Goldsmith v Sperrings Ltd: CA 1977

Claims for Collateral Purpose treated as abuse

The plaintiff commenced proceedings for damages for libel and an injunction against the publishers, the editors and the main distributors of Private Eye. In addition, he issued writs against a large number of other wholesale and retail distributors of the paper for the same relief. Some of the distributors applied for an order that the actions against them should be stayed or dismissed as an abuse of process of the court on the ground that the plaintiff’s purpose in pursuing the actions against them was not to protect his reputation but for the collateral purpose of destroying the paper by cutting off its retail outlets.
Held: (Lord Denning MR dissenting) A court may prevent an abuse of process when that process is predominantly being used as a means of obtaining an advantage for which the proceedings were not intended.
Lord Denning MR (dissenting) said: ‘In a civilised society, legal process is the machinery for keeping and doing justice. It can be used properly or it can be abused. It is used properly when it is invoked for the vindication of men’s rights or the enforcement of just claims. It is abused when it is diverted from its true course so as to serve extortion or oppression: or to exert pressure so as to achieve an improper end. When [the process of the court] is so abused, it is a tort, a wrong known to the law. The judges can and will intervene to stop it. They will stay the legal process, it they can, before any harm is done. It they cannot stop it in time, and harm is done, they will give damages against the wrongdoer . . Sometimes abuse can be shown by the very steps being taken in the courts . . At other times the abuse can only be shown by extrinsic evidence that the legal process is being used for and improper purpose. On the face of it, in any particular case, the legal process may appear to be entirely proper and correct. What may make it wrongful is the purpose for which it is used.’ and
‘A criminal libel is so serious that the offender should be punished for it by the state itself. He should either be sent to prison or made to pay a fine to the state itself. Whereas a civil libel does not come up to that degree of enormity.’
and ‘The distributors of newspapers and periodicals are nothing more than conduit pipes in the channel of distribution. They have nothing whatever to do with the contents. They do not read them – there is no time to do so. Common sense and fairness require that no subordinate distributor – from top to bottom – should be held liable for a libel contained in it unless he knew or ought to have known that the newspaper or periodical contained a libel on the plaintiff himself: that is to say, that it contained a libel on the plaintiff which could not be justified or excused: and I should have thought that it was for the plaintiff to prove this. And the Restatement bears this out: see Restatement, Torts 1965 Supplement, section 581, Comment. I have read every case cited in the textbooks on this subject and I find that a subordinate distributor has never been held liable to a plaintiff except when prior knowledge of the libel has been brought home to him.’
Scarman LJ said: ‘to pass judgment on the respondent’s purpose upon a preliminary application, [to] prevent him bringing to trial actions in each of which . . he is pleading a cause of action recognised by the law. It is right, therefore, that to obtain before trial the summary arrest of a plaintiff’s proceedings as an abuse of the process of the court, the task of satisfying the court that a stay should be imposed is, and should be seen to be, a heavy one.
Unless the court is satisfied, a stay is a denial of justice by the court – a situation totally intolerable . . the defendants have to show that the plaintiff seeks a collateral advantage for himself beyond what the law offers. In a phrase, the plaintiff’s purpose has to be shown to be not that which the law by granting a remedy offers to fulfil, but one which the law does not recognise as a legitimate use of the remedy sought, see In re Marjory.’
Bridge LJ said: ‘For the purpose of [the] general rule, what is meant by a ‘collateral advantage’? The phrase manifestly cannot embrace every advantage sought or obtained by a litigant which it is beyond the court’s power to grant him. Actions are settled quite properly every day on terms which a court could not itself impose upon an unwilling defendant. An apology in libel, an agreement to adhere to a contract of which the court could not order specific performance, an agreement after obstruction of an existing right of way to grant an alternative right of way over the defendant’s land – these are a few obvious examples of such proper settlements. In my judgment, one can certainly go so far as to say that when a litigant sues to redress a grievance no object which he may seek to obtain can be condemned as a collateral advantage if it is reasonably related to the provision of some form of redress for that grievance. On the other hand, if it can be shown that a litigant is pursuing an ulterior purpose unrelated to the subject matter of the litigation and that, but for his ulterior purpose, he would not have commenced proceedings at all, that is an abuse of process. These two cases are plain; but there is, I think, a difficult area in between. What if a litigant with a genuine cause of action, which he would wish to pursue in any event, can be shown also to have an ulterior purpose in view as a desired by product of the litigation? Can he on that ground be debarred from proceeding? I very much doubt it. But on the view I take of the facts in this case the question does not arise and it is neither necessary nor desirable to try to lay down a precise criterion in the abstract.’

Denning MR, Scarman LJ, Bridge LJ
[1977] 1 WLR 478, [1977] 2 All ER 566
England and Wales
CitedShackleton v Swift CA 1913
The Act gave special protection to officers and others acting under its powers in cases where, although they might have misconstrued the Act, and although they might have done things which they had no jurisdiction to do, they had acted in good faith . .
CitedGrainger v Hill CEC 1838
Misuse of Power for ulterior object
D1 and D2 lent C 80 pounds repayable in 1837, secured by a mortgage on C’s vessel. C was to be free to continue to use the vessel in the interim but the law forbade its use if he were to cease to hold its register. In 1836 the Ds became concerned . .
CitedIn re Marjory 1955
Lord Evershed said: ‘ . . court proceedings may not be used or threatened for the purpose of obtaining for the person so using for threatening them some collateral advantage to himself, and not for the purpose for which such proceedings are properly . .

Cited by:
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CitedBroxton v McClelland CA 31-Jan-1995
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CitedDhir v Saddler QBD 6-Dec-2017
Slander damages reduced for conduct
Claim in slander. The defendant was said, at a church meeting to have accused the client of threatening to slit her throat. The defendant argued that the audience of 80 was not large enough.
Held: ‘the authorities demonstrate that it is the . .

Lists of cited by and citing cases may be incomplete.

Litigation Practice, Defamation

Leading Case

Updated: 11 November 2021; Ref: scu.186023