Malicious Prosecutions - Discussion

[Openlaw15]

Re: Malicious Prosecutions - Discussion

For everyone's benefit, a brief summary of the claim in the case is set out below.

Summary of Case before the Supreme Court
Mr Gubay was an owner of a leisure company (now deceased) and Mr Willers was a director before being dismissed in or around 2009. The Leisure company brought proceedings against Willers for breach of contract and so Willers issued an indemnity from Gubay claiming to have acted under instructions.

A few weeks before trial, the Leisure company discontinued the claim against Willers and so Willers decided to bring a claim for malicious prosecution. It was already accepted that the leisure company satisfied the criteria of malicious prosecution but the question was whether or not malicious prosecution was extended to civil proceedings.


So what are the ingredients to bring a malicious prosecution claim?
It is probably helpful to understand the requirements to bring a successful claim in a criminal context:

1. There is criminal proceedings brought against the defendant
2. the prosecution determined in favour of the defendant
3. it was without reason and probable cause
4. it was malicious

Now you could easily transfer that into a civil context, points 1 and 2 are self explanatory so focus is on the latter 2.

Without reason and probable cause
'probable cause' isn't really a british definition and that is widely used over the in the USA, but for ease i'm going to refer to 'probable cause' as reasonable belief as we all know what that means in the English legal system. @Openlaw15's argument below is exactly the sort of argument made out in the Supreme Court case.



The answer to that is reasonable belief, and if you reasonably believe that you have a genuine claim and are using the court's process to obtain justice then there will be no claim for malicious prosecution. This could be by way of evidence provided to the court which backs up your claim, even if you eventually lose the case. If the other side wishes to argue the claim is being brought maliciously then the burden of proof rests with the defendant to prove that the claimant's claim was groundless and had no good reason to bring a claim.

The bringing of proceedings was malicious
As the Supreme Court pointed out, there has been over 400 years of legal meanings of malice each of which has been refined over the years. I'm not going to cite every case law or meaning to that because the post would go on forever however, my interpretation of malice in a civil context is the improper motive of the claimant. What is the meaning of improper motive? Well this is where it could overlap with the abuse of process argument (which I might add is entirely a separate ground and is distinct from malicious prosecution) in that the claimant is using the court system which was not bona fide and instead for example, as leverage to compel the other side into paying a sum of money which it does not owe. Malicious prosecution of course goes against the well known basis that a claimant does not owe a duty of care in civil proceedings (one of the arguments raised by Sumption I believe who dissented) but nevertheless, the Court decided that it would be unjust for someone to have proceedings brought against them as a result of malicious prosecution and have no right to compensation. It has also been held that knowledge or recklessness will be virtually conclusive as malice (Kaye v Robertson [1990] EWCA Civ 21).

Overall, I do agree with OL that the bar for malicious prosecution is high and the burden of proof is on the defendant to show that not only was the bringing of the claim without reasonable belief but also malicious. However, this burden I think, could easily be overcome in certain industries and I will use the debt purchasing industry as a prime example. We all know that debt purchasers issue claims in bulk (probably) without taking any consideration as to the merits of the case. Therefore statute barred claims and claims with no evidence will be included in this bulk issue of proceedings. The debt purchasers will put on pressure for the defendant to pay up or have the thread of a CCJ against the defendant which will cause extensive damage to them for the following 6 years in terms of credit, mortgage etc.

There have also been many claims by debt purchasers on this forum that have indicated that defendant's have made so called one-off payments that would bring the claim within the limitation period. Now I don't want to accuse any business of fabricating evidence but when a defendant hasn't made a payment for a number of years and then suddenly a nominal amount is paid in one month but not the following months sounds very shifty.

Luckily, in the thread that brought this discussion about, the OP had proof that no payment had been made by him on the date that the debt purchaser had suggested. As I understood it to be, despite telling them this, they continued with proceedings and then as soon as the defence had been submitted or after mediation, they suddenly discontinued the case. As I said in the post, if there was a genuine claim and they genuinely believe that the payment was made why did they not pursue it? The fact that the decided not to verify or ask the OP proof which could have ended proceedings earlier, they chose to ignore that and you could potentially argue that the debt purchaser had been reckless (maybe deliberate) in continuing with proceedings for the sake of it and then suddenly discontinuing before trial thus falling within the scope of malicious prosecution.

Personally, I think the debt purchasing industry is likely to be most affected by this and I suspect they may have to change their ways. Debt purchasers who obtain judgment against a person (particularly at their old address) resulting in a CCJ for someone only to discontinue the case (for one reason or another) after it being setting aside could land themselves in trouble if claims for malicious prosecution are brought. This is a potential deterrent against those who think its okay to issue proceedings if they do not have the requisite knowledge or basis for bringing a claim.

We also need to note that the claim for malicious prosecution will be permitted to go to trial and so the result of that is likely to be found in favour of Willers given that it was accepted the criteria was met. Perhaps the High Court will give us some indication of the necessary ingredients and how one can satisfy the criteria for a claim to be successful.

P.s another example of where malicious prosecution could be brought is those defamation claims brought by Kellie's Veggies where there are future claims brought either as a separate claim or counterclaim.

Rob, it was for breach of trust (ie breach of a fiduciary duty), which is rather different to breach of contract. The Director has a duty and the claim was the director breached that duty (ie breached a fiduciary duty). There was clearly a relationship of trust with the company and the director. Not every situation in law will be a relationship of trust. In any event this is the narrow principle in this recent UKSC (2016) case. The tort remedy for malicious prosecution is supposed to stop floodgate arguments, so how it is that then you're using the remedy for the Op?

[des8]

Re: Malicious Prosecutions - Discussion

https://www.supremecourt.uk/cases/do...ss-summary.pdf

"For the purposes of the appeal, the Court was invited to assume that Mr Gubay controlled a leisurecompany, Langstone, of which Mr Willers was a director. Mr Willers was later dismissed as directorof Langstone and in 2010 Langstone sued Mr Willers for alleged breach of contractual andfiduciary duties in pursuing litigation."

[R0b]

Re: Malicious Prosecutions - Discussion

Rob, it was for breach of trust (ie breach of a fiduciary duty), which is rather different to breach of contract. The Director has a duty and the claim was the director breached that duty (ie breached a fiduciary duty). There was clearly a relationship of trust with the company and the director. Not every situation in law will be a relationship of trust. In any event this is the narrow principle in this recent UKSC (2016) case. The tort remedy for malicious prosecution is supposed to stop floodgate arguments, so how it is that then you're using the remedy for the Op?

Again, every case turns on its facts and the Court did not confine MP to a certain category of claims, so I;m not sure if you are saying that MP is only restricted to breach of trust cases but thats not correct. I would suggest reading further articles on this which have confirmed that MP can apply to any claim being brought, subject to further developments where the courts narrow it.

[Openlaw15]

Re: Malicious Prosecutions - Discussion

https://www.supremecourt.uk/cases/do...ss-summary.pdf

"For the purposes of the appeal, the Court was invited to assume that Mr Gubay controlled a leisurecompany, Langstone, of which Mr Willers was a director. Mr Willers was later dismissed as directorof Langstone and in 2010 Langstone sued Mr Willers for alleged breach of contractual andfiduciary duties in pursuing litigation."

The question is if there were no relationship of trust would there have been this tort remedy for malicious prosecution. I'd answer in the negative.

[Openlaw15]

Re: Malicious Prosecutions - Discussion

Again, every case turns on its facts and the Court did not confine MP to a certain category of claims, so I;m not sure if you are saying that MP is only restricted to breach of trust cases but thats not correct. I would suggest reading further articles on this which have confirmed that MP can apply to any claim being brought, subject to further developments where the courts narrow it.

You never answered my question how you believed this MP remedy applies in the OP's situation, for whom your provided your advice/ opinion.

My point Rob is that there will likely be lots of cases to test its applicability....as the ratio is just too broad, too vague. Legal commentary is their opinion and not the law. The law is the judgment itself and in my view is simply too broad and therefore dangerous. It was like when I had to research a tort (for a uni assignment) against a rugby referee. The difference was this tort created a duty of care but not every duty leads to a breach of that duty. In this MP UKSC case though the ratio does not apply to a duty of care. The ambiguity is deceptive - as any lawyer will try to use this MP and find out to their detriment that it will not apply. If the court said it'll stop the floodgates arguments as it did in the rugby referee's case, then there must be strict limitations.

[R0b]

Re: Malicious Prosecutions - Discussion

I'll repeat what I've quoted previously:

It seems instinctively unjust for a person to suffer injury as a result of the malicious prosecutionof legal proceedings for which there is no reasonable ground, and yet not be entitled tocompensation for the injury intentionally caused by the person responsible for instigating it [at 43]

That very quote and the judgment set out by Toulson simply provides that a person is liable for bringing a claim in which there is no grounds for doing so. It does not matter whether its breach of fiduciary duty, contract, negligence etc. the fact is that someone who instigates proceedings (more likely in spite) without evidence to back it up, then you are liable and subject to damages against you.

Judgment has been made, MP applies in civil proceedings across the board where there is no similar remedy (I doubt MP will be available for defamation where malicious falsehood remedy similar to it).

[Openlaw15]

Re: Malicious Prosecutions - Discussion

I'll repeat what I've quoted previously:



That very quote and the judgment set out by Toulson simply provides that a person is liable for bringing a claim in which there is no grounds for doing so. It does not matter whether its breach of fiduciary duty, contract, negligence etc. the fact is that someone who instigates proceedings (more likely in spite) without evidence to back it up, then you are liable and subject to damages against you.

Judgment has been made, MP applies in civil proceedings across the board where there is no similar remedy (I doubt MP will be available for defamation where malicious falsehood remedy similar to it).

Civil legal proceedings is too broad - as it covers pretty much covers any cause of action that is not criminal per se. Let's take the foundation subjects of the law degree. 1 out of 7 is criminal law. This leaves public law (ie police law, human rights; judicial review); contract; tort; EU; trusts/ equity; land (ie property) all vulnerable.

Consumer law; Bailiff law; tax law; DWP law; family law; employment law; commercial law; intellectual law; Wills law... all vulnerable.

[R0b]

Re: Malicious Prosecutions - Discussion

So what's the problem? The court did not say that MP is restricted to a certain classes of claims but that the claim of MP was available where malicious proceedings are brought in a civil context. That therefore means that it is available across the board. Again the Court has also pointed out that people with genuine claims and with evidence which they can present to the court that shows they have some reason to bring a claim.

Employment = an employee bringing a claim against an employer making certain allegations causing damage but no evidence to back it up.

IP = claims for breach of IP but no evidence to back it up/withholding information

Commercial = claims for breach of contract with no evidence to back it up/withholding information

Family = claims against ex partners which causes damage to the other with no evidence to back it up/withholding information

A recurring theme here I think? Evidence or some evidence or indication that gives cause to bring a claim will prevent a claim for MP, the burden rests with the defendant that the claim was groundless and malicious and without reasonable belief. Your opinion just like mine and other practitioners in the field are just that, but I think the Court has made itself clear on when MP can apply and that it applies to any civil proceedings.

[Crazy council]

Re: Malicious Prosecutions - Discussion

A recurring theme here I think? Evidence or some evidence or indication that gives cause to bring a claim will prevent a claim for MP, the burden rests with the defendant that the claim was groundless and malicious and without reasonable belief. Your opinion just like mine and other practitioners in the field are just that, but I think the Court has made itself clear on when MP can apply and that it applies to any civil proceedings.

Hi [MENTION=71570]R0b[/MENTION]

In relation to the liability orders, to input false,fake,inappropriate accounts, the council officers, trip a number of points were they guarantee accuracy. From memory these are

1. ensure all payments added from suspense account ( payin in account ) , to the individually CT accounts before processing for arrears
My council just ignored this, they get the LO, then Finnish adding all the payments, adjust the account, sometimes, the person is just left with teh court costs
( one of the court officers delegated responsibility )

2. Ensure any applications for benefits that were placed in time are processed before doing the liability order run

3. Ensure the accuracy of the charges ( the bill ) sent to the public, are accurate in relation to the information they have on there systems or reasonably could assume the accuracy.
The above is supposed to stop double charges when you move, both TT and LL getting bills for same period, that banding and monthly charges are correct. Its also the reason they wont change things on there systems after notifying you with a summons, to then getting the LO,

The above is what the Court officer Has to ensure, ( but in some councils, they ignore the steps because it reports better )

Then, you have whatever group ( ither CIPFA - or one of the others financial bodies ) rules are set out ( accountancy management rules, ). These can be complex to understand at first, but are the only way of really measuring financial performance.

The point of adding the above, would be any claim of malicious prosecution, or false accounting, would be based on the decision that the court officer takes, at one of these points above, so rather than the claim at court being the malicious prosecution, the point were the delegated officer, bypassed the safety mechanism,

[Openlaw15]

Re: Malicious Prosecutions - Discussion

So what's the problem? The court did not say that MP is restricted to a certain classes of claims but that the claim of MP was available where malicious proceedings are brought in a civil context. That therefore means that it is available across the board. Again the Court has also pointed out that people with genuine claims and with evidence which they can present to the court that shows they have some reason to bring a claim.

Employment = an employee bringing a claim against an employer making certain allegations causing damage but no evidence to back it up.

IP = claims for breach of IP but no evidence to back it up/withholding information

Commercial = claims for breach of contract with no evidence to back it up/withholding information

Family = claims against ex partners which causes damage to the other with no evidence to back it up/withholding information

A recurring theme here I think? Evidence or some evidence or indication that gives cause to bring a claim will prevent a claim for MP, the burden rests with the defendant that the claim was groundless and malicious and without reasonable belief. Your opinion just like mine and other practitioners in the field are just that, but I think the Court has made itself clear on when MP can apply and that it applies to any civil proceedings.

In the real world Rob, you're talking about lawyers who'll say their client has had a MP to stop a cause of action. It would be interesting to see how tribunal or the County Court interprets an MP, as the Supreme Court/ Law Lords recognised the massive potential that they have. You use the word 'wrongful' - but wrongful and MP are very different. Breach is wrongful but MP requires more than wrong, doesn't it? The high standard is what made it once a criminal proceeding attempt of 'reasonable and probable cause' to bring an MP, ie 'reasonable belief and probable cause.' Probable is much more than possible, in means there is a very high correlation. Reasonable, well I have discussed that already. There is a shed load of cases incidentally for each ingredient of the MP.

You never answered my question how you believed this MP remedy applies in the OP's situation, for whom your provided your advice/ opinion.

What damages has the person suffered - it's a tort so where is the injury to bring this tort?

[des8]

Re: Malicious Prosecutions - Discussion

Without going back to the original thread wasn't the claim for all the expenses OP incurred in preparing to defend what was (allegedly) a malicous prosecution.
So therein are the damages.

[Openlaw15]

Re: Malicious Prosecutions - Discussion

Without going back to the original thread wasn't the claim for all the expenses OP incurred in preparing to defend what was (allegedly) a malicous prosecution.
So therein are the damages.

How does this UKSC change the law where a party makes an MP but later discontinues/ withdraws without court permission? For instance, does the UKSC precedent benefit small claims in an MP situation by over-riding normal CPR 38 procedure, to permit LIP's costs?