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Courts will still say councils cannot bring defamation actions, claims minister

The Government is “in no doubt” that if a claim were brought by a local authority, the courts would still find that councils cannot bring actions in defamation, a minister has said.

Lord McNally told peers that the Ministry of Justice had explored the issue with officials at the Department for Communities and Local Government.

This followed legal advice given to Rutland County Council by law firm Bevan Brittan that the general power of competence contained in s. 1 of the Localism Act 2011 had overturned the bar on councils suing in defamation.

This principle had been established by the House of Lords in Derbyshire County Council v Times Newspapers.

Lord McNally said: “The decision in Derbyshire was reached on public policy grounds, which we considered remain compelling. The House of Lords found that it would be contrary to the public interest for organs of government to be able to sue in defamation, and that it would be an undesirable fetter on freedom of speech.”

The minister added that Derbyshire was decided before the enactment of the Human Rights Act 1998. “Consideration of Article 10 would only bolster the reasoning of the House of Lords in Derbyshire,” he argued.

However, Lord McNally was moved to add that “….even if the issue was brought before the court and found to the contrary, the situation could be remedied by way of a statutory instrument under section 5(3) of the Localism Act 2011”.

The power under s. 5(3) allows the Secretary of State to prevent local authorities using section 1 powers to do anything specific in the order.

The minister said: “In this case, an order could be made preventing any action being brought in defamation. I have already indicated in earlier debates our view that it is preferable for the courts to have the flexibility to continue to develop the Derbyshire principle, rather than to attempt to prescribe rigid boundaries in statute.

“That remains our view. In the unlikely event of any difficulty arising as a result of the provisions in the Localism Act, prompt action can be taken to address that without any need for primary legislation.”

Earlier this month Rutland decided to defer a decision over whether to make a defamation claim against three of its members.

However, councillors did give the go-ahead for the authority to seek an injunction preventing harassment of the chief executive and other officers by the Rutland Anti-Corruption Group and its members. The council also backed other measures such as the requirement for a single point of contact for all communications.

The members of the RACG have consistently denied any wrongdoing.

In their report, prepared ahead of the council’s special meeting, Bevan Brittan highlighted the general power of competence contained in the Localism Act and pointed out that there was no restriction in the legislation on a council issuing a defamation claim.

The report argued: “Given the extent to which a local authority is now dependent on its public reputation for its ability to secure external funding, to attract competitive tenders for the provision of services, or to recruit outstanding officers, it seems quite appropriate that the 2011 Act should now have brought the law up to date with commercial reality.”

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