Leveson Report and the proposed arbitration service

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As the dust settles following publication of The Leveson Report, it is important to consider carefully the recommendations before any steps are taken towards implementation.  Of particular significance is Leveson LJ’s recommendation that the new regulatory body should provide two dispute resolution forums: a complaints handling service and an arbitration service.  The proposed complaints handling service feels much like a rebranding of the Press Complaints Commission.  However, the arbitration service is a much more interesting prospect – albeit still embryonic in concept, and raising as many questions than it answers.

Media lawyers have long recognised the problem with resolving claims against publishers through the courts; historically, only very rich claimants could bear the cost risk associated with bringing an action for alleged defamation or breach of privacy.  The introduction of third party funding options changed all this, and granted access to justice for a much wider range of claimants.  However, the upcoming changes to the CFA regime under the Jackson Reforms looked set to inhibit the ability for claimants to bring cases in this way.  Leveson LJ’s proposals aim to mitigate this.

“A quick, fair and inexpensive system…”

Leveson LJ proposes that the new regulatory body operates an arbitral process to hear claims against publishers.  The key features of this arbitral body will be:

  • that it is a quick, fair and inexpensive system;
  • that it is inquisitorial in nature; and
  • that it is free for claimants (unless the claimant is making a vexatious or frivolous claim).

One area of uncertainty is whether the arbitral process will be structured so as to give adequate assistance to claimants without legal representation.  This seems like a key factor in the success of any arbitral process over the current system of litigation, which is perceived to disadvantage claimants who cannot afford equality of arms in legal representation.

Arbitration v Litigation

It is worth noting that the proposed arbitration system will be an alternative to – not a replacement for – the conventional court avenues, which will remain available to claimants and defendants alike.

This makes the proposed form of arbitration somewhat distinct from traditional institutional/ad hoc arbitration forums.  Arbitration and litigation are usually mutually exclusive; if parties have determined to resolve their disputes by arbitration then that is their only means of recourse.  Providing claimants with multiple avenues for dispute resolution does create potential for cynical and expensive jurisdictional tussles.

Leveson LJ suggests that parties should be incentivised to use the arbitral process due to the lack of costs risk.  Where the court system is engaged, the court should take into account whether the publisher is part of the arbitral scheme, and/or whether it would have been more appropriate for the claimant to opt for arbitration when considering any award of costs.  While cost penalties are likely to carry weight with claimants and smaller publishers, it remains to be seen whether this will influence the large media organisations with deep pockets.

Closure and Confidentiality

One element of the arbitration option that still needs to be clarified is the extent to which the arbitral decision will be kept confidential (since this is traditionally one of the perceived benefits of arbitration).  Unlike a typical commercial dispute where confidentiality may be cherished, however, it is common in defamation actions for both the claimant and the defendant to seek a public outcome, whether that be a retraction or a vindication.  The arbitral body will need to consider how best to offer claimants in particular this “day-in-court feeling” where appropriate.

BLP Perspective

Leveson LJ’s recommendations will inevitably undergo some changes during the implementation process.  There are many interesting proposals which have real potential, not least the proposal to establish a dedicated arbitral body.  However, the new regulator will have to consider carefully exactly how this arbitral process interrelates with the court system and whether it can, in reality, provide effective redress for claimants and publishers alike.

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