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November 4, 2013

Government proposal to protect poor from libel costs could lead to increase in claims, lawyers warn

By Darren Boyle

Removing the threat of paying costs for some libel claimants could lead to an increase in vexatious actions, a leading law firm has warned. 

The Government is currently considering removing the threat of paying defendant's costs from an individual taking a case for defamation if they are of modest means.

Specialist media law firm Wiggin commissioned ComRes to conduct a survey of 2,018 British adults seeking their opinion on the proposed changes.

The survey found that only 39 percent of people would consider taking a legal action if an offensive post was made online on  a social media site or newspaper message board. However, almost one quarter of those who said they would not take legal action, would threaten to sue if they did not have to pay of the action.

The survey was conducted between 18-20 October 2013.

Of those  questioned, 60 percent thought it  fair that the loser could potentially have to cover both sides’ costs.

However, 41 percent of people did not know they could be faced with all the costs if they failed in a libel action.

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The Ministry of Justice has called for submissions on the proposed changes. The consultation process will end on Friday, 8 November.

Caroline Kean, partner at Wiggin said: “Our opinion poll indicates that the Government’s proposals could lead to a potential increase in unmeritorious and even vexatious claims being brought. We have found that a significant proportion of people who would not have otherwise brought a claim, would be willing to ‘have a go’ because the risk of having to pay both sides’ costs is removed. The impact of this, on small publishers in particular but also the already over-stretched courts system, could be devastating.

“The consultation states that the principle that ‘the loser pays’ is important because it helps deter unmeritorious claims and we agree with this sentiment. If a party was not otherwise going to take action, we do not believe that the removal of the cost barrier should be their motivation.

“These are similar to the fears expressed by the newspaper industry that a free arbitration service would open the floodgates to vexatious claimants.

“Crucially, what we have also found is that there doesn’t appear to be the appetite on the part of the public to change the current system, less than half of people feel that is it unfair.

“Over the past year we’ve seen a number of high profile defamation cases hit the headlines but the percentage of people who would consider taking legal action if they feel they have been defamed is down significantly. It could be that cases like Sally Bercow’s and Frankie Boyle’s, both of which have ended with settlements being paid to the claimant, have made people more considered about what they post online.”

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