Floe Telecom Ltd v Office of Communications and Another

JurisdictionEngland & Wales
JudgeLord Justice Mummery,Lord Justice Lawrence Collins,Sir John Chadwick
Judgment Date10 February 2009
Neutral Citation[2009] EWCA Civ 47
Docket NumberCase Nos: A3/ 2007/0658 & 2007/0665
CourtCourt of Appeal (Civil Division)
Date10 February 2009

[2009] EWCA Civ 47




Marion Simmons QC (Chairman)

Mr Michael Davey & Mrs Sheila Hewitt

Before : Lord Justice Mummery

Lord Justice Lawrence Collins


Sir John Chadwick

Case Nos: A3/ 2007/0658 & 2007/0665

Case No: 1024/2/3/04

(1) Office of Communications
(2) T-Mobile (UK) Limited
Floe Telecom Limited (in liquidation)

MR RUPERT ANDERSON QC, MS ANNELI HOWARD and MR BEN LASK (instructed by General Counsel, Office of Communications) for the Appellant Office of Communications

MR MEREDITH PICKFORD (instructed by Robyn Durie, Regulatory Counsel, T-Mobile) for the Appellant T-Mobile (UK) Limited

MS MONICA CARSS-FRISK QC MR BRIAN KENNELLY and MR TRISTAN JONES (instructed by Taylor Wessing for the Respondent)

Hearing dates: 4 th, 5 th & 6 th March 2008

Lord Justice Mummery

Lord Justice Mummery:

An extraordinary appeal


As a general rule the Court of Appeal only accepts appeals against orders made by a “lower court”, which is defined in CPR Part 52.1(3)(c) as “the court, tribunal or other person or body from whose decision an appeal is brought.” Section 16 of the Supreme Court Act 1981 provides that—

“Subject as otherwise provided by this or any other Act….the Court of Appeal shall have jurisdiction to hear and determine appeals from any judgment or order of the High Court.”


According to the commentary in Volume 1 of the White Book (2008) at page 1386,

“Appeals are against orders, not reasoned judgments…..Accordingly appeal lies against the order made by the lower court, not against the reasons which that court gave for its decision or the findings which it made along the way. Thus a party who has been wholly successful in obtaining or (as the case may be) resisting the relief sought cannot appeal against the judgment, in order to challenge the findings made: Lake v. Lake [1955] P 336….If the court wishes to enable a party to appeal against a particular finding contained in the judgment, it may make a declaration embodying that finding. See Compagnie Noga D'Importation Et D'Exportation SA v. Australia and New Zealand Banking Group Ltd [2002] EWCA Civ 1142; [2003] 1 WLR 307


The commentary also notes that the Court of Appeal made an exception to the general principle in Morina v. Secretary of State for Work and Pensions [2007] EWCA Civ 749, when it held that there were good reasons for deciding jurisdictional points arising on an appeal by the Secretary of State, even though he was the overall victor below. The Secretary of State had won on the merits before the Commissioner, but he had lost on jurisdictional points, which the Court of Appeal was nevertheless willing to decide.


Except in rare and exceptional circumstances, the only legitimate purpose of an appeal is to reverse or vary an order on the ground that the decision of the lower court was wrong, or was unjust because of a procedural or other irregularity in the proceedings in the lower court: CPR Part 52.11(3). The same applies to the case of a second appeal to the Court of Appeal i.e. an appeal from the decision of a lower court which was itself made on appeal: CPR Part 52.13(1). If the party seeking to appeal has obtained the desired order from the lower appellate court, such as, as in this case, an order dismissing an appeal, a further appeal by that party would not normally lie simply for the purpose of overturning or modifying legal reasoning or findings in the lower court's judgment.


In this case jurisdiction is conferred on the Court of Appeal by section 49(1)(c) of the Competition Act 1998 (the 1998 Act). An appeal from the Competition Appeal Tribunal (the Tribunal) may be brought on a point of law arising from a decision on an appeal under sections 46 or 47. An appeal may be brought, with the permission of either the Tribunal or the Court of Appeal, by a party to the proceedings before the Tribunal, or by a person who has a sufficient interest in the matter.


The Tribunal's order dated 18 January 2007 gave effect to a judgment handed down on 31 August 2006. The Tribunal dismissed an appeal by Floe Telecom Limited (Floe) against the decision of the Office of Telecommunications (Ofcom) dated 28 June 2005. Ofcom, which succeeded the Director-General of Telecommunications (the Director) in 2003 dismissed a competition complaint originally made by Floe to the Director on 18 July 2003. Floe's complaint was that Vodafone Limited (Vodafone) had breached competition law in abusing a dominant position contrary to Article 82 of the Treaty and section 18 of the 1998 Act by suspending and disconnecting Floe's use of certain mobile phone services called GSM gateways on 11 April 2003. Vodafone considered that the use of unlicensed GSM gateways was unlawful.


Very protracted proceedings before the Director, Ofcom and the Tribunal followed the complaint. The proceedings involved a Competition Act investigation by the Director and his report dated 3 November 2003 concluding that there had been no infringement of section 18 by Vodafone; an appeal by Floe to the Tribunal, which delivered a 145 page judgment on 19 November 2004 that the decision of the Director should be set aside on grounds of incorrect and/or inadequate reasoning and made an order remitting the matter to Ofcom for re-investigation; a re-investigation of Floe's complaint by Ofcom, which made the second decision dated 28 June 2005, concluding that section 18 and Article 82 of the Treaty did not apply in respect of the particular facts of the case, because Floe's use of GSM gateways was unlawful and, by ceasing to supply Floe, Vodafone was complying with a “legal requirement”; and another appeal by Floe to the Tribunal, which delivered a 163 page judgment dated 31 August 2006 and made an order on 18 January 2007 dismissing the appeal, but in terms which have given rise to Ofcom's extraordinary appeal to this court.


VIP Communications Limited (VIP) made a complaint similar to Floe's against the appellant T-Mobile (UK) Limited (T-Mobile). That complaint was rejected by Ofcom in a decision dated 22 December 2003. VIP appealed to the Tribunal, which ordered a re-investigation by Ofcom. VIP, which has gone into administration, appealed to the Tribunal against the second decision of Ofcom dated 28 June 2005 rejecting the complaint. T-Mobile asserts in this appeal that it has a sufficient interest to support Ofcom and to add some arguments of its own.


No-one questions the Tribunal's decision to dismiss Floe's appeal. On its own short findings of fact the Tribunal agreed with and confirmed Ofcom's decision that no infringement of competition law had occurred. If the Tribunal had stopped at that point, the jurisdiction of this court could not, and would not, have been invoked by the appellants Ofcom and T-Mobile, or by the respondent Floe, if it had decided to appeal. The Tribunal made a finding of fact against which there is no right of appeal by any party under the 1998 Act. The Tribunal's dismissal of Floe's appeal was not in consequence of any error of law in the Tribunal's judgment nor was it, in itself, an error of law.


The most unusual feature of this appeal is that it was Ofcom and T-Mobile, not Floe, who then applied to the Tribunal for permission to appeal to this court. The applications were open to an obvious objection that the Tribunal had dismissed Floe's appeal. As Ofcom was the overall winner in the Tribunal, there appeared to be nothing for it to appeal against. It is not surprising that permission to appeal was refused by the Tribunal for the reasons set out in a judgment dated 15 March 2007. One of the grounds for refusing permission was that Ofcom's appeal would be academic. That, incidentally, is the very criticism that Ofcom makes in this court about many passages in the Tribunal's 378 paragraph judgment. Ofcom has brought this appeal because it is troubled by much of the content of the Tribunal's judgment. First, the Tribunal decided points of law that were unnecessary for the determination of Floe's appeal. Secondly, the unnecessary rulings were legally wrong and called into question Ofcom's regulatory approach to GSM gateways and were contrary to the “conventional wisdom” of the mobile network operators.


This court also refused permission to appeal on a paper application dealt with by Lloyd LJ on 3 May 2007. On a renewed application permission was granted by two other Lords Justices on 19 January 2007. The appeal has proceeded to a full hearing on the unusual basis that Ofcom was prepared, if necessary, to enter into an arrangement funding Floe's reasonable legal costs in opposing its appeal. This was to ensure that both sides of the arguments, which call for specialised knowledge of the relevant technology and the complex regulatory law, could be properly presented to the court.


As for Floe, it not only lost its appeal to the Tribunal; it went into administration and then liquidation. It was in no position to afford the costs of a Court of Appeal hearing. It was, however, willing and able to play the part of a funded respondent to Ofcom's appeal.


As for the Court of Appeal (if it matters), the situation is that it has more than enough to do hearing appeals from unsuccessful litigants without encouraging appeals from successful litigants. Ofcom is content with the overall outcome of Floe's unsuccessful appeal to the Tribunal, which expressly upheld Ofcom's second decision and declared that

“2. …that Vodafone had not abused a dominant...

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