A forum shopper's paradise: is Australia set to become a "must see" destination for a libel tourist?

Given the globalised and cross-border nature of modern communications in this digital information age, libel tourism has been viewed as a growing threat. The jurisdictions of the United Kingdom and United States have attempted to address this threat through defamation law reform aimed at ensuring an appropriate balance is maintained between freedom of speech and the right to reputation.

Snapshot

• The United Kingdom was once considered a libel tourism hotspot; recent legislation has attempted to curtail its desirability as a plaintiff-friendly jurisdiction to foreign plaintiffs in an attempt to reduce the impact of libel tourism.
• The United States is a more challenging jurisdiction for a plaintiff to succeed in a defamation action; recent legislation has reinforced freedom of expression as paramount.
• Australia is yet to respond to the threat of libel tourism, and in light of the legislative changes made to defamation law in the UK, it may be perceived as an attractive jurisdiction for libel tourists to litigate their claims.

Introduction

The challenge of defamation law is to strike a balance between the right to reputation and the right to free speech. With the internet as a truly global platform for individuals, businesses and organisations to publish material online, legislative reform in both the UK and US has sought to tighten their defamation laws in response to the threat of libel tourism.

"Libel tourism" is a phrase now commonly used to describe the process of forum shopping which occurs when plaintiffs are looking to bring an action in defamation and commence proceedings in a jurisdiction with favourable defamation laws. This global forum selection process has caused, according to some commentators, a "chilling effect" on a person's willingness to freely express an opinion engendered by the fear that a libel tourist could commence defamation proceedings, which may discourage freedom of expression.

Traditionally, the courts of England and Wales have been considered a libel tourism hub. London has even been nicknamed the defamation capital of the world. Why? The defamation laws have proven to be much more attractive to the plaintiff seeking relief than the publication-friendly position in other jurisdictions, such as the United States of America, where the First Amendment to the US Constitution has enshrined the right to freedom of speech as being of paramount importance.

UK

In England and Wales, a plaintiff has a cause of action in defamation (libel or slander) where defamatory words are published to a third party. This publication can either be in writing or another other permanent form (i.e. libel) or spoken or in another other temporary form (i.e. slander).

There is no complete or comprehensive definition of a defamatory statement but as guidance, a statement may be defamatory if it can be considered a statement which:

1. tends to lower a person in the estimation of right thinking members of society generally;
2. causes him or her to be shunned or avoided or exposes him or her to hatred, contempt or ridicule; or
3. disparages the person in his or her office, profession, calling, trade or business.

In English law, the intent of the defamer is irrelevant to prove the cause of action; the defendant's intention only becomes relevant if the defendant seeks to rely on defences such as qualified privilege, truth or honest comment. As the plaintiff is not required to prove that a defamatory statement was false, the burden of proof in English defamation law effectively falls upon the defendant.

Further, each and every publication of a defamatory statement gives rise to a separate claim; this is known as the multiple-publication rule and means that there are as many publications as there are recipients.  This can be compared and contrasted with the single publication rule in the United States. In a digital age, where the internet provides for instantaneous and seamless cross-border communications, it is easy for publications to have a widespread global reach with defamation occurring in multiple jurisdictions at any one time. This can lead to complex claims under English law which have the potential to implicate multiple legal systems.

Legislative intervention to combat the chilling effect defamation can have on publication resulted in the Defamation Act 2013 (UK) (UK Defamation Act), which came into effect on 1 January 2014. It introduced the following reforms:

1. a serious harm threshold test, meaning a plaintiff in England and Wales proceedings has had to overcome an additional hurdle by demonstrating the "publication has caused or is likely to cause serious harm" to his or her reputation, or in the case of a company trading for profit, the publication must cause, or is likely to cause, serious financial loss;
2. restriction on the jurisdiction of the courts of England and Wales for claims against a person not domiciled in the UK or the European Union unless the court is satisfied that "of all the places in which the statement complained has been published, England and Wales is clearly the most appropriate place in which to bring an action"; and
3. limitation period for multiple publications, where the time limit for bringing a defamation action is limited to one year from the first publication of the defamatory statement, unless the manner of a subsequent publication is materially different from the manner of the first publication.

Since the enactment of the UK Defamation Act, there has been a reduction in the number of defamation cases commenced in England and Wales. Statistics published by the Ministry of Justice in June 2016 show a 40% decline in the number of defamation claims brought in Royal Courts of Justice, from 227 in 2014 to 135 in 2015.[1]

United States of America

In the United States, defamation law is addressed primarily by state legislation and the definition of what is and is not libel or slander differs between states. Crucially, the US is widely considered a much more defendant-friendly jurisdiction than England. The reason for this is two-fold:

1. the plaintiff carries the burden of proof to establish that the defendant published an unprivileged false statement of fact about the plaintiff, which caused material harm, and the defendant acted either negligently or with actual malice; and
2. the single publication rule, whereby only one claim can be made for the primary publication, meaning only a reduced number of legal systems can legitimately exercise jurisdiction over the claim.

Freedom of expression is considered so fundamental in the United States that, as well as having a legal landscape which already acted as a challenging jurisdiction for plaintiffs, it also enacted legislation which addresses the chilling effect of libel tourism. The Securing the Protection of our Enduring and Established Constitutional Heritage (SPEECH Act) was enacted on 10 August 2010, and aims to deter libel tourism and ensure First Amendment protection for potential defamation defendants in the United States. The SPEECH Act prohibits domestic courts from recognising or enforcing foreign judgments for defamation that are inconsistent with the First Amendment.

Australia

Australia is considered a plaintiff-friendly jurisdiction for defamation claims compared to other forums and has the potential to become an increasingly popular destination for the libel tourist in the digital age, particularly given the relatively recent legislative changes made to defamation law in the UK.

Defamation law in Australia is derived from English common law. However, over time, differences developed in the common law in relation to defamation across the various Australian jurisdictions. In response to these inconsistencies, all states and territories enacted substantially uniform national legislation in the form of the Defamation Act [1] (Uniform Defamation Acts) in 2005 and 2006.

The Uniform Defamation Acts retain much of the common law principles of defamation and also abolished the common law distinction between slander and libel. A further key change brought about by the Uniform Defamation Acts is the exclusion of corporations from having a cause of action for defamation, except for those corporations which are not for profit or have fewer than 10 persons and no related entities.

The key differences between defamation law in Australia and the UK, which may be influential in Australia becoming the jurisdiction of choice for the libel tourist, are:

1. the absence of a serious harm test, meaning that a plaintiff only has to prove the defamatory meaning within the publication was likely to cause a reasonable person to think less of the plaintiff;
2. the absence of protective freedom of speech rights, meaning unlike the US (and to a lesser extent the UK), a defendant cannot seek to rely on any constitutional or legislative rights to freedom of speech in defence of a defamation claim;
3. the Australian interpretation of the doctrine of forum non conveniens, meaning unlike the UK Courts which have adopted an approach of declining to exercise jurisdiction in the event there is a more appropriate forum, the High Court of Australia has invoked a test requiring Australian Courts to only decline to hear a matter on jurisdictional grounds where it is shown that it is a clearly inappropriate forum[2].

To date, there does not appear to be any significant call for reform to the Uniform Defamation Acts to adopt legislative changes similar to what has been enacted in England and Wales through the UK Defamation Act.

What does the future hold for the libel tourism in Australia?

Whilst Australia may be perceived as a more desirable destination for the libel tourist than the UK, there has not been a significantly noticeable spike in foreign nationals commencing litigation for defamation in Australia since the UK Defamation Act came into effect.

We can only speculate as to why not, but key reasons why libel tourists may not have yet flocked to Australian shores for relief in respect of defamatory publications may include:

1. the expense involved in litigating a claim for defamation, particularly for a foreign national who may be exposed to a requirement to provide security for costs in order to pursue his or her claim; and
2. even if an Australian judgment is obtained, the libel tourist may encounter a number of obstacles to be able to enforce the judgment outside of Australia.

Ultimately, time will tell if Australia experiences a surge in defamation litigation as a result of the legislative changes in the UK. However, for the libel tourist with sufficient appetite to bring defamation proceedings following a primary or secondary publication reaching a local audience, the Australian courts may become an attractive forum to pursue such a claim.

 

[1]  See Royal Courts of Justice tables for 2015, available from: https://www.gov.uk/government/statistics/civil-justice-statistics-quarterly-january-to-march-2016-and-the-royal-courts-of-justice-2015

[2] The uniform laws are known as the Defamation Act in each jurisdiction within Australia, save for the ACT which incorporates the uniform laws into its Civil Law (Wrongs) Act 2002

[3] See Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 and Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538