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Case summary – Alvaro Sobrinho v Impresa Publishing SA

February 10, 2016

Alvaro Sobrinho v Impresa Publishing SA - trial of preliminary issues

 

Reference: [2016] EWHC 66 (QB)
Court: High Court

Date of Judgment: 22 January 2016

 

Facts of the case

 

The claimant, Mr Sobrinho, is a citizen of both Angola and Portugal.  He was the CEO of the Angolan bank Banco Espirito Santo Angola (“BESA”), a subsidiary of the Portuguese bank Banco Espirito Santo (“BES”), from 2000 to 2012.  The defendant, Impresa Publishing SA, is the owner of a Portuguese weekly newspaper named Expresso known for its probing political reporting. 

 

The libel claim was brought in respect of an article published in the 7 June 2014 edition of Expresso.  The article alleged that Mr Sobrinho had failed in his governance of BESA by allowing the bank to grant loans of US $5.7 billion to unknown beneficiaries.  It also alleged that Mr Sobrinho had misappropriated millions of dollars from BESA’s funds and that there were reasonable grounds to suspect he had done so fraudulently.  Further, that the Angolan state had provided a sovereign guarantee to isolate BESA's parent company BES from the risks arising from Mr Sobrinho’s conduct.  The article was published widely in Portugal with limited circulation in England and Wales.

 

When Mr Sobrinho became aware of the article he filed libel proceedings in England and Wales and also filed a criminal complaint in Portugal.  BES subsequently collapsed requiring a bail out from the central bank.  A public inquiry was held to establish the reasons for the collapse and Mr Sobrinho gave evidence to the inquiry which was televised.  When the public prosecutor in Portugal decided not to pursue a criminal complaint against Impresa, Mr Sobrinho filed civil proceedings in libel against the publisher.  However, Mr Sobrinho later discontinued the Portuguese proceedings as he believed that the inquiry had vindicated his reputation in Portugal.

 

 

 

 

 

Trial of preliminary issues

 

a) The meaning of the words

 

Mr Justice Dingemans considered the meaning of the words with reference to the factors set out in the case of Jeynes v News Magazines Limited [2008] EWCA Civ.  He considered that the overall meaning of the article was that there were reasonable grounds to suspect that Mr Sobrinho had fraudulently granted suspect loans for the benefit of himself, his family and the many companies under his control.     

 

b) Legal basis for bringing the claim in England and Wales

 

The general rule is that a party should be sued in the Member State in which it is domiciled

[Council Regulation EC No. 1215/2012, the “Judgments Regulation”].  However, where a tort has been committed, a party domiciled in a Member State may be sued in another Member State if the harm occurred or may occur in that other Member State.  In the case of Shevill v Presse Alliance SA (C-68/93), it was held that if a claimant chooses to sue where the damage occurred, that state has jurisdiction only in respect of the harm caused in that state, while the state of the defendant’s domicile has jurisdiction to award damages for the total harm caused in all countries. 

 

Mr Justice Dingemans confirmed that Mr Sobrinho was not able to rely on the worldwide publication of the article in the English proceedings.

 

c) Serious harm under Section 1 of the Defamation Act 2013

 

To meet the serious harm threshold pursuant to Section 1 of the Defamation Act 2013, the claimant must prove as a fact, on the balance of probabilities, that the statement complained of has caused or will probably cause serious harm to the claimant's reputation.  It is open to the claimant to call evidence in support of his case on serious harm and it is open to the defendant to call evidence to demonstrate that no serious harm has occurred or is likely to occur.  The Court is entitled to draw inferences based on the admitted evidence.  Mass media publications of very serious defamatory allegations are likely to render the need for evidence of serious harm unnecessary [Lachaux v Independent Print Ltd & ors [2015] EWHC 2242 (QB)].  However, serious harm is not merely a “numbers game”, and very serious harm to reputation can be caused by the publication of a defamatory statement to just one person.

 

d) Abuse of process

 

The Court is required to stop as an abuse of process defamation proceedings which serve no legitimate purpose [Jameel v Dow Jones [2005] EWCA Civ 75].  The test in Jameel was whether "a real and substantial tort" had been committed in the jurisdiction.

 

Evidence of serious harm and abuse of process

 

a) Mr Sobrinho's reputation in the jurisdiction of England and Wales

 

Mr Sobrinho was not required to show a reputation in the jurisdiction of England and Wales predating the article.  However, Mr Justice Dingemans accepted Mr Sobrinho’s evidence that he regularly visited London in connection with his charity work and to see his daughter who is studying in London.

 

b) Circulation

 

Mr Justice Dingemans did not think that the evidence demonstrated an enormous circulation and readership of Expresso in England and Wales as pleaded in the Particulars of Claim.  The circulation of the hard copy was made up of 127 individual sales and 9 print subscribers.  The readership of the hardcopy was likely to be 3 times the number of hardcopies: 408 readers.  There were 52 digital subscriptions to the newspaper and google analytics data showed that in the period between 7 June 2014 and 20 June 2014 that only 8% of the subscribers had read the entire article.  Assuming that the whole article was read by a similar number of hardcopy readers only 33 readers read the entire article in the hardcopy (8% of 408). 

 

The article was also freely available on Factiva, a business information and research service, which operates a website available in the British Library and several universities.  Through Factiva, different parts of the article had been accessed on 94 different occasions by 26 users.  Assuming that readers who had read page 4 had also read the rest of the article this amounted to 18 readers. 

 

Based on these assumptions, Mr Justice Dingemans calculated that only 55 readers had read the entire article in the jurisdiction of England and Wales.  As a result, Mr Sobrinho was not able to rely on any inference which might be drawn as to the publication of very serious allegations by a newspaper with a large circulation in this jurisdiction.

 

c) Evidence of serious harm

 

Mr Sobrinho’s evidence was important in that it did not show any apparent harm from the publication of the article in England and Wales.  Mr Sobrinho was upset by the article but injury to feelings was not relevant to the serious harm threshold.  Several executives of the charity Mr Sobrinho chairs, the Planet Earth Institute (“PEI”), were unsettled by the article.  The PEI Policy and Communications advisor gave evidence that the story was a major topic of conversation at various events connected with the charity.  However, Mr Justice Dingemans considered that it was not possible to show that Mr Sobrinho was known because of the article rather than the collapse of BES.  Another PEI executive gave evidence that she had been questioned in respect of the article’s allegations against Mr Sobrinho and that several supporters of the PEI Africa Breakfast Club had stopped attending meetings.  However, Mr Justice Dingemans considered that there was no evidence to suggest that these companies had ceased their support because they had read the article. 

 

d) Vindication of Mr Sobrinho's reputation

 

Mr Sobrinho had obtained vindication of his reputation in Portugal due to the extensive coverage by the Portuguese media of the evidence he gave at the inquiry into BES’s collapse.  The evidence showed that the Portuguese media coverage of the inquiry was available in England and Wales, in the same way that the Expresso article had been available in England and Wales.

 

Ruling

 

 

Mr Justice Dingemans ruled that there had been no serious harm to Mr Sobrinho’s reputation.  The meaning of the article was such that it could potentially cause serious harm to someone in Mr Sobrinho’s position.  However, the article set out Mr Sobrinho's defence which may have meant that the detrimental effect of the meaning of the article was lessened.  Serious harm may have also been avoided due to the very limited extent of the publication in England and Wales, that no one believed the article, that the story in the article was overtaken by the collapse of BES and because Mr Sobrinho had given evidence at the inquiry into BES’s collapse.  Mr Justice Dingemans was unable to identify precisely why no serious harm had been caused however it was clear on the evidence that there had been no serious harm.

 

It was also not likely that Mr Sobrinho would suffer serious harm in the future since he had set the record straight by giving evidence to the public inquiry.  The media coverage of the inquiry was available in England and Wales to the same extent the article was available in England and Wales.  For those reasons, the pursuit of the proceedings was a Jameel abuse of process since the English proceedings were not worth the time, effort and expense in pursuing them.

 

Comment

 

The case shows that even where the allegations are serious English courts will not be quick to infer serious harm in cases involving foreign parties in circumstances where there has been limited publication.  Where the defendant is domiciled abroad, a claimant should gather evidence to show that the defamatory allegations have adversely affected their reputations in this jurisdiction.  If a claimant’s reputation has been vindicated in the country where the defamatory allegations were published widely, the claimant will need to provide evidence that their reputation in England and Wales has not also been vindicated.  

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