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Hain and Parliamentary Privilege: say what you like and be at no risk as to costs

Labour Party life peer Peter Hain is clearly learned in the law. Drawing on his experience as a consultant at international law firm Gordon Dadds LLP, Lord Hain made use of Parliamentary Privilege on 25 October 2018, rising to his feet in the House of Lords to say the following:

“My Lords, having been contacted by someone intimately involved in the case of a powerful businessman using non-disclosure agreements and substantial payments to conceal the truth about serious and repeated sexual harassment, racist abuse and bullying which is compulsively continuing, I feel it’s my duty under Parliamentary Privilege to name Philip Green as the individual in question, given that the media have been subject to an injunction preventing publication of the full details of the story, which is clearly in the public interest.”

As Lord Hain was well aware, having been careful to say what he did within the precincts of the Palace of Westminster, Parliamentary Privilege meant that he was immune under Article 9 of the Bill of Rights Act 1689 from any legal action being taken against him in respect of the words he used.

That meant, too, that he was safe from any costs order being made against him, since it is trite law that without an action, there cannot be any award of costs. Had he said such things outside Parliament, Lord Hain could have been whisked off to the Court of Appeal which had granted the injunction forbidding the naming of Sir Philip, until he (Lord Hain) had purged his contempt of court. In addition, even had he done so, he would still have left himself open to proceedings being brought against him by the target of his statement, Sir Philip Green, with the prospect of a substantial costs order being made against him in the event that the action succeeded.

The background to Lord Hain’s statement is to be found in ongoing High Court litigation involving three anonymised claimants and the Daily Telegraph. Until Lord Hain’s utterances, those claimants had been referred to as “ABC, DEF and GHI”: now we know the name of one of them, Sir Philip Green, but not the other two, only that they are two companies in the same group in which Sir Philip is a senior executive.

Within those proceedings against Telegraph Media Group Ltd, the claimants had sought (and obtained) an interim non-disclosure order under CPR 25.3 to prevent the newspaper from publishing information about them, which had been disclosed in breach of confidence. According to the judgment of the Court of Appeal (see [2018] EWCA Civ 2329), the information in question had been disclosed to the Telegraph by one or more of various complainants or by its employees. They had been aware of the information and of five settlement agreements (known as non-disclosure agreements — NDAs) in which those five complainants, who had made allegations of discreditable conduct by Sir Philip, had resolved their complaints. In respect of all five settlement agreements in which substantial payments had been paid to the complainants, the Court of Appeal found:

“In each case [the complainants] had independent legal advice in entering into the Settlement Agreement in their case. There were terms in each of the Agreements under which both sides undertook to keep confidential the subject matter of the complaints themselves and various associated matters, including the amount paid by way of settlement [4] … There is no evidence that any of the Settlement Agreements were procured by bullying, harassment or undue influence by the claimants. Each employee received independent legal advice before entering into the Settlement Agreement. Each Settlement Agreement contained provisions authorising disclosure to regulatory and statutory bodies [61] … two of the complainants support the claimants’ application and one of them gave the express reason that they wished their privacy to be protected … [63] … One complainant said that they were happy for their complaint and the settlement to be disclosed, provided they were not named … One said they did not support the application [6].”

Lord Hain’s justification for disclosing Sir Philip’s name — and thereby doing what the Court of Appeal had expressly ordered should not be done pending an expedited trial or further order — was that he had been discharging his function as a “responsible parliamentarian”. Interviewed on Newsnight on 25 October 2018, he said:

“What concerned me about this case was wealth and the power which comes with it and abuse and that was what led me to act in the way I did.”

Lord Hain had been contacted by someone “intimately involved” whose identity could not be disclosed since to do so would be the betrayal of a person who was “extremely vulnerable”. The reason for speaking out in the way that he had was to protect such people from being forced into making NDAs by the rich and powerful such as Sir Philip Green.

As to the source of his knowledge, Lord Hain subsequently confirmed that it was not the solicitors acting for the Telegraph, which just happened to be Gordon Dadds LLP, the firm which paid him for his professional and legal services in the United Kingdom and globally as a Global and Governmental Adviser, as disclosed on his Parliamentary Register of Interests. That suggestion Lord Hain was able to explain in a press release:

“I categorically state that I was completely unaware Gordon Dadds were advising the Telegraph regarding this case. Gordon Dadds, a highly respected and reputable international law firm, played absolutely no part whatsoever in either the sourcing of my information or my independent decision to name Sir Philip. They were completely unaware of my intentions until I spoke in the House of Lords.”

Thanks goodness that that one has been cleared up! Rival newspaper the Times plainly thought that there might be more to it than that by carrying a front page story that the Labour peer had failed to mention his work for Gordon Dadds. Not only that, but that Lord Hain was facing potential hypocrisy accusations after he himself had “insisted on an NDA when settling a defamation claim”.

Rotten luck that. Negative coverage by a rival journal left the inference to be drawn that it was odd that Lord Hain could not have known about Gordon Dadds acting for the Telegraph, when the firm’s name had appeared on page one of both the first instance judgment of Mr Justice Haddon-Cave ([2018] EWHC 2177 (QB)) and the judgment of the Court of Appeal, which were handed down on August 13 and October 23 respectively.

Relief all round to know, too, that as a responsible parliamentarian, as Lord Hain had described himself on Newsnight, he must have averted his eyes when he read the judgments in order to satisfy himself that it was in the “public interest” to disclose Sir Philip’s name. After all, without having read the judgments, he could scarcely have worked out from the someone intimately involved in the case that it was, indeed, Sir Philip who was claimant ABC and that he, Lord Hain, would need to use Parliamentary Privilege in order to avoid making an actionable statement in breach of the injunction.

It might be thought that none of this is particularly surprising as, judging from the stories carried by the Times, rotten luck is something that appears to have dogged Lord Hain throughout his long career in public life.

In 2010, for example, Lord Hain felt compelled to resign from the shadow cabinet after failing to declare 20 donations worth over £100,000 during his bid for the deputy leadership of the Labour party. At least, as he had said at the time, it had been “an honest mistake” and “a disorganised end to the campaign”.

More rotten luck was experienced a year earlier, when Lord Hain had to apologise in the House of Commons in a personal statement about money he had paid to his 80-year-old mother to do constituency work when it was reported in the press that she had never been seen in his constituency.

Even in his relative youth, Lord Hain had rotten luck. Back in 1972, he was fined £200 at the Old Bailey for conspiracy. He appealed to the Court of Appeal where his appeal was dismissed by a three-judge court with costs. In doing so, Lord Justice Roskill had observed that the then Peter Hain’s conviction had been “fully justified” and that Mr Hain had elected not to give evidence: “he gave no explanation of his part over the incidents with which he was charged”.

Of course, the luck was not always rotten. In 1976, Lord Hain was tried and acquitted back at the Old Bailey of a bank robbery in which he had been accused of snatching £490 from the counter of a bank in Putney, the jury only having acquitted him after five hours’ deliberation.

And then there was the NDA. According to the Times on 29 October 2018, whose legal correspondent had interviewed the solicitor in the case, the defamation claim brought against Lord Hain by a Scotland Yard detective had been settled “very quickly”. That was because Mr Hain (as Lord Hain then was) had insisted on a NDA, thereby keeping the terms of settlement confidential, just as Sir Philip had done with the five complainants.

The difference between the Hain NDA and the Green NDAs? According to Lord Hain, who has not denied that he used a NDA to settle his defamation dispute:

“You cannot seriously compare the two. This is just another attempt by the Philip Green smear machine to discredit me.”

That was then and now is now. What next in the Daily Telegraph litigation now that Sir Philip Green has been “outed” as being the businessman claimant in the case?

In a letter published in the Times on 30 October 2018, eminent Queen’s Counsel Stanley Brodie suggested that all might not be quite the way that Lord Hain thinks it is so far as Parliamentary Privilege is concerned. He wrote this:

“Sir, The disclosure of the identity of Sir Philip Green by Lord Hain in the House of Lords in the face of the injunction granted by the Court of Appeal was shocking. Had Lord Hain made the same statement outside the precincts of the Palace of Westminster, he would have faced proceedings for civil or criminal contempt. He relied on the supposed privilege afforded to parliamentarians as a shield against contempt proceedings. But does the law go that far? Such limited research as I have been able to pursue seems inconclusive. One thing seems clear: it is at least arguable that conduct by a member of the House of Lords which amounts to a contempt of court of this kind should not be protected by parliamentary privilege. Contempt proceedings should be brought against Lord Hain, either by the Court of Appeal or by Sir Philip in the context of the current proceedings.”

If Stanley Brodie QC is correct, Lord Hain may not be quite as learned in the law as he thought, in which case the full machinery of the costs rules, CPR Parts 44 to 47, from which he thought he was impervious, may come crashing down on him after all.

The headnotes and full texts of the cases below are available to online subscribers at Follow Costs Law Reports on Twitter to be notified of new cases as soon as they are published.

New cases this month

Page v RGC Restaurants Ltd [2018] 5 Costs LO 545: Costs budgets under Section II of CPR Part 3; failure to comply with CPR 3.13 and relief from sanctions under CPR 3.9 following failure to file a complete costs budget.

Francois v Barclays Bank plc [2018] 5 Costs LO 603: Allocation and re-allocation of cases to a track under CPR 26; notification to parties being required lest a party’s exposure to costs be unfairly increased.

BAE Systems Pension Funds Trustees Ltd v Bowmer & Kirkland Ltd and Others [2018] 5 Costs LO 613: Discontinuance under CPR 38.6; whether there should be a departure from the default rule where the claimant has discontinued against one defendant but succeeded against another.

Old Street Homes and Another v Chelsea Bridge Apartments Ltd and Another [2018] 5 Costs LO 625: Jurisdiction to make orders for costs: whether costs judge has power to determine who should pay costs of interim applications in the proceedings as opposed to during the detailed assessment.

KL Law Ltd v Wincanton Group Ltd and Another [2018] 5 Costs LO 639: Rule 80 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013; wasted costs orders.

LKH v TQA AL Z (Interim Maintenance and Pound for Pound Costs Funding) [2018] 5 Costs LO 653: Family proceedings: interim maintenance and “pound for pound” costs funding compelling payment of equal sums by the respondent to his solicitors as to the applicant for arrears of maintenance.

London Borough of Lambeth v MCS (By Her Litigation Friend the Official Solicitor) and Another [2018] 5 Costs LO 661: Costs in the Court of Protection; departure from the general rule where the proceedings should have never been commenced and on account of conduct after commencement.

Sony/ATV Music Publishing LLC and Another v WPMC Ltd (in Liquidation) and Others [2018] 5 Costs LO 665: Non-party costs orders under CPR 46.2: whether notice of an intention to seek an order is a requirement before a party can be ordered to pay costs of the action under the rule.

Costs and Fees Encyclopaedia updating

The Immigration and Nationality (Fees) (Amendment) (EU Exit) Regulations 2018 (SI 2018/875) amended Schedule 2 of the Immigration and Nationality (Fees) Regulations 2018, with effect from 28 August 2018, setting fees in respect of applications for leave to remain in the United Kingdom. Updated pages are now available for printing out and adding to your Costs and Fees Encyclopaedia: Pages 335-340

Other recent cases

Hanley v J C & A Solicitors; Green and Others v SGI Legal LLP [2018] 4 Costs LR 693: Solicitors Act 1974 and disclosure: whether the court either under s 68 or under its inherent jurisdiction over its officers has power to order a solicitor to give disclosure to a former client of documents belonging to the solicitor.

Accident Exchange Ltd and Another v McLean and Others [2018] 4 Costs LR 713: Security for costs under CPR Part 25: factors to apply on a late application, taking into account whether the making of an order for security would stifle the claim.

Tuson v Murphy [2018] 4 Costs LR 733: Part 36 offers; costs consequences where a party is guilty of dishonest and misleading conduct, but the offer is made in the full knowledge of the non-disclosure.

R (Adath Yisroel Burial Society and Another) v HM Senior Coroner for Inner North London [2018] 4 Costs LR 749: Coroner’s costs: appropriate costs order where coroner had ceased to act neutrally in the proceedings.

Holmes v West London Mental Health NHS Trust [2018] 4 Costs LR 763: Claimants’ offers made under Part 36 where the defendant has been responsible for “bimbling” viz. inexcusable delay: order for costs on the indemnity basis, the “bimbling” being out of the norm.

PJSC Aeroflot – Russian Airlines v Leeds and Others [2018] 4 Costs LR 775: Costs on discontinuance under CPR 38; conduct “out of the norm” justifying an order for costs on the indemnity basis: effect in costs of a failure to mediate where allegations of fraud and wrongdoing pleaded.

Catalyst Management Services v Libya Africa Investment Portfolio [2018] 4 Costs LR 807: Security for costs under CPR Part 25: factors to consider in order to decide if a material change in circumstances justifies its discharge.

FPH Law (a Firm) v Brown (t/a Integrum Law) [2018] 4 Costs LR 823: Conditional fee agreements: consequences flowing from a CFA found to be unenforceable on a damages claim for loss of chance.

R (Faulkner) v Director of Legal Aid Casework [2018] 4 Costs LR 841: Legal Aid statutory charge: whether waiver of the charge pursuant to s 10(7) Access to Justice Act 1999 had to occur at the beginning of or during a case as opposed to at the end.

Chernukhin and Others v Danilina [2018] 4 Costs LR 859: Security for costs under CPR 25.13(2)(a): principles to apply to the quantum of security where a real risk exists of non-enforcement of a judgment against a claimant resident in a non-Convention jurisdiction.

Hertel and Another v Saunders and Another [2018] 4 Costs LR 879: Part 36 offers: whether an offer to settle made before there had been any claim or action can be effective and have the costs consequences under the rule.

The Commissioner of Police of the Metropolis v Brown; The Chief Constable of Greater Manchester Police v Brown and Another [2018] 4 Costs LR 897: Qualified one-way costs shifting; the extent to which QOCS protection under CPR 44.16 applies in proceedings in which the claimant has advanced mixed claims rather than only those relating to personal injuries.

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