Hennessy v K-Tel Ireland Ltd

• Jurisdiction: Ireland
• Judge: Lynch J
• Judgment Date: 12 June 1997
• Neutral Citation: 1998 WJSC-SC 8033
• Court: Supreme Court
• Date: 12 June 1997

1998 WJSC-SC 8033

THE SUPREME COURT

Murphy J

Lynch J

Barron J

196/95

HENNESSY v. K-TEL IRELAND LTD

Between:

Shay Hennessey

Plaintiff/ Appellant

AND

K-TEL Ireland Limited and MargaretMcDonnell

Defendants/Respondents

Synopsis:

Defamation

Libel; qualified privilege; malice; whether words published in letter constitute qualified privilege; issue of malice; onus on plaintiff to prove malice; presumption of no malice where qualified privilege exists Held: Appeal dismissed; existence of qualified privilege; no evidence of malice Supreme Court: Murphy J., Lynch J., Barron J. 12/06/1997

Hennessey v. K-TEL Ireland Ltd.

1 Judgment delivered the 12th day of June 1997by Lynch J.

2 This is an appeal by the Plaintiff in a libel action against the decision of the learned trial judge (Kinlen J) to withdraw the case from consideration by the jury and to dismiss the Plaintiff's action on the grounds that the words complained of were published on an occasion of qualified privilege and that there was no evidence upon which the jury could reasonably find that the publication by the Defendants was malicious. In this judgment I shall deal with these two rulings by the learned trial Judge in the above order, that is to say first, the question of qualified privilege and secondly, the question ofmalice.

QUALIFIED PRIVILEGE

3 The words complained of by the Plaintiff are effectively the contents of a letter dated the 18th of November 1992 written by the second Defendant on behalf of the first Defendants to Ms Sherin the credit controller of a company called Pal Productions Limited of 4/5 The Vineyard, Sanctuary Street, London SE1 - 1QL (Pal). The letter was in reply to telephone demands by Ms Sherin on behalf of Pal for interest in respect of late payment of royalties and is as follows:

"Dear Ms Sherin

I feel your request is very unreasonable for interest amounting to£436.05 for the late payment of royalties. As already explained this was due to the departure of our managing director Mr Shay Hennessey from K-Tel along with all our royalty files.

It subsequently left us in the position of having to redo all our royalty files.

I trust you will be understanding and treat this matter asclosed.

Yours faithfully

Margaret McDonnell

Accounts Department"

4 The undisputed facts relating to the issue of qualified privilege are asfollows.

5 The first Defendants are part of a world wide organisation engaged in the music industry. They sell recordings of music performed by various artistes and it is then their duty to remit appropriate royalties to the various artistes out of the proceeds of sale of the recordings. Pal is engaged in the collection of royalties for artistes and have a reputation for efficiency in such tasks.

6 The Plaintiff was employed by the first Defendants in 1988 as general manager of their Dublin office. He was appointed managing director of the first Defendants Dublin office in July 1989 and he retained that position until the month of May 1992. However, he had been informed in mid February 1992 that his services were being dispensed with and he effectively ceased to work as managing director of the first Defendants in or about the month of March or April 1992 but he remained on the first Defendants premises until the 31st of May 1992 and on their payroll until the 30th of June 1992 having accumulated arrears of holiday pay. During the time of the Plaintiff's employment by the first Defendants up until the 30th of June 1991 the calculation ofroyaltypayments in respect of business done by the first Defendants in their Dublin office for the previous quarter or half year was carried out by the London office of the organisation. For this purpose it was the duty of the Plaintiff first as general manager and then as managing director of the first Defendants to ensure that all necessary information to enable these calculations to be done was remitted in proper time to the London office. No problem arose in relation to this prior to the 30th of June 1991. The necessary information and figures were promptly remitted to the London office and any queries by the London office were promptly dealt with. Royalty payments were made reasonably soon after the due date and no question ever arose of a demand for interest by Pal or by any other collection agency.

7 The organisation of which the first Defendants are a branch had a financial year running world wide from the 1st of July to the 30th of June in the following year. From the 1st of July 1991 no information or figures were remitted by the first Defendants to the London office nor did the London office seek any such information or figures to enable them to calculate the royalty payments required to be made by the first Defendants. It is clear from the evidence that the Plaintiff was anxious to make the Dublin office more self sufficient and the London office were quite agreeable to this ambition of the Plaintiff. Unfortunately each office thought that the other was attending to the calculation of the royalty payments falling due after the 1st of July 1991whichaccordingly was neglected by both offices and the payments for the two quarters ending the 30th of September 1991 and the 31st of December 1991 were not in fact made until the 18th of June 1992 resulting in the unprecedented demand by Pal for interest referred to in the letter of the 18th of November 1992.

8 During the period from the 1st of July 1991 the Plaintiff was in fact putting royalty information of the first Defendants on to a computer which was his own property using a system called Musicalc. The object of this exercise was to enable the Dublin office to calculate and pay its own liabilities for royalties. As I have said there was no communication of information from the Dublin office to the London office to enable the London office to calculate the payments falling due and the London office apparently assumed that the Dublin office was attending to the matter themselves.

9 The Plaintiff ceased to work for the first Defendants certainly not later than the end of April 1992. By then he had on his own computer enough information relating to the calculation of royalty payments due by the first Defendants to enable him to do what he called a dummy run. When he left the first Defendants he took with him his own computer and erased from it the information which he had put onto it regarding the calculation of the first Defendants royalty liabilities. He did not transfer this information which hehad compiled in his own computer on to any other computer or computer disk for the use of the first Defendants but he did hand to the first Defendants a print out of that information.

10 Whether or not the London office had erased their own computer systems for calculating the Dublin office royalty liabilities the fact clearly is that the foregoing sequence of events from the 1st of July 1991 created considerable difficulties for the London office in the calculation of the royalties due in respect of that period and the consequent delay ensuing from the whole saga gave rise to the unprecedented claim by Pal for interest.

11 The undisputed facts therefore establish a position where Pal were claiming to be creditors of the first Defendants for the sum of£436.05 interest on overdue royalty payments and the first Defendants were denying liability for that sum and were contending that in all the circumstances the claim was unreasonable. The first Defendants had a right and/or duty and /or interest to communicate their contentions regarding this claim for interest to Pal who had a corresponding right and/or duty and/or interest to receive such communications. I see no point in endeavouring to set out and deal individually with various submissions made on behalf of the Appellant on this issue of qualified privilege. Some confusion arose regarding the precise point decided by the Supreme Court in the case of Hynes - O'Sullivan -v- O'Driscoll (1988) IR 436 relating to the issue of qualified privilege. That case makes it clear that a Defendant cannot create an occasion of qualified privilege by communicating with another person whom he honestly believes has a duty and/or interest to receive the communication where such other person has in fact no such duty and/or interest to receive the communication. That problem does not arise in this case. Counsel's task was really impossible. This was a classic case for the existence of qualified privilege and the learned trial Judge was therefore correct in so ruling.

MALICE

12 Once the occasion on which the words complained of were published is one of qualified privilege the onus of proof of malice or express malice as it also called, rests on the Plaintiff. The onus is a heavy one and is not discharged by showing circumstances which could possibly be construed as showing malice but equally as not so...