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Damages

“[A]ctions of defamation … involve a money award which may put the plaintiff in a purely financial sense in a much stronger position than he was before the wrong.  Not merely can he recover the estimated sum of his part and future losses, but, in case the libel, driven underground, emerges from its lurking place at some future date, he must be able to point to a sum awarded by a jury sufficient to convince a bystander of the baselessness of the charge.”
— Lord Hailsham of St Marylebone LC in Cassell & Co Ltd v Broome [1972] 1 All ER 801 (HL) at 824.

The essentials

What types of damages are available?
A successful plaintiff may be awarded damages under several heads:

  • General damages (which includes aggravated damages)
  • Punitive damages
  • Special damages

What are general damages?
This is main head of damages available.  As with, say, breach of contract or the committing of other torts, the underlying purpose of an award of general damages in defamation is to compensate the plaintiff for the harm that has been caused; to put the plaintiff into the same position—as best money can do—as if the defamation had not occurred.

But of course, reputation is intangible, so the usual rationale for damages does not quite fit.  So it is said that, properly speaking, a plaintiff does not get compensatory damages for their damaged reputation, but rather because their reputation was damaged.  In this way, general damages operate as:

  • vindication of the plaintiff to the public,
  • and as a consolation for the wrong that has been done.

An award of general damage is therefore a ‘solatium’, as opposed to a a strictly measurable monetary compensation.

It is notoriously difficult to accurately predict awards of damages in defamation cases.  However, some factors which normally influence the level of damages awarded include:

  • Gravity of the allegations – allegations of rape will normally give rise to higher damages than those of shoplifting.
  • Impact of the allegations on the plaintiff’s reputation – the more closely it touches the plaintiff’s personal integrity, professional reputation, honour, courage, loyalty and the core attributes of his or her personality, the more serious it is likely to be.
  • Width/nature of audience – how many people read or heard the statement, and were those people of special importance to the plaintiff’s reputation.
  • Conduct of the defendant – aggravated damages, discussed below.

What are aggravated damages?
This is one of the juiciest parts of defamation law.  They are not a separate head of damages, but rather serve to increase the level of general damages that may be awarded.

Points of aggravation normally arise from conduct by the defendant, or conduct committed by their lawyers on their behalf, which ‘aggravate’ the harm occasioned to the plaintiff’s reputation or feelings.  This might include such things as:

  • repetitions of the original defamation,
  • failed pleas of truth (which effectively repeat the defamation through the Court process),
  • wounding or searching cross-examinations of the plaintiff (and sometimes, of the plaintiff’s witnesses),
  • and more generally things which the jury (or trial judge) might regard as improper conduct by the defendant during the course of litigation, such things as unduly threatening solicitors’ letters, various tactics employed by defendants such as having private investigators dig into the plaintiff’s past, failures to answer interrogatories, or failures to comply with discovery obligations.

A slightly nuanced issue is whether certain misconduct by a defendant should only sound in costs, rather than in support of damages.  But in view that damages are at large in defamation proceedings, it can sometimes turn into a ‘free for all’.

(Points of aggravation naturally have their limits, but one running joke we have with a prominent media lawyer is that literally anything he does might sound in aggravated damages against his client, whether that’s a failure to say “Good morning” to the plaintiff, or presenting in Court with a shirt slightly untucked.  Needless to say, the lawyer takes it all in good humour.)

What are punitive damages?
These are basically aggravated damages on heat.  In some parts of the law, they are called ‘exemplary damages‘  They’re exactly the same thing; their purpose is to ‘punish’ or ‘make an example out of’ the defendant.  The Defamation Act provides that punitive damages are available if the plaintiff can prove that the defendant “acted in flagrant disregard of the rights of the plaintiff”.  What’s more, where a case is heard by a jury, punitive damages are a matter within the jury’s province, which is slightly unusual because normally issues of punishment and deterrence are matters for a judge.

Punitive damages are a major aspect of North American litigation.  In the United States, the compensatory (or general) damages sought are usually quite modest, with juries being encouraged to “send a message” with an eye-watering award of punitive damages – sometimes even hundreds of millions of dollars are awarded.  In Canada, in 1995 the Supreme Court upheld an award of $800,000 in punitive damages.

Sadly for plaintiffs, New Zealand courts are much more conservative.  Even in the worst cases of misconduct by a defendant, $50,000 would probably be at the upper end of what a Court is likely to award – and normally will only award much lower than that, if anything at all.  In particular, the Court will weight the necessity of an award of punitive damages against the amount of general damages already awarded.  If the general damages are already high, then the Court will probably consider that the ‘punishing’ or ‘deterrence’ object is already met.

What are special damages?
These are damages which can be precisely be attributed to a defamatory publication.  For example, a corporate plaintiff can only receive damages in respect of ‘pecuniary loss’ it has suffered stemming from the defamatory publication.  Damages of this sort will normally require expert accounting evidence to demonstrate loss of profits, etc.  An individual plaintiff might sometimes claim special damages if they lose their job as a result of the defamatory publication.  Special damages might include lost earnings and that sort of thing, although such claims are difficult, and thus brought only rarely.

Can an award of damages be mitigated?
Yes.  A defendant can raise lots of matters that might support an argument for mitigation of damages.  The best mitigating feature is usually a prompt and unreserved apology published shortly after the defamation is published.

Another key point is if the defendant can prove that, prior to the publication of the defamation, the plaintiff already had a bad reputation in the aspect of their life with which the publication dealt.  So, if Louis was to sue Sally for saying he had defrauded her, even if Sally could not establish a defence, if she could show that Louis had been convicted 10 years earlier for fraud, then this would support her argument that Louis should not receive the same level of damages as though he was of unblemished character.

And further, if a plaintiff sues several defendants and obtains financial settlements with some of them, the remaining defendants can point to this compensation in mitigation of their own exposure, on the basis that the plaintiff has already received some damages in compensation for the harm occasioned.

What levels of damages been awarded by New Zealand courts?
This table lists all damages awarded in the High Court since 2000.

 

YearAmountCaseJudge or JuryNature of allegationsWidth of publicationComments
2021$100,000Solomon v PraterJudgeFinancial impropriety
Electoral impropriety
Lack of ethics
Local community
2021$325,000Craig v SlaterJudgeSexual impropriety
Dishonesty
Vindictiveness
Popular blog
repeated through mainstream media
Damages for sexual allegations mitigated on account of finding of sexual harassment against one individual
2019$10,000Wiremu v AshbyJudgeCheating
Dishonesty
Social media
2018$150,000Lee v Lee JudgeDishonesty
Hypocrisy
Newspaper
(print and online)
2018$84,000Ross v HunterJudgeDishonesty
Laziness
Incompetency
Defendant's website$50000 awarded to the first plaintiff
$34,000 to the second plaintiff
2017$100,000LVVTA v BrettJudgeIncompetency
Criminal conduct
Dishonesty
Defendant's website
Social media
2017$100,000Newton v DunnJudgeBullyingLetterAward contingent on defendant not complying with apology and correction recommended by the Court
2016$100Memelink v GrindlayJudgeDishonestySocial media
2016$100,000Kim v ChoJudgeCriminal conductNewspaper
(print and online)
2014$535,000Karam v ParkerJudgeDishonesty
Lack of ethics
Criminal conduct
Defendant's website
Social media
Apportioned $350,500 against the first defendant and
$184,500 to the second defendant
2013$270,000S v LJurySexual misconductBook
2010$104,000Jones v LeeJuryDishonestyNewspaper
2010$140,000Hallett v WilliamsJudgeCriminal conductBook
2010$250,000Lee v New Korea HeraldJudgeCriminal conduct
Dishonesty
Lack of ethics
Newspaper
2008$900,000Korda Mentha v SiemerJudgeCriminal conduct
Dishonesty
Defendant's website$75000 awarded to the first plaintiff
$825,000 to the second plaintiff
2008$85,000Ahn v LeeJudgeCriminal conductNewspaper
print and online)
2008$57,500Wells v HadenJudgeCriminal conduct
Dishonesty
Defendant's website
Emails
2006$40,000Court v AitkenJudgePaedophiliaLoud conversation
2004$780,000Idour v INL PublicationsJuryUnprofessional criticismNewspaperDamages awarded to three plaintiffs in equal portion
2004$150,000Chinese Herald v New Times MediaJudgeAnti-Democracy
Dishonesty
Lack of ethics
Newspaper$125,000 awarded to second plaintiff
$25,000 to third plaintiff
2002$25,000Heptinstall v FranckenJudgeUnreliable
Mental instability
Infidelity
Malicious gossip
Letter
2001$50,000Jennings v BuchananJudgeDishonestyNewspaper
2001$42,000O’Brien v BrownJudgeCriminal conduct
Lack of ethics
Incompetency
Website posting
Emails
2001$163,500Reeves v MaceJudgeCriminal conduct
Dishonesty
Lack of ethics
Letter$95,000 to the first plaintiff
$65,000 to the second plaintiff
$3,500 to the third plaintiff
2000$675,000Columbus v Independent NewsJuryUnprofessionalism
Lack of ethics
Newspaper$500,000 in compensatory, aggravated and punitive damages
$175,000 in special damages

Masterclass

Legal practice tips
For publishers:

  • Media often bemoan cases where a plaintiff has received a high award of damages as “chilling free speech”.  Perhaps a better view is that these cases serve to chill defamatory speech.  Indeed, if the media—or anyone for that matter—elects to publish a horribly defamatory statement and cannot establish a defence, then is a high award of damages not the appropriate outcome?
  • Ironically, those who bemoan damages—and defamation law more generally—are often the same people who seek a high award of damages themselves when they perceive a slur on their character.  Glass houses, indeed.

For plaintiffs:

  • A defamation case is not a lotto ticket.  Because of New Zealand’s costs regime, which generally awards a successful plaintiff only scale costs—which we discuss under Costs—it is rare for a successful plaintiff to not end up out of pocket following a defamation proceeding.  Unsuccessful defendants have been known to flee abroad or file for bankruptcy following a loss in Court.  And even where a damages award puts the plaintiff in front financially, the damages cannot account for the intense stress, and loss of time from doing other productive things, incurred during the course of the litigation.

For defendants:

  • A failure to apologise is not necessarily a point of aggravation; the Courts will often view the absence of an apology as consistent with the case being responsibly defended, particularly where honest opinion is raised.
  • Removing an online article at the request of a plaintiff is probably best appreciated as a measure to avoid aggravated damages, rather than a discrete point of mitigation.
  • All defendants—and those representing them—should appreciate that a vigorous defence of a defamation claim, is a game of high stakes.  Bullish pre-action correspondence, irresponsible pleas of truth and misguides pleas bad reputation, all might come back to haunt you when the jury returns its verdict.

Recommended reading

For the Court of Appeal’s consideration of New Zealand’s largest damages award, part of which was ultimately set aside.  A full Court of five judges sat on the appeal.  All the judges put their own spin on the issues, so it’s probably all worth reading (it’s a big one, mind).

For the Court of Appeal’s consideration of New Zealand’s second-largest damages award, in which the Court upheld its setting aside by the trial judge.  This seems to be the judgment which courts are now most commonly citing: see paragraphs [31]–[59].

For the Court of Appeal’s consideration of New Zealand’s largest-standing damages award (the former two being either partially or wholly set aside).  The case concerns consideration of major points of aggravation, and analysis of the different heads of damages available: see paragraphs [30]–[88].

While damages serve to mark the seriousness of a defamation, the Court also has power to grant other remedies available to those who have been defamed.  Let’s review them.