Catalyst Recycling Ltd v Nickel Aue Gmbh
| Jurisdiction | England & Wales |
| Judge | Lord Justice Waller,Lord Justice Lawrence Collins,Lord Justice Rimer |
| Judgment Date | 22 May 2008 |
| Neutral Citation | [2008] EWCA Civ 541 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A2/2007/1498 |
| Date | 22 May 2008 |
[2008] EWCA Civ 541
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
His Honour Judge Grenfell, sitting as a High Court Judge
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Waller
Vice-president Of The Court Of Appeal, Civil Division
Lord Justice Lawrence Collins And
Lord Justice Rimer
Case No: A2/2007/1498
Giles Wheeler (instructed by Messrs Squire, Sanders & Dempsey) for the Respondent
Adrian Jack (instructed by Messrs Bates, Wells & Braithwaite) for the Appellant
The respondents, Catalyst Recycling Limited, were formerly known as Chris Cutchey Limited. They operated under an “agency” agreement with the appellants Nickelhütte Aue GmbH. The object of the agreement was that the respondents, an English company operating in the United Kingdom and Ireland, acting as principals would secure for the appellants, a company in Aue in the District of Dresden, Germany, supplies of materials for recycling. The materials were defined as “spent or redundant catalysts and other residues suitable for recycling”. The main source of the materials was catalyst generators within the United Kingdom. The business therefore involved the transhipment of waste for recycling between the United Kingdom and Germany, to which the European Transhipment of Waste Regulation ( Council Regulation (EEC) No 259/93) (the European Regulation) applied and to which, indeed, regulations passed in both the United Kingdom and Germany also applied.
Amongst the requirements of the European Regulation was that there had to be in place in relation to any shipment a financial guarantee to cover the costs of reshipment of the waste in case it was rejected. A financial guarantee had in this case been obtained in relation to shipments but the guarantee referred to the respondents by their former name, Chris Cutchey Limited. The main dispute in this case arose out of the fact that there was a period during which the authorities in Dresden became concerned as to whether the guarantee covered shipments made by “Catalyst Recycling Limited” when the guarantee referred to “Chris Cutchey Limited”. Although ultimately satisfied that the guarantee was effective, the authorities alleged that three shipments imported into Germany while the authorities were considering the position were made illegally under German law.
As between the respondents and the appellants it was also alleged that because the shipments were made illegally the respondents were in repudiatory breach of the agency agreement. In reliance on that breach the appellants terminated the agency agreement and claimed damages. The respondents denied any illegality and denied in any event that whatever occurred could amount to a repudiatory breach. In their turn they accepted the appellants' termination as repudiation and claimed damages. The issues before the judge were accordingly: (1) Were the three shipments, or any of them, illegal under German Law? (2) If so, did the consignor, by shipping the waste into Germany, commit a repudiatory breach of the agency agreement?
By a judgment handed down on 4 th May 2007 His Honour Judge Grenfell sitting as a High Court Judge, preferring the evidence of the expert in German law called by the consignor, decided there was no illegality under German law. He further decided that even if any shipment was illegal the respondents' conduct was not a repudiatory breach of contract. He held that the respondents were entitled to damages for the appellants' repudiation. This is an appeal from that judgment.
European Regulation
I append to this judgment the relevant provisions of the European Regulation with which this case was concerned. [We were told that there is a new Regulation (EC) No 1013/2006 with effect from 12 th July 2007, but it is not of relevance to any point in issue.] As appears, the main object of the regulation is to see that prior notification is given to the competent authorities in different member states to which waste may be transported or through which waste may be transported. The aim is to enable those authorities to be informed of the particular type of waste, its movement, its disposal or recovery so that the authorities can take measures to protect human health and the environment, including being able to take reasoned objections to any shipment. Different types of waste are dealt with in different ways. The European Regulation contemplates competent authorities in the state of dispatch, in the state of transit and the state of destination, all of whom will have a role in controlling the movement of waste. The competent authority in England which, in the case of two shipments was the state of dispatch and, in the case of one shipment from Ireland, was the state of transit, was The Environment Agency. The competent authority of the state of destination was the Regierungsprädium (Dresden RP).
Chapter A, which I have not produced in the appendix, is concerned with waste for disposal, but in this case we are concerned with waste for recovery covered by Chapter B. The basic structure before considering Article 9, which is perhaps the most important Article to be considered in this case, I can summarise as follows. Article 6 (the first Article in Chapter B) provides that where a notifier (in this case the respondents) intends to ship waste from one member state to another, he shall notify the competent authority of destination (in this case Dresden RP) and send copies of the notification to the competent authorities of (a) dispatch (in two cases the Environment Agency in England and in one case Cork County Council in Cork), (b) of transit (in the case of the shipment from Ireland to the Environment Agency), and (c) to the consignee. Article 6(3) provides for the notification to be through a consignment note issued by the competent authority of despatch (i.e. in two cases the Environment Agency and in one Cork County Council). Articles 6(4) and (5) specify the information to be on the consignment note and impose on the notifier (the respondents) an obligation to supply additional information and documentation if requested by the competent authorities. Article 6(6) requires a notifier (the respondents) to have concluded a contract with the consignee (the appellants) for recovery of the waste. Importantly the contract must include an obligation on the notifier to take the waste back “if the shipment has not been completed as planned or if it has been effected in violation of this regulation”.
Article 7 requires the competent authority of destination to send within 3 working days an acknowledgement to the notifier, with copies to the other competent authorities and to the consignee. Article 7(2) then gives 30 days for any of the competent authorities to object to shipment on grounds based on those identified in Article 7(4).
Article 8(1) allows shipment to be effected if, after the 30 day period, no objection has been lodged. Article 8 (2) requires the notifier to insert the date of shipment in the consignment note and send copies to the competent authorities 3 working days before shipment. The remainder of Article 8 is concerned with the completion of the consignment note by others and with obtaining confirmation that the waste has been recovered not later than 180 days following receipt of the waste.
Article 9 is important in this case. It allows, by Article 9(1), for “competent authorities having jurisdiction over specific recovery facilities” (in this case Dresden RP) to decide “notwithstanding Article 7, that they will not raise objections concerning shipments of certain types of waste to a specific recovery facility.” Dresden RP, in the case of the shipments with which this case is concerned, did so decide. Articles 9(3) and (5) I should quote in full:-
“9(3) All intended shipments to such facilities shall require notification to the competent authorities concerned, in accordance with Article 6. Such notification shall arrive prior to the time the shipment is dispatched.
The competent authorities of the Member States of dispatch and transit may raise objections to any such shipment, based on Article 7(4), or impose conditions in respect of the transport.
…..
9(5) For the actual shipment, Article 8 (2) to (6) shall apply.”
It would seem (and it seems logical) that it was contemplated that if an Article 9 decision had been taken by a competent authority of destination, only the competent authorities of dispatch and transit would have any right to make objections based on Article 7(4). It also seems to have been contemplated that when Article 9 was being used notification had to be made to the competent authorities and that that notification had to be sent 3 working days before the shipment is made (Article 8(2)) to arrive with the competent authorities “prior to the time the shipment is dispatched”(Article 9(3)). In this instance, as I read the regulation, it seems to have been intended that there should be no period of 30 days for any of the competent authorities to consider the making of objections under Article 7(2), which seems to explain the omission of Article 8(1) in Article 9(5). I will return to this point, about which there may be an issue.
Article 26 deems certain shipments of waste to be illegal traffic e.g. if notification has not been given to all competent authorities or consent has not been obtained or consent has been obtained by fraud. The Article imposes obligations on the competent authorities for the...
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