Offer of Amends – Reduced discounts for those that delay
This recent High Court decision highlights the importance for defendants to conduct a forensic analysis of the strengths and weakness of their defences as early as possible. Those with defences that are unlikely to prevail at trial should consider implementing the offer of amends procedure sooner rather than later as those that delay will impede their ability to minimise their financial exposure to the greatest extent possible.
In this case, two directors of the Donegal Bay Waterbus were awarded defamation damages of €192,000 arising from articles published by the Donegal Times1.
These articles alleged financial malpractice and mismanagement of monies against both directors. Although a local newspaper with circulation of less than 5,000 it was alleged that the seriousness of these allegations exposed the directors to public contempt.
The newspaper sought to resolve the claim by implementing the offer of amends procedure but agreement could not be reached between the parties regarding the appropriate level of financial compensation and the wording of the apology.
The offer of amends procedure is designed to provide parties with a fast track resolution process. In order to utilise the procedure, a defendant must accept that the publication was defamatory and thereafter the parties engage in negotiations with a view to agreeing the terms of an apology as well as suitable financial compensation. If agreement cannot be reached on either or both, it then falls for the Court to decide what is appropriate in the circumstances.
Having considered the defamatory allegations and the extent of publication, the Court awarded damages of €120,000 to each director. However, it then discounted this by 20% to €96,000 as the newspaper had accepted the articles were defamatory and sought to implement the offer of amends procedure.
Interestingly, the discount obtained was only 20% as the Court looked unfavourably on the fact that the newspaper had waited over a year from receipt of the initial letter of complaint to accept its wrongdoing and offer an apology. This can be compared to the Court's approach in the case involving TV3 last year where an apology published within a week of the defamatory publication contributed to it securing a 33% reduction on the level of damages awarded2.
Early and genuine engagement with the offer of amends procedure is essential so as to ensure that the maximum reductions on damages can be obtained.