PERSUADING THE JUDGE TO CHANGE THEIR MIND AFTER JUDGMENT CAN BE AN EXPENSIVE STEP: COURT OF APPEAL DECISION
We have looked, many times, at issues relating to procedure after the handing down of a draft judgment. The Court of Appeal judgment in George v Cannell & Anor  EWCA Civ 1067 highlights one of the difficulties that arise. The judge sent out a draft judgment in favour of the claimant. The defendant successfully persuaded the judge to re-open the judgment on the basis of written submissions and the judgment was then in favour of the defendant. However the defendant was less successful on appeal. The original judgment of the judge was preferred and that judgment reinstated.
“The purposes of circulating a judgment in draft are to enable the parties to identify typographical and other obvious errors and to prepare an agreed order or submissions on consequential matters. The authorities make clear that this is not to be treated as an opportunity to advance further argument.”
The claimant brought an action for malicious falsehood. The trial judge handed down a judgment in the claimant’s favour. The defendant, by way of written submissions, persuaded the judge to re-open the matter. A second judgment was handed down in favour of the defendant. The claimant appealed, successfully, to the Court of Appeal. The appeal was allowed primarily on the issue of the substantive law. However the procedure adopted in re-opening the issue proved to be expensive for the defenadnt.
THE JUDGMENT ON THIS ISSUE
Lord Justice Warby set out the history of the matter.
The purposes of circulating a judgment in draft are to enable the parties to identify typographical and other obvious errors and to prepare an agreed order or submissions on consequential matters. The authorities make clear that this is not to be treated as an opportunity to advance further argument. The Judge was persuaded by the defendants, however, that this was one of those exceptional cases in which it was appropriate to do so. The upshot was that the parties exchanged further written submissions in which “for the first time, the Ds explained their position on the law on section 3(1) in some detail”. This was, in summary, that malicious falsehood is an economic tort; s 3(1) does not relieve a claimant of the need to prove on the balance of probabilities that she has suffered some economic loss; it does relieve her of the need to plead and prove special damage, “but the likelihood of some pecuniary damage is nonetheless central to the statutory provision.” Rejecting the claimant’s complaint of procedural impropriety and unfairness, the Judge proceeded to reconsider the issue on the basis of the further written submissions. Having done so, he prepared and handed down a judgment dismissing the claims.
Explaining this decision, the Judge said that “the preponderance of modern authority favours the [defendants’] position”. Malicious falsehood, he said, “is a tort that compensates only for pecuniary loss… Recovery turns on matters of fact as to pecuniary damage.” The claimant’s case on (1) nature and mechanism of loss and (2) causation failed because for both purposes it was necessary to undertake “an inquiry into the circumstances of the publication, including into historical facts”. On that basis, the pleaded case on the nature and mechanism of loss failed for essentially the same reasons as the special damage claim: the publications complained of did not dissuade Mr Butler or F&R from dealing with the claimant, because Balgores would not have dealt with her anyway, and F&R’s attitude to the claimant was unaffected by the Lingenfelder Email. The case on causation fell victim to the same line of reasoning. Proof of causation required proof that the pleaded loss was a “direct and natural result” of the publication complained of. That could not be established because “an examination of the facts as they were before, at and after publication” was “fatal to the claim based on s 3(1).” The Judge identified a third route to the same conclusion, namely that even if a claimant could prevail on proof that the words were “in the abstract” more likely than not to cause pecuniary loss, a defendant could not be prevented from establishing, as these defendants had done, that no such loss occurred in fact.
The Court of Appeal held that the initial judgment was the correct one and overturned the second decision.