Dealing with defamation: how not to do it

A recent High Court decision, Wiremu v Ashby [2019] NZHC 558, shows lawyers need to carefully consider several options before advising their clients to issue a defamation claim seeking damages.

Wiremu v Ashby concerned an annotated collage of photos Ashby had posted on a community motocross Facebook page. That collage showed Wiremu inside the starting area of a motocross event, holding onto his son’s bike. This is contrary to motocross rules. Ashby wrote various statements on these photos alleging Wiremu was cheating to help his son.

Wiremu denied he was cheating and immediately demanded Ashby apologise and retract the allegations. But while Ashby removed the post, he refused to apologise or retract the allegations. To clear his name and restore his reputation, Wiremu decided to issue defamation proceedings.

Nearly two years after the defamatory post had been made, and after a two-day hearing, the High Court held that Ashby had indeed defamed Wiremu. The court rejected the range of defences Ashby raised from truth to honest opinion and qualified privilege. But while finding Wiremu had been defamed, the court held that damages should be set at the “very modest” level of $10,000.

While Wiremu succeeded in getting a declaration he had been defamed, it took him nearly two years to get that result. Presumably the modest damages award was significantly dwarfed by his actual legal costs.

And because the award was so low, Wiremu opened himself up to costs being calculated on the District Court scale and even, if the court thought his claim was excessive, for solicitor-client costs to be awarded against him.

Similarly modest awards are likely to become more frequent after the Court of Appeal’s judgment in Williams v Craig [2018] NZCA 39, [2018] 3 NZLR 1.

This decision made it clear that damages are a secondary remedy to a declaration and the function of damages is solely compensatory. The court’s reasoning has been applied in several High Court decisions to justify awarding, at most, modest damages.

Other options

What alternative does someone like Wiremu have if they believe they have been defamed and want to clear their name? The Defamation Act 1992 gives that person three useful options:

• A person whose main aim is clearing his or her name can seek a declaration that he or she has been defamed. If the court grants that declaration it will nearly always order the defendant to pay the plaintiff’s solicitor-client costs.
• The person can, within five days of learning that a media organisation has published a defamatory statement, request a retraction or a reasonable right of reply. If the media organisation publishes that retraction or reply, it has to pay the person’s solicitor-client costs and other reasonable costs, including compensation for direct losses. If the media organisation refuses to publish the requested retraction or reply, that refusal will resound in damages if the media company is found liable.
• The person can file a claim with the court and ask for a recommendation that the defendant publish a correction. If the court makes that recommendation, the defendant is placed in a difficult position because:
• if the defendant publishes the recommended correction, the defendant will generally be required to pay solicitor-client costs to the plaintiff, and
• if the defendant refuses to publish a correction, but is later found liable for defamation, that failure to publish is taken into account in assessing damages. The defendant will nearly always be required to pay the plaintiff’s solicitor-client costs.

While none of these options enables the plaintiff to get damages, they nearly always entitle the plaintiff to get solicitor-client costs. Generally, solicitor-client costs far outstrip any damages award, particularly for low-level defamations.

This spectre of solicitor-client costs significantly ramps up the risks for a defendant.

As a result, often a pre-action letter setting out one of these options and their consequences is enough for many defendants to decide to retract defamatory allegations and publish a correction. That removes the defamatory allegations straight away, rather than letting them fester until after a judgment is issued. It also avoids significant legal costs for what is often little reward.

And if the defendant refuses to retract the allegations, the only way for the defendant to avoid having to pay the plaintiff’s solicitor-client costs is if the defendant wins at trial; a risky and expensive strategy.

As Wiremu v Ashby illustrates, issuing a defamation claim and seeking damages might not always be the best option for a person alleging defamation. At the very least, lawyers should advise a defamed person to consider these three options outlined above before issuing a claim.

This article was published as below in LawNews on 14 June 2019.