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You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Westcrowns Contracting Services Ltd v. Daylight Insulation Ltd [2005] ScotCS CSOH_55 (26 April 2005) URL: http://www.bailii.org/scot/cases/ScotCS/2005/CSOH_55.html Cite as: [2005] CSOH 55, [2005] ScotCS CSOH_55 |
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Westcrowns Contracting Services Ltd v. Daylight Insulation Ltd [2005] ScotCS CSOH_55 (26 April 2005)
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OUTER HOUSE, COURT OF SESSION [2005] CSOH 55 |
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P763/02
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OPINION OF LORD MACPHAIL in the cause WESTCROWNS CONTRACTING SERVICES LIMITED Petitioners; against DAYLIGHT INSULATION LIMITED Respondents:
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Petitioners: Murphy, Q.C., Jamieson; MacRoberts
Respondents: Olson; Semple Fraser
26 April 2005
1. Introduction
[1] The petitioners supply and install specialised glass and glazing products. They have the exclusive right to supply and install in the United Kingdom a specialised glazing system known as Profilit. It was formerly known as Reglit. The respondents are the petitioners' principal competitors in the United Kingdom. They are the exclusive distributors in the United Kingdom of a similar product, Linit-U. In this action the petitioners claim that from May to July 2002 the respondents engaged in a deliberate campaign aimed at injuring the petitioners' commercial reputation and trading prospects by falsely accusing the petitioners of misleading actual and potential customers by claiming that Profilit was a safety glass. The petitioners aver that the respondents' statements were untrue and defamatory, and were calculated and intended to inflict injury and disruption on the petitioners' business by disparaging Profilit and thereby attempting to divert the petitioners' business to the respondents. The respondents admit that the statements founded on by the petitioners were made, but maintain that they were true or substantially true; that they were subject to qualified privilege and were made without malice; and that they were communicated by the respondents, who had a duty and interest to communicate them, to parties who had a duty and interest to receive them. [2] The material part of the prayer of the petition, as amended, is in these terms:"to interdict, prohibit and discharge Daylight Insulation Limited whether by themselves or their respective directors, officers, employees or agents or otherwise howsoever from making false and misleading statements whether by telephone, letter, facsimile, electronic mail or otherwise containing representations directly or indirectly: (1) to the effect that Westcrowns Contracting Services Limited have claimed that the system of u-channelled glass known under the trademarks 'Profilit' and 'Reglit' supplied by Westcrowns aforesaid is a safety glass in accordance with the requirements of BS 6206: 1981; (2) to the effect that Profilit and/or Reglit aforesaid may be being supplied by the said Westcrowns or manufactured in infringement of European Patent no EP 0 387 717 B1 having a priority date of 16 March 1989 granted to Glasfabrik Lamberts GmbH; (3) to the effect that Westcrowns aforesaid have been deceitful, duplicitous and misleading in their claims that when tested in accordance with the impact test described in BS 6206: 1981 Profilit and/or Reglit aforesaid achieve results equivalent to class C in said British Standard; and (4) as hereinbefore enumerated or other statements containing representations of a nature calculated to affect Westcrowns aforesaid business injuriously."
Counsel for the respondents has intimated that the respondents will consent to decree in terms of head (2). The petitioners' counsel has intimated that the petitioners do not seek perpetual interdict in terms of head (4).
[3] The petitioners' pleas-in-law are as follows:"1. The petitioner being reasonably apprehensive that the respondent will continue to behave in the manner complained of, interdict should be granted as prayed.
2. That [sic] the petitioner's business reputation and legitimate business interests being prejudiced by the respondent's false and misleading representations, interdict should be granted as prayed.
3. The respondent's conduct being calculated to disparage the petitioner's supply of Profilit and being calculated to affect the petitioner's business injuriously, interdict should be granted as prayed."
"4. The petitioner not having been defamed nor the words complained of not being capable of a defamatory meaning, the prayer should be refused.
5. The communications of [sic] being without malice and subject to qualified privilege, the prayer should be refused.
6. The petitioners having no reasonable apprehension that the respondents will defame them, the prayer should be refused."
"The respondent undertook to not allege that the petitioner is misleading the public as set out in the prayer of the petition."
In the light of that undertaking, interim interdict was refused. On 4 November 2003 a motion by the petitioners for interim interdict was refused. The minute of proceedings records:
"Counsel for the respondent stated at the bar of the Court that he would advise the respondent Alistair Price that he should say nothing further about this matter to any outside party until this matter is resolved."
On 16 December 2003 the prayer of the petition was amended so as to take its present form, and on 8 January 2004 interim interdict was pronounced in terms of heads (1), (2) and (3).
[6] The live issues for decision are, first, whether the respondents have made false and misleading statements containing representations directly or indirectly (1) to the effect that the petitioners have claimed that the system of u-channelled glass known under the trade marks "Profilit" and "Reglit" supplied by them is a safety glass in accordance with the requirements of BS 6206: 1981 (head (1) of the prayer); and (2) to the effect that the petitioners have been deceitful, duplicitous and misleading in their claims that when tested in accordance with the impact test described in BS 6206: 1981 Profilit and/or Reglit achieves results equivalent to class C in that British Standard (head (3) of the prayer). Secondly, if the respondents have made such statements, are the petitioners entitled to perpetual interdict in terms of heads (1) and (3)?The law
[7] The parties were agreed that the wrong of which the petitioners complained was malicious falsehood or verbal injury. Both counsel referred to the discussion of this topic in Walker on Delict (2nd ed) pages 902-907. The petitioners' counsel also cited Burn-Murdoch on Interdict, pages 102-103; Bruce v J M Smith Ltd (1898) 1 F 327; De Beers Abrasive Products Ltd v International General Electric Co of New York Ltd [1975] 1 WLR 972; Schulke & Mayr UK Ltd v Alkapharm UK Ltd [1999] FLR 161; Mentmore Manufacturing Co Ltd v Fomento (Sterling Area) Ltd (1955) 72 RPC 157; Linotype Co Ltd v British Empire Type-setting Machine Co Ltd (1899) 81 LT 331; and The London Ferro-Concrete Co Ltd v Justicz (1951) 68 RPC 261. The respondents' counsel cited Barratt International Resorts Ltd v Barratt Owners' Group (Outer House, Lord Wheatley, 20 December 2002); Gatley on Libel and Slander (10th ed), chapter 20; Argyllshire Weavers Ltd v A Macaulay (Tweeds) Ltd 1965 SLT 21; Spring v Guardian Assurance plc [1993] 2 All ER 273; Horrocks v Lowe [1975] AC 135; and Fraser v Mirza 1993 SC (HL) 27. [8] In Walker on Delict (2nd ed), page 902, malicious falsehood is defined as "[h]arm done to a person in his business relations by written or oral falsehood". In this case the harm allegedly done and apprehended is of a kind which appears to be unusual. What the petitioners are seeking to interdict is the making by the respondents of false statements to the effect that the petitioners are making false or misleading claims about the goods they supply. Thus the alleged harm is not a wrongful assertion by the respondents relating to the goods supplied by the petitioners, which is the kind of the harm often founded on in an action of this type, but a series of wrongful assertions by the respondents whereby they attribute to the petitioners false statements relating to these goods. [9] I consider that the law which is applicable in the present case is most appositely stated in the opinion of Lord Hunter in Argyllshire Weavers Ltd, albeit that was a case where the pursuers apprehended a wrongful assertion relating to the goods they produced. His Lordship said (at page 35):"The nature of the wrong which the pursuers contend they have suffered, and of which they maintain a repetition is to be reasonably apprehended, falls in my opinion into the category which has been referred to in Scotland as verbal injury, and in England by a variety of terms, including the general description injurious falsehood, of which slander of goods and slander of title or property are examples. In Scotland the ingredients of the particular type of wrong with which the present action is concerned are not particularly well illustrated by decision, possibly because the distinction between actions of slander proper involving injury to character or reputation and actions of verbal injury has not always been clearly maintained, though they have been the subject of quite considerable academic discussion. The subject is dealt with in Burn-Murdoch on Interdict, pages 388-390, para 380, from which passage it appears that in the view of the learned author three requirements must be present to make false assertion relating to another's property or goods an actionable wrong. First, the pursuer must establish positively the falsity of the assertion complained of. There is no presumption in his favour, as there is in actions of defamation proper, that the statement is false. Second, the pursuer must prove that the false assertion was made maliciously. Malice is not presumed. Third, actual damage, or as it is called in England special damage, to the pursuer must be averred and proved. In an action of interdict, reasonable apprehension of such actual damage would no doubt be sufficient to qualify a pursuer for the preventive remedy, and in any event the law has now been amended by section 14 of the Defamation Act, 1952."
His Lordship goes on to observe that those propositions are in his opinion supported not only by other Scottish textbook authority but also by decisions of the Inner House.
[10] Although I have had the advantage of hearing useful relevant evidence, the material facts are not in dispute. The issues for decision turn essentially on the interpretation of statements admittedly made. I shall begin by describing the product supplied by the petitioners. Next, I shall set out the provisions of the Building Regulations and British Standards which are relevant to the use of the product. Thereafter I shall examine the claims made about the product by the petitioners and the statements made by the respondents on which the petitioners found. I shall then consider whether it is proved that these statements by the respondents were false, and that they were made maliciously. Finally, I shall discuss the issue of damage.2. The petitioners' product
[11] The product which the petitioners supply is called the Pilkington Profilit Glass System. It was formerly called Reglit. It will be convenient to refer to it as Profilit, except when quoting from documents in which it is called Reglit. It is manufactured by Bauglasindustrie GmbH, a subsidiary of Pilkington Deutschland AG, at a factory in Schmelz, Germany. It consists of glass channels within a metal frame. Each glass channel is U-shaped, that is, it resembles in horizontal section the letter U with a long base and short uprights, the uprights being flanges of 41mm or 60 mm in height. The channels are of varying widths. Within the frame, one row of channels is placed upon another so that they interlock at the flanges. The flanges are sealed with silicone and at the end of each flange there is an impact gasket which provides impact resistance. Thus the finished product has the appearance of two layers of U-shaped glass, some 41 or 60 mm apart, within a metal frame. The glass may be described as "profiled glass". Since it contains longitudinal reinforcing wires, it may also be described as "wired glass". The system is more fully described on pages 1-3 of the petitioners' architectural specification manual, no 6/35 of process. No 6/66 of process is a sample.3. Building Regulations and British Standards
[12] In order to understand the dispute between the parties it is necessary to examine certain provisions in the Building Regulations and British Standards relative to the use of glazing in buildings. The use of glazing in buildings is controlled by the Building Regulations 1991. Schedule 1, Part N, as amended, provides:"Protection against impact
N1. Glazing with which people are likely to come into contact whilst moving in or about the building shall -
Practical guidance on meeting the requirements of Schedule 1 is provided by The Building Regulations 1991: Glazing - safety in relation to impact, opening and cleaning: Approved Document N, 1998 edition (no 6/29 of process) which is one of a series approved by the Secretary of State for the Environment, Transport and the Regions. The document states on page 2:
"The Approved Documents are intended to provide guidance for some of the more common building situations. However, there may well be alternative ways of achieving compliance with the requirements. Thus there is no obligation to adopt any particular solution contained in an Approved Document if you prefer to meet the relevant requirement in some other way." [Emphasis in original.]
On page 5 the document states:
"0.1 In the Secretary of State's view, requirement N1 will be met by adopting, in critical locations, measures to limit the risk of sustaining cutting and piercing injuries.
[...]
0.4 Glazing in critical locations would be considered reasonably safe were its nature such that, if breakage did occur, any particles would be relatively harmless.
0.5 The requirement may also be met if the glazing is sufficiently robust to ensure that the risk of breakage is low, or if steps are taken to limit the risk of contact with the glazing."
Section 1 of the document is entitled "Protection against impact". The following paragraphs appear on page 6 under the heading "Critical Locations":
"1.1 The following locations may be considered "critical" in terms of safety;
Reducing the risks
1.1 Glazing in critical locations should either,
Safe breakage
1.1 Safe breakage is defined in BS 6206: 1981 Specification for impact performance requirements for flat safety glass and safety plastics for use in buildings: clause 5.3, and is based on an impact test which requires the result of the impact to be limited to creating:
In terms of safe breakage, a glazing material suitable for installation in a critical location would satisfy the requirements of Class C of BS 6206 or, if it is installed in a door or in a door side panel and has a pane width exceeding 900 mm, the requirements of Class B of the same standard."
"in order to provide specified and verifiable safety performance criteria for the types of flat safety glass and safety plastics used in buildings so as to reduce cutting and piercing injuries to persons who impact them."
On page 1 it is said that the Standard specifies performance requirements and a test method in respect of energy absorption (impact) for flat safety glass and safety plastics for use in buildings. The introduction states that it was envisaged that a child weighing 100 lb (45.36 kg) could reasonably be regarded as representative of persons involved in accidents where glass or plastics are impacted. The test method is that a piece of the material to be tested, of a defined size, is placed in a frame and is struck in the centre from specified "drop heights" by a carefully specified impactor of 100 lb (45.36 kg) overall mass to simulate a running child in the shape of a leather case of a punch bag type filled with lead shot. The drop heights are of 12, 18 and 48 inches, equivalent to impact energies representative of those likely to be delivered accidentally by persons in glazed areas.
[14] Paragraph 3 provides that for the purposes of the Standard certain definitions apply, including the following:"3.2 safety glass and safety plastics. Material that, when tested by the method given in appendix A at one of the drop heights specified in clause 4, either does not break or else breaks safely according to the criteria given in 5.3."
Paragraph 4 provides that safety glass and safety plastics are to be classified as Class A, B or C. Material classified as Class C is "material that complies with the requirements of 5.3 when tested by the method given in appendix A at a drop height of 305 mm."
[15] Paragraph 5 is headed "Impact test". Paragraph 5.3 sets out the test requirements for various materials including wired glass, the category of material to which the glass in the petitioners' system belongs. It provides in part:"5.3 Test requirements. When tested by the method given in appendix A at any drop height appropriate to the class for which the test material is intended (see clause 4), all four test pieces either shall not break, or shall break safely, as defined for the appropriate material. [...]
(b) [...] wired glass [...] shall be deemed to break safely if numerous cracks or fissures appear in the test piece, but no shear, or opening, develops through which a 76 mm diameter sphere can be passed freely. Additionally, if particles are detached from the test piece up to 3 min after impact, they shall, in total, weigh no more than the mass equivalent to 10,000 mm2 of the original test piece. The largest single particle shall weigh less than the mass equivalent to 4400 mm2 of the original test piece."
"All installed panels shall be marked as follows. These marks shall be permanent and applied before installation in a position to remain visible after installation.
"This Part of BS 6262 gives safety recommendations for the vertical use of glass and plastics glazing sheet materials in locations likely to be subject to accidental human impact. The recommendations are intended to reduce impact related injuries and in particular the risk of cutting and piercing injuries."
Paragraph 4 states in part:
"Accident statistics show that glazing in some locations in buildings is more vulnerable to human impact than in others. These critical locations are:
The designer, or specifier, should take precautions to reduce the risk of injuries from accidental human impact in these locations by:
Paragraph 7 makes recommendations about glazing in different types of critical locations. Paragraph 10 is headed "Specialist glazing products" and states:
"Some specialist glazing products are difficult to classify in accordance with BS 6206 but the following should apply.
[...]
[...] profiled [...] glass should be acceptable if a flat pane of the same type, thickness and quality of material conforms to the recommendations given in clause 7."
4. The petitioners' claims
[18] The petitioners' claims about the product they supply appear principally in their publication Freedom to Design in Glass: Architectural Specification Manual (no 6/35 of process). It is dated 27 March 2002. The petitioners distributed about 6,500 copies of it. They sent it to the architects on their database, and published it on their website. At page 7 the following paragraphs appear under the heading "Safety":"At Reglit Profiled Glass Architecture we ensure that every installation is assessed to identify any risk of breakage and personal injury and that the design complies with all applicable building regulations and standards. In conjunction with Pilkington, we continually undertake extensive testing of the product range to ensure that it meets the current safety standards and legislation.
The Pilkington ProfilitTM system, when installed in the appropriate formats, can meet the requirements of Class B and Class C in terms of the testing criteria stipulated in BS 6206: 1981. Please refer to the Product Testing Section for further information on the test reports. [...]"
Section 1.5 of the brochure, headed "Product Certification", states that the main areas of testing have included impact resistance. On page 10, under the headings "Impact Test" and "UK Testing", the following appears:
"The Pilkington ProfilitTM glazing system has been tested in accordance with the requirements of BS 6206: 1981 pendulum impact test with a soft body by Pilkington PLC. This test identifies the impact performance requirements for flat safety glass and safety plastics for use in buildings.
The following glass profiles installed in a double-glazed format achieve the required classification standards by either breaking safely during the test or not breaking at all."
There follow some test results, and the sentence:
"To meet the requirement, the glass has to be fitted with an impact gasket, as shown on the drawing."
The expression "safety glass" is used in section 1.2, which is headed "Product Description". On page 3, the description of the impact gasket includes the following:
"This component provides improved impact resistance and is incorporated in the following circumstances.
"Installed system must meet the requirements for critical glazing areas as stipulated within Section N of the Building Regulations and the criteria of the BS 6206: 1981 - Impact performance requirements for flat safety glass and safety plastics for use in buildings."
A footnote reads:
"The Glass has been tested in the double-glazed format to meet the criteria of BS 6206: 1981."
"Safety - The Reglit system can be installed to meet the criteria of class B+C of the British Standard safety test for glass, BS 6206 1981."
In a fax dated 20 June 2002 sent by Ms Alison Mathers of the petitioners' marketing department to a firm of architects (no 6/32 of process), Ms Mathers said:
"Pilkington Profilit glass type SP26 with 8 number wires has been tested in accordance with BS 6206: 1981 impact performance requirements for flat safety glass and safety plastics for use in buildings and meets the criteria of class C.
[...]
We are currently retesting our glass to ensure compliance with BS 6206: 1981 and the new CEN regulations. [...]"
The respondents' counsel referred to statements attributed to the petitioners by Mr Paul Dickinson, the project procurement manager for Laing Ltd, contractors. In a letter to the petitioners dated 14 November 2002 (no 6/45 of process), he states the belief of the contractors that Reglit profiled glass has been independently tested and this reaffirms compliance with BS 6206 Class C. An enclosure with the letter, an extract from the relevant specification for profiled glass cladding, states, "Safety glass shall be category C when tested in accordance with BS 6206." A memorandum by Mr Dickinson dated 18 June 2002 states that after a meeting with representatives of Pilkington plc and Bauglasindustrie GmbH
"verbal assurances were given that the Reglit profiled glass not only met the requirements of BS 6206 - Class C but also achieved the requirements of Class B."
"Because of Pilkington ProfilitTM being a channel shaped glass product it cannot be tested and classified in accordance with BS 6206-1981 which specifies the impact performance requirements for flat safety glass and safety plastics for use in buildings. However it is possible to subject a channel shaped glass assembly to the BS 6206 impact test method and based on the results provide a performance rating to the assembly in an analogous adaptation of the standard. The Building Regulations dealing with glazing, e.g. Part N in England and Wales, provide several methods of complying, only one of which being to use glass classified to BS 6206. A totally equivalent alternative compliance method is the ability to provide impact test results on an assembly by which it can be demonstrated that in the event of an accidental human impact the person will be safe in the sense of the Building Regulations. This is what Pilkington has done with their product Pilkington ProfilitTM which allows us to state compliance with the Building Regulations for safe glazings."
"are intended to reduce [not 'to remove'] the risk of injuries caused by cutting and piercing in accidents where [flat safety glass and safety plastics] are involved"
(no 6/21 of process, page 1, s v "1. Scope"). Accordingly, if the nature of any injuries likely to be sustained were a relevant consideration, it would be sufficient if the product under consideration reduced the risk of such injuries. It should be added that while Profilit has been installed in very many critical locations, there is no evidence of any accident having occurred or of any complaint having been made, other than by the respondents, owing to its presence in such locations.
[28] It is now necessary to consider whether there was anything duplicitous, deceitful or misleading in the claims for the product which were made by the petitioners. Here it is important to bear in mind that the persons to whom the claims were addressed were architects, contract specifiers and other professionals in the building industry. The petitioners' publication Freedom to Design in Glass (see paragraph [18] above) states that the system,"when installed in the appropriate formats, can meet the requirements of Class B and Class C in terms of the testing criteria stipulated in BS 6206: 1981."
It goes on to say that the system
"has been tested in accordance with the requirements of BS 6206: 1981 pendulum impact test with a soft body by Pilkington PLC. This test identifies the impact performance requirements for flat safety glass and safety plastics for use in buildings."
In my opinion that is clear. It would be obvious to a reader to whom the publication was directed that the system was neither flat nor comprised of safety glass, and that the petitioners had followed the requirements of the pendulum impact test in the Standard. Section 5 of the publication makes it explicit that there had been no question of testing a single pane of glass: it had been "tested in the double-glazed format" (see paragraph [19] above). The other statements by the petitioners which are detailed in paragraph [20] above are to a similar effect.
[29] There was no evidence from anyone to whom these statements had been addressed that they had misunderstood, or been misled by, the statements. It will be noted later in this opinion that when the respondents called the attention of others to such statements by the petitioners, some were satisfied with the validity of the statements after making a cursory investigation and none was sufficiently concerned to pursue the matter (see paragraphs [43], [44], [45], [47] and [48]). [30] I had the advantage of seeing and hearing in the witness box the petitioners' managing director, Mr William McBride, one of their other directors, Mr Alasdair Brown, and Ms Alison Mathers, who is employed in their marketing department. Each of them favourably impressed me as an honest and straightforward witness. Mr McBride, in particular, underwent a searching and proper cross-examination and showed himself to be, in my opinion, reasonable and fair-minded. Counsel for the respondents submitted that he should not be accepted as a credible and reliable witness, but I am unable to accept that submission. Counsel pointed to his failure to mention in examination-in-chief that he had been a director of a company called Circle Construction Ltd before joining the petitioners, but I am unable to attach any significance to that. Counsel also criticised the figure of £80,000 which he gave as the cost to the petitioners of pursuing the present dispute, but he was not examined about that figure in chief or in cross and I do not regard it as important. It was also said that he had created a mythical enemy who was intent on destroying his business, but I think that that puts the matter much too strongly. Mr McBride appeared to me to be patient and good-natured and initially to have been genuinely bemused by the assertions made on behalf of the respondents. I regard the claims made by the petitioners as unambiguous and I cannot find that in making them the petitioners were deceitful, duplicitous or misleading.5. The respondents' statements: falsity
[31] The statements on behalf of the respondents, of which the petitioners complain, are narrated in statements 5 to 7 of the petition. The assertion referred to in statement 4 relates to head (2) of the prayer which is no longer insisted in. I shall now examine each of the other statements founded on. In this section of this opinion I shall consider to what extent each statement is proved to be false. In the following section I shall consider the issue of malice. [32] The first statement that falls to be considered was made in a fax dated 6 June 2002 (no 6/5 of process). At that time the petitioners and the respondents were competing for a contract to supply glass for an Airbus Assembly and Manufacturing Facility. On that date the respondents' managing director, Mr Alastair Price, sent a fax to Mr Paul Dickinson of Laing Ltd, the principal contractors. Its heading is,"RE: U-PROFILED GLAZED CLADDING - AIRBUS ASSEMBLY & MANUFACTURING FACILITY, BROUGHTON"
It is necessary to quote the message in full (paragraph numbers supplied):
"1. Further to our telephone conversation of late yesterday, I was disappointed to hear you were planning to make a procurement decision in favour of our competitor for this project on the basis that their product is produced by Pilkington.
2. It is interesting to note that, although the product is produced by a subsidiary of the multi-national Pilkington PLC, Pilkington in the UK do not provide the product directly but supply through an independent distributor. Consequently, the Pilkington connection is rather tenuous.
3. Of particular concern is the somewhat misleading impression that is created by Reglit in the UK that wire reinforced U-profiled glass is a 'safety glass' as defined by BS 6206 - Soft Body Pendulum Impact Test.
4. From our own testing in Germany to the corresponding DIN 52337, there is no way that wire reinforced U-profiled glass can be defined as a 'safety glass'. This is supported by the position of the manufacturer of Reglit, Bauglasindustrie, who make no claims for wire reinforced glass complying with safety requirements in Germany.
5. Both the British and German standards are now effectively superseded by a new European standard EN 12600 where the impactor is of a slightly different design - this is the double wheelbarrow type arrangement shown in the images sent last night, rather than the leather bag used previously.
6. Interestingly, the impact energy of the new impactor with the new EN standard is less than in the original British standard test, and more than in the German DIN standard test - see attached graph. This simply reiterates the question - how can Reglit glass pass the (more onerous) BS6206 when tested by Pilkington in the UK, but fails to pass the (less onerous) DIN 52337 when tested by the manufacturing subsidiary of Pilkington in Germany?
7. Our suspicions are aroused when we find that there seems to be no formal independent test report, photographs, or description of the specimen following the test to support the vague claims made that wire reinforced U-profiled glass is a safety glass. It seems that there is considerable reliance on the claim that 'the Reglit glazing system has been tested in accordance with the requirements of BS 6206 . . . . . . by Pilkington PLC'. There is not even any clarification provided as to whether the glass breaks, or whether it does break and breaks safely. See attached copy e-mail to Mike Ward.
8. The issue of availability of smooth/clear glass remains.
9. We understand that Bauglasindustrie can produce some smooth glass profiles, but only with 40 mm flanges. In this case, the load/span conditions are such that profiles with 60 mm flanges are required, and we do not believe that this product is currently available from Reglit. We recommend that you seek immediate samples of this material to demonstrate product availability - we are sending samples of the specified glass by courier today.
10. In conclusion, it is our opinion that you are being misled on a number of important issues and we would urge that these issues should be thoroughly researched and verified before making any final procurement decision."
"2. We stand by our assertions that the specified product does not satisfy the stated standards for impact, and as such cannot be considered as a safety glass.
3. We have now taken this matter up with the Trading Standards authorities in an attempt to have this matter investigated properly and resolved once and for all.
4. However, we consider that current claims for compliance with stated standards are duplicitous and the continuing absence of formal independent test accreditation supports this view.
5. Consequently, we do not accept that the sub-contract selection procedure has been entirely objective, and we have therefore requested our sub-contractor partners to withdraw our tender for this project.
6. I regret that this has been necessary, but we are not comfortable operating in an environment of deceit and misrepresentation."
"Structural Glazing - Airbus Project
Our Tender No T8631/01Rev
We wish to formally advise you that the above tender is formally withdrawn in view of the circumstances in that there appears to be acceptance of products which do not comply with the specification and UK Building Regulations.
We are also concerned that there was not a single response to our submission which considering the input by us and the significance of the project leaves us uneasy to say the least."
The petitioners aver in statement 5: "Believed and averred that said letter was written at the instigation of the respondent." It is reasonable to assume that it was written in accordance with the request referred to in paragraph 5 of the fax of 12 June 2002. Mr Alastair Price said in the witness box that his father agreed with him that the tender should be withdrawn. As I have already found, there is no question of the petitioners' product not complying with the specification and Building Regulations.
[41] In statement 6 of the petition the petitioners found on a fax sent by Mr Alastair Price to Dr Mark Swennarton (correctly "Swenarton": see no 6/46 of process, page 1), a publishing editor of the architectural magazine Architecture Today. The date of the fax is 10 June 2002. The heading is "RE: REGLIT/PROFILIT - SAFETY GLAZING". The message reads in part (paragraph numbers supplied):"1. On page 82 of your March 2002 issue of Architecture Today, I noticed an advertisement relating to Reglit/Profilit glass.
2. The accompanying picture [no 6/70 of process] clearly shows the product in an application where a safety glass is required in accordance with the Building Regulations.
3. However, Reglit/Profilit cannot comply with the requirements of BS 6206 Soft Body Pendulum Impact Test. We have enclosed images of a similar wire reinforced U-profiled glass construction and would be pleased to forward originals of these to you by e-mail.
4. The German manufacturer of the Reglit/Profilit system makes no claims for wire reinforced U-profiled glass satisfying the requirements of the corresponding (but slightly less onerous) DIN standard, so it seems strange that the UK distributor for their system makes such claims in the UK.
5. The Building Control department at Tower Hamlets Borough Council are now looking into this matter, and the claims made by the UK supplier are also being examined by the local Trading Standards office.
6. This is a serious issue where public safety is at stake, and we believe that there will be industry interest in the potential misrepresentation of glazing products as "safety glass" where this is not in fact the case.
7. I would be interested to hear your view on this matter, and perhaps you would be interested to cover this issue in more detail once the various inquiries have been completed and the true facts have been established."
"The basis of the complaint made related to the suitability of associating BS 6206 with your company's product and whether the specified level of classification could be achieved."
The letter goes on to make it clear that in the view of the Council the complaint was unfounded.
[45] It is evident from a letter to the petitioners dated 19 June 2002 from the Director of Technical and Environmental Services of Southend on Sea Borough Council (no 6/16 of process) that the respondents had raised a similar issue with that authority. Again, the petitioners gave the Director accurate information about their product, and that was the end of the matter. [46] Warrant for service of the petition in the present proceedings was granted on 2 July 2002. On 5 July 2002 the respondents gave the undertaking recorded in paragraph [5] above. On 10 September 2002 Mr Alastair Price sent e-mails to two journalists, Mr J Brind and Mr Richard Schwarz. In the e-mail addressed to Mr Brind (no 6/47 of process) Mr Price headed his message "Public Interest News Story" and said, amongst other things:"I wish to draw your attention to the activities of Pilkington Plc in the United States with regard to the use of wire reinforced glass as a safety glazing material. It is widely recognised here in the UK that ordinary wire reinforced glass is not considered to be a safety glass when tested in accordance with BS 6206, and as such cannot be used in the 'critical' locations identified in Approved Document N of the Building Regulations. In response to tightening of UK regulations in 1992, Pilkington introduced a new product with thicker wire reinforcement - wired safety glass - to satisfy the new requirements for impact safety. It would appear that Pilkington do not make this product available across the Atlantic, and they persist with claims that ordinary wire reinforced glass is a safety glass despite BS 6206: 1981 being largely based on the United States standard ANSI Z 97.1 - 1975. More information on the story surrounding the cynical activities of this pervasive multi-national glass producer can be found on www.safeglass.org and I also attach a couple of articles carried in US Glass magazine on this subject."
6. The respondents' statements: malice
[50] The next question is whether it is proved that these false statements were made maliciously. It is for the petitioners to prove that they were so made (Argyllshire Weavers Ltd cit paragraph [9] above). The respondents plead that the communications were made "without malice and subject to qualified privilege" (paragraph [4] above). I was not addressed on the issue of qualified privilege. [51] The petitioners' material averments appear in statement 3 and are in these terms:"The respondent is the petitioner's principal competitor. From May 2002 until in or around July 2002 the respondent has engaged in a deliberate campaign as hereinafter averred aimed at injuring the petitioner's commercial reputation and trading prospects by falsely accusing the petitioner of misleading actual and potential customers by claiming that Profilit is a safety glass. In respect of this campaign the statements made by or on behalf of the respondent are untrue and defamatory. Further the statements made were calculated and intended to inflict injury and disruption upon the petitioner's business by disparaging Profilit and thereby attempting to divert the petitioner's business to the respondents."
"[I]n all cases of qualified privilege there is some special reason of public policy why the law accords immunity from suit - the existence of some public or private duty, whether legal or moral, on the part of the maker of the defamatory statement which justifies his communicating it or of some interest of his own which he is entitled to protect by doing so. If he uses the occasion for some other reason he loses the protection of the privilege.
So, the motive with which the defendant on a privileged occasion made a statement defamatory of the plaintiff becomes crucial. The protection might, however, be illusory if the onus lay on him to prove that he was actuated solely by a sense of the relevant duty or a desire to protect the relevant interest. So he is entitled to be protected by the privilege unless some other dominant and improper motive on his part is proved. 'Express malice' is the term of art descriptive of such a motive. Broadly speaking, it means malice in the popular sense of a desire to injure the person who is defamed and this is generally the motive which the plaintiff sets out to prove. But to destroy the privilege the desire to injure must be the dominant motive for the defamatory publication; knowledge that it will have that effect is not enough if the defendant is nevertheless acting in accordance with a sense of duty or in bona fide protection of his own legitimate interests.
The motive with which a person published defamatory matter can only be inferred from what he did or said or knew. If it be proved that he did not believe that what he published was true this is generally conclusive evidence of express malice, for no sense of duty or desire to protect his own legitimate interests can justify a man in telling deliberate and injurious falsehoods about another, save in the exceptional case where a person may be under a duty to pass on, without endorsing, defamatory reports made by some other person.
Apart from these exceptional cases, what is required on the part of the defamer to entitle him to the protection of the privilege is positive belief in the truth of what he published or, as it is generally though tautologously termed, 'honest belief'. If he publishes untrue defamatory matter recklessly, without considering or caring whether it be true or not, he is in this, as in other branches of the law, treated as if he knew it to be false. [...]
Even a positive belief in the truth of what is published on a privileged occasion - which is presumed unless the contrary is proved - may not be sufficient to negative express malice if it can be proved that the defendant misused the occasion for some purpose other than that for which the privilege is accorded by the law. The commonest case is where the dominant motive which actuates the defendant is not a desire to perform the relevant duty or to protect the relevant interest, but to give vent to his personal spite or ill will towards the person he defames. If this be proved, then even positive belief in the truth of what is published will not enable the defamer to avail himself of the protection of the privilege to which he would otherwise have been entitled. There may be instances of improper motives which destroy the privilege apart from personal spite. A defendant's dominant motive may have been to obtain some private advantage unconnected with the duty or the interest which constitutes the reason for the privilege. If so, he loses the benefit of the privilege despite his positive belief that what he said or wrote was true.
Judges and juries should, however, be very slow to draw the inference that a defendant was so far actuated by improper motives as to deprive him of the protection of the privilege unless they are satisfied that he did not believe that what he said or wrote was true or that he was indifferent to its truth or falsity. The motives with which human beings act are mixed. [...] It is only where his desire to comply with the relevant duty or to protect the relevant interest plays no significant part in his motives for publishing what he believes to be true that 'express malice' can properly be found".
"Honest belief in an unfounded claim is not malice; but the nature of the unfounded claim may be evidence that there was not an honest belief in it. It may be so unfounded that the particular fact that it is put forward may be evidence that it is not honestly believed."
"Linit U-profile glass incorporating stainless steel wire reinforcement satisfies BS 6206: 1981 'Impact Performance Requirements For Flat Safety Glass For Use In Buildings' as a Class C safety glazing material, and, accordingly, can be used in the appropriate risk areas identified in BS 6262: 1982 'Code of Practice for Glazing in Buildings'."
However, in a later brochure produced by the respondents, no 6/20 of process, dated May 2001, that claim is not made. Describing Linit U-profiled glazing, this brochure says on page 2:
"However, wire reinforced U-profile glass is not a 'safety glass' as defined by BS 6262 and determined by the soft body pendulum impact test in BS 6206."
The evidence of Mr Price as to how these statements came to be made was confusing. The respondents aver in answer 6:
"Whilst the respondents' earlier brochure contained an erroneous statement regarding compliance with BS 6206 that was based on a misinterpretation of the data supplied by the manufacturer. This mistake was quickly appreciated and no clients installed Linit-U glazing in critical areas."
In the witness box, however, Mr Price did not say that the respondents had misinterpreted data supplied by the manufacturer. He said that the statement in the earlier brochure had been made because the manufacturer had told him on the telephone that the product complied with BS 6206. He indicated in cross-examination that that statement by the manufacturer had been based on a similar statement in a document describing Profilit which had been produced by Pilkington plc. He went on to say that the statement in the earlier brochure had been withdrawn in the later brochure because the manufacturer had failed to substantiate it. He also said that before the later brochure was produced, the statement had been blacked out in copies of the earlier brochure. This evidence appeared to me to strain credulity. It was not supported by any correspondence with the manufacturer, or by the production of any blacked-out copies of the earlier brochure. It seeks to suggest that the respondents made and withdrew important claims on insubstantial grounds, without reliance on any test of the product concerned; and it is at variance with the respondents' record. It must be added that in a fax to a Mr Mike Ward of Faulkner Browns, the firm of architects in the Airbus project, dated 22 February 2002 (no 7/9 of process) Mr Price said:
"We have always maintained that wire reinforced U-profiled glass (irrespective of manufacturer) cannot be classified as a safety glass when tested in accordance with BS 6206, although there may be scope for individual Building Control authorities to consider each case on its merits."
It is clear from the statement in the earlier brochure that the first part of that sentence is incorrect. I find Mr Price's various positions and his evidence on this whole matter puzzling and unconvincing, and that disposes me to be wary of placing reliance on his unsupported testimony on any material issue.
[56] The test to which Mr Price referred in the statements founded on by the petitioners is that described in a document headed "Linit U-profiled glass. Pendulum Impact Test (Internal Test at Glasfabrik Lamberts)" (annexed to no 6/2 of process). The images in this document are "the images sent last night", referred to in paragraph 5 of his fax of 6 June 2002 to Mr Dickinson (quoted in paragraph [32] and commented on in paragraph [34]). He sent the same images to Dr Swenarton (see paragraph 3 of his fax of 10 June 2002, quoted in paragraph [41]) and to Southend on Sea Borough Council (see paragraph 3 of the Council's letter to the petitioners dated 19 June 2002, no 6/16 of process, discussed in paragraph [45]). In court, no data relative to this test were produced, other than the exiguous information on the first page, and no witness from Glasfabrik Lamberts or elsewhere was called to give any evidence about it. Mr Price's position in the witness box was that he had used the images only to demonstrate breakage characteristics. But that is not what he said to his correspondents. His fax no 6/5 of process implies that the images illustrate testing in Germany to the corresponding DIN test, or offer some meaningful comparison with the BS 6206 test. I would adopt the language of Walton J in De Beers Abrasive Products Ltd v International General Electric Co of New York Ltd [1975] 1 WLR 972 at 981:"It appears to me that, where the interested parties are presented with what purports to be a proper scientific test, properly carried out by the "application laboratory" - whatever that is - they must be intended by the persons who furnished them with this information to take it all very seriously indeed."
In any event Mr Price accepted that the breakage characteristics of a test piece would depend on the weight of the impactor and would vary with different drop heights.
[57] It appears to me that Mr Price, with all his experience in the glass industry, must have known that the test illustrated in the document attached to no 6/2 of process was neither a BS 6202 test nor a DIN test, and could not support his contention that Profilit could not comply with the requirements of the BS 6206 soft body pendulum impact test. The drop height, the weight and description of the impactor, and the sample size are all different from those specified in the Standard. It is obviously impossible to draw from the limited information about the test in no 6/2 of process any conclusion as to whether Profilit would comply with the BS 6206 soft body pendulum impact test. The nature of the contention, and the material adduced in support of it, appear to me to be, in the words of Scrutton LJ, "evidence that there was not an honest belief in it." [58] Next I consider Mr Price's fax of 6 June 2002 to Mr Dickinson (no 6/5 of process, set out in paragraph [32]). I refer to my discussion of this document in paragraphs [33] to [37]. It is in my view clear from paragraphs 1 and 10 that Mr Price was actuated by the dominant and improper motive of obtaining for the respondents the advantage of a reversal in their favour of the contractors' intended procurement decision in favour of the petitioners. Paragraph 2 is an obvious attempt to disparage the petitioners, as is paragraph 10. Paragraphs 4, 5 and 6 discuss the issue of tests which I have already considered. The claim in paragraph 9 that profiles with 60 mm flanges were not currently available from Reglit is, to quote Scrutton LJ once more, "so unfounded that the particular fact that it is put forward [is] evidence that it is not honestly believed." [59] Further evidence of malice is to be found, in my view, in the fax to Dr Swenarton (no 6/6 of process, set out in paragraph [41]). I refer to paragraph [42]. It is difficult to accept that Mr Price seriously believed that the photograph showed the product in an application where a safety glass was required (paragraph 2). I have already considered the claims about testing in paragraphs 3 and 4. Paragraph 5 is designed to create the false impression that each of the bodies referred to was spontaneously examining the issue, when in truth it was Mr Price who had called the matter to their attention. Paragraph 6 seeks to raise "a serious issue where public safety is at stake" when in truth there was no such issue. It goes on to refer to "industry interest in the potential misrepresentation of glazing products as 'safety glass'" when Mr Price must have known that there was no evidence of such misrepresentation. The letter concludes with the expression of a hope that the recipient "would be interested to cover this issue in more detail once the various inquiries have been completed and the true facts have been established." It seems clear that Mr Price's dominant motive here was to injure the petitioners by asserting that their claims raised a serious issue of public safety and by obtaining adverse publicity for the petitioners. [60] An inference of malice is also to be drawn, in my opinion, from the terms of Mr Price's further fax of 12 June 2002 to Mr Dickinson (no 6/7 of process, set out in paragraph [38] and discussed in paragraph [39]). Here, the respondents' untrue assertions are adhered to, the petitioners are said to make "duplicitous" claims and reference is made to "an environment of deceit and misrepresentation". It is manifest that Mr Price was displeased by the contractors' procurement decision and that in this letter he was giving vent to ill will towards the petitioners by expressing these views to one of their important clients. His reference to his having taken the matter up with the Trading Standards authorities (see paragraph [44]) is a further indication that his object was to create trouble for the petitioners. The same object may be discerned in his approaches to Tower Hamlets Borough Council, noted in paragraph [43], and to Southend on Sea Borough Council, noted in paragraph [45]. [61] The same inference may be drawn, and the same object is discernible, in the e-mails Mr Price sent to the journalists on 10 September 2002 (paragraphs [46] to [49]). It is to be noted that he sent these after the undertaking had been given on 5 July 2002 that the respondents would not allege that the petitioners were misleading the public as set out in the prayer of the petition (see paragraph [5]). At that time the prayer sought interdict of the respondents"from making statements in any form alleging that the petitioner has [sic] or is misleading the public by suggesting that Profilit does not comply with the Pendulum impact test with soft body according to British Standard BS 6206: 1981 and that Profilit does not fulfil the safety requirement of BS 6206: 1981."
The petitioners have not founded on the sending of the e-mails as a breach of the undertaking. The sending of the e-mails is, however, an indication of rashness and persistence. It is difficult to accept that after the undertaking had been given such e-mails would have been sent by a person of ordinary prudence acting in good faith. The statement in the first sentence of each e-mail, which represents that Mr Price wishes to draw the reader's attention to the activities of Pilkington plc in the United States, is disingenuous, as I have pointed out in paragraph [47]. The inference is plain that Mr Price was seeking to injure the petitioners by securing unfavourable publicity for them in journals that would be read by their potential clients.
[62] I have noted that the Court should be very slow to draw an inference of malice. I cannot, however, resist the conclusions (1) that Mr Price did not believe that what he wrote in these various documents was true and (2) that he was actuated in each case by one or more of the following desires: a desire to injure his company's only competitor by creating serious doubts in the minds of the petitioners' clients and potential clients about the petitioners' claims for their only asset, the product they supplied and installed, and thus to denigrate the petitioners' reputation and diminish their business; a desire to secure for the respondents a procurement decision in favour of them rather than the petitioners; and a desire to give vent to ill will towards the petitioners. These desires can only be described as dominant and improper motives, and they are sufficient to establish the element of malice which is essential for the success of the petitioners' claim of malicious falsehood.7. Damage
[63] The petitioners make the following averments on the subject of damage:"Further the statements made were calculated and intended to inflict injury and disruption upon the petitioners' business by disparaging Profilit and thereby attempting to divert the petitioners' business to the respondents (Statement 3).
The respondents' conduct has created uncertainty in the market for Profilit (Statement 5).
If such further allegations are made they will materially damage the reputation, business and trading prospects of the petitioners and will cause inconvenience and disruption to the petitioners in the conduct of their business (Statement 8)."
"3. In any action for verbal injury it shall not be necessary for the pursuer to aver or prove special damage if the words on which the action is founded are calculated to cause pecuniary damage to the pursuer."
"Special damage" means actual damage (Argyllshire Weavers Ltd v A Macaulay (Tweeds) Ltd 1965 SLT 21 at 35). "Calculated to cause" means "likely to cause" (Customglass Boats v Salthouse Bros [1976] RPC 589 at 603, not cited at the hearing on evidence, construing the equivalent provision, section 5(1), of the New Zealand Defamation Act 1954). In Argyllshire Weavers Ltd supra Lord Hunter observed that in an action of interdict reasonable apprehension of such actual damage would no doubt be sufficient to qualify a pursuer for the preventive remedy, and in any event the law had been amended by the 1952 Act.
[65] The petitioners' counsel tendered evidence from Mr McBride and Mr Brown about the effect of the respondents' conduct on the petitioners' business. Counsel for the respondents stated timeous objections to the line of evidence on the basis that there was no adequate record for such evidence. I allowed the evidence to be led under reservation of all questions of competency and relevancy. Mr McBride spoke to the inconvenience and disruption caused by the respondents' conduct and stated that the resulting cost to the petitioners, excluding their legal expenses, approached £80,000. As to loss of business, he said that they had failed to secure a number of projects, but the potential clients had been reluctant to tell them why they had not been selected. He did not know how much that had cost the petitioners. They were now asked more frequently than they used to be for a test certificate. Mr Brown said that the respondents' assertions had caused the petitioners' staff to spend much time providing information for clients and travelling throughout the United Kingdom. Since July 2002 the petitioners had lost some 10 to 12 substantial projects to the respondents. Architects now sometimes looked at specifications for glass fairly rigorously. In my opinion there is a foundation for the evidence of these two witnesses in the averments I have quoted. I have therefore repelled the objections. [66] Mr Price gave evidence that the respondents' business had been damaged by the present dispute. He said it had had a devastating effect on their sales of U-profiled glass. The Linit-U side of the business was in suspended animation. Neither side produced any documentation to support the various claims made. As I have indicated, I accept the evidence of Mr McBride and Mr Brown as credible and reliable. I would not, however, attach great significance to the estimates of £80,000 and of 10 to 12 lost projects which were offered in the witness box. I have also expressed my reluctance to rely on the unsupported word of Mr Price. It is fair to say, however, that while for that reason I would not rely on his evidence about the effect on the respondents' business, I readily accept that the current action has caused him much inconvenience. I have concluded that there is sufficient acceptable evidence in the testimony of Mr McBride and Mr Brown to establish the averments quoted, and I find the averments proved. [67] In any event, the effect of section 3 of the 1952 Act is that it is not necessary for the petitioners to aver or prove actual damage if the respondents' words are likely to cause them pecuniary damage. The respondents' counsel sought to elide the effect of section 3 by arguing that on a fair reading of the words on which the action was founded, they were not calculated to cause pecuniary damage to the petitioners. I have found, however, that they were so calculated (paragraph [62]). Had it been necessary to do so, I would have found that the petitioners had sufficiently averred and proved actual damage.8. Result
[68] The question remains whether the petitioners are entitled to the remedy of interdict in terms of heads (1) and (3) of the prayer. As I have already noted, the respondents consent to decree in terms of head (2). Their counsel contended that there was no evidence that perpetual interdict in terms of heads (1) and (3) was necessary. It is clear, however, that Mr Price persisted in making his assertions after this action had been raised and after the undertaking had been given. In my opinion the petitioners have established that there is reasonable apprehension of the repetition of the assertions, and there is no reason why perpetual interdict should be refused. [69] I shall therefore sustain the pleas-in-law for the petitioners, repel the third, fourth, fifth and sixth pleas-in-law for the respondents and pronounce interdict in terms of heads (1), (2) (of consent) and (3) of the prayer. Quoad ultra I shall dismiss the petition. I shall reserve all questions of expenses.
