HONG KONG POLYTECHNIC UNIVERSITY v. NEXT MAGAZINE PUBLISHING LTD AND ANOTHER

IN THE COURT OF APPEAL

1997, No. 28
(Civil)

- Headnote -

Damages for libel - Suit by University against publisher of a magazine - Whether the common law precluded the University as a body from pursuing its claim.

Held (Court of Appeal): University has reputation which the common law would protect. The judgment of the House of Lords in Derbyshire County Council v. Times Newspapers [1993] AC 534 which related to a local authority did not preclude the University from pursuing its claim.

Observation by Court of Appeal: The argument that Article 16(3) of the Hong Kong Bill of Rights operates to rob the University of the right it would otherwise have to defend its reputation by invoking the law of defamation is wholly misconceived.

IN THE COURT OF APPEAL

1997, No. 28
(Civil)

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J U D G M E N T

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Litton, V.-P.:

1. This is an interlocutory appeal. It arises from a writ issued by three plaintiffs against the publisher of Next Magazine and its editor-in-chief in respect of an article published on 2 September 1994 entitled "Bluffing Lecturers: False Curriculum Vitae". The three plaintiffs are respectively (1) The Hong Kong Polytechnic University, a body corporate with perpetual succession and capable of suing and being sued in its name: see s3(1) The Hong Kong Polytechnic University Ordinance, Cap 1075; (2) the University's President and (3) a lecturer in law in the Department of Business Studies employed by the University.

2. On the face of the statement of claim the article in the 2 September 1994 issue of Next Magazine seriously defamed all three plaintiffs: For example it was alleged that the Head of the Department of Business Studies had put forward false qualifications, but the University deliberately turned a blind eye to the fraud.

3. On 19 October 1995 the defendants took out a summons purportedly under Order 15 r6(2) of the Rules of the Supreme Court for an order that "the 1st plaintiff should cease to be a party" and that its name should be struck out on the grounds that the proceedings for defamation by the University (i) contravened Article 16 of the Bill of Rights and (ii) that the proceedings were contrary to common law.

4. The summons went before Master Cannon on 2 April 1996. The Master dismissed the defendants' application. When the matter went on appeal before Keith J on 13 May 1996 under Order 58 of the Rules of the Supreme Court he took a course which had unfortunate results. Instead of dealing with the summons as a whole, he gave what can only be described as a preliminary ruling on the question whether the University was a "public authority" within the meaning of that expression in s7(1)(a) of the Hong Kong Bill of Rights Ordinance, Cap 383 and answered that question affirmatively. He gave judgment to that effect on 7 June 1996. But since that did not dispose of the matter before him, it went back to him again on 28 and 29 November 1996 when further submissions from counsel were entertained. He gave judgment in favour of the defendants and, treating by consent the summons before him as an application to strike out the University's claim under Order 18 r19, he allowed the appeal and struck out the University's claim.

5. Hence the appeal to this Court.

The true issue before the judge

6. There was, in truth, only one issue before the judge: Was the University's claim for damages for defamation one which could be entertained in law?

7. On the face of it any suggestion to the contrary may seem surprising: If there ever was a body corporate which relied for its success on its reputation it would be the University in this case. The judge himself acknowledged as much, for, at p6 of his second judgment, he said:

"I do not overlook the fact that as an institution of tertiary education it has a reputation as an academic institution which it has a legitimate reason to seek to protect. Its viability depends on its ability to attract good administrators, researchers and teaching staff as well as a sufficient number of students. I accept also that it is not in the public interest that unjustified attacks be permitted to undermine its ability to perform its statutory functions."

8. But, despite this finding, the judge concluded that the University was precluded by law from maintaining its suit against the defendants for damage to its reputation, and ordered that its claim be struck out.

The Derbyshire County Council Case

9. In reaching this conclusion the judge relied on Derbyshire County Council v. Times Newspapers Ltd. [1993] AC 534 where a local authority brought an action for damages for libel in respect of newspaper articles which had questioned the propriety of investments made for its superannuation fund. It was held that the action could not be maintained.

10. The House of Lords at the same time re-affirmed the principle that "a trading corporation is entitled to sue in respect of defamatory matters which can be seen as having a tendency to damage it in the way of its business" (see p547B, per Lord Keith of Kinkel).

11. This principle is, of course, not confined to trading corporations: non-trading corporations, though not engaged in business for profit, may have reputations which the law protects: for example trade unions and charitable organisations referred to at p547D to E in Derbyshire County Council. As regards charitable organisations Lord Keith said that the defamatory statements may impair their ability to carry on their charitable objects: Hence their capacity to sue for defamation.

12. What then distinguishes a local authority from the other bodies whose reputations are protected by the common law? Lord Keith said this at 547F:

"There are, however, features of a local authority which may be regarded as distinguishing it from other types of corporation, whether trading or non trading. The most important of these features is that it is a governmental body. Further, it is a democratically elected body, the electoral process nowadays being conducted almost exclusively on party political lines. It is of the highest public importance that a democratically elected governmental body, or indeed any governmental body, should be open to uninhibited public criticism. The threat of a civil action for defamation must inevitably have an inhibiting effect on freedom of speech."

13. Lord Keith elaborated upon these considerations later on in his judgment by saying at (p550C-D):

"In the case of a local authority temporarily under the control of one political party or another it is difficult to say that the local authority as such has any reputation of its own. Reputation in the eyes of the public is more likely to attach itself to the controlling political party, and with a change in that party the reputation itself will change. A publication attacking the activities of the authority will necessarily be an attack on the body of councillors which represents the controlling party, or on the executives who carry on the day to day management of its affairs. If the individual reputation of any of these is wrongly impaired by the publication any of these can himself bring proceedings for defamation. Further, it is open to the controlling body to defend itself by public utterances and in debate in the council chamber."

14. These are the factors which caused the House of Lords in Derbyshire County Council to hold that in the case of a local authority, it was contrary to the public interest to allow the body to sue for libel.

Application of the Derbyshire Country Council principle to this case

15. In my judgment, the considerations which govern a body like a University are far removed from those in the Derbyshire County Council case. In no way does the University take part in the government of Hong Kong. It is not an organ of government, democratically elected or otherwise. If public interest be the test, I would hold that it strongly favours the protection of the reputation of institutions of learning like the University.

The judge's rationale

16. I regret to say that I have difficulty in following the judge's reasoning. He says at p5 of his judgment:

"the essential feature of the University is that it operates in the public sphere."

17. I do not know what the expression "operating in the public sphere" means.

18. As Mr Huggins submits, there are 78 bodies in the Schedule to the Prevention of Bribery Ordinance, Cap 201 which are deemed "public bodies" for the purposes of that Ordinance. To take the very first in the Schedule: Cable & Wireless (HK) Ltd.: No-one would suggest that it cannot maintain a suit for libel. Yet, under the Ordinance, it is as much a "public body" as the Regional Council which, on the defendants' argument, would be precluded by Derbyshire County Council from suing for libel. So the proposition that a body "operates in the public sphere" could hardly be the right test for determining whether it is precluded by law from suing for defamation.

19. It is unnecessary, in this judgment, to go beyond the facts of this case, as found by the judge. On those facts, the University has an undoubted reputation which the common law would protect. The rationale in Derbyshire County Council cannot apply to preclude the University from maintaining its suit for damages.

The Bill of Rights

20. It was unfortunate, in my view, that the judge was distracted from the main focus of the case by elaborate arguments based upon the Bill of Rights.

21. Article 16, upon which reliance is placed, does not give the defendants an unfettered right to defame and injure "public authorities" - assuming that the University comes within that expression in s7 of the Ordinance, which seems to me somewhat doubtful.

22. Article 16(3) says:

"(3) The exercise of the rights provided for in paragraph (2) of this article carries with it special duties and responsibilities. It may therefore be subject to certain restrictions, but these shall only be such as are provided by law and are necessary -

(a) for respect of the rights or reputations of others; or

(b) for the protection of national security or of public order (ordre public), or of public health or morals."

23. What are the restrictions "provided by law"? The answer must be, the restrictions provided by the common law: in particular the ability of bodies defamed to sue for libel. And this brings the argument immediately back to the alleged disability to sue as exemplified by the Derbyshire County Council case.

Conclusion

24. In my judgment, the judge erred in striking out the University's claim. I would discharge the judge's order and restore the Master's order of 2 April 1996.

Godfrey, J.A. :

25. I agree; but out of respect for the judge below from whom we are differing, I append a short judgment of my own.

26. The common law precludes a local authority (e.g., in Hong Kong terms, the Regional Council or the Urban Council) from maintaining an action for defamation, because such an authority does not have, as such, the sort of reputation which the law of defamation protects : see Derbyshire County Council v. Times Newspapers Ltd. [1993] AC 534. No doubt the rule would apply equally to any government body properly so-called (e.g., in Hong Kong terms, the Legislative Council; or the Government Transport Land Agency; or even what is called here "the Judiciary").

27. We are asked to extend the application of this salutary rule to "public authorities", being, as I understand the argument, all authorities which (1) act for the public benefit and not for private profit; (2) are wholly or partly publicly funded; and (3) are subject to a degree of government supervision. The appellant, it is said, is such a "public authority".

28. For my part, I am prepared for present purposes to assume, without deciding, that the appellant is a "public authority" meeting the criteria I have listed. But I am not prepared to extend the rule which precludes some public authorities (such as national or local government bodies) from maintaining an action for defamation, to all "public authorities". And, for the purpose of disposing of this appeal, it is sufficient to state that in particular I am not prepared to extend the rule to a "public authority" such as the appellant here. The appellant plainly does have a reputation of the sort which the law of defamation may properly be invoked to protect. As it seems to me, it bears no resemblance at all to the sort of "public authority" with which the Derbyshire case was concerned.

29. It has been argued that, whatever the position at common law, the Hong Kong Bill of Rights Ordinance, Cap. 383, operates so as to rob the appellant of the right it would otherwise have to defend its reputation by invoking the law of defamation. This argument is wholly misconceived. Article 16 of the Hong Kong Bill of Rights would clearly operate to strike down any rule of common law (or any legislation) which purported to protect the "reputation" of the Regional or Urban Councils (or, for that matter, of the Legislative Council, or any other government body); but there is no such common law rule, and there is no such legislation. As the Derbyshire case shows, the common law rule is precisely the opposite.

30. It appears also to be said that if it be assumed (as I am prepared to assume) that the appellant here is a "public authority" for the purposes of section 7(1) of the Hong Kong Bill of Rights Ordinance (which provides that the Bill of Rights is to bind only the government and all "public authorities") then it must follow that the appellant is the sort of body which, under the common law rule, is denied the protection of the law of defamation. This non sequitur is equally misconceived. Article 16 of the Bill of Rights contains a valuable and important re-statement of the right of freedom of expression, recognised for centuries by the common law; but at the same time it recognises the validity of the restrictions placed on that right by the law of defamation, so far as those restrictions are necessary to protect the reputations of others. In the case of a government body such restrictions would, I agree, not be necessary; but the common law does not assert otherwise. In the case of the appellant, however, it has, in my judgment, the same right to maintain an action for the protection of its reputation as has any other person or corporation properly claiming to have a reputation to protect.

31. I too would allow this appeal.

Ching, J.A. :

32. I agree that this appeal must be allowed and that the Appellant should be reinstated as a Plaintiff in the action. I agree with the reasons given by the learned Vice-President and Godfrey, J.A.

33. I would only add that I am firmly of the view that the Bill of Rights Ordinance, Cap. 383, is wholly irrelevant to any issue in this appeal. By section 7(1)(a) the Ordinance binds only "The Government and all public authorities." The Appellant is not the Government. Assuming, without deciding, that it is a "public authority" under section 7(1)(a), article 16 then provides that there should be freedom of expression but that that freedom carries with it special duties and responsibilities. It goes on to provide that there may therefore be restrictions on that freedom but they are only to be such as are provided by law and as are necessary for the respect of the rights or reputations of others. There is nothing in the Ordinance which directly prohibits an institution such as the Appellant from bringing proceedings for defamation. Then one looks to see whether there are any laws, such as the common law, which restrict the rights to sue for defamation. The only authority cited to us is the Derbyshire case wherein it was held that a local authority cannot bring such an action. The Appellant is not a local authority. The question then is whether the restrictions imposed upon a local authority in this respect should be extended to apply to an institution such as the Appellant. If they should be, then it would have no right under common law to sue for defamation anyway and reference to the Bill of Rights Ordinance is therefore otiose.