'Sunday Times' faces a £2m legal bill over Ulster death squads libel

A television journalist capped a libel victory against The Sunday Times in the so-called "Ulster death squads" case when he won a costs order yesterday expected to land the newspaper with a legal bill totalling £2m.

A television journalist capped a libel victory against The Sunday Times in the so-called "Ulster death squads" case when he won a costs order yesterday expected to land the newspaper with a legal bill totalling £2m.

The Sunday Times's liability for lawyers' services arising from the case is thought to be among the highest ever faced by a newspaper.

The Court of Appeal in London ordered that part of the costs which the newspaper must pay Sean McPhilemy to cover his costs for the libel action and The Sunday Times's unsuccessful appeal, must be calculated under the draconian "indemnity" principle. An indemnity costs order means that, when a winning party's costs are assessed, nearly all the fees and charges are allowed. This differs from the normal procedure, under which certain claims are struck out in the settlement.

Yesterday's ruling saddles the newspaper with having to pay Mr McPhilemy up to £870,000 costs, in addition to the £145,000 damages he won last year. The newspaper's own costs are thought to be about £1m.

Mr McPhilemy won the damages over allegations that he produced a "hoax" programme about high-level involvement in the murder of Catholics by Northern Ireland loyalist death squads.

A London High Court jury decided that the newspaper had failed to prove "on the balance of probabilities" that the clandestine committee of murder conspirators featured in his 1991 Channel 4 programme for Dispatches, did not exist.

In its appeal, The Sunday Times claimed the jury's finding on that issue was "perverse and unreasonable".

But Lords Justices Simon Brown, John Chadwick and Andrew Longmore said the appeal ­ challenging the jurors decision on the ground that they gave "the wrong answer" ­ was an "abuse" of the court process.

Two Northern Ireland businessmen received more than £700,000 in May after a libel action against Mr McPhilemy's book on the same subject.