The Sunday Times has lost the latest stage of its long-running libel battle with Albert Reynolds. Today the House of Lords ruled that an article, in which the former Taoiseach had been accused of misleading the Dáil, was not in the public interest and could not be protected by the legal defence of qualified privilege. Mr Reynolds, who is still faced with huge legal bills, is seeking a retrial of the whole action.

The Sunday Times has said it is disappointed with today's decision. However, the paper has claimed an element of victory in today's House of Lord's ruling in Albert Reynolds' favour, saying the decision had significantly expanded the right of freedom of expression for media in the United Kingdom.

Albert Reynolds emerged from the House of Lords this afternoon looking relieved. The five law lords decided by a three to two majority that the Sunday Times could not claim the defence of qualified privilege in seeking to defend itself. The newspaper had alleged in a 1994 article that Mr Reynolds had misled the Dáil over the Father Brendan Smyth affair. The row brought down the Fianna Fáil-Labour coalition of the time. Albert Reynolds sued the Sunday Times. The Court of Appeal in London ruled in July of last year that Mr Reynolds did not receive a fair trial during the first High Court libel hearing in 1996, which left him with huge legal bills. Although the jury found that he had been libelled by the story, they awarded him only a penny in damages and he was left with a massive legal bill.

The newspaper subsequently argued that the article was in the public interest and should be protected by qualified privilege. Today the House of Lords disagreed. This means the newspaper will not be able to use this defence when Albert Reynolds goes back to court for a new trial in an attempt to secure damages and his legal costs.