Although followed in City of Prince George v British Columbia Television System Ltd, 85 D. The alleged libel is contained in a letter written by the defendant to the editor of the 'Manchester Examiner and Times,' which charged, as alleged by the statement of claim, that bribery and corruption existed or had existed in three departments of the Manchester City Council, and that the plaintiffs were either parties thereto or culpably ignorant thereof, and that the said bribery and corruption prevailed to such an extent as to render necessary an inquiry by a parliamentary commission.
Now it is for us to determine whether a corporation can bring such an action, and I must say that, to my mind, to allow such a thing would be wholly unprecedented and contrary to principle.
It would be monstrous if a corporation could maintain no action for slander of title through which they lost a great deal of money.
It could not sue in respect of an imputation of murder, or incest, or adultery, because it could not commit those crimes.
This is not a hypothetical matter: the defendant in the Bognor Regis case  2 QB 169 was completely ruined by the legal costs of defending a libel trial for having handed out a leaflet at a ratepayers' association meeting in a village hall. Seditious libel requires proof of a seditious intention, whereas state of mind is immaterial for defamatory libel, since malice is implied from the mere publication of defamatory matter. Where there has been judicial weighing of the competing public interests, it has been held that governmental bodies cannot sue in respect of their governing reputations: City of Chicago v Tribune Co (1923) 139 N. In the absence of legislative intervention by Parliament, it is the constitutional function of the courts, when declaring and applying the common law, to ensure that the law does not unnecessarily interfere with free expression: see In re Alberta Legislation  2 D. The judgement of Day J in the Queen's Bench report is in these terms  1 QB 94, 96:"This is an action brought by a municipal corporation to recover damages for what is alleged to be a libel on the corporation itself, as distinguished from its individual members or officials. It is altogether unprecedented, and there is no principle on which it could be founded.
Freedom of expression is an essential feature of citizenship and of representative democracy. The development of a tort of government libel, much more draconian than the crime of seditious libel, would have a chilling effect upon the freedom of expression of newspapers as well as of the individual citizen critic of government. The libel complained of consists of a charge of bribery and corruption. The limits of a corporation's right of action for libel are those suggested by Pollock CB in the case which has been referred to.
The facts are stated in the opinion of Lord Keith of Kinkel. So, too, can trade unions: Electrical, Electronic, Telecommunication and Plumbing Union v Times Newspapers Ltd  QB 585. There is no reason in logic or principle to distinguish the plaintiff from these bodies. The rationale for permitting persons other than individuals to sue for libel thus applies with equal force to local authorities. Balcombe LJ, giving the leading judgement in the Court of Appeal, summarised the facts thus  QB 770, 802:"The facts in the case are fortunately refreshingly simple.
Each of these bodies, although having only legal personality, has a legitimate entitlement to protect its reputation from defamatory attacks. Bognor Regis Urban District Council v Campion  2 QB 169 remains good authority for the proposition that a local authority has a "governing" reputation, which it can protect by an action for libel. Article 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms (1953) (Cmd. 407 and Oberschlick v Austria, , Publications of the European Court of Human Rights, Series A No. Even if the question were to be asked in the abstract, a thorough investigation of the aims and effect of domestic law would show that the English law of defamation strikes a balance between the rights of protection for reputation and of freedom of expression. In two issues of 'The Sunday Times' newspaper on 17 and 24 September 1989 there appeared articles concerning share deals involving the superannuation fund of the Derbyshire County Council.
A local authority should not be deprived of the right to bring an action for libel because of the possibility of its being able to prosecute for criminal libel. The plaintiffs are not a trading corporation or some other private body: they are a governmental body performing public duties and exercising public powers not possessed by individual citizens or private bodies. This would deter newspapers and individual citizens from offending governmental bodies and would lead to self-censoring and public ignorance about the workings of government. On 31 July 1991 French J refused an application by the plaintiff to amend the statement of claim so as to plead a certain specific item of special damage.
Therefore it appears to me clear that a corporation at common law may maintain an action for a libel by which its property is injured."In South Hetton Coal Co Ltd v North-Eastern News Association Ltd  1 QB 133 a newspaper had published an article alleging that the houses in which the company accommodated its colliers were in a highly insanitary state.
The Court of Appeal held that the company was entitled to maintain an action for libel without proof of special damage, in respect that the libel was calculated to injure the company's reputation in the way of its business.
This offence is virtually extinct and is anomalous and difficult to reconcile with article 10: see Reg. There is no justification for treating a local authority's governing reputation as analogous to a private company's or trade union's business reputation, and there is no legitimate public interest in restricting or interfering with freedom of speech to protect that governing reputation. Placing the burden of proving justification upon the defendant does not mean that only false allegations would be deterred. The preliminary point of law was tried at first instance before Morland J  QB 770 who on 15 March 1991 decided it in favour of the plaintiff.
v Wells Street Stipendiary Magistrate, Ex parte Deakin  AC 477. For the courts to allow an elected public authority to sue for libel would be to authorise unnecessary interference by the common law with freedom of expression in a democratic society. In addition, would-be critics of government conduct will be deterred from voicing criticism even though what they published was reasonably believed to be true and was in fact true, because of doubt of whether it could be proved to the satisfaction of a court of law, or because of fear of the expense of having to do so: see City of Chicago v Tribune Co, 139 N. 86, approved in New York Times Co v Sullivan, 376 U. However, on appeal by the defendants his judgement was reversed by the Court of Appeal (Balcombe, Ralph Gibson and Butler- Sloss LJJ)  QB 770, on 19 February 1992.
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Nor should the right be denied because of the availability of actions for malicious falsehood. It is important that there should be as much public information and public criticism about the workings of local government as there is about the workings of central government. The plaintiff now appeals, with leave given in the Court of Appeal, to your Lordships' House.