Karyn Harty (top)
and Jaime Flattery

While it was intended to encourage parties to settle their disputes quickly and in a cost-effective manner, the potential for a jury assessment of damages continues to discourage defendants from utilising the procedure: but is reform on the way?

On 14 November 2019, a High Court jury determined that a pilot, Pádraig Higgins, was entitled to damages of €387,000 from the Irish Aviation Authority (“IAA”) arising from defamatory emails it sent in 2013. This reflected an initial assessment of €300,000 general damages and €130,000 in aggravated damages but included a 10 per cent discount, in light of the offer to make amends under s. 22 of the Defamation Act 2009. It is understood the IAA issued a final approved apology to Mr Higgins and a retraction only at the outset of the damages assessment hearing. The IAA had previously made an unqualified offer to make amends in May 2015. This offer was accepted by Mr Higgins. However, the parties were unable to agree the amount of damages or costs payable, and according to s. 23(1)(c) of the 2009 Act, they then fell to be determined by “the court”.

The jury’s role in determining quantum of damages

In the Higgins case, the High Court was initially asked to determine whether the meaning of the term “court” in s. 23(1)(c) of the 2009 Act required the quantum of damages to be assessed by a jury (rather than a judge). The court held that Mr Higgins was entitled to have the quantum of damages assessed by a jury, with appropriate instruction from a judge, and rejected the IAA’s argument that the language of s. 23 of the 2009 Act did not permit a jury trial. That decision was appealed by the IAA to the Court of Appeal, which affirmed the decision of the High Court and specified that the right also applied where no proceedings had been instigated. The IAA subsequently appealed to the Supreme Court. Ms Justice Dunne concluded that the phrase “the court” used in s. 23(1)(c), while not defined, meant a “jury” and noted that “the assessment of damages in a High Court defamation action is and always has been quintessentially a matter for a jury”. Interestingly, in the Supreme Court’s view, there was no basis for a difference of approach in a defamation action compromised by an admission of liability, leaving over damages for assessment by a jury, and a compromise of actual or potential proceedings by the acceptance of an “offer of amends”.

Counting your apples - what are the potential damages and discount?

The offer to make amends procedure may involve a jury assessment of both the starting point for damages and any discount to be applied, which may not appeal to defendants looking for certainty and a quick resolution. For example, in Higgins the initial award (pre-discount) of €430,000 would, irrespective of the facts, be considered at the higher end of the scale and the recent decision of the Court of Appeal in Kinsella v Kenmare Resources plc further highlights the potential for hugely disproportionate jury awards – where the Court of Appeal substituted the highest ever defamation award of €10 million in damages for €250,000.

Despite this, one of the main benefits in availing of the offer to make amends procedure is the potential to receive a discount on the damages awarded. The level of discount will be influenced by factors such as the timing, nature and sufficiency of the terms offered but there is little certainty: it may range from as little as 10 per cent (in Higgins) to 40 per cent or 50 per cent (Christie v TV3 Television Networks Ltd). Overall, the discount to be applied will be influenced by the defendant’s conduct and their efforts to suitably vindicate and compensate the plaintiff. Clearly, an early offer acknowledging the defamation, made in good faith and including a fulsome apology will attract a higher discount. The case of Christie v TV3, as considered in our previous briefing on the Higgins Court of Appeal judgment in 2016, remains the lead guidance for determining the discount to be applied.

Potential reform - is the jury here to stay?

In the Supreme Court judgment in Higgins, Ms Justice Dunne recognised that the “offer to make amends” procedure was aimed at facilitating early and speedy resolution of defamation proceedings but criticised the lack of clarity as to how it was intended to work in practice to achieve its objective. The Supreme Court further echoed practitioners’ calls for reform of the provisions, noting that “it would be very desirable that consideration is given to setting out very clearly the mechanism envisaged and how it would function in a range of different circumstances”. However, the court was clear that the core function of the jury in assessing damages could not be displaced without clear and express words from the legislature. Such reform has since occurred in the United Kingdom, where the right to a jury trial in defamation actions was abolished by section 11 of the Defamation Act 2013.

In terms of Irish reforms, last week the Department of Justice indicated its long-awaited review of the 2009 Act is due to be published in early 2020, with legislative proposals due to be tabled before the summer recess next year. Some of the stated aims include addressing the “chilling” effects of high/unpredictable awards and legal costs on public interest media reporting, developing the use of alternative dispute resolution processes and solutions, and tackling the specific problems raised by online defamation.

In this context, it is hoped the role of the jury – especially with regard to the assessment of damages – will be carefully scrutinised in light of the uncertainty created for defendants generally, and particularly those wishing to avail of the offer to make amends procedure. In this regard, it is worth remembering that Circuit Court judges are routinely tasked with assessing damages in defamation actions without a jury. The intention to develop alternative means for resolving defamation claims will be welcomed by defendants, particularly in view of the shortcomings of the offer to make amends procedure.

Comment

Last week’s decision makes clear that, where parties cannot agree on the terms of an offer to make amends, juries may be asked to consider both the level of damages and any discount to be applied. It seems that to avail of a substantial discount, a defendant must act quickly to acknowledge the defamation and offer a fulsome and genuine apology or retraction. Yet how attractive is this procedure if defendants still bear the risk of an unpredictable jury assessment and have no guarantee of a significant discount?

In summary, jury assessments are here to stay – for now at least – which makes it difficult to predict the level of damages to be expected in any given defamation claim, including where an offer to make amends has been made. Stakeholders will therefore eagerly await the anticipated reform and clarifications signalled by the Department of Justice.

• Karyn Harty is a partner and Jaime Flattery is a senior associate at McCann FitzGerald