Court roundup: Five key legal judgments you shouldn't miss

Courts have ruled recently on culling beavers, liability for a massive oil spill off Spain, compensation for not appealing the revocation of an emissions control patent, licensing for a Scottish fish farm and denial of permission for an energy-from waste plant. Here’s what you need to know:

Photograph: Troy Harrison/Getty Images Photograph: Troy Harrison/Getty Images

NatureScot beaver killing licenses found lawful

Although Scottish natural environment regulator NatureScot “erred in law” by failing to explain why it had granted permits to cull beavers, the Outer House of the Court of Session has found that its approach in general was lawful.

Campaign group Trees for Life sought to overturn the Scottish government’s policy on killing the protected species, arguing that it should only be done as a last resort.

Judge Lady Carmichael ordered that activity under the existing permits should be halted until NatureScot publishes its reasons for issuing them, individually. But this was the only successful aspect of the campaigners’ suit: claims that the regulator had failed to interpret the Habitats Regulations correctly, that it had a “blanket policy” of granting licences related to prime agricultural land and that it had not considered consider the individual circumstances of each application.

The ruling may have wider implications for the culling of protected species in general, for which NatureScot would have to provide solid reasoning.

Case: CA [2021] CSOH 108

Date: 21 October 2021

Ref: Trees for Life v NatureScot

 

Spain not immune from sunk oil tanker insurers’ lawsuit

Spain could be forced to pay damages to the insurer of an oil tanker that sank in 2002, devastating its coastline and that of France and Portugal, the Court of Appeal’s Civil Division has ruled.

A Spanish ruling on liability for damages breached a binding obligation for arbitration in London, it found.

The ageing oil tanker Prestige sprang a hole and sank 200km off the coast of Galicia in 2002, spilling around 60,000 tonnes of heavy fuel oil – almost twice the volume released by the Exxon Valdez in Alaska in 1989. It was the greatest environmental disaster Spain had ever seen, and it also affected beaches in Portugal and France.

Criminal and civil litigation arising from the spill have been heard in the US, Spain and England, reflecting the multinational nature of the shipping industry and the insurers that cover it.

In January 2016, the Spanish Supreme Court held The London Steam-Ship Owners’ Mutual Insurance Association Ltd (or the London P&I Club for short), which insured the Prestige, liable for damages of £855m (the Euro equivalent of $1bn), the limit of the funds available.

However, the company denied that the ruling could be enforced, arguing that the Spanish and French governments must pursue their claims for compensation through an arbitrator that had been appointed by the Commercial Court in London.

It therefore issued proceedings against the two states, seeking compensation, an injunction restraining the enforcement of the Spanish judgment and a declaration that they are bound to pursue claims through arbitration. In response, France and Spain argued that they are entitled to state immunity and denied that the court had any jurisdiction. It was these competing claims that came to be heard by the Civil Division of the Court of Appeal in October, on appeal by the governments.

In a ruling handed down on 4 November, Lords Justice Males, Popplewell and Phillips said the spill off Cape Finisterre “was a catastrophe for the regions affected and for the people who lived there, including those whose livelihoods were dependent on the marine environment”.

They confirmed that France and Spain are not entitled to the immunity that they claimed, as their litigation was commercial rather than sovereign activity and that the Commercial Court did have the right to appoint an arbitrator to determine the claim against Spain.

However, proceedings launched by the club in the Commercial Court against, “seeking damages or equitable compensation for any liability under the Spanish judgment”, were ruled ultra vires. Such a claim would have to be launched in the Spanish courts, the judges found.

A separate challenge to a Spanish order made under the Brussels I Regulation (which concerns jurisdiction in cases involving more than one country), seeking to enforce the £855m claim, will be considered by the Court of Appeal later this year,

Case: London Steam-Ship Owners' Mutual Insurance Association Ltd v Spain & France

Date: 4 November 2021

Ref: [2021] EWCA Civ 1589

 

‘Nominal damages’ to be awarded for NOx emission patent failure

Chemicals firm BASF will only receive limited damages after its lawyers “negligently failed to lodge appeal” when one of its emission control patents was revoked, the High Court has ruled.

The patent concerned the combination of a copper chabazite zeolite catalyst, used for the selective catalytic reduction of nitrogen oxides, with a particulate filter. The technology was developed by predecessor firm Engelhard and patented in 2003, for use in cleaning up the exhaust from diesel-fuelled cars and vans.

However, it was revoked by the European Patent Office’s Opposition Division in 2012, “for lack of inventive step”, says the judgment of Mr Justice Adam Johnson. BASF’s patent attorneys Carpmaels did not lodge an appeal against the move, for which they admitted liability for professional negligence. Had they done so, the decision would have been suspended until at least early 2015.

This was apparently a critical period for the business. With an intact patent, the claimants argued that they would have had a better chance to obtain more business from automotive manufacturers such as Daimler, Volkswagen and Ford. They instead largely opted for equipment supplied by BASF’s rival, Johnson Matthey International (JMI). Furthermore, the claimant argued that JMI “would have needed a licence of BASF’s technology in order to compete at all”,

Two questions arose in the case brought by BASF, and its subsidiaries based in South Africa, Poland and Germany: to whom did they owe duties of care, and what losses flowed from Carpmael’s breach? BASF argued that it lost profits of over $1bn, plus licensing fees of $136m, over the 2012-2015 period.

Having found that there was no contractual responsibility to the subsidiaries, Johnson found that, “on the facts is that there was no real chance of OEMs’ procurement decisions being different”, if the patent had remained in force. In addition, “the claimants have not discharged the burden of proof which rests on them” to prove that JMI or the manufacturers would have behaved differently in that case, says the judgment.

Therefore, only “nominal damages”, to be agreed by the parties, should follow from Carpmaels’ admitted breach, it concludes.

Case: BASF Corporation & Ors v Carpmaels and Ransford

Date: 29 October  2021

Ref: [2021] EWHC 2899 (Ch)

 

Fish farm developer’s appeal refused

The Outer House of the Court of Session had refused permission for Orkney Marine Farms Ltd to operate two fish farms off the mainland of Orkney.

To do so, the firm would require an authorisation under the Water Environment (Controlled Activities) (Scotland) Regulations 2011. The Scottish Environmental Protection Agency refused to grant this, due to potential impacts on a particular form of rare and protected seaweed. This led to an appeal to the Scottish government, which was refused in March. The firm then attempted to overturn this at judicial review.

It questioned if the reporters for the Scottish government had wrongly applied the policies of the National Marine Plan, the precautionary principle in relation to a proposal to relocate them by a short distance, and the law in relation to climate change adaptation and mitigation. The latter is because the habitat, known as maerl beds, forms a natural long-term store of carbon.

All three aspects of the petition were refused.

“It is not correct to say, as Orkney Marine do at one point in their note of argument, that the use of the precautionary principle is excluded where there is available evidence. There may be evidence which leaves the decision maker legitimately uncertain in relation to material matters. That is what happened here,” wrote Lady Carmichael. As the reporters could not readily determine how much waste the beds could tolerate, or how and where it would be deposited, they were right to apply the precautionary principle, he concluded.

They were also “entitled to take the approach that they did” regarding relocation and, “to conclude that even a small consequence, so far as climate change was concerned, was relevant,” she added.

Case: Orkney Marine Farms Ltd v The Lord Advocate and Scottish Ministers

Date: 29 October 2021

Ref: [2021] CSOH 112

 

BEIS right to block energy-from-waste plant

The High Court has rejected Wheelabrator Technologies’ attempt to overturn the government’s decision to block plans for an energy-from-waste plant in Kent.

The Wheelabrator Kemsley North plant would have been able to generate up to 42MW of power from and up to 390,000 tonnes of waste. Although consent was granted to expand an existing facility close by, energy secretary Kwasi Kwarteng refused to grant consent for the new incinerator, claiming it would lead to recyclable material being incinerated. It would thus breach the waste hierarchy.

Mr Justice Dover found that Kwarteng had erred in law, by failing to consider all relevant aspects of the Planning Act 2008 but denied a grant of relief. The decision “would have been the same, and certainly the outcome would not have been substantially different, without commission of the error of law which has been identified,” he wrote.

The judge added that there was no demonstrated need for the development and that incineration demand was well met already, through Wheelabrator’s K3 and FCC’s Allington plants. Furthermore, the proposal “would justifiably put at risk” meeting the county’s recycling and composting targets.

Case: EFW Group Ltd v Secretary of State for Business, Energy and Industrial Strategy

Date: 8 October

Ref: [2021] EWHC 2697 (Admin)

 

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