May 20, 2019

The claimant, William Tinkler, was at the relevant time an executive director and substantial shareholder in Stobart Group Ltd. He was the Chief Executive Officer of Stobart from 2007 until his resignation on 28th June 2017.

Mr Tinkler brought proceedings for defamation and malicious falsehood against five defendants, all directors and/or officers of Stobart, in relation to an announcement made on the London Stock Exchange’s Regulatory News Service by Stobart on 29 May 2018.

Mr Tinkler claimed that the words complained of were defamatory in meaning that he had acted in breach of his duties as a director of Stobart by deliberately destabilising the Board at a crucial time for the business, and/or had done so for selfish and self-interested reasons to protect his own position, following his history of improper conduct and poor corporate governance, and that he had repeatedly shown himself to be so lacking in integrity that he was unfit to hold the office of company director. Mr Tinkler also claimed that the announcement was false and had been published maliciously by the defendants.

At first instance, the High Court disagreed, finding that the single meaning of the announcement was that (a) Mr Tinkler had presented a series of challenges to the Board of Stobart, the most recent of which was his opposition to the re-election of the first defendant, Iain Ferguson, as Chairman of Stobart, (b) that a vote to remove the current Chairman would weaken Stobart’s corporate governance, create instability, present a number of serious risks to Stobart and would not be in the best interests of the shareholders, and (c) that Mr Tinkler’s behaviour was disruptive and in relation to the challenges in (a) unreasonable, and his opposition to the re-election of the Chairman was regrettable and risked destabilising Stobart.

Mr Tinkler appealed the High Court’s decision on meaning.

Giving the lead judgment, Lord Justice Longmore noted that a Stock Exchange announcement was a measured statement and that its readership would be businessmen and investors who were relatively well informed. Longmore LJ found that these were considerations that the judge had had well in mind and the suggestion that the judge had failed to take the context of the announcement into consideration could not be sensibly maintained.

As for any imputation of impropriety, which was the essential question, Longmore LJ rejected Mr Tinkler’s submission that the announcement asserted that he was in breach of fiduciary duty as a director and was, for that or other reasons, unfit to continue as a director. Longmore LJ said that the difficulty with this submission was that the announcement did not say that. There was no reference to breach of fiduciary duty nor was there any inference of such breach. The announcement did not suggest that Mr Tinkler had committed any impropriety. It simply reported a boardroom dispute, alleging that Mr Tinkler was a destabilising influence who had presented several challenges to the Board, some of which posed a number of serious risks to the company. The ordinary reasonable reader would not have understood the allegations to imply that Mr Tinkler was in breach of his fiduciary duties as a director.

Mr Tinkler also asserted that the correct meaning was that he was selfish and self-interested and that he was not committed to the same high standards as the rest of the Board. However, Longmore LJ said, again, these were not to be found in the announcement. To the extent that the judge regarded them as matters of “inferred opinion” and might have used that finding as a reason for rejecting Mr Tinkler’s preferred meaning, he had been correct to do so. Further, these phrases could not be considered defamatory in themselves save as found by the judge in his meaning.

Longmore LJ therefore upheld the judge’s single meaning.

As for the question of serious harm, Longmore LJ noted that this was “quintessentially” a matter for the judge, and that an appeal court should be slow to reverse a decision that an allegation is insufficiently serious to raise an inference of serious harm to reputation. Being said to be disruptive or unreasonable or to be behaving regrettably in the context of a boardroom dispute was, Longmore LJ said, “part of the give and take of business life”. If it was defamatory at all it was very much at the lower end of the scale. An inference of serious harm could not be drawn. Therefore, if Mr Tinkler wished to pursue the defamation claim by reference to the single defamatory meaning found by the judge, he would have to demonstrate that the announcement had caused or was likely to cause serious harm to his reputation.

As for the malicious falsehood claim, Longmore LJ noted that Mr Tinkler’s claim differed from the claim in defamation because (among other things) there was no single meaning rule for the purposes of the tort of malicious falsehood. A claimant will be entitled to succeed if he can show that a substantial number of people would have reasonably read the announcement in a way that accords with his preferred meaning. In other words, a claimant can seek to show that any reasonably available meaning of the statement in question was false and made maliciously.

Longmore LJ agreed with the judge that Mr Tinkler’s pleaded meanings were not reasonably available meanings, but that a reasonably available meaning (which Mr Tinkler could try to prove was both false and malicious) was that: a) he had destabilised the Board at a crucial time for the business; and/or b) had required the Board to deal with certain challenges. In making this decision as to the available meaning, the judge had stripped out the inferences drawn by Mr Tinkler, but not stated in the announcement. In Longmore LJ’s view, the judge had been correct to do so.

The appeal was dismissed. (William Andrew Tinkler v Iain George Thomas Ferguson [2019] EWCA Civ 819 (15 May 2019) — to read the judgment in full, click here).