Court of Appeal gives guidance on qualified privilege defence and meaning of malice in defamation actions

Background

In its recent judgment in Jonathan Lu & Ors v Paul Chan Mo-Po and Frieda Hui, CACV 251/2015, the Court of Appeal allowed the appeal of the Defendants (the now Financial Secretary(D1) and his wife (D2) and dismissed the Plaintiffs’ claims against them for defamation. Deacons acted for the Defendants. The judgment is significant as the Court of Appeal gave guidance on the circumstances in which the defence of Qualified Privilege can be relied upon and also on what amounts to “malice” and can defeat such defence.

The Offending Words

The Defendants had sent emails to the headmaster, senior managers and parents of children at Chinese International School (CIS), referring to rumours that two students (1^st and 2^nd Plaintiffs) had cheated in a school exam and got away with it because their father (3^rd Plaintiff) was on the school’s Board of Governors. The Defendants’ daughter also attended CIS.

The Jury’s findings and Court of First Instance Ruling

After an 18-day trial, the jury found that the “offending words” in all six emails were defamatory, but that only four of the emails were published with malice and they awarded the Plaintiffs a total of HK$230,000. The judge held that two of the emails (those which the jury had found not actuated by malice) were protected by the defence of Qualified Privilege. It was successfully argued for the Defendants that the emails were covered by such defence because there was a common interest to publish the emails to the recipients and a corresponding interest for the recipients to receive them.

The Appeal

Both parties appealed. The Plaintiffs sought to set aside the ruling on Qualified Privilege and the Defendants sought to challenge the judge’s directions to the jury and their findings on malice.

Qualified Privilege- The Plaintiffs’ Appeal

The Court of Appeal repeated the following basic propositions regarding the defence of Qualified Privilege:

1. Qualified Privilege stems from the public interest to protect free speech;
2. For an occasion to attract Qualified Privilege, there must exist between the maker of the statement and the recipient some duty or interest in the making of the communication;
3. The existence of the common interest to found an occasion of Qualified Privilege is to be determined objectively. It is not sufficient that the maker of the defamatory statement honestly believes that he has a legitimate duty or interest to make it or the recipient to receive it, although such a belief may have a bearing on malice. 

The Plaintiffs argued that there was no common interest and reciprocity in publishing the two emails by the Defendants and receiving the same by the recipients. The common interests relied upon by the Defendants were the preservation of CIS’s image and reputation, ensuring that CIS inculcates and instils in students the importance of academic integrity, and ensuring that CIS takes a responsible attitude and appropriate action as regards cheating in exams or rumours of such behaviour.

Counsel for the Plaintiffs argued that academic integrity was not of itself capable of forming a common interest in the present case since there was factually no academic dishonesty in the form of cheating by the 1^st and 2^nd Plaintiffs and therefore the need to protect academic integrity did not arise. However, the Court of Appeal rejected that argument as being too narrow a view about academic integrity. Instead the Court of Appeal found that academic integrity embodies the core values of an educational institution. The circumstances prevailing at the time in the present case, the Court said, clearly called for immediate action by the school management to look into the matter with a view to finding the truth and if necessary to take appropriate steps to prevent academic dishonesty, which gave rise to the common interest for protecting academic integrity.

Counsel for the Plaintiffs also argued that although the senior members of the school management had a duty and interest in receiving the two emails in question, the parents did not since, as a matter of law, only persons in a position of authority to address the issue have the duty or interest in receiving the defamatory statement. The Court of Appeal rejected that blanket proposition (whether as a general one or one specific to an educational setting), as going against the public interest that the law of Qualified Privilege seeks to protect, namely freedom of speech. Further, the Court agreed with the Defendants’ Counsel’s that all that the case authorities have established is that whether the requisite duty or interest exists is a fact-sensitive question, to be determined by the particular circumstances of each case.

Accordingly, the Court of Appeal dismissed the Plaintiffs’ appeal, holding that the circumstances surrounding the publication of the two emails overwhelmingly supported the Defendants’ case of Qualified Privilege. The Court of Appeal said that the need to facilitate and encourage parental involvement in CIS affairs, including matters concerning academic integrity clearly supported the Defendants’ case that they and the recipient–parents had the common interest relied on, in the publication and receipt of the two emails.  

Defendants’ Appeal – Malice

The Court of Appeal took as the starting point for the review of the law on malice, the basic premise that the immunity afforded by Qualified Privilege is lost if the occasion giving rise to it is misused.

The crux of the Defendants’ appeal lay in the directions given by the judge below to the jury on knowledge of falsity and recklessness, in relation to which, the Court of Appeal held as follows:-

1. Mere absence of positive belief in the truth of what is published is not malice and mere lack of belief in the truth is not equivalent to knowledge of falsity;
2. Knowledge of falsity or lack of honest belief is not a separate head of malice though knowledge of falsity is ‘almost conclusive evidence’ that the defendant had some improper motive and it actuated the publication;
3. Recklessness as to the truth or falsity of a publication, short of wilful blindness, will not destroy an occasion of Qualified Privilege unless it is accompanied by some other state of mind;
4. Such other state of mind could be spite, ill-will, anger, hatred, bias or unreasoning prejudice which can be evidenced by recklessness not amounting to wilful blindness. The mere presence of such state of mind as one of the motives of a defendant is not enough to establish malice;
5. ‘Recklessness’ in jumping to conclusions which are irrational, reached without adequate inquiry or based on insufficient evidence is not enough to constitute malice if a defendant does believe in the truth of the statement;
6. Carelessness of expression, carelessness, irrationality, stupidity or refusal to face facts concerning the plaintiff is not conclusive proof of malice although it may provide evidence of it in an extreme case. Mere failure to make inquiries or apologise or correct the untruth when discovered is not evidence of malice.

The Court of Appeal determined that the judge below had seriously misdirected the jury on malice in the following respects:-

1. There was no clear intimation to the jury that lack of belief in the truth of the statements is not sufficient as this cannot be equated with knowledge of falsity;
2. There was no direction on presumption of honesty. Lack of honest belief was treated by the judge as an alternative to actual knowledge of falsity. In this context, the lack of honest belief had to be more than lack of reasonable basis for the belief, more than mere indifference as to the truth. It has to be dishonest, or in the context of recklessness, wilful blindness;
3. Less serious recklessness, presented with other states of mind, can support a finding of malice. However, those other states of mind like gross unreasoning prejudice or anger must be identified and the actuation by the improper motive must be so overwhelming that the desire to comply with the relevant duty or to protect the relevant interest plays no significant part. The jury were not directed accordingly.
4. In terms of the imputation of dishonesty on the Defendants’ part under the umbrella of lack of honest belief, there was no direction on the inherent unlikelihood of the same.
5. The direction on recklessness as to the truth of the statements does not distinguish wilful blindness from the less serious case of indifference. The latter, without other evidence of improper motive, is not sufficient.
6. The direction on departure from reasonableness as grounds for disbelieving the Defendants’ honest belief in the truth carries with it a risk of equating lack of reasonable belief as a ground for finding malice. Though on its own, this may not be fatal, read together with the other defects, this was also a ground for holding that there was a misdirection.

Accordingly, by reason of the misdirection, the Court of Appeal allowed the Defendants’ appeal and set aside the jury’s verdict on malice.

Conclusion

Rather than remit the case to the court below for re-trial, the Court of Appeal dismissed the Plaintiffs’ claims and entered judgment for the Defendants, since it concluded that there was no evidence on which a properly directed jury could make a finding of malice on the Defendants’ part.