Crofter Properties Ltd v Genport Ltd (No. 2)

• Jurisdiction: Ireland
• Judge: Denham J.
• Judgment Date: 12 April 2005
• Neutral Citation: [2005] IESC 20
• Date: 12 April 2005
• Court: Supreme Court
• Docket Number: [SC. No.

CROFTER PROPERTIES LTD v GENPORT LTD

BETWEEN

CROFTER PROPERTIES LTD

PLAINTIFF/APPELLANT

AND

GENPORT LIMITED

DEFENDANT/RESPONDENT

[2005] IESC 20

DENHAM J.

GEOGHEGAN J.

KEARNS J.

APPEAL NO. 75/2004

THE SUPREME COURT

DAMAGES

Defamation

General damages - Aggravated and exemplary damages - Proof of damage - Jurisdiction of appellate court to review award of damages - Award of general damages upheld but appeal allowed against award of exemplary damages

Publication - Damage - Requirement of specific identification - Requirement of proof of actual damage - Damage to reputation of company - Publication to limited class of persons

The plaintiff demised premises known as Sachs Hotel to the defendant. These proceedings commenced as an application for ejectment. The defendant delivered a counterclaim with its defence claiming damages and a set off. The plaintiff's primary grounds of appeal related to the sums awarded in general and exemplary damages to the defendant. The defendant's claim for damages for defamation arose from a series of telephone calls made on behalf of the plaintiff which alleged that Sachs Hotel was being used to launder drug money.

Held by the Supreme Court (Denham, Geoghegan and Kearns JJ) inter alia that the award for general damages should not be set aside but that the award of exemplary damages should be reduced. An award of exemplary damages should not be excessive but should be sufficient to punish the behaviour of the plaintiff.

Reporter: R.W.

DE ROSSA v INDEPENDENT NEWSPAPERS PLC 1999 4 IR 432

JOHN v MGN LTD 1996 2 AER 35 1997 QB 586

BARRETT v INDEPENDENT NEWSPAPERS LTD 1986 IR 13

CROFTER PROPERTIES LTD v GENPORT LTD 2002 4 IR 73

GATLEY ON LIBEL & SLANDER 8ED 161-163

MCINTYRE v LEWIS 1991 1 IR 121

RICHES & ORS v NEWSGROUP NEWSPAPERS LTD 1986 1 QB 256

O'BRIEN v MIRROR GROUP NEWSPAPERS LTD 2001 1 IR 1

MCDONAGH v NEWS GROUP NEWSPAPERS LTD UNREP SUPREME 23.11.1993 1993/13/4009

1 Judgment delivered on the 12th day of April, 2005 by Denham J.

2 1. This is an appeal by Crofter Properties Limited, the plaintiff/appellant, hereinafter referred to as "the plaintiff", from the judgment and order of the High Court made on 10th day of September, 2002 and 8th day of November, 2002, which was perfected on the 27th day of January, 2004, to set aside the following parts of the High Court order:

3 (a) The award of IR£50,000 for general damages to the defendant.

4 (b) The award of IR£250,000 punitive or exemplary damages to the defendant;

5 (c) That the defendant be entitled to recoup interest on the sum of IR£300,000 at 8% per annum from the 23rd day of April 1996 to the date of the said judgment and order from the plaintiff and to set off same against the sums due by the defendant to the plaintiff;

6 (d) The refusal of the plaintiff's application for the costs of its claim against the defendant.

7 Genport Limited, the defendant/respondent, is referred to hereafter as "the defendant".

8 2. There is a history of litigation between these parties over the last two decades. While it is not necessary to set out the previous lengthy litigation between the parties it is appropriate to refer to the history insofar as to state that by lease dated 12th May 1981 the plaintiff demised premises known as Sachs Hotel for a term of 21 years from the 1st August, 1980 to the defendant. These proceedings commenced as an application for ejectment. The defendant delivered a counterclaim with its defence claiming damages and a set off. This judgment relates solely to the four grounds raised on this appeal by the plaintiff from the previously stated High Court judgment and orders.

9 3. The case was remitted by the Supreme Court to the High Court to assess damages, to determine the defendant's right to set off and its right to relief against forfeiture. On the 10th September, 2002 the High Court (McCracken J.) delivered judgment. I shall consider each of the issues raised on this appeal separately. As indicated by counsel for the plaintiff, however, the primary grounds of appeal relate to the sums awarded in damages.

False Information

10 4. The defendant's claim for damages for defamation arises from a series of telephone calls. False information was received from an English Police Force who had received information from an anonymous woman on the telephone. The essence of the false information was that both Mr. Philip Smyth and his brother Chief Superintendent Paul Smyth were actively assisting the I.R.A. in laundering drug money through Sachs Hotel. Caroline Devine denied making the phone calls. However, on 23rd April, 2002 the High Court held that the telephone calls had been made by Caroline Devine, who was a secretary to, and director of, the plaintiff, and who worked with Hugh Tunney, the principle shareholder of the plaintiff. On appeal the Supreme Court held that these telephone calls had been made on behalf of and for the benefit of the plaintiff. Further, that while the defendant was not mentioned by name, the Supreme Court held that the words be deemed to refer to the defendant.

General Damages

11 5. The High Court held, on the issue of general damages, as follows:

"There is no express evidence of actual loss suffered by the defendant as a result of the allegations in the telephone calls made by Caroline Devine. However, there is certainly general evidence that the morale of the staff in Sachs Hotel was affected, and also general evidence that members of the Gardaí Síochána were frequent customers of the hotel and may have been affected. It must be remembered that the defendant is a company, and a company of itself is not capable of having feelings which can be injured by false allegations. However, a company does have a reputation, and that reputation can be injured, and I believe I am certainly entitled to infer in the circumstances of this case that there probably was some injury to the reputation of the company, and some loss of efficiency of its staff by reason of these allegations. However, I fully accept the arguments on behalf of the plaintiff that this is not a comparable situation to, for example De Rossa v Independent Newspapers [1999] 4 I.R. 432, where similar very serious allegations of criminal offences and indeed of acts against the State were made in a Sunday newspaper. The publication in this case was to members of the South Eastern Regional Crime Squad in the United Kingdom, but with the clear intention, and knowledge, that the allegations would be repeated by that authority to the Garda authorities in this country, and I think with the equally clear intention that they would be acted on by the Garda authorities."

12 Having considered the judgment of the Supreme Court the learned High Court Judge held that on those findings it was the plaintiff's intention to damage the defendant in the hotel trade. He held that the plaintiff was entitled to substantial general damages based on the likelihood of loss of various kinds, including reputation, and he assessed general damages at IR£50,000.

13 6. Counsel on behalf of the plaintiff, Mr. Eoin McGonigal S.C., submitted that the award of general damages was excessive. He submitted that: (i) Genport Limited was not referred to in the information; (ii) that there was no evidence at all as to any damage suffered by the plaintiff, and, (iii) that the publication was to a very limited class of person.

14 7. The law provides that the plaintiff is entitled to an award of general damages such as will fairly and reasonably compensate the plaintiff for the wrong suffered: De Rossa v Independent Newspapers [1994] 4 I.R. 432 at 463; John v MGN Limited [1997] QB 586 at 607; Barrett v Independent Newspapers Limited [1986] I.R. 13 at 23. On this aspect of the appeal the plaintiff has raised three specific issues and I will consider each separately.

15 8. The first issue raised in this ground of appeal has been decided already by this Court: [2002] 4 I.R. 73, where at p. 91 Murray J. (as he then was) stated:

"The High Court Judge appears to have attached importance to the fact that only one express reference to the defendant by name is to be found in one allegation as recorded by the English police. It must be noted that this reference to the defendant by name is contained in a summary of what had been communicated to the English police in more than one phone call. However, I consider this to be significant evidence of an express attempt to damage the reputation of the defendant."

16 I am satisfied that the plaintiff may not revisit this as a substantial issue.

17 In reaching this decision I bear in mind that there was specific reference to Sachs Hotel (albeit that it was misspelt.). A relevant reference was in the document, dated 26th October, 1992, to Detective Chief Superintendent from Assistant Detective Inspector Stephen Condon, which relates to confidential information. In the report it is stated, inter alia,

"[-] allegedly is part of a money laundering operation on behalf of the I.R.A. The source states that a lot of funds are "cleansed" through an Irish company called PRINCETON LIMITED. This company apparently owns hotels and clubs in Dublin including Saks [sic] Hotel and the Hippodrome.

One of the directors of PRINCETON is called Philip SMITH who is allegedly known to ___________. Johnston. ... His brother and co-director is Paul SMITH. Paul SMITH is allegedly a member of the GARDA and until recently the Superintendent in charge of Personnel at Phoenix Park. He has recently been promoted to Chief Superintendent and posted to Portleish [sic] ..."

18 In reaching the decision that the plaintiff may not revisit this issue I bear in mind the facts as found by the High Court and this Court and...