Feakins v Burstow
| Jurisdiction | England & Wales |
| Judge | MR. JUSTICE JACK,Mr. Justice Jack |
| Judgment Date | 11 November 2005 |
| Neutral Citation | [2005] EWHC 2441 (QB),[2005] EWHC 1931 (QB) |
| Docket Number | Case No: HQ03X01888 |
| Court | Queen's Bench Division |
| Date | 11 November 2005 |
[2005] EWHC 1931 (QB)
Mr. Justice Jack
Case No: HQ03X01888
IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
Andrew Sutcliffe QC and Gavin Hamilton (instructed by Messrs Parker Bullen) for the Claimant
Philip Moser and Dan Stacey (instructed by Messrs Beachcroft Wansbroughs) for the Defendants
Hearing dates: 27 June—12 July 2005
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Introduction
This is an action against a solicitor for alleged negligence. The claimant, Kevin Feakins, carried on a business of exporting live sheep. Under European Community law as applicable only to the United Kingdom, in the relevant period a premium was payable on lambs of appropriate quality when they were sold in the market for slaughter. If such lambs were then exported within the Community, an amount supposed to be equivalent to the premium had to be paid by the exporter with the aim of removing the price advantage that he would otherwise have over producers in the country of import. This was called 'clawback'. Categories of sheep which did not attract the premium when sold were exempt from clawback on export, and were referred to as exempt sheep. The scheme came to an end in February 1992.
The recovery of clawback was provided for by a Community Regulation made in 1984. A decision of the European Court delivered in 1992 declared that the provision it contained for the calculation of clawback was invalid. A further Regulation was made later that year to replace it. In 1992 together with a number of other exporters Mr Feakins instructed the defendant solicitor, Mr Anthony Burstow, to act for him in actions claiming recovery of clawback which they had paid. The defendant was the Intervention Board for Agricultural Produce, often called IBAP, which was the government body responsible for the payment of premium and the collection of clawback on behalf of the Community. It later became the Rural Payments Agency. In the course of that litigation the Board, as I will refer to it, made a counterclaim against Mr Feakins for unpaid clawback in the sum of £406,298 calculated under the 1992 Regulation. The 1992 Regulation was held to be valid and IBAP obtained summary judgment against Mr Feakins for that sum and interest, a total of £650,644. It was Mr Feakins' case that £194,708 of the £406,298 related to exempt sheep in respect of which no clawback was payable. In the present action he asserts that Mr Burstow was negligent in relation to his exempt sheep case, and in particular that he failed to raise it as a defence to the counterclaim. On his part Mr Burstow has advanced a number of defences which include that Mr Feakins failed himself to take the matter up with IBAP when he was first invoiced by the Board, and failed adequately to instruct him. This is a summary and it is also a simplification of a more complex situation.
The litigation concerning the Regulations
The 1992 regulation to which I have referred was Commission Regulation (EEC) No 1922/92, which was made on 13 July 1992. It was made because on 10 March 1992 in what I can call the first Lomas case the European Court of Justice held that the relevant part of the 1984 Regulation relating to the calculation of clawback, namely Article 4(1) of Commission Regulation (EEC) No 1633/84, was invalid: [1992] ECR-1 1781. The first Lomas case came about because English sheep exporters had been prosecuted in the Crown Court for breach of the 1984 Regulation, which had resulted in references to the European Court as to its validity. So the 1992 Regulation was made to amend Article 4(1) and was retrospective. It related to a scheme which had already ended.
Meanwhile shortly before the delivery of the first Lomas judgment a number of actions had been commenced against the Board by exporters claiming the repayment of clawback paid under the 1984 Regulation between 1988 and 1992, or repayment of such sums as exceeded the clawback properly chargeable. One such writ was issued by Mr Feakins. I will call these 'the English actions'. Some exporters had stopped paying clawback pending the first Lomas decision.
It was however considered by exporters' advisers that the new 1992 Regulation was also capable of challenge. Two sets of proceedings were started in Europe. One, called the FMC case, was commenced by representatives of the carcase trade, and was initiated by a reference from the English High Court. Mr Burstow did not act for the claimants in that action. The other, the second Lomas case, in which Mr Burstow did act, was commenced by representatives of the live trade in the European Court of First Instance in September 1992, and Mr Feakins was among the claimants. Proceedings in the second Lomas case were stayed pending the decision of the European Court in the FMC case. On 8 February 1996 judgment was given in the FMC case dismissing the carcase trade's attack on the 1992 Regulation. The live traders then sought in the second Lomas case to introduce an expert's report distinguishing their position under the Regulation from that of the carcase trade. In its judgment dismissing the case delivered on 9 July 1997, [1997] ECR-2 1095, the Court of First Instance held that the new material could not be admitted pursuant to its rules but noted that it could be admitted in the pending proceedings before the national court, that is, in the English actions.
Meanwhile, in the English actions statements of claim, defences and replies had been served in 1993, and they had then hung fire pending progress in Europe. On 11 January 1996 the Board served defences which were amended to add counterclaims for the amount of clawback outstanding under the 1992 Regulation. The sum claimed from Mr Feakins was £406,298. On 29 March 1999 the Board issued summonses applying for the statements of claim to be struck out as disclosing no reasonable cause of action, and for summary judgments on the counterclaims. Those summonses were heard before Ian Kennedy J. He considered the claims on the basis of draft amended pleadings served on behalf of the claimants. The proposed amendments raised the points which it had been sought to raise in the second Lomas action before the European Court of First Instance as to the validity of the 1992 Regulation and also a plea that the counterclaims were barred by limitation. They simply put the Board to proof of the amounts of clawback that the Board counterclaimed. In a judgment delivered on 14 April 2000 Ian Kennedy J held that the decision of the European Court in TWD Textilwerke Deggendorf v Germany [1994] ECR-1 833 barred the claimants from raising the arguments which they sought to raise as to the validity of the 1992 Regulation. He also held that the Board's claims were not barred by limitation. He held that the Board succeeded on the claims and counterclaims. There was a further hearing before Ian Kennedy J on 23 June 2000. It was argued on behalf of the claimants that the amount of the clawback that was outstanding had not been in issue on the summonses and remained to be determined. It was sought to raise on behalf of Mr Feakins the issue of exempt sheep. The judge held that there were no issues as to the amount save in respect of one claimant where the Board had accepted that there was an issue. He held that it was too late to raise the issue of Mr Feakins' exempt sheep. On 23 October 2001 the Court of Appeal dismissed appeals from the decisions of Ian Kennedy J.
The present action was commenced by Mr Feakins on 18 June 2003. The claim form claimed damages for breach of contract and negligence in the conduct of Mr Feakins' action against the Board. A second action was commenced on 5 May 2004 in which Mr Feakins sought damages for negligence in the conduct of the second Lomas case. Those causes of action were combined in an amended statement of case served on 12 May 2004, but the second was abandoned by its deletion by a re-amendment made on 6 October 2004. In the action as it now stands Mr Feakins claims damages in respect of the Board's counterclaims against him.
The system relating to clawback and exempt sheep.
Clawback was payable on the export of sheep other than exempt sheep. Some exporters paid what was due to Customs on export by, for example, banker's draft. Other exporters gave security and were invoiced by the Board in due course. Mr Feakins was among the latter and the Board held a bank guarantee from him for £50,000.
The primary document required for the export of sheep was called a C1220. This form was used whether or not the export attracted clawback. It was presented to Customs at the port by the exporter, or in practice, by his agent, when the lorry carrying the sheep arrived and was waiting to be loaded on ship. Only on its completion by Customs could the lorry be loaded. If the sheep were exempt from clawback a second form had to be provided to Customs. This was the CES 3. It has different initials in earlier periods. The CES 3 also required completion by Customs.
The CES 3 originated at the lairage close to the port where the sheep were required to rest for a minimum of 10 hours before shipment. At the lairage the sheep were inspected by inspectors employed by the Meat & Livestock Commission, the MLC. The inspectors checked the sheep to see that they were each exempt, and then the CES 3 was completed by the MLC inspector to certify that they were. Sheep on which premium had been paid were readily identifiable and so could not be presented for certification as exempt because they were...
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