The Judicial Committee of the Privy Council Decisions

"W" v. "W" and "J" v. Bell (New Zealand) [1999] UKPC 2 (19th January, 1999)

Privy Council Appeals Nos. 47 and 52 of 1998

(1) "W" Appellant                                   (2) "J" Appellant

v.                           and                                   v.

                "W" Respondent                      Raewyn Anne Bell Respondent

FROM

THE COURT OF APPEAL OF NEW ZEALAND

COMMITTEE OF THE PRIVY COUNCIL,

Delivered the 19th January 1999

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Lord Browne-Wilkinson

[Delivered by Lord Hoffmann]

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1. The question in these appeals is whether an action for exemplary damages can be maintained against a defendant in respect of conduct which is also a criminal offence and which has been the subject of a criminal prosecution. The Court of Appeal decided by a majority that no such action could be maintained. Against that decision the plaintiffs appeal to Her Majesty in Council. In one case, the defendant had been convicted and, in the other, he had been acquitted.

 

2. The main purpose of exemplary damages (sometimes called punitive damages) is to punish the defendant. This gives rise to two separate but related questions. The first, which their Lordships will call the wider question, is the extent to which the civil law ought to concern itself with punishment at all, this being more obviously the province of the criminal law. The second, which their Lordships will call the narrower question, is the interaction, in cases in which exemplary damages are in principle available, between the civil remedy and the fact or possibility of a criminal prosecution. As both are intended to punish, there is in a general sense a possibility of double punishment, or double jeopardy, which the law ordinarily regards as unfair and contrary to principle.

 

3. On the wider question there is a difference between the law of England on the one hand and the law of Australia and New Zealand on the other. In Rookes v. Barnard [1964] AC 1129, at page 1221 Lord Devlin, speaking for the House of Lords, viewed the whole concept of exemplary damages with disfavour, saying that it might well be thought to confuse the civil and criminal functions of the law. The House therefore decided to confine awards of exemplary damages to certain categories of cases which were "not, generally speaking, within the criminal law and could not, even if the criminal law was to be implied, conveniently be defined as crimes". These categories were, first, oppressive, arbitrary or unconstitutional action by servants of the government; secondly, cases in which the defendant’s conduct has been calculated to make a profit for himself which may well exceed the compensation payable to the plaintiff; and thirdly, cases in which an award of exemplary damages is expressly authorised by statute. In cases in which the conduct was also a criminal offence, Lord Devlin said at page 1230:-

"I do not care for the idea that in matters criminal an aggrieved party should be given an option to inflict for his own benefit punishment by a method which denies to the offender the protection of the criminal law."

 

4. In Australia and New Zealand, however, these restrictions on the scope of exemplary damages have not been accepted. The leading Australian case is Australian Consolidated Press Ltd v. Uren (1966) 117 C.L.R. 185, a libel action not falling within the Rookes v. Barnard categories in which the judge directed the jury that they could award exemplary damages if they considered that the defendant newspaper had shown a contumelious disregard of the plaintiff’s right to enjoy a good reputation. A decision of the High Court approving such a direction was affirmed by the Privy Council for reasons to which their Lordships will have to return: see [1969] 1 AC 590. The New Zealand Court of Appeal reached a similar decision in Taylor v. Beere [1982] 1 N.Z.L.R. 81. In neither of these cases was there any question of a criminal prosecution and the narrower question therefore did not arise.

 

5. It might have arisen in the case of Donselaar v. Donselaar [1982] 1 N.Z.L.R. 97, which was decided by the Court of Appeal on the same day as Taylor v. Beere (supra). The plaintiff sued for exemplary damages for assault and battery alleged to have caused physical injury, indignity, mental suffering, disgrace and humiliation. It appears that he had been charged with assault in a Magistrate’s Court and that the charge had been dismissed. But the defendant did not rely upon the fact that he had already been prosecuted. Instead, he submitted that all claims for damages for personal injury were excluded by the terms of the Accident Compensation Act 1972. The court held that the Act excluded only claims for compensatory damages. The narrower question was therefore not considered.

 

6. In these appeals, the majority judgment of Henry J. and the minority judgment of Thomas J. contain exhaustive surveys of the policy issues at stake and the state of the authorities and literature in various parts of the world. There are plainly important differences, recognised in both judgments, between a criminal prosecution and an action for exemplary damages. The procedure is of course radically different and so is the standard of proof. A prosecution is generally speaking initiated and controlled by the State. A civil action is initiated and controlled by the victim. Thus the prosecution of an action for exemplary damages enables the victim publicly to vindicate his or her version of events and inflict punishment, even revenge, in ways which a criminal prosecution may not satisfy. Punishment takes the form of damages which go to the victim rather than imprisonment or a fine which can afford her only a more indirect satisfaction. Allowing the victim to pursue such a claim may have a therapeutic value which mitigates the effects of the offence.

 

7. On the other hand, there can be no doubt that allowing an action for exemplary damages to follow or precede a criminal punishment carries the risk that a person may be punished twice for the same offence. The minority view acknowledges that this would be unfair and proposes that any criminal punishment should be taken into account by way of reduction in the damages awarded. But this remedy carries its own difficulties because prima facie it must be assumed that the criminal punishment was considered by the court to be appropriate to the offence and the offender. To award exemplary damages at all would imply that the civil court thought that the criminal punishment had been inadequate. There is an additional problem when a criminal prosecution follows a civil action. Logically, the criminal punishment should take into account the exemplary damages which have been awarded but there is an argument for regarding criminal proceedings in the name of the State as having primacy over a private action.

 

8. In addition, there are arguments which go to the wider question of whether claims for exemplary damages should be awarded at all, such as the absence of the ordinary safeguards afforded to an accused person in criminal proceedings, on which Lord Devlin laid stress in Rookes v. Barnard (supra). In New Zealand, this consideration has not been treated as sufficient to justify a restriction in the scope of exemplary damages but that does not mean that it carries no weight. It remains something to be taken into account in the calculation of where the public interest lies in deciding the narrower question.

 

9. There are also aspects of the argument which are peculiar to New Zealand. The absence of a tort remedy for compensatory damages for personal injury, abolished by the Accident Compensation Act 1972, has important consequences. First, victims of personal injury may try to obtain additional compensation by actions for exemplary damages because they consider the level of statutory compensation to be inadequate. The courts have cautioned against confusing questions of compensation and punishment but the pressure is undoubtedly there and tort liability has a tendency to expand. Secondly, in jurisdictions in which there is a tort action for compensatory damages, a civil action following criminal proceedings is commonplace. Although it may be possible to avoid a trial by a payment into court, the action cannot be struck out in limine. It follows that barring a claim for exemplary damages after a criminal prosecution would not necessarily prevent a reinvestigation of the facts by a civil court. Indeed, civil actions for compensatory damages are sometimes brought after failed prosecutions primarily for the purpose of enabling the disappointed victim to vindicate his or her version of the facts before a civil judge.

 

10. In New Zealand, on the other hand, the absence of a tort remedy for compensatory damages means that if exemplary damages are barred, the action is struck out altogether. This has both advantages and disadvantages. The advantage is that a defendant who has already been tried in a criminal court does not have to undergo another public investigation of the same incident in a civil court. The disadvantage is that a victim who feels that the failure of a criminal prosecution has, through no fault on her part, cast doubt upon her integrity, has no private remedy by which she can prove that her allegations were true.

 

11. In addition, as the majority in the Court of Appeal pointed out, New Zealand has adopted a procedure by which the court in a criminal trial can be made aware of the effect of the offence upon the victim. He or she is therefore not, as in some jurisdictions, marginalised as a mere witness to the offence.

 

12. Their Lordships have said enough to demonstrate that the answer to the narrower question, as in the case of the wider one, depends upon a perception of the balance of public advantage and disadvantage. There are no principles which mandate an answer one way or the other. So much was frankly acknowledged by Thomas J. in his dissenting judgment. The question is therefore whether it would be right for this Board to take a different view of the public interest in New Zealand from that of the New Zealand Court of Appeal.

 

In Australian Consolidated Press Ltd v. Uren [1969] 1 AC 590 the Board, considering an Australian appeal which raised the wider question, said firmly that questions of public interest were a matter for the Australian courts to decide. Lord Morris of Borth-y-Gest said that the question was one of policy and that where the policy of the law in a particular country was "fashioned so largely by judicial opinion" (p. 644) the Board should not substitute its own views (if different) for those of the national court. This limited role of the Board in policy decisions has been recently reaffirmed in Invercargill City Council v. Hamlin [1996] AC 624.

 

13. Their Lordships consider that the abstention which the Board considered proper in dealing with the wider question is also appropriate to the narrower. In principle, therefore, they would not disagree with the view taken by the majority. They must however deal with two points on which it was urged by the appellants that the view of the majority displayed an error of principle rather than a choice of policy.

 

14. The first concerns the effect of an acquittal. It was argued that in the case of an acquittal, which may have been on technical grounds, there can be no question of double punishment. The accused has not been punished in the criminal court at all. This is of course true, but their Lordships consider that a need for consistency leads inexorably to the conclusion that an acquittal should also bar the civil remedy for exemplary damages. The decision to bar the remedy after conviction and punishment is plainly a matter of policy and the consistent application of such a policy requires that it should apply irrespective of the severity or lightness of the punishment imposed by the criminal court. In each case, it will be the punishment which that court considered appropriate to the offence and the offender and it should not be reconsidered by another court. This must be the case even when the sentence is an absolute discharge. Having got to that point, their Lordships consider that it would be illogical to bar an action against an accused who has been convicted and discharged but not against an accused who has been acquitted. Their Lordships think it would be impractical in this context to try to distinguish between technical acquittals and acquittals on the merits.

 

15. Finally, counsel for the appellants complained of the fact that the claims had been struck out as an abuse of the process of the court. It was, he said, unfair to apply such a contumelious description to a form of action which has been approved by judges, writers and law reform agencies in many parts of the world. But the majority in the Court of Appeal did not suggest that the contrary view was not seriously arguable. They were considering a question of law referred to the Court of Appeal pursuant to Rule 419 of the High Court Rules. On balance they decided that the public interest required that exemplary damages should not be available in cases in which there had been a criminal prosecution based upon substantially the same facts. Once this question of law had been decided, it followed that the actions brought by the appellants could not succeed. Even if the actions could not have been characterised as an abuse at the time when they were brought, it would have been an abuse to prosecute them after it had been decided that they were bound to fail and their Lordships therefore consider that they were properly struck out.

 

16. Since the hearing of this appeal, their Lordships’ attention has been drawn to the Accident Insurance Act 1998, which received the Royal Assent on 18th December 1998. Section 396, which will come into force on 1st July 1999, provides that no rule of law shall prevent a person bringing proceedings for exemplary damages even though the defendant has been convicted or acquitted of an offence involving the conduct concerned in the claim. The appellants have submitted in writing that the section, when it comes into force, will retrospectively confer upon the appellants a cause of action. Their Lordships express no view on this point, which may be a matter for decision in the courts of New Zealand after the section has come into force. They can dispose of this appeal only in accordance with the law as it now stands. They will therefore humbly advise Her Majesty that the appeal should be dismissed and that the appellants should pay the respondents’ costs before their Lordships’ Board.