Private International Law (Miscellaneous Provisions) Bill [H.L.] (Hansard, 2 May 1995)

§ Lord Wilberforce

My Lords, before the Bill leaves the House, I should like to offer some general observations. It is a tripartite Bill on three separate subjects. As regards Part I and Part II, reactions can only be favourable. They introduce some modest reforms which should have been made long ago. There is no difficulty about them.

On the other hand, Part III is in a quite different dimension. It deals with a complex subject in a complicated way. I—and I do not believe that I am alone in this—have serious misgivings about it. I spoke as to those misgivings on Second Reading. I do not propose to go over the arguments I then made. However, much has happened since Second Reading and it is only fair to the large number of people who have contributed to the discussion on the Bill and who have provided evidence to review the situation.

Just to recapitulate, what we are concerned with in Part III is the double actionability rule—that is to say, a judge-made rule of law which requires that, when you are suing in a UK court in respect of a civil wrong committed abroad, you have to show not only that the wrong was against the law of the place where the act took place but that it was contrary to UK law. That double actionability rule has been criticised by academics as illogical, chauvinistic, anomalous and capable of creating injustice. I underline "capable" because there is a singular lack of evidence that it has produced any injustice whatsoever.

My position has been, and is, that this subject—torts with a foreign element—is not one which calls for legislative intervention or codification. It is much better to leave it to the judges, who have by two recent decisions —one as recently as July 1994—given themselves sufficient liberty of action to deal with the variety of cases.

As your Lordships know, the Bill was committed to a special Public Bill Committee. In passing, let me say that that procedure has shown itself very successful in saving the time of the House and in permitting extensive discussion. I might have a small reservation about the method of calling and dealing with evidence, but this is not the place to discuss that. Basically the procedure has shown itself to be very useful.

I should like, if I may, to pay tribute both to the Law Commission, including its past members who put in a great deal of work on this Bill in Committee, and, respectfully, to the noble and learned Lord on the Woolsack for the trouble that he personally has taken over the Bill in Committee and for the open-minded attitude that he took to individual questions. I was a member of the Committee and, though critical of the whole of the Bill in Part III, thought it right to contribute as best I could to the effort to improve it.

The Committee decided, as it could do, to receive evidence, and over 50 representations were made. The Committee heard also oral evidence—almost entirely from those supporting the Bill. It is printed in the very valuable report. I shall not go into the evidence in detail. I believe that it is fair to say—it does not overstate the case from my point of view—that the Scottish evidence was 1361 almost uniformly in favour of the Bill. I shall return to that point. The English evidence—academic, judicial and other —was pretty evenly balanced, with strong and well argued contributions each way.

The Government basically have two arguments. First, legislation is necessary for Scotland, and therefore we ought to bring it in for the rest of the United Kingdom. Secondly, this is a Law Commission Bill and there is a strong presumption in favour of such legislation.

Briefly, the reply is as follows. Scotland, it is true, is tied by a seven-judge decision which prevents their courts and their judges, from taking the flexible attitude open to English judges. My answer to that argument is that if—and only if—Scotland desires legislation, desires the position to be changed, that could be done much more simply than by this elaborate Bill. It could be done, for example, by enacting a clause similar to the ruling in Dicey's Conflict of Laws, Rule 203. In any case, the local difficulty in Scotland is not a good reason for imposing a statute over the Border where no such difficulty arises. There is here an argument, no doubt, for the Bill, but surely not a strong one.

Then, as to the Law Commission: I hope that by now the House realises that the Law Commission has no stronger supporter in this House than myself. I have advocated its cause in general and in relation to particular Bills many, many times. I agree in general that Law Commission Bills ought to go through easily; but this is rather a different case. In the form in which your Lordships are dealing with it, this is hardly a Law Commission Bill. It has been radically redrafted and radically changed. Leaving aside purely drafting points which are quite important, the Government have rejected the whole of the Law Commission's Clause 3—that is about one-quarter of the Bill—which contains at least two important provisions. One deals with torts committed in the United Kingdom, but with effects abroad, and the other deals with defamation.

I do not wish to take up too much of your Lordships' time, but I must say something about defamation. It is a very important and sensitive subject, in the light of modern information technology. Broadcasts from the United Kingdom may reach any part of the world. Newspapers are widely distributed and may be printed abroad, as is the Financial Times. The question arises: are they to be exposed in United Kingdom courts to actions based on foreign libel laws which may be very different from our own?

The subject is a very actual one, as your Lordships may appreciate. I give two examples. A noble Lord, who sits on these Benches and was at one time closely connected with a broadsheet newspaper, wrote an interesting article a few weeks ago about the heads of governments of various European countries. The theme which he advocated was this: "We may not be too happy about our own Prime Minister, but goodness! just look at the others". In a wide-ranging way, he went right over the countries of Europe, making pungent comments about this, that or the other heads of government: one is inefficient; one is corrupt; one is immoral, and so on. It was a well written and entertaining piece, if I may respectfully say so.

1362 That is all right as regards English law—fair comment, a matter of public interest and no question of malice. But if one brings in foreign law in respect of a foreign publication, one might be in a different position. There, it may be suable in the courts to attack the head of a government, an organ of government, to make disparaging remarks about the reputation of public figures. If that were to be the case, if foreign law were to be applied by the English court, the author might find himself in great difficulty.

A second example is that Mr. Bernard Levin wrote an article only last week which started off by saying: "Everybody knows or ought to know that all Cabinet Ministers"—in a certain country which perhaps I had better not name—"are crooked". Again, in this country there would be no problem, everyone is used to Mr. Bernard Levin's exuberant language. There would be no difficulty and it would hardly be worth bringing the matter to court. But think if that were published in the country concerned: it would be injurious to an organ of government; very injurious to the head of government; an attack on reputation. If one were to apply the law of that country in respect of a publication in that country, there would be serious trouble.

So something must be done. The Law Commission gave very careful consideration to the problem. It considered a number of options and finally proposed that defamation actions in the United Kingdom courts should be based on United Kingdom law, wherever there had been publication in the United Kingdom prior to or simultaneous with the foreign publication. I am sorry that the proposal is slightly complicated, but that is how it was phrased. It would have dealt adequately with both the examples I gave.

However, the interesting point is that the Government rejected the suggestion, They would not have it in their Bill. Nothing in the Government's original Bill said anything about defamation at all, so that the general rules in the Bill allowing actions based on foreign law would have applied. Both of the cases would have been suable in the English courts.

For some time there was silence because the subject of private international law (miscellaneous provisions) is not one which grips the media's attention. Then I suppose someone alerted a prominent newspaper and in one day there were three pieces in The Times. On that, the Government decided appropriately to invite evidence. So the committee heard evidence from the legal manager of The Times newspaper and from a lady representing the Guild of British Newspaper Editors. Having heard the evidence, the Government ran up the white flag. They put in a clause taking defamation actions right out of the Bill. Noble Lords will find that in Clause 13, to which the noble Lord, Lord Mishcon, has just adverted.

I do not quarrel with the solution, it is probably as good as that of the Law Commission. But it rather raises a question of principle. There is the double actionability rule, the illogical, nationalistic, potentially unjust rule which, under the Bill, is to continue to apply to defamation, widely defined as it is in Clause 13. Surely, that destroys whatever logical or academic appeal the Bill 1363 may have. It disentitles the Government to shelter behind Law Commission infallibility. If double actionability is good enough for defamation, why not for other torts?

Of course, the noble and learned Lord the Lord Chancellor may say, as he did in Committee, that defamation is unique, quite different from other torts; it is so widespread, it goes all over the world; one cannot give it a location and it is concerned with freedom of speech and fundamental rights. But the same argument may apply to other matters. There are a number of other torts with implications that are difficult to locate. Think of pollution; acid rain; a situation like Chernobyl. They are just as widespread; they may come anywhere. Think of investment negligence: it may affect investors all over the world, whoever happened to hear the broadcast or happened to read the newspaper.

I am sorry to see that the noble Lord, Lord Lester, is not in his place. As he pointed out in his evidence, many other torts are concerned with civil rights and liberties other than defamation. Thus if defamation is unique—as it may be—one suspects that it is in the strength of the interests behind it rather than anything else.

So this is the bottom line, the 64,000 deutschmark question: is it a good Bill? It is supposed to provide certainty as contrasted with judicial muddle. I invite your Lordships to look at Clause 12 which is riddled with words and clauses requiring interpretation and inviting legalistic arguments. The Bill lacks logical coherence. It deals anomalously with defamation, it does not deal at all with United Kingdom torts. It does not deal at all with torts unknown to United Kingdom law, as to which both the noble Lord, Lord Lester, and the firm of solicitors, Norton Rose, made powerful comments, leaving the situation to be disposed of by the doubtful provisions in the Bill as to characterisation and public policy. In three words, the Bill is complex, uncertain and incomplete. Could not the judges do as well as that?

Lest noble Lords think that this is a matter of personal eccentricity or some idée fixe, perhaps I may quote some opinions on the Bill. First, there is the evidence on page 53 of the Red Book, of Mr. W. E. Peel of Oxford University. It is rather complicated, but it is very well put: The change is from a general rule of double actionability supplemented by a flexible exception of uncertain scope and application"— that is the judicial position as it is now— to a general rule of lex loci delicti" (the law of the place where the tort takes place) supplemented by an exception of equally uncertain scope and application… there seems little merit in exchanging one uncertain rule for another… particularly one restricted by a statute".

My second quotation is from Mr. P. B. Carter of Oxford, writing in the March 1995 issue of the Cambridge Law Journal. He writes to the same effect about exchanging one uncertainty for another, and continues, any statutory interference, let alone interference of the root-and-branch type proposed in Part III, could scarcely be less appropriate".

Finally, Mr. Briggs, also of Oxford, writing in January 1995 in the Law Quarterly Review, which as noble Lords will know is our leading legal publication, states: Many would agree that undertaking reform by making a cautious addition to the common law"— 1364 that would be by the judges— is greatly to be preferred to erecting the monstrous carbuncle of the Law Commission's draft Bill". My own final comment might be more parliamentary in language, even though the word "carbuncle" carries the Royal Warrant. However, I see Part III of the Bill passed with some sadness, tempered only by the hope that another place may put its wisdom to work upon it.

§ The Lord Chancellor

My Lords, we have had the benefit, as my noble and learned friend Lord Wilberforce said, of very detailed discussion of these matters in Committee. I am grateful for what my noble and learned friend said about my part. I thank him and all the members of the Committee, some of whom are able to be here today and a number of whom are not, for the time and effort that they put into this difficult matter.

As my noble and learned friend said, Parts I and II of the Bill, which are based on Law Commission reports, have been comparatively uncontroversial. The whole Bill has been uncontroversial in any kind of party political terms, but has been quite controversial so far as Part III is concerned between lawyers. My noble and learned friend made wise selections from the evidence of those who are opposed to the Bill. I could inform noble Lords with some examples selected by myself in support of the other side of the case, which, as my noble and learned friend accepted, was very balanced as between the legal and judicial communities, including the academic community, on these matters.

Considerable expertise has been devoted to trying to get a workable system. The present law, as I believe my noble and learned friend accepted, contains very flexible exceptions to the general rule, the precise import of which no one can readily tell.

The Bill substitutes for that a method of approach to the problem which in my submission is logical, although of course it contains words that are capable of interpretation and application to individual circumstances. Part III of the Bill contains a logical approach to the problems and provides a way forward for development which is in accordance with the policy of the Law Commission to make this general area of the law subject to statutory enactment.

So far as defamation is concerned, I took the view, which was shared by the majority of the Committee, that the correct answer to the defamation problem was the one which now appears in the Bill. I agree that it is an exception to the underlying logic of the Bill. On the other hand, I believe that it is an exception that is justified by the particular circumstances of defamation. The illustrations that my noble and learned friend gave of two distinguished contributors to the newspapers of this country might have been affected if it had been left in the way that the Law Commission had left it, and certainly if the Bill had not contained an exception in respect of defamation. As is implicit in my noble and learned friend's analysis of the situation, the present Bill gives a very considerable width of judicial application to the 1365 judges as to the way in which they take the logical structure forward. As noble Lords would expect, there is protection for the public policy of our law.

This is certainly a difficult issue. I am grateful to all noble Lords who contributed to it in Committee and on Report —and not least to the noble Lord, Lord Mishcon—for their contributions. I regret that my noble and learned friend remains sad so far as Part III is concerned. I have great respect for his sadness, as well as for the very considerable contribution that he made to the detailed consideration of the Bill in Committee. Here, as in few other places, no one is more authoritative in this area of the law in the light of a long judicial experience than is my noble and learned friend. Since he has played so distinguished a part in developing the law as a judicial creation, it is perhaps not entirely surprising that it is with an element of sadness that he sees that going from the exclusive control of the judges to a statutory framework under which, if the Bill passes in its present form, the judges will in future be called upon to operate.

1366 I hope that noble Lords will pass this Bill, and that it will receive favourable consideration when it arrives in the other place. I am grateful to the Opposition parties for the co-operation that they have shown in the procedures by which this Bill has been considered, enabling us to take it forward in a way which, without that co-operation, we might have found a good deal more difficult.