Securing the cost of a libel trial

In
Al-Koronky v Time Life and Lewis (2005), a court has ordered two
foreign libel claimants to put up security of £375,000 before their
case will be allowed to proceed.

The claimants, Mr and Mrs
Al-Koronky, are suing the author and publishers of a book, Slave, over
allegations that they kept a slave in their London home. Mr Al-Koronky
worked as a press attaché and was briefly acting ambassador at the
Sudanese embassy in London. Since 2002 the couple have lived in Sudan.

The
libel action has been hard fought. The Al-Koronkys vigorously deny that
they kept a domestic slave and maintain that the book is a pack of
lies. The author and publishers maintain that the allegations are true.

The
Al-Koronkys are represented by their solicitors, Carter-Ruck, pursuant
to a conditional fee agreement. The Al-Koronkys’ counsel have also
agreed to act on CFAs. Legal costs so far incurred are already very
substantial and will mount rapidly as the case progresses.

The
author and publishers were concerned that if they won, they would never
recover their costs as the prospects of successfully enforcing a UK
costs judgment in Sudan were remote (even if the Al-Koronkys had
sufficient assets to meet such a judgment).

The Al-Koronkys,
through Carter-Ruck, maintained at one time that any liability for
costs would be covered by ATE (“after the event”) insurance taken out
for the purpose – but it was later conceded, when the policies were
finally produced for inspection, that the ATE insurance was worthless.

The
defendants therefore launched an application for secur for costs. The
application was resisted on two grounds: (1) that the defence was bound
to fail; and (2) that the author and publishers had brought the claim
upon themselves by choosing to publish allegations for which a
newspaper in a previous libel action had already apologised and paid
damages of £100,000.

Mr Justice Eady rejected these arguments. He
said he could not be satisfied that there was no merit in the plea of
justification. It was possible that the defence would succeed “however
extraordinary the story might appear to a casual observer”. The
conflicts of evidence could not and should not be resolved by him. They
were matters to be resolved after full disclosure and cross-examination
of witnesses.

As for the suggestion that the defendants were the
authors of their own misfortune, the judge gave this short shrift: “It
is the defendants’ right to make their own judgment in this matter.
They should not be placed at any greater disadvantage in defending
their beliefs… merely because some other litigant has on the basis of
different information come to a different decision (or perhaps
concluded, for all they know, that discretion is the better part of
valour).”

In deciding to order security, the judge was influenced
by Mr Al-Koronky’s failure to explain his apparent deception of the
British authorities when he applied for a visa to bring a domestic
servant from Sudan to the UK. In the judge’s words: “That is a very
telling consideration when it comes to the exercise of the court’s
discretion.”

Keith Mathieson is a partner at Reynolds Porter Chamberlain and represented the defendants

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