- Noseweek editor Martin Welz has been granted leave to appeal a R330 000 defamation order made against him and his publication.
- Welz and Noseweek's owner and publisher, Chaucer Publications, were in April ordered to pay R330 000 in damages for defaming senior attorney Leonard Katz in 2014.
- Welz has said that Noseweek may not be able to survive if it has to pay the full damages, plus Katz's legal costs.
Noseweek editor Martin Welz has won an application for leave to appeal a R330 000 damage order made against him and the investigative magazine he runs in a defamation suit.
Welz wanted the damages reduced, in part,so that his publication has a chance to stay in business.
On Friday, the Western Cape High Court heard an application for leave to appeal an earlier judgment that found Welz liable to pay R330 000 in damages to Leonard Katz, senior attorney at law firm Edward Nathan Sonnenbergs.
In late April, acting Western Cape High Court Judge Ncumisa Mayosi found that Welz had defamed Katz in an editorial and an article published in the July 2014 edition of the magazine. Katz also featured on the magazine's front cover.
In the articles, Noseweek made allegations about Katz's conduct in liquidation cases. The magazine refused to retract these accusations following a request by Katz.
Welz and Noseweek's owner and publisher, Chaucer Publications, were ordered to pay R330 000 in damages, plus Katz's legal costs. According to Welz, the legal costs may be more than R1 million.
On Friday, Mayosi ruled that Welz could appeal the damages order to a full bench of the Western Cape High Court. She refused permission for Welz to appeal other sections of the ruling, including the requirement that he pay for Katz's legal costs.
Earlier on Friday, Advocate Michael Bishop, for Welz, had argued that the Noseweek editor was seeking limited leave to appeal on the grounds that certain statements found to be defamatory were, in fact, reasonable. Mayosi refused this part of the appeal.
Bishop clarified that Welz's position was not that Katz was not entitled to any damages, but that the damages were too high and should be reduced.
Bishop said that, in his view, the maximum payout should be R100 000. He noted that appellate courts had, in the past, reduced payouts in defamation cases.
He argued that Mayosi had erred in relying too heavily on cases that made high defamation awards rather than cases where similar allegations had made lower awards.
Bishop also argued that the impact of the damages award on media was relevant.
The court, he said, must consider what the impact of the damages award on media freedom. The R330 000 in damages, coupled with an order that Welz pay Katz's legal costs, were "likely to put Noseweek out of business".
"We submit there is a reasonable prospect that an appellate court will make a significantly lower award of damages," he said.
In addition to lowering the damages, Bishop said there was a prospect that an appellate court could lower the legal costs that Welz had to pay by 50%. Mayosi refused this section of the appeal, however.
Cherry-picking
Advocate Brendan Manca, for Katz, had argued there was little hope that an appeal could be successful.
Responding to Bishop's argument that some phrases deemed to be defamatory were, in fact, reasonable, he said Bishop appeared to be wanting to "cherry-pick" "little phrases" and divorce them of their content.
The "entire article" had to be understood as a whole, he said.
He also argued against the view that Katz had caused Noseweek's precarious financial position. "It is not Mr Katz, it is Mr Welz himself," he said.
He noted that Katz made an offer to Welz six months into the litigation to stop legal proceedings if he retracted the article. Welz would then only have to pay Katz's legal costs. Welz did not take up the offer.
Manca contended that Welz had been given "every opportunity" to avoid a damages award in its entirety.
He added that an appeals court would only revisit or downgrade defamation costs if they were found to be "glaringly disproportionate".
While he argued that there was "no basis for an appeal court to come to that conclusion", Mayosi ended up grating leave to appeal this part of Bishop's argument.
A date has not yet been set for the appeal.