The Office of Fair Trading v Somerfield Stores Ltd & Anor
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
- LORD JUSTICE LAWS
- LORD JUSTICE PATTEN
- LORD JUSTICE VOS
Areas of Law
- Civil Procedure
- Administrative Law
- Commercial Law
2014
COURT OF APPEAL (CRIMINAL DIVISION)
United Kingdom
CORAM
AI Generated Summary
Vos LJ, with Patten LJ and Laws LJ concurring, considered whether the CAT properly granted Somerfield Stores Limited/Co-operative Group Food Limited and Gallaher Group Limited/Gallaher Limited extensions of time to appeal the OFTs April 2010 Tobacco Decision. Both respondents had executed Early Resolution Agreements in July 2008 admitting infringements based on the broad Statement of Objections. The Decision later advanced a narrower paragraph 40 theory of harm. In Tobacco I, six other addressees overturned the Decision after the OFT abandoned the paragraph 40 theory and attempted to introduce a different paragraph 2 theory; the CAT quashed the Decision as to those appellants. Somerfield and Gallaher then sought out-of-time appeals, which the CAT allowed on exceptional circumstances . Emphasizing legal finality and certainty, rejecting legitimate expectation and apt to mislead arguments, and refusing to imply a proper evidential basis term, the Court of Appeal allowed the OFTs appeal and refused the extensions.
Judgment
Lord Justice Vos
Introduction
The issue in this case is whether the Competition Appeal Tribunal (Mr Marcus Smith Q.C.) (the “CAT”) was right to find that there were “exceptional circumstances” justifying an extension of time for appealing a decision of the Appellant, the Office of Fair Trading (the “OFT”).
The Respondents in Case 1197/1/1/12, Somerfield Stores Limited and Co-operative Group Food Limited (which acquired the assets and liabilities of Somerfield Limited) (together the singular “Somerfield”), and the Respondents in Case 1200/1/1/12, Gallaher Group Limited and Gallaher Limited (together the singular “Gallaher”) had each entered into early resolution agreements with the OFT in about July 2008 (respectively the “SERA” and the “GERA”, and together the “ERAs”). The CAT held, in essence, that the Respondents had a legitimate expectation that the OFT would be able to maintain the theory of harm that it had advanced and that had given rise to the ERAs, and that it would be reflected in the OFT’s decision (entitled “Case CE/2596-03: Tobacco” which was issued on 15 th April 2010 – the “Decision”) when it was ultimately made. Accordingly, when other third party addressees of the Decision successfully challenged it, and the OFT had to abandon the theory of harm that underlay it, the Respondents were entitled to initiate their own appeal out of time. It is noteworthy that neither Somerfield nor Gallaher seeks to uphold the reasoning of the CAT as to the finding of a formal “legitimate expectation”.
The term “theory of harm” has been central to this appeal, and it is worth explaining it briefly at the outset. The OFT’s theory of harm is its explanation as to why the agreements that it finds to exist are said to have the anti-competitive objects or effects it alleges are contrary to section 2(1) of the Competition Act 1998 (the “1998 Act”).
The OFT is appealing the CAT’s ruling dated 27 th March 2013 (the “Ruling”) granting an extension of time for the Respondents to appeal the Decision, with permission granted by Lewison LJ on 23 rd July 2013.
The CAT extended the two-month time limit for appealing, which is provided for under rule 8(1) of the Competition Appeal Tribunal Rules 2003 (S.I. No. 1372 of 2003) (the “Rules”), for 28 days from the date of the CAT’s ruling. It did so expressly under rule 8(2) of the Rules, which provides that: “the Tribunal may not extend the time limit provided under paragraph (1) unless it is satisfied that the ci