Ratcliffe v. Evans

A newspaper falsely said that the firm of Ratcliffe & Sons no longer existed. The owner proved a general loss of business but named no lost customer. The Court of Appeal held that this evidence was admissible and enough to support the action on the case.

Quick Revision

Parties

Ratcliffe — plaintiff and respondent in the appeal; carried on business as an engineer and boiler-maker at Hawarden, Flintshire, under the name Ratcliffe & Sons.

Evans — defendant and appellant; registered proprietor, publisher and printer of the weekly newspaper the County Herald.

Mr. Commissioner Bompas, Q.C. — the trial judge at the Chester Summer Assizes, 1891.

Bowen L.J. — read the judgment of the Court (Lord Esher M.R., Bowen and Fry L.JJ.).

Procedural History

1. The action was tried with a jury before Mr. Commissioner Bompas, Q.C., at the Chester Summer Assizes, 1891.
2. At the trial the commissioner allowed the statement of claim to be amended. The amendment added that the plaintiff was injured in his credit, reputation and business, and lost profits.
3. The jury answered the questions the commissioner left to them. The commissioner entered judgment for the plaintiff for £120 with costs.
4. The defendant appealed to the Court of Appeal by motion. He asked the Court to enter judgment for him, or to order a new trial.
5. Counsel were heard, and the Court reserved judgment (Cur. adv. vult).
6. On 26 May 1892 the Court dismissed the appeal with costs.

Facts

1. The plaintiff had for many years carried on business at Hawarden in the county of Flint as an engineer and boiler-maker under the name Ratcliffe & Sons.
2. He had become entitled to the goodwill of the business on the death of his father. His father, with others, had formerly carried on the business under that name.
3. The defendant was the registered proprietor, publisher and printer of a weekly newspaper, the County Herald. It circulated in Flintshire and some adjoining counties.
4. The County Herald published words about the plaintiff's business. They imported that he had ceased to carry on his business and that the firm of Ratcliffe & Sons did not then exist.
5. The statement of claim alleged that the plaintiff was damaged because the defendant published these words falsely and maliciously.
6. At trial the plaintiff proved the publication and that the statements were untrue.
7. He also proved a general loss of business since the publication.
8. He gave no specific evidence of the loss of any particular customers or orders because of the publication.
9. The jury found that the words did not reflect on the plaintiff's character and were not libellous.
10. The jury found that the statement that the firm was extinct was not published bona fide (in good faith).
11. The jury found that the plaintiff's business suffered injury to the extent of £120 from that statement.
12. The Court noted that the pleadings treated the statement as defamatory or a libel, but that suggestion was rejected. The verdict rested on a false statement purposely made about the plaintiff's goods, intended to cause him damage, and in fact causing it.

Issues Raised

1. In an action for a false and malicious publication about a man's trade, is evidence of general loss of business admissible?
2. If it is admissible and uncontradicted, is it sufficient to maintain the action, or must special damage such as the loss of particular customers or orders be alleged and proved?

Arguments Contended

For the appellant (Evans; Bowen Rowlands, Q.C., and E. H. Lloyd appeared):

• The commissioner ought to have entered judgment for the defendant. The evidence of general loss of business ought not to have been admitted.
• The action is not one for slander of the plaintiff in the way of his business. It is an action on the case, so special damage must have been alleged and proved.
• Had the plaintiff sued for slander, he would have had to prove special damage by calling witnesses who withdrew their custom. He should not be better off because he sued on the case in the nature of an action for slander of title.
• In such an action there must be an express allegation of some particular damage. Malachy v. Soper (3 Bing. N.C. 371, Tindal C.J. at p. 382) was relied on.
• The analogy of slander applies, where damage is the gist of the action.
• If the slander is not actionable per se, a plaintiff proving general damage would recover only because others repeated the defendant's statement. Ward v. Weeks and Dixon v. Smith rest on the principle that a defendant is not liable for repetitions of his statement.
• It was conceded that in some cases the plaintiff cannot give evidence of particular damage, so the jury may infer damage from the fact that his business has gone. Evans v. Harries may be one.
• Evans v. Harries differs from this case because it involved a personal imputation on the plaintiff. It was never treated as an action on the case.
• In Riding v. Smith (the saved text prints Biding v. Smith) the Court held that special damage must be proved. But it thought that, on the facts, it could be proved by general evidence of a falling off in trade, without showing that particular persons stopped dealing with the plaintiff.
• The principle of Malachy v. Soper should be applied here.
• Counsel also referred to Western Counties Manure Co. v. Lawes Chemical Manure Co. and Clarke v. Morgan.

For the respondent (Ratcliffe; F. Marshall appeared):

• The evidence of general loss of business was admissible. It was evidence of special damage sufficient to support the action.
• The defendant's statements appeared in a newspaper widely read in Wales. Their natural consequence was to stop customers and intending customers who read them from giving the plaintiff further orders.
• From the nature of the case, the plaintiff could give only general evidence of his loss of business. The case falls in the class where such evidence has been held sufficient evidence of special damage.
• Malachy v. Soper is not in point. The Court there did not intend to lay down a general rule. It found no sufficient allegation or proof of special damage on the facts of that case.
• Counsel also referred to Thomas v. Williams and Dicks v. Brooks.

Court's Reasoning

Judgment of the Court, read by Bowen L.J. (Lord Esher M.R., Bowen and Fry L.JJ.)

1. Noted: The case was an action for a false and malicious publication about the trade and goods of the plaintiff. It ended in a verdict for the plaintiff for £120.
2. Noted: The defendant appealed for a new trial, or for judgment in his favour. One ground was that no special damage of the kind needed to support the action was proved at trial.
3. Noted: The statement was published in the County Herald, a Welsh newspaper. The pleadings treated it as defamatory or a libel, but that suggestion was rejected.
4. Noted: The verdict rested on the view that the writing was a false statement purposely made about the plaintiff's goods. It was intended to cause him damage and did so.
5. Noted: The only proof of damage was general loss of business. There was no proof of the loss of particular customers or orders.
6. Noted: The question was whether, in such an action, general evidence of damage was admissible and sufficient.
7. Held: It is established law that an action lies for written or oral falsehoods that are not actionable per se and not even defamatory. The falsehood must be maliciously published, calculated in the ordinary course of things to produce actual damage, and must in fact produce it.
8. Held: Such an action is not libel or slander. It is an action on the case for damage wilfully and intentionally done without just occasion or excuse. It is analogous to an action for slander of title.
9. Held: To support it, actual damage must be shown. The action lies only for damage that has actually occurred.
10. Noted: It was argued that general loss of business is general and not special damage, and that special damage is the gist of such an action.
11. Noted: The term special damage is found in the books for centuries. It is not always used for similar subject-matter or in the same context.
12. Noted: In one context, special damage is damage from the special circumstances of the case. It may be added to the general damage the law implies in every breach of contract and every infringement of an absolute right. Ashby v. White was cited.
13. Noted: In that context the law presumes that some damage flows in the ordinary course from the mere invasion of the plaintiff's rights. It calls this general damage.
14. Noted: Special damage there means the particular damage beyond the general damage. The plaintiff should give warning of it in his pleadings so there is no surprise at trial.
15. Noted: Where no actual and positive right has been disturbed apart from the damage done, the damage done is the wrong. Special damage then means the actual financial loss that has in fact occurred.
16. Noted: Old authorities call it express loss, particular damage (Cane v. Golding), or damage in fact and special or particular cause of loss (Law v. Harwood; Tasburgh v. Day).
17. Noted: The term is also used in actions on the case for a public nuisance, such as obstructing a river or highway. There it means the actual and particular loss, beyond that of the general public, which the plaintiff must allege and prove. Iveson v. Moore and Rose v. Groves were cited.
18. Held: The Court would avoid a term that, used in several contexts, encourages confusion of thought. The question is one of substance, not of words.
19. Noted: The question is stated again. In an action for a malicious falsehood intentionally published in a newspaper about the plaintiff's business, is evidence of a general loss of business admissible and, if uncontradicted, sufficient? The falsehood is neither actionable as a personal libel nor defamatory in itself.
20. Held: In a personal libel, general loss of custom may unquestionably be alleged and proved.
21. Why: Every libel is itself a wrong for which the law implies general damage. By committing it, the defendant is prepared for proof that some general damage was done.
22. Noted: Gould J. said in Iveson v. Moore that against a wrong-doer a more general mode of declaring is allowed.
23. Noted: If further particular damage is relied on over and above the general damage, it must be alleged and shown.
24. Noted: A loss of general custom flowing directly and in the ordinary course of things from a libel may be alleged and proved generally. Pollock C.B. said in Harrison v. Pearce that it is not special damage but general damage resulting from the kind of injury sustained.
25. Noted: In Bluck v. Lovering, general evidence of a decline of business was received under a general allegation of loss of credit in business. Loss of particular customers, not having been pleaded, was rightly rejected. Ingram v. Lawson was also cited.
26. Noted: Oral slander actionable in itself is akin to libel. The mere speaking of the words is a wrong, and the law presumes and in theory allows proof of general damage.
27. Noted: Slander differs from libel in a way that makes proof of general damage difficult. Printed defamation is more permanent and more easily transmitted than oral slander.
28. Held: Spoken defamatory words may be meant to be repeated, or uttered so that repetition follows in the ordinary course. Otherwise the plaintiff cannot recover damages that flow from unauthorized repetition, not from the original slander. Ward v. Weeks, Holwood v. Hopkins and Dixon v. Smith were cited.
29. Held: General loss of custom cannot properly be proved for a slander uttered where repetition does not flow directly and naturally from the circumstances of the original utterance.
30. Held: The doctrine that general damage may be proved generally in slander actionable per se carries a qualification. The words must have been spoken in circumstances that might in the ordinary course have directly produced the general damage that occurred.
31. Noted: Evans v. Harries was a slander of this kind. Words about an innkeeper's conduct of his business were spoken openly before guests and customers, a floating and transitory class. General evidence of the decline of business was rightly receivable.
32. Noted: Martin B. asked how a public-house keeper, whose only customers are passing persons, could show damage unless he could give general evidence of loss of custom.
33. Noted: In Maeloughlin v. Welsh the plaintiff was excommunicated in open church. General proof that he was shunned and his mill abandoned was rightly admitted, though no loss of particular customers was shown.
34. Why: The nature of the slander made such general proof necessary. The words were spoken openly and publicly and were meant to have the exact effect that followed. Without general evidence, the injury could not be proved at all.
35. Noted: If loss of particular customers was also relied on, those losses would have to be mentioned in the statement of claim under the ordinary rules of pleading. Ashley v. Harrison was cited.
36. Noted: The Court then turned to slanders not actionable per se, where actual damage is the very gist of the action. Many old authorities say the actual loss must be proved specially and with certainty. Law v. Harwood was cited.
37. Noted: Such instances are collected in Iveson v. Moore. There was a difference over whether the rule was satisfied in that kind of action on the case, but no doubt was thrown on the principle.
38. Noted: The old pleaders' rule was that damages in the per quod, where the per quod is the gist of the action, should be shown certainly and specially.
39. Held: That doctrine was always subject to good sense and justice. A general loss of custom may be the natural and direct result of the slander, and it may be impossible to specify particular instances.
40. Noted: Hartley v. Herring is probably such a case. The report does not show in whose presence the words were uttered.
41. Held: If words are uttered to one individual and repetition is not intended except to a limited extent, general loss of custom cannot ordinarily be a direct and natural result of the limited slander. Dixon v. Smith and Hopwood v. Thorn were cited.
42. Noted: Puller's Nisi Prius (p. 7) states the broad doctrine. Where words are not actionable and special damage is the gist, saying generally that several persons left the plaintiff's house does not lay the special damage.
43. Noted: Slanders of title, written or oral, and actions like this one for falsehoods about a man's goods or business are similar to that class. Damage is the gist of both, and it makes no difference whether the falsehood is oral or written. Malachy v. Soper was cited.
44. Noted: The need to allege and prove actual financial loss with certainty has been insisted on for centuries. Lowe v. Harewood, Cane v. Golding, Tasburgh v. Day and Evans v. Harlow were cited.
45. Held: It is an ancient rule of pleading that the generality of pleading depends on the general subject-matter. Janson v. Stuart, Lord Arlington v. Merricke, Grey v. Friar, Westwood v. Cowne and Iveson v. Moore were cited.
46. Held: In all actions on the case where the damage done is the gist, the nature of the acts and the circumstances in which they are done regulate the degree of certainty and particularity needed. Both pleading and proof of damage must be as certain and particular as is reasonable, having regard to those circumstances.
47. Held: "To insist upon less would be to relax old and intelligible principles. To insist upon more would be the vainest pedantry." In plain words, the Court asks for as much precision as is reasonable, no more and no less.
48. Held: The rule for malicious falsehoods affecting property or trade is only one instance of these good-sense doctrines. The nature and circumstances of the publication may require admitting evidence of general loss of business as the natural and direct result, and perhaps the intended result.
49. Noted: Hargrave v. Le Breton, decided a century and a half earlier, covers this appeal. It was a slander of title at an auction.
50. Noted: The declaration there alleged that several persons who would have purchased left the auction, without naming them. The objection that they were not named was easily answered.
51. Why: In the nature of the transaction it was impossible to name them. The complaint was in effect that the bidding was stopped and everyone went away, so it was impossible to tell who would have bid or bought.
52. Held: Take an action for a falsehood that damages a man's trade. Suppose the falsehood by its nature is intended or reasonably likely to produce a general loss of business. Suppose it also does produce that loss in the ordinary course. Evidence of the general decline is then admissible. The loss is one of general business, as distinct from the loss of this or that known customer.
53. Noted: In Hargrave v. Le Breton the falsehood was openly spread at an auction. Here it was openly disseminated through the press. It was probably read, and possibly acted on, by persons of whom the plaintiff never heard.
54. Held: To refuse such general evidence would misunderstand the meaning of old expressions and depart from old rules. It would also deny justice and redress for the very harm intended.
55. Noted: So far as Riding v. Smith (printed Hidings. Smith in the saved text) can be justified, it must be on the ground that the Court believed, rightly or wrongly, that the circumstances of the falsehood brought it within a similar principle.
56. Held: There was no misdirection and no improper admission of evidence. The appeal should be dismissed with costs.

Authorities

• Malachy v. Soper (3 Bing. N.C. 371, at 382; also 3 Bing. N.C. 382) — relied on by the appellant for the need for particular damage. The respondent said it was not in point. The Court cited it for the rule that damage is the gist of slander of title and of actions for falsehoods about goods or business, whether oral or written.
• Ward v. Weeks (7 Bing. 211) — no damages for unauthorized repetition of slander. Appellant's argument; used by the Court.
• Dixon v. Smith (5 H. & N. 450) — same principle; also on words spoken to one individual with limited repetition.
• Evans v. Harries (1 H. & N. 251; 26 L.J. (Ex.) 31) — innkeeper slander before guests; general evidence of declining business rightly received.
• Riding v. Smith (1 Ex. D. 91; text prints Biding v. Smith) — the appellant relied on it: the Court there said special damage must be proved, but held general evidence of falling trade could prove it. This Court said it can be justified only on the ground of a similar principle.
• Western Counties Manure Co. v. Lawes Chemical Manure Co. (L.R. 9 Ex. 218) and Clarke v. Morgan (38 L.T. (N.S.) 354) — referred to by the appellant's counsel. The judgment records no use of them.
• Thomas v. Williams (14 Ch. D. 864) and Dicks v. Brooks (15 Ch. D. 22) — referred to by the respondent's counsel. The judgment records no use of them.
• Ashby v. White (2 Ld. Raym. 938; 1 Sm. L.C. 9th ed. p. 268, per Holt C.J.) — on special damage added to the general damage implied for infringement of a right.
• Cane v. Golding (Sty. 169; 176), Law v. Harwood (Cro. Car. 140), also cited as Lowe v. Harewood (W. Jones 196), and Tasburgh v. Day (Cro. Jac. 484) — old authorities on express loss, particular damage and the need to prove actual loss with certainty.
• Iveson v. Moore (1 Ld. Raym. 486) — special damage in public nuisance; Gould J. on general pleading against a wrong-doer; collection of old authorities; pleading rule.
• Rose v. Groves (5 M. & G. 613; text prints Bose v. Groves) — special damage in public nuisance.
• Harrison v. Pearce (32 L.T. (O.S.) 298) — Pollock C.B.: general loss of custom from a libel is general damage.
• Bluck v. Lovering (1 Times L.R. 497) and Ingram v. Lawson (6 Bing. N.C. 212) — general evidence of decline of business received under a general allegation; particular customers not pleaded were rejected.
• Holwood v. Hopkins (Cro. Eliz. 787) and Hopwood v. Thorn (19 L.J. (C.P.) 95) — no damages for unauthorized repetition; limited slander to one individual.
• Maeloughlin v. Welsh (10 Ir. L. Rep. 19) — excommunication in open church; general proof of being shunned rightly admitted.
• Ashley v. Harrison (1 Esp. 50) — particular customer losses must be pleaded if relied on.
• Hartley v. Herring (8 T.R. 130) — probably a case where general loss of custom was the direct result.
• Puller's Nisi Prius (p. 7) — the broad doctrine that saying generally that several persons left does not lay special damage.
• Evans v. Harlow (5 Q.B. 624) — need to prove actual financial loss with certainty.
• Janson v. Stuart (1 T.R. 754), Lord Arlington v. Merricke (2 Saund. 412, n. 4), Grey v. Friar (15 Q.B. 907; see Co. Litt. 303 d) and Westwood v. Cowne (1 Stark. 172) — generality of pleading depends on the subject-matter.
• Hargrave v. Le Breton (4 Burr. 2422) — slander of title at an auction; the case by which the Court said this appeal is really covered.

Also cited in footnotes: Cane v. Golding (Sty. 176), Tasburgh v. Day (Cro. Jac. 484), Rose v. Groves, Lowe v. Harewood, Evans v. Harlow, Janson v. Stuart, Lord Arlington v. Merricke, Grey v. Friar, Westwood v. Cowne, Holwood v. Hopkins, Hopwood v. Thorn and the reports of Ashby v. White, Iveson v. Moore, Harrison v. Pearce, Bluck v. Lovering and Ingram v. Lawson.

Judgement

1. The Court held there was no misdirection and no improper admission of evidence.
2. The appeal was dismissed with costs. The Court did not order judgment for the defendant or a new trial.
3. The commissioner's judgment for the plaintiff for £120 with costs therefore stood.

Legal Principle / Ratio

In an action on the case for a false and malicious statement about a man's trade, the plaintiff must prove actual damage. Where the falsehood is intended or reasonably likely to cause, and does cause, a general loss of business, general evidence of that loss is admissible. It need not name particular lost customers. The headnote states it as: "evidence of such general loss of business is admissible, and sufficient to support the action".

Critical Analysis

Analysis based on the judgment text.

• The Court says it will avoid the term special damage. The judgment therefore does not settle the label for general loss of business. It fixes the test as reasonable certainty on the facts.
• The test that the falsehood must be intended or reasonably likely to cause general loss is stated but not defined. The judgment does not say how a court should judge this in other trades or media.
• The verdict rested on the jury's finding that the statement was not published in good faith. The judgment does not say what a plaintiff must show about malice beyond that finding.

Significance

• The Court treats the tort as an action on the case, separate from libel and slander.
• The case links pleading and proof to the nature of the wrong. The nature of the acts and the circumstances of the publication set how precisely damage must be stated and proved.
• The judgment compares libel, slander actionable per se, slander not actionable per se, and slander of title. It shows where general proof of loss is allowed.
• The judgment lists no later cases. The text saved for this page contains no later case discussing it.

Exam-Important Points

• Rule: in a malicious falsehood about a man's trade, general loss of business is admissible and sufficient where the falsehood is intended or reasonably likely to cause it.
• The action is an action on the case, not libel or slander. Actual damage must be shown.
• The Court asks for as much certainty as is reasonable. It rejected both less certainty and the vainest pedantry.
• Contrast: for slander not actionable per se, uttered to one individual, general loss of custom is not ordinarily a natural result. Dixon v. Smith applies.
• Key analogy: Hargrave v. Le Breton, slander of title at an auction, where the losers could not be named.
• Trap: the jury found the words were not libellous. The plaintiff won on the falsehood and general loss, not on defamation.
• Result: appeal dismissed with costs; £120 stood.

Prepared from the full text of the judgment. The judgment is not paragraph-numbered, so no paragraph numbers are cited. The citation is not in the judgment text.