Out-Law Guide | 17 Jul 2015 | 1:02 pm | 2 min. read
Although both malicious falsehood and defamation claims deal with publication of false statements the main difference between them is that a claimant in a malicious falsehood claim is not required to prove damage to reputation. Another advantage is that the single meaning rule does not apply to malicious falsehood claims, so there may be tactical reasons for bringing a claim in malicious falsehood rather than defamation, although damages tend to be lower.
A claim for malicious falsehood may be brought against a defendant who maliciously publishes a false statement which identifies the claimant, his business, property or other economic interests, and can be shown to have caused the claimant financial loss or to fall within one of the exceptions in section 3(1) of the Defamation Act 1952.
A typical situation in which a claim for malicious falsehood arises is where one competitor has made an untrue statement about another’s goods or services, which is calculated to cause it financial loss. Slander of goods or title are types of malicious falsehood.
The defendant must have intended to publish the statements complained of, and have done so with an improper motive. Evidence of malice might include proof:
● that the defendant knew that the relevant statements were false;
● that the defendant was reckless as to the truth or falsity of the statements when publishing them, or
● that, even though the defendant believed the statements to be true, their dominant motive in publishing the statements was to injure the claimant’s interests.
It is up to the claimant to prove that the statements complained of were untrue, unlike in defamation claims, where falsity is presumed and the burden falls on the defendant to prove that the statements are true. Furthermore, the statements complained of, even if false, must be more than “mere puff” between trade rivals, such as that often seen in comparative advertising. There is no defence equivalent to the honest opinion defence available in defamation. This means that the defendant cannot contend that the inference is one that an honest person could have believed to be true.
The claimant, or the claimant’s business, property or other economic interests, must be identified, whether by way of a direct or an indirect reference.
The claimant must demonstrate that the statement has caused actual financial loss unless it falls within one of the exemptions in the 1952 Defamation Act (DA 1952):
● if the words upon which the action is founded are calculated to cause pecuniary damage to the claimant and are published in writing or other permanent form, or
● if the said words are calculated to cause pecuniary damage to the claimant in respect of any office, profession, calling, trade or business held or carried on by him at the time of publication.
The use of the word “calculated” in the DA 1952 is to be read as meaning ‘more likely than not’. In relying on this a claimant must identify the nature of the likely loss and the mechanism by which such loss would be incurred.
Damages are available to claimants who can demonstrate that the statements complained of caused them actual financial loss or, if the statements fall within the exemptions above, likely financial loss. Both interim and final injunctions may also be available.