Daily Mail lawyer voices alarm over 'grossly inflated' legal costs in libel fight over police 'cronyism' story

The Supreme Court has rejected an attempt by Daily Mail publisher Associated Newspapers to appeal in a case in which it was ordered to pay £65,000 in libel damages to a management consultant it alleged  won a contract with the Metropolitan Police through cronyism.

And the paper (editor Paul Dacre pictured above) has said that the whole newspaper industry should be concerned abou the “huge sums” the case has cost the publisher, because of the no win, no fee system which inflates costs for claimant lawyers.

A three Justice panel – Lord Mance, Lord Toulson and Lord Hodge – rejected the petition on the grounds that the application did not raise a point of law of general public importance.

Associated Newspapers had sought to appeal against the Court of Appeal's ruling upholding a decision which awarded the damages to Andrew Miller over a front-paged story which appeared in the Daily Mail from October 2008.

Mr Justice Tugendhat had ruled in 2011 that the article led to reasonable grounds to suspect that Miller was a willing beneficiary of improper conduct and cronyism.

Mrs Justice Sharp awarded Miller the damages following a trial in May 2012, holding that Associated Newspapers had failed to prove that the allegation was true.

The Court of Appeal rejected the publisher's appeal in January this year.

The Guardian reported last week that the Daily Mail faced a legal bill of up to £3m as a result of the case.

But in a letter to the paper today head of editorial legal services for the paper Liz Hartley disputed that the bill would be “anything like” that figure.

She did however say: "The costs of this case have been grossly inflated by a punitively unfair system under which, through 100 per cent success fees and ATE insurance, defendants’ costs are trebled, while claimants take no financial risk and have little incentive to settle.

"In a case involving damages of £65,000, such huge sums should be of considerable concern to the entire newspaper industry, including the Guardian."

She also said: “The overall thrust of your article was that the Mail had unreasonably dragged its feet when it could have resolved matters quickly and simply without recourse to the law. We dispute that interpretation.

"It is wrong to suggest that Mr Miller initially only asked for an apology and modest legal costs. In fact he always sought damages, and indeed early on was seeking £200,000 – over three times what he was eventually awarded.

"Associated always accepted that the article contained an inaccuracy, offered to correct it and made an offer of damages and costs. This was rejected by Mr Miller, who, using a no-win no-fee arrangement and the iniquitous After the Event insurance – in which the premium is only ever paid by the defendant if they lose – embarked on his legal case.

"Associated has not appealed against several judgments in Mr Miller’s favour, rather it appealed the initial high court judgment, lost that appeal before the court of appeal and most recently was refused permission to appeal by the supreme court."

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