Case summary – Sam Theedom v (1) Nourish Training t/a CSP Recruitment (2) Colin Sewell

Sam Theedom v Nourish Training t/a CSP Recruitment and ors - trial of preliminary issues

Reference: [2015] EWHC 3769 (QB) Court: High Court

Date of Judgment: 11 December 2015

Facts of the case

In mid 2013 the claimant Sam Theedom commenced employment at the first defendant CSP Recruitment (‘CSP’) as a trainee recruitment consultant. In early 2014, two employees of CSP, Kate Kirszak and Zoe Crutchley, left for a rival recruitment agency. Ms Kirszak subsequently became Mr Theedom’s girlfriend. On 26 June 2014, there was a meeting between Mr Theedom and Mr Karl Purviss, the managing director of CSP. During the meeting Mr Theedom was accused of leaking confidential information to Ms Kirszak and Ms Crutchley and their new employer. Mr Theedom’s employment was terminated though it is disputed between the parties as to whether Mr Theedom was dismissed or whether he resigned.

On 29 to 30 June 2014, the second defendant, Mr Colin Sewell, the managing partner of CSP sent an email to 102 different companies stating that Mr Theedom had been dismissed for gross misconduct for sending confidential information on a regular basis to Ms Kirszak and Ms Crutchley. All but nine of the emails stated that CPS was considering taking criminal action against Mr Theedom. The majority of the companies were clients or potential clients of CPS.

Preliminary Trial

a) The actual defamatory meaning of the words

HHJ Moloney considered the meaning of the words by reference to the factors applied in the case of Jeynes v News Magazines Ltd [2008] EWCA Civ 130:

The governing principle was reasonableness;
The hypothetical reasonable reader was not naive but he was not unduly suspicious;
Over-elaborate analysis was best avoided;
The publisher's intention was irrelevant;
The words had to be read as a whole;
The hypothetical reader was taken to be representative of those who would read the publication;
The court should rule out any meaning which can only emerge as the product of some strained or utterly unreasonable interpretation (factor 7 did not apply in this case); and
It was not enough to say that the words might be understood in a defamatory sense by some persons.

Both parties accepted that the words complained of referred to Mr Theedom and that they were defamatory of him, with a core meaning that Mr Theedom had been guilty of gross misconduct in his employment. However, Mr Theedom contended that a reader of the email would read the words of the email closely and take into account the details of the allegations made, while CSP contended that a reader would approach the words fleetingly and would form a broad general impression of the allegations in the email.

HHJ Moloney stated that the key to resolving the dispute between the parties was to consider the characteristics of the typical reader of the publication (factor 6). HHJ Moloney assessed the readers of the emails all to have been business people reading an email from another employer about the gross misconduct of its employee. The readers were informed that the employee had betrayed his employer’s confidence and the confidences of the readers and that they may be approached by the employee or his associates who had received the confidential information.

HHJ Moloney held that the hypothetical reasonable reader of the email would read it with care and give some weight to the details. They would note that the misconduct was regular, and in some cases, note that criminal action was being considered. He concluded that the claimant’s arguments carried more weight than the defendants’ arguments. Firstly, the words meant that during Mr Theedom’s employment with CSP, he had regularly provided commercially important and confidential information in respect of CSP’s business and that of its clients to CSP’s commercial rivals in breach of his contractual obligations to his employer. Secondly, as a result, CSP had rightly dismissed him for gross misconduct. Thirdly, there were reasonable grounds to suspect that Mr Theedom’s conduct amounted to a criminal offence.

b) Serious harm to reputation

HHJ Moloney stated that to have a claim in defamation it must be established as a substantive element of the claim that the statement complained of has in fact caused or is likely to cause serious harm to the claimant’s reputation pursuant to Section 1 of the Defamation Act 2013. This can be established by relying on inferences of serious harm to reputation drawn from the level of the defamatory meaning of the words and the nature and extent of their publication. Evidence can be provided to demonstrate that serious harm has occurred though it is open to the defendant to rebut any evidence. Section 1 is a threshold requirement and once the threshold has been passed further evidence relating to quantum of damages is not required.

To determine whether the serious harm threshold had been met the following factual areas were considered:

i) Publishees: Did they know the claimant or would they come across him in his new job

There was a high probability that Mr Theedom would come into contact with someone who had read the email since his new job focused on Leicestershire and 75% of the companies to whom the email had been sent were based there. It was less likely that the email would be circulated outside the circle of employers who had received it.

ii) Actual response: evidence that the publishees were influenced or not against the claimant

Two of the publishees informed Mr Theedom about the email, but said it did not affect them. Two publishees declined to do business with him. Two publishees mentioned it, but listened to his explanations and later did some business with him. The great majority had not responded therefore the degree of harm had to be inferred.

iii) The claimant’s subsequent progress

That Mr Theedom found employment within the recruitment sector within a month was not very significant as the email had not been sent to recruitment companies. However, that Mr Theedom had done well in a job that involved wide contact with the local industry was a substantial factor in favour of the defendants.

Did the publication cause serious harm to the reputation of the claimant?

HHJ Maloney confirmed that the term “serious” should be given its meaning as an ordinary word in common usage in the English language [Lachaux v Independent Print Limited & Ors [2015] EWHC 2242 (QB)]. The question of whether the case was serious depended on the circumstances of the individual claimant not whether it was serious compared to other defamation cases.

HHJ Maloney ruled that on the balance of probabilities the publication of the emails had caused serious harm to Mr Theedom’s reputation to such a degree as to pass the Section 1 threshold. The defamatory words were of a high degree of gravity by an influential author to a fairly substantial audience relevant in terms of proximity and importance to Mr Theedom’s career. Mr Theedom was also vulnerable in that he was a young man starting out in his career. The circumstances raised an inferential case for serious harm to reputation, so strong to call for rebuttal. That no financial loss had been suffered was not relevant. That few publishees manifested hostility to Mr Theedom did not mean that harm had not been suffered. The lack of apology or withdrawal meant that it was likely that the harm had persisted.

Comment

The judgment followed the Lachaux ruling in that the claimant succeeded in establishing serious harm by relying almost entirely on inference. It appears that an inference of serious harm will be drawn in circumstances where the defendant is influential and prima facie reliable, the libel “fairly serious” and where there are more than a negligible number of recipients. However, in the Lachaux case, Justice Warby believed that this applied to more obvious cases of serious harm and gave the example of a well known person who is accused in the national media of a serious crime such as conspiracy to murder or a serious sex crime. We await the outcome of the Lachaux appeal with interest.

This is the third preliminary issue trial on serious harm since the Defamation Act 2013 was introduced. In this case, HHJ Moloney expressed concerns on what appears to be a further escalation of the complexity and level of evidence provided in the conduct of a Section 1 hearing. HHJ Moloney suggested that Masters considering whether to direct a trial of a preliminary issue under Section 1 should decline to do so if it would lead to a lengthy evidential dispute or overlap with other factual matters in the case. Accordingly, in the future the Court may take a more cautious approach when considering whether to order a Section 1 hearing.