Partridge Farms Ltd v Secretary of State for Environment, Food and Rural Affairs

JurisdictionEngland & Wales
CourtQueen's Bench Division (Administrative Court)
JudgeLord Justice Stanley Burnton
Judgment Date14 July 2008
Neutral Citation[2008] EWHC 1645 (Admin)
Docket NumberCase No: CO/4636/2006
Date14 July 2008

[2008] EWHC 1645 (Admin)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

ADMINISTRATIVE COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

Lord Justice Stanley Burnton

Case No: CO/4636/2006

Between:
The Queen on the Application of Partridge Farms Ltd
Claimant
and
The Secretary of State for Environment, Food and Rural Affairs
Defendant

Hugh Mercer QC and Jeremy Brier (instructed by Clarke Wilmott) for the Claimant

Jason Coppel (instructed by Department for the Environment, Food and Rural Affairs) for the Defendant

Hearing dates: 9, 10 June 2008

Lord Justice Stanley Burnton

Introduction

1

In these proceedings the Claimant seeks judicial review of the Cattle Compensation (England) Order 2006 (“the Order”), which makes provision for the payment of compensation to farmers whose cattle are taken by the Government for slaughter by reason of tuberculosis or certain other diseases. His application is supported by the National Farmers' Union. Its proceedings were issued on 6 June 2006. Permission to apply for judicial review was given by Lloyd Jones J on 5 April 2007. It is symptomatic of the current pressure of work on the Administrative Court, and highly regrettable, that it has taken over 2 years since the proceedings were commenced for this application to be heard.

2

The question of compensation for cattle slaughtered because of tuberculosis (often abbreviated to TB), is of increasing importance to farmers. According to the final report of the Independent Scientific Group on Cattle TB of the Environment, Food and Rural Affairs Committee of the House of Commons (Fourth Report of Session 2007–08):

Cattle TB is an infectious disease that is one of the most serious animal health problems in Great Britain today. The number of infected cattle has been doubling every four and a half years. The consequential growing cost of the disease to the taxpayer and to the farming industry is unsustainable. In “hot spot” areas where the prevalence of the disease is highest, the farming industry has reached a breaking point as the disruption to business in both human and economic terms has become unacceptable.

The “hot spot” areas are in South West England, South West Wales, Staffordshire and Derbyshire, and include the area of the Claimant's farm.

3

As is well known, it is suspected that bovine TB is spread by infected badgers, and there are suggestions that badgers should be culled in “hot spot” areas. The Government has decided not to cull. The controversies concerning the cause of the increase in reported cases of bovine TB and badger culling are, I am glad to say, irrelevant to the matters I have to address.

The provisions of the Order

4

Section 32 of the Animal Health Act 1981 confers power on the Secretary of State to cause to be slaughtered any animal which is affected or suspected of being affected with a disease to which that section applies, or which has been exposed to the infection of any such disease. The diseases to which the section applies include tuberculosis, brucellosis (also known as contagious abortion) and enzootic bovine leukosis (“EBL”).

5

The Order was made, at least in part, pursuant to EC Directives, namely Council Directive 77/391/EEC of 17 May 1977 “introducing Community measures for the eradication of brucellosis, tuberculosis and leucosis in cattle” and Council Directive 78/52/EC of 13 December 1977 “establishing the Community criteria for national plans for the accelerated eradication of brucellosis, tuberculosis and enzootic leukosis in cattle”.

6

The Order makes provision for the payment of compensation in respect of animals slaughtered as a result of the exercise by the Secretary of State of his power under section 32 where the disease in question is TB, brucellosis or EBL. The principal, but not the only, means of ascertaining the amount of compensation payable under the Order is known as table (or tabular) valuation. Part 2 of the Order contains a table setting out 47 categories of bovine animals, i.e. cows and bulls, to which I shall for convenience somewhat inaccurately refer as cattle. The Order requires the average market price for each category to be calculated. For non-pedigree cattle, the compensation payable is the average market price paid for cattle in their category during the month preceding their slaughter, assuming that adequate sales data are available in respect of that month. For pedigree cattle, the compensation payable is the average market price during the period of 6 months preceding their slaughter.

7

The relevant parts of the Order are set out in the Annex to my judgment.

The Claimant

8

Partridge Farms Ltd is a family company. Its principal is David Partridge, who followed his family into farming. The company's farm is near Tiverton in Devon. It farms both crops and livestock. It has nearly 900 head of cattle, of which about 300 are Holstein dairy cows, 300 are followers (young stock) and 300 are beef cattle.

9

Mr Partridge states that his herd is of significantly higher quality than the average, and that this is reflected in their market value. The top producing Holstein produces about 80 litres of milk a day, much more than twice the national average. He complains that the value of the herd is not reflected in the compensation payable under the Order.

10

As mentioned above, the Claimant's farm is in one of the areas of the country, known as TB hot-spots, which have a chronic TB problem. Despite the precautions taken by the Claimant, it has had difficulties with TB for about 4 years. About 110 animals have been removed for slaughter over that period. In February 2006 a TB test was carried out. It identified 9 reactors, a bull and 8 Holstein cows, and they were removed for slaughter in March 2006. The bull was individually valued at £25,000, and that valuation is not the subject of complaint. Before their removal, the cows and heifers were separately valued by two valuers, Derek Biss of Greenslade Taylor Hunt and David Jones, an auctioneer based in Monmouthshire. Their written and reasoned valuations of the individual animals, on the basis of the market price for healthy animals, were not identical, but were generally reasonably similar: Mr Biss's average value was £3,156, and Mr Jones's £2,900. The compensation payable under the Order was just over £1,000 per animal, approximately one third of the average individually assessed market value. The average is not typical however: one animal was individually valued at only £1,000 by Mr Biss and £800 by Mr Jones; in that case, therefore, there could be no complaint as to the sum paid. On the other hand, taking that animal out of the calculation of the average increases the discrepancy between the average valuation of the remaining animals and the average compensation paid under the Order in respect of them.

11

Mr Partridge considers that it is unfair that his compensation represented such a low fraction of the market value of his animals when healthy, whereas the farmer with the average or worse animal would recover its full market value or more. In the claim form, the Claimant seeks a declaration that the Secretary of State's decision as to its compensation for its 8 cows was unlawful, a declaration that the Order is unlawful and a declaration that it is entitled to be compensated for the “full value” of those 8 cows. However, during the hearing, Mr Mercer sensibly abandoned the claim for the first and the last of those declarations, and confined the claim to the second.

The parties' contentions in summary

12

Table valuations such as those provided in the Order have a number of distinct advantages over individual professional valuations of cattle. The element of subjectivity in making a valuation is removed; assessment of compensation is a purely arithmetical exercise, cheaper and quicker than traditional individual valuation by a valuer. For ordinary, run of the mill, cattle within their category table valuations provide a rough and ready but, it is conceded, acceptable means of establishing the value of a healthy animal. Indeed, for the farmer whose cattle are worth less than the average in their category, table valuations are advantageous, since he will be paid an average value, which will give him the benefit of the value of better-than-average cattle sold during the period in question.

13

On the other hand, however, such table valuations will necessarily result in payment to a farmer whose cattle are better than average of a sum that is less than the individual value of his cattle; and the greater the disparity between the value of his cattle and that of the average cattle in a category, the greater the disparity between what he receives in compensation and the compensation received by the owner of the average or less than average animal. As will be obvious, the discrepancy between (healthy) market value and the sum payable under the Order is not restricted to the Claimant. There is also in evidence the case of Eileen Persey, an organic farmer. In December 2006, 28 pedigree organic Holstein Friesians failed a TB test: a bull and 27 cows. They were slaughtered. She received compensation of £8400 in respect of the bull, based on its individual valuation. The cows were the subject of table valuations under the Order, most at £890 and the remainder at £1,067. Ms Persey obtained independent individual valuations of these animals. They range from £700 to £10,000. Again, she could not complain about the payment in respect of the lowest valued cows; but the discrepancy in respect of the highest value animal is enormous, some 1000 per cent.

14

Thus, as Ms Persey's evidence demonstrates, the...

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