MoJ considers £5,000 costs cap to protect defendants against SLAPPs

Raab: Just the opening salvo

The Ministry of Justice (MoJ) has suggested that people defending themselves from strategic lawsuits against public participation (SLAPPs) could be protected by a £5,000 costs cap.

The MoJ said a costs regime for SLAPPs would be introduced through secondary legislation alongside primary legislation enabling courts to apply a three-part test to decide whether cases should be struck out at an early stage.

Responding to the call for evidence it issued in March, the MoJ noted submissions that suggested SLAPPs were “no more than the rough and tumble of ordinary litigation and note too submissions based on the fact that everyone is entitled to representation in court as part of the right to a fair trial”.

But it concluded that the type of activity identified as SLAPPs, and the aim of preventing exposure of matters that were in the public interest, “go beyond the parameters of ordinary litigation and pose a threat to freedom of speech and the freedom of the press”.

“The government is very concerned about the effects of SLAPPs on freedom of speech and on public interest investigation and reporting. Such lawsuits have a chilling effect, both on the individual against whom they are brought and systematically.

“We are very clear on the wider harm to society if economic and other activities are not subject to reasonable scrutiny.

“SLAPPs can have the effect of not just deterring any reporting of certain individuals or organisations, but of pinning down scarce resources that inhibit other public interest stories being covered. That is to the detriment of us all.

“As a result, the government intends to pursue legislative reform at the earliest opportunity.”

The MoJ said robust costs protection mechanisms were needed “to ensure that costs are not ratcheted up in a way designed to overwhelm or intimidate an opponent”.

The costs regime would be developed as a procedural reform with the Civil Procedure Rule Committee, “using the same definition in the primary legislation that underpins the early dismissal process”.

The MoJ said the government was provisionally persuaded that “it might be sensible to invert” the cost caps set out in the environmental costs protection regime – £5,000 for individual claimants and £10,000 for organisations.

This would mean setting “the default defendant costs cap” for SLAPPs at £5,000.

“There is, however, a question as to whether a SLAPP claimant should have any protection in respect of their own adverse costs: one option is that this should be a matter for the judge in individual cases.”

The MoJ said the “precise levels, and design of any scheme” would be explored through work with the rule committee.

Under the early dismissal procedure, a court would first assess if a case was “against activity in the public interest”, which could include investigating financial misconduct by a company or individual.

“Then, it will examine if there’s evidence of abuse of process, such as whether the claimant has sent “a barrage of highly aggressive letters” on a trivial matter. “Finally, it will review whether the case has sufficient merit – specifically if it has a realistic prospect of success.”

The rationale for the three-part test was “to ensure that SLAPPs can be properly identified, and apply to any claim, including in libel, privacy, or data protection”.

Anyone subjected to a suspected SLAPP would be able to apply to the court to have it considered for early dismissal.

The MoJ noted that it was clear from the responses it received that there was already provision for unmeritorious claims to be struck out at an early stage.

“We were struck by the fact that, although available, the common law authorities for striking out abusive cases have failed to be consistently applied in SLAPPs.”

The government was not going to pursue any reform of defamation laws for the time being, but would keep the public interest defence in section 4 of the Defamation Act 2013 under review.

Likewise, there were no plans to reform the appropriate jurisdiction test, linked to complaints about ‘libel tourism’ or introduce a new right of ‘public participation’.

The MoJ received fewer responses on the issue of regulation and said there was little consensus on whether further action was needed. It did not propose anything.

In his forward to the response, Lord Chancellor Dominic Raab said the reforms were “just the opening salvo against SLAPPs”, saying the government would also explore financial penalties for those who bring SLAPPs.

“These changes will help to uphold our fundamental liberties of free speech and a free press, end the abuse of our courts, and defend to the hilt those who bravely speak out in the public interest,” he said.

Mark Fenhalls QC, chair of the Bar Council, said: “Action on SLAPPs is timely and welcome to curb the abuse of court proceedings by those with the power and wealth to use the justice system to intimidate others.

“Tackling the myriad complex challenges posed by SLAPPs will require sensitive law and policy making, as well as considering the international nature of these cases.”

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