exemplary damages cannot be claimed. This is because if, which I regret, exemplary damages are to be retained and reformed, rather than abolished, deceit practised by a government or local authority official, or by a police officer, on a citizen ought, it seems to me, to be allowed in a suitable case to attract them.

There is, however, a further issue in this case that, in my opinion, requires some comment. The issue is whether exemplary damages can be claimed against an employer for a tort committed by an employee where the employer's liability is only vicarious. The facts of the present case raise this issue.

The plaintiff's case is that he made a complaint to the police of the theft from his home of certain property. He named a lodger at his home as the suspect. A police officer, PC Cavendish, assured the plaintiff that the complaint would be investigated but subsequently forged the plaintiff's signature on a statement purporting to be a withdrawal by the plaintiff of the complaint. So the theft was never investigated and the plaintiff lost the chance of his property being recovered. Later the plaintiff was informed by the Crown Prosecution Service that there was insufficient evidence to justify a prosecution of the lodger. The defendant to the plaintiff's misfeasance in public office claim is the Chief Constable of Leicestershire Constabulary. PC Cavendish, the alleged wrongdoer, has not been sued. The plaintiff makes no allegation against the Chief Constable personally. The Chief Constable's alleged liability is simply vicarious. The particulars of conduct relied on as justifying an award of exemplary damages are particulars which relate to the alleged conduct of PC Cavendish. The Chief Constable is not mentioned anywhere in the body of the pleading.

My Lords, the viability of the plaintiff's exemplary damages claim against the Chief Constable depends not only on the question whether exemplary damages can ever be recovered in a misfeasance claim, but also on the question whether exemplary damages can be recovered in a claim where the defendant's alleged liability is simply vicarious. The point was raised with counsel in the course of the hearing before your Lordships but neither counsel made any submission on it. Nonetheless it is a point that seems to me of considerable importance and one that may be determinative of the present case.

There has been, so far as I have been able to discover, no discussion in English case law, and, with one notable exception, very little discussion in English law textbooks, of the availability of exemplary damages awards in vicarious liability cases.

In McGregor on Damages, 16th ed (1997) para 469, the text deals with exemplary damages awards where there are joint wrongdoers:

"Where joint wrongdoers are sued together, the conduct of one defendant does not allow exemplary damages to be awarded in the single judgment which must be entered against all if the conduct of the other defendant or defendants does not merit punishment. This was the view of Pollock B in Clark v Newsam (1847) 1 Exch 131, 141, and is now finally established by the House of Lords in Broome v Cassell & Co Ltd [1972] AC 1027."

If that is the rule where joint wrongdoers are sued, it must also be so where only one of two or more joint wrongdoers is sued, or where the employer is sued together with the wrongdoers, or where the employer alone is sued. Since all the wrongdoers are jointly liable for the wrong and, if their employer is vicariously liable, he is jointly liable with them, an exemplary damages award against any of them ought, in principle, to be a justifiable award against each of them. If the conduct of any of them, including the employer, does not merit punishment, an exemplary damages award ought, in principle, not to be made. The law might, of course, develop so that an exemplary damages award against a particular wrongdoer became separated from the general compensatory damages for which all the wrongdoers and their vicariously liable employer were jointly liable.

The notable exception to which I referred is to be found in Professor Atiyah's Vicarious Liability, published in 1967 not long after Rookes v Barnard [1964] AC 1129 had been decided, which contains a chapter (chapter 39) dealing with exemplary damages. The chapter has a section headed "Vicarious Liability". This section commences with the following paragraph:

"The most difficult problems arise in this connection in cases of pure vicarious liability. There appears to be no English authority in which there has been any discussion of the question whether exemplary damages can be awarded against an employer who is vicariously liable for the tort of a servant committed in circumstances in which exemplary damages can be awarded against the servant. At first sight there seems to be much against allowing vicarious liability for exemplary damages, for if these are avowedly designed as punishment it might seem wrong in principle to punish someone other than the actual wrongdoer. On the other hand it can also be urged that vicarious liability in the criminal law is not wholly unknown, and that the deterrent aspect is also an important consideration. In certain types of action, in particular false imprisonment, purely compensatory damages might not be an adequate deterrent against repetition, and it may well be that the deterrence would be more effective if aimed against the employer rather than the servant. The question could become of practical importance with the recent introduction of vicarious liability for police officers. If a policeman were to make an arrest in wholly unjustifiable circumstances it would seem right that the vicarious liability of the Chief Constable should extend to exemplary damages, for otherwise there might be no sufficient incentive to the police authorities to take stern measures with a view to preventing repetition of the offence."

I would not myself accept that a deterrent purpose was a sufficient justification for exemplary damages in vicarious liability cases, but, whatever may be the value of such a purpose in the false imprisonment or unlawful arrest cases referred to in the text, such a purpose has no relevance in the present case. No one would think of arguing that there is a need for chief constables to be deterred from allowing their officers to conduct themselves as PC Cavendish is alleged by the plaintiff to have conducted himself.

The "Vicarious Liability" section goes on to refer to the manner in which exemplary damages in vicarious liability cases is dealt with in the American Restatement.

"The problem has received some discussion in America although the courts are divided in the result. The Restatement, however, comes out in favour of a compromise. While denying vicarious liability for exemplary damages in principle, it admits such liability in four cases, that is, if, but only if:

'(a) the principal authorised the damage and the manner of the act, or

(b) the agent was unfit and the principal was reckless in employing him, or

(c) the agent was employed in a managerial capacity and was acting in the scope of his capacity, or

(d) the principal or a managerial agent of the principal ratified or approved the act.'

None of these four paragraphs would cover the exemplary damages claim in the present case, nor, for that matter, in either of the two Northern Ireland cases referred to by my noble and learned friend, Lord Hutton.

The objection to exemplary damages awards in vicarious liability cases seems to me to be fundamental. The only acceptable justification of exemplary damages awards in cases falling within Lord Devlin's first category (Rookes v Barnard [1964] AC 1129, 1226), "oppressive, arbitrary or unconstitutional action by the servants of the Government", including police officers, is that the conduct complained of has been so outrageous as to warrant a punitive response. As Lord Devlin said, at p 1227: "the plaintiff cannot recover exemplary damages unless he is the victim of the punishable behaviour". The other side of the coin is, in my opinion, equally valid: the defendant should not be liable to pay exemplary damages unless he has committed punishable behaviour. This principle leaves no room for an award of exemplary damages against an individual whose alleged liability is vicarious only and who has not done anything that constitutes punishable behaviour.

In 1997 the Law Commission laid before Parliament a paper on Aggravated, Exemplary and Restitutionary Damages (Law Com No 247). The paper was, by order of the House of Commons, printed on 15 December 1997.

The section of the paper dealing with exemplary damages refers to some of the complications that arise in vicarious liability cases. The paper notes, in paragraph 4.69, that "when calculating the appropriate exemplary sum, it has been laid down that the court or jury should take into account the defendant's capacity to pay" and went on in the following paragraphs to consider how this could work in a vicarious liability case:

"4.69 When calculating the appropriate exemplary sum, it has been laid down that the court or jury should take into account the defendant's capacity to pay. It would seem that either party may give evidence of the defendant's resources, but that in practice evidence of the defendant's means is rarely, if ever, adduced.

4.70 Until the recent case of Thompson v Commissioner of Police of the Metropolis [1997] 3 WLR 403 it was unclear how this consideration should be applied in a vicarious liability case, where a plaintiff seeks to make an employer liable for the wrongful conduct of his employee. One possibility was that any sum which an employer is liable to pay as exemplary damages could be subject to deduction on account of the employee's lack of means. Another, contrasting, possibility was that the means of the wrongdoing employee are irrelevant to the size of the sum which the employer is vicariously liable to pay.

4.71 In Thompson v Commissioner of Police of the Metropolis the Court of Appeal finally endorsed the second approach. It was said [at p 418] that where the action is brought against the chief police officer, and damages are paid on the basis of vicarious liability for the acts of his officers,

'it [is] wholly inappropriate to take into account the means of the individual officers except where the action is brought against the individual tortfeasor.'

There seems to be no good reason why this approach should not apply generally to vicarious liability to exemplary damages."

Thompson v Commissioner of Police of the Metropolis, referred to in the Law Commission Paper, is now reported in [1998] QB 498. The case was one in which the plaintiff, having been lawfully arrested, was subsequently assaulted and manhandled by police officers and wrongly detained in a cell for about four hours. She claimed against the Commissioner damages for false imprisonment and malicious prosecution. She claimed both aggravated damages and exemplary damages. The only defendant was the Commissioner. No argument was presented to the court that exemplary damages should not be awarded in a vicarious liability case. So the court was entitled to proceed on the footing that exemplary damages as well as aggravated damages could be awarded. The points taken before the court related simply to quantum. Counsel for the Commissioner argued, at p 501, that:

"The jury should be directed (1) that the [exemplary damages] award should be the minimum sum necessary to meet the underlying purpose of punishing the defendant …"

But why should the Commissioner have been punished at all? He had done nothing that merited punishment.

Lord Woolf MR said, at p 512:

"The fact that the defendant is a chief officer of police also means that here exemplary damages should have a lesser role to play. Even if the use of civil proceedings to punish a defendant can in some circumstances be justified it is more difficult to justify the award where the defendant and the person responsible for meeting any award is not the wrongdoer, but his 'employer'. While it is possible that a chief constable could bear a responsibility for what has happened, due to his failure to exercise proper control, the instances when this is alleged to have occurred should not be frequent."

I respectfully agree with the first two sentences in the above cited passage. As to the third sentence, there is nothing in the report of the case in the Court of Appeal which indicates that any factual findings of breach of duty on the part of the Chief Constable personally were made, whether in respect of failure to exercise proper control or otherwise. But it is possible that there were such findings. In the absence of any finding of some personal breach of duty by the Chief Constable, there would, in my opinion, have been no basis upon which punishment, in the form of exemplary damages, could properly have been visited upon him. The conduct meriting punishment was not his conduct but that of his officers. It appears to me that, silently and without any proper or principled justification for it, a system of vicarious punishment of public employers for the misfeasances of their employees has crept into our civil law.

In my opinion vicarious punishment, via an award of exemplary damages, is contrary to principle and should be rejected. The plaintiff's pleaded case against the Chief Constable of Leicestershire Constabulary is a vicarious liability case and no more. It does not, in my opinion, enable an award of exemplary damages to be made against the Chief Constable.

However, the point regarding vicarious liability and exemplary damages was not the basis on which the strike-out application was made, was not dealt with in the courts below and was not addressed by counsel before your Lordships. The views I have expressed should, therefore, be regarded as provisional and the point left for decision at a later stage in the proceedings.

In the result I would, for the reasons given in paragraph 122 above, with reluctance, allow this appeal. My reluctance is the consequence of my opinion that, on the vicarious liability point, this exemplary damages claim is bound to fail.