In the situation where false statements are being published about you or your business, the first association many people make is one of defamation. However, depending on the facts of the case, defamation may not be the most viable remedy. Rather, a claim in the tort of malicious falsehood may be more effective, stronger, or, in many cases, the sole legal remedy.
The main difference between malicious falsehood and defamation lies within the harm or loss suffered by the injured party. Malicious falsehood is not concerned with reputation; it is separate from the tort of defamation and need not be defamatory to fulfil the threshold. Instead, it is more concerned with financial loss than reputational harm.
Proving Defamation
To succeed with a claim under the Defamation Act 2013, the claimant must show that the defendant published a defamatory statement that identified them either directly or indirectly and caused, or was likely to cause, serious harm to their reputation. Where the claimant is a business, this will usually require evidence of serious financial loss.
Under defamation, truth is an absolute defence – the principle of defamation action is built upon the assumption that the information being circulated is untrue.
Proving Malicious Falsehood
To prove malicious falsehood, the claimant must prove that the defendant has maliciously published a statement about, or referring to them, that is false, and it has caused financial loss to them or their business. The statement must be in writing or in some other permanent form, and it must relate to the claimant’s office, line of work, business, or profession.
The evidential threshold for malicious falsehood is higher than that of defamation. Namely, the claimant must demonstrate that the defendant knew that the statement was false or was recklessly indifferent as to the truth of the matter. This additional threshold makes malicious falsehood claims more difficult to prove in practice.
The Single Meaning Rule
In a defamation claim, the court does not consider every possible interpretation of a statement. Instead, it identifies the single meaning that an ordinary, reasonable person would naturally understand the words to convey. This approach reduces ambiguity and prevents claims based on strained or extreme interpretations.
By contrast, the single meaning rule does not apply to malicious falsehood. A claim may be based on any reasonable interpretation of a statement that a number of people could understand as damaging. The court will therefore consider the statement’s possible meanings and whether a substantial proportion of those who encountered it understood, or would be likely to understand, it in a way that could cause the claimant economic harm.
From these differences it can be seen how each claim may benefit claimants in a range of circumstances. For example:
- If a false statement that your company has ceased trading is circulated and damages its existing commercial relationships, this may amount to malicious falsehood because the harm is economic rather than reputational.
- If a statement is not defamatory in its natural and ordinary meaning but a significant proportion of its audience understands it as damaging because of implied references to other facts or opinions, it may support a malicious falsehood claim, as the single meaning rule does not apply.
- If the false statement has caused emotional distress but no actual financial loss, defamation may be the more appropriate claim.
If you would like advice or assistance about malicious falsehood and defamation, call Nath Solicitors and book your consultation today.