Claiming damages when a malicious and false statement is published about you, your property or your business

The Supreme Court has recently clarified the law regarding claiming damages in malicious falsehood, in the case of George v Cannell and another [2024] UKSC 19.

The Claimant, Ms George, established that her former employer had emailed malicious and false statements about her to her new employer, and although she had suffered no actual financial loss, sought to recover damages for injury to her feelings.

The Court of Appeal held that she was entitled to recover compensation (being more than merely nominal damages) for injury to her feelings and ordered for damages to be assessed on this basis.

Nominal Damages vs Actual (Compensatory) Damages

Nominal damages are a small sum on money awarded to a claimant who has won a civil case but not suffered any substantial loss. They are awarded to recognise that a claimant’s legal rights have been infringed upon, even if they have not experienced actual harm. Claimants should be warned that the cost of bringing a civil action is likely to be entirely disproportionate to any such award, making it not worth the time and expense, unless of course a claimant is seeking a finding of liability for reasons other than receiving compensation. By comparison, actual (compensatory) damages, are damages awarded by a court to compensate a party for a loss suffered.

The Supreme Court’s Decision

The defendants appealed the Court of Appeal’s decision and the Supreme Court unanimously held that it is enough to establish liability where the statement is likely to cause financial loss, even if no financial loss is actually suffered. However, a claimant can only recover damages (other than merely nominal damages) for any financial loss actually suffered. The Supreme Court also held that injury to feelings could only be recovered if such injury was consequent on financial loss caused by the statement. Accordingly, the order made by the Court of Appeal for an assessment of damages for injury to feelings was set aside. 

The Supreme Court’s decision reflected that emotional wellbeing is not an interest protected by the law of malicious falsehood and recognised that the legislation is based on the common law principle that proof of financial damage is fundamental to any claim. There is a possible exception where the publication causes acute distress and anxiety about a claimant’s livelihood following damage to a claimant’s business, however it must follow that the injury to feelings was consequential upon the economic damage.