Mr Phillip Gwyn James Evans v Barclays Bank Plc and Others
| Jurisdiction | England & Wales |
| Judge | Lord Justice Green,Lord Justice Snowden,Sir Julian Flaux |
| Judgment Date | 09 November 2023 |
| Neutral Citation | [2023] EWCA Civ 876 |
| Docket Number | Case No: CA-2022-002002 & CA-2022-002003 & A |
| Court | Court of Appeal (Civil Division) |
and
and
[2023] EWCA Civ 876
THE CHANCELLOR OF THE HIGH COURT
( Sir Julian Flaux)
Lord Justice Green
and
Lord Justice Snowden
Case No: CA-2022-002002 & CA-2022-002003 & A
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE COMPETITION APPEAL TRIBUNAL
(Mr Justice Marcus Smith, Professor Neuberger and Mr Lomas)
[2022] CAT 16
Royal Courts of Justice
Strand, London, WC2A 2LL
CA-2022-002002
Aidan Robertson KC, Victoria Wakefield KC, Benjamin Williams KC, Jamie Carpenter KC, David Bailey & Sophie Bird (instructed by Hausfield & Co LLP) for the Appellant — Evans
Brian Kennelly KC, Paul Luckhurst, Thomas Sebastian & Hollie Higgins (instructed by Baker McKenzie LLP; Allen & Overy LLP; Herbert Smith Freehills LLP; Slaughter and May; Macfarlanes LLP; Gibson, Dunn & Crutcher UK LLP; Latham & Watkins (London) LLP) for the 1st to 15th Respondents — Barclays Bank PLC & Ors
Daniel Jowell KC, Gerard Rothschild, Shail Patel and Charlotte Thomas (instructed by Scott + Scott UK LLP) for the 16th Respondent — O'Higgins
CA-2022-002003
Daniel Jowell KC, Gerard Rothschild, Charlotte Thomas (instructed by Scott + Scott UK LLP) for the Appellant — O'Higgins
Aidan Robertson KC, Victoria Wakefield KC, Benjamin Williams KC, Jamie Carpenter KC, David Bailey & Sophie Bird (instructed by Hausfield & Co LLP) for the 1 st Respondent — Evans
Brian Kennelly KC, Paul Luckhurst, Thomas Sebastian & Hollie Higgins (instructed by Baker McKenzie LLP; Allen & Overy LLP; Herbert Smith Freehills LLP; Slaughter and May; Macfarlanes LLP; Gibson, Dunn & Crutcher UK LLP; Latham & Watkins (London) LLP) for the 1st to 13th Respondents — Barclays Bank PLC & Ors and 1 st to 2 nd Proposed Objectors – Barclays Bank PLC & Ors
Hearing dates: Tuesday 25th — Friday 28th April 2023
Approved Judgment
This judgment was handed down remotely at 10.30am on Tuesday 25 July 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives
A. Introduction
The context to the appeal
This is an appeal from the judgment of 31 st March 2022 of the Competition Appeal Tribunal (“ CAT”) following a five day hearing in July 2021 which was then followed by a series of written submissions from the parties to the CAT in September and November 2021 (“ the Judgment”). The appeal is brought with permission of the CAT upon the basis that the issues are novel, difficult and evolving and there was disagreement between the tribunal members on the central points. The majority included the President, Mr Justice Marcus Smith, and Professor Neuberger. The dissenting minority comprised Mr Paul Lomas.
The issues relate to the system of collective actions instituted by the Consumer Rights Act 2015 which led to amendments to the Competition Act 1998 (“ CA 1998”). Under this system representatives (who generally combine a named individual as figurehead, lawyers and funders) apply to be certified to act collectively for a class of claimants. In this case there were two rival claims for certification before the CAT brought by Mr Evans (“ Evans”) and Michael O'Higgins FX Class Representative Ltd (“ O'Higgins”) as putative class representatives. If a claim is certified as suitable for a collective claim, the CAT then decides whether it proceeds upon an opt-in or opt-out basis. This system and related issues have been the subject of a series of judgments of the Supreme Court and the Court of Appeal. They have set out detailed expositions of the system. Rather than repeat what has been extensively set out therein, it suffices to refer to those judgments for the background. The judgments are as follows: Sainsbury's Supermarkets Ltd v Mastercard Inc [2020] UKSC 24 (“ Sainsbury's”); Merricks v Mastercard Inc [2020] UKSC 51 (“ Merricks”); Le Patourel v BT Group PLC and another [2022] EWCA Civ 593 (“ Le Patourel”); LSER and others v Gutmann [2022] EWCA Civ 1077 (“ Gutmann”); and, MOL (Europe Africa) Ltd and others v Mark McLaren Class Representatives Ltd [2022] EWCA Civ 1701 (“ McLaren”).
In the Judgment the CAT gave permission for the Appellants to submit revised applications to be certified on an opt-in basis a claim for damages against certain banks which had engaged in an unlawful exchange of competitively sensitive pricing and other data with the object of reducing the risks normally attendant upon genuine competition. The claim is that this illegal cartel resulted in the participating banks earning artificially inflated returns at the expense of competitors and counterparties. The total claim with interest approaches £2.7 billion.
This judgment has been handed down at the same time as the judgment in UK Trucks Limited v Stellantis NV (Formerly Fiat Chrysler Automobiles NV) and others [2023] EWCA Civ [ ] (“ Trucks”). In that case an identically constituted Court of Appeal heard appeals in relation to a collective action against certain truck manufacturers for a price fixing cartel which it is alleged raised the price of trucks causing loss and damage to customers. There was overlap between some of the issues arising in the two appeals. Both cases are follow-on claims whereby, pursuant to section 60A CA 1998, the prior regulatory finding of the EU Commission is binding as to liability.
The present case was the first coming before the CAT for certification following the seminal judgment of the Supreme Court in Merricks ( ibid). There are however now over 30 collective actions before the CAT with vast total claims. Many of these claims are highly complex legally and economically. In the intervening period the CAT has grappled with a range of novel procedural and legal issues and has instituted, and fine-tuned, many case management techniques, all with the object of bringing order and control to what otherwise risks the unleashing of litigation leviathans.
The Commission decisions
On 16 th May 2019, the Commission rendered two decisions finding infringements of Article 101(1) TFEU in relation to FX spot trading: (i) Case AT.40135 FOREX (“ Three Way Banana Split”); and (ii) Case AT.40135 FOREX (“ Essex Express”). The decisions are short form, settlement decisions, whereby the defendants made admissions to the Commission in return for a reduced fine. They have not therefore been made the subject of appeals. Both decisions are “ object” decisions where liability is predicated upon the Commission proving, to the requisite standard, that the object of the cartel was to restrict and distort competition. This means that there is no detailed analysis of the “ effects” of the cartel, which is the alternative predicate for liability. An important issue arising in this appeal is as to the probative value before the CAT of object based decisions. Taken at face value they provide limited information, evidence or guidance and offer only a relatively bare bones account of the impugned conduct and the law.
As it happens, on 5 th July 2022, following the hearing and judgment of the CAT and hence left out of account in the Judgment, the Commission published a fully reasoned decision addressed to Credit Suisse (which is not one of the defendant banks) finding an infringement of Article 101(1) TFEU in Case AT.40135-FOREX (“ Sterling Lads”). This was not a settlement decision. As can be seen from a compare and contrast exercise with the two earlier decisions, the decision in Sterling Lads is a fleshed out version of the template used in Three Way Banana Split and Essex Express. There are numerous paragraphs of all these decisions which are identical. An issue in this appeal concerns the admissibility and probative value in these proceedings of the ordinary decision in Sterling Lads. The respondent banks argue that it is wholly inadmissible; but if admissible bears strictly limited evidential weight. The appellants argue that it is admissible, relevant and provides powerful support for their arguments on the appeal.
The majority judgment on the strength of the claims
At the certification stage the putative class representatives adduced a substantial volume of factual and expert economic evidence. This was subjected to detailed scrutiny by the CAT majority which expressed concern that, whilst a plausible case at the level of economic theory had been advanced, they could not detect how, at the evidential level, causation was to be established between the breach (as per the Commission decisions) and the alleged loss, nor how disclosure would fill this gap. Significantly, the banks did not seek to strike out the claim or adduce evidence (expert or otherwise) or give disclosure to refute it. The CAT, of its own motion, however, considered whether it should nonetheless dismiss the claims.
The CAT majority ultimately decided not to strike out the claims. Instead, having set out in the Judgment why they considered a viable claim had not been formulated, and recognising that their concerns were described most fully and in some respects for the first time in the Judgment, they deferred a decision on strike out until the prospective class representatives had been given an opportunity to address the CAT's comments in relation to the question of pleading. They did however reflect their negative views in the decision to be made on whether the claims should be opt-in or opt-out. The criteria for this are set out in CAT Rule 79(3) under which the considerations to be taken into account are at large but the rule expressly stipulates that (i)...
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