Petition Of Abundance Investment Limited And Another For Judicial Review
| Jurisdiction | Scotland |
| Judge | Lord Clark |
| Neutral Citation | [2020] CSOH 12 |
| Date | 28 January 2020 |
| Docket Number | P158/19 |
| Court | Court of Session |
| Published date | 28 January 2020 |
OUTER HOUSE, COURT OF SESSION
[2020] CSOH 12
P158/19
OPINION OF LORD CLARK
in the petition of
(FIRST) ABUNDANCE INVESTMENT LIMITED,
and (SECOND) DONALD FRANCIS IRWIN HOUSTON
Petitioners
for
judicial review of decisions of the Scottish Ministers
Petitioners: Webster QC; Davidson Chalmers Stewart LLP
Respondents: M. Ross QC, Jajdelski; Scottish Government Legal Directorat e
28 January 2020
Introduction
[1] The petitioners seek judicial review of two decisions made by the respondents in
relation to a grant which was offered by the respondents to the company Celtic Renewables
Limited (“CRL”) on 30 March 2017. The first decision, notified to CRL on 14 November
2018, was that payment of a part of the grant for which CRL had submitted a claim would
not be authorised. The reasons given for that decision were that CRL had failed to meet
certain conditions of the grant. The second decision, dated 21 December 2018, stated that the
respondents adhered to their earlier decision and also that the respondents were not able to
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accept any further claims for payment of the grant made after 7 December 2018. The
petitioners seek reduction of these decisions on the grounds that each decision involved
errors of law et separatim was irrational. The petitioners also seek declarator that the
respondents are to make payment to CRL of the sum of £1,483,587 which it had claimed
under the grant.
[2] The respondents contend that:
(i) the petition is concerned with contractual rights between CRL and the
respondents which are not amenable to judicial review and so the petition
should be refused as incompetent;
(ii) in any event, the petitioners (who have financial interests in CRL) do not have
standing to raise these proceedings;
(iii) in any event, on the merits, the decisions contained no error of law, nor were
they irrational.
Background
[3] In terms of section 153(1)(zl) of the Environmental Protection Act 1990 (“the 1990
Act”) the respondents may give financial assistance, which can take the form of a grant, to or
for the purposes of the programme known as the Low Carbon Infrastructure Transition
Programme (“LCITP”). The LCITP was launched on 20 March 2015. Under the LCITP,
grants are awarded for innovative low-carbon infrastructure projects in Scotland. In 2016,
one of LCITP’s competitions for grant funding was the Transformational Low Carbon
Demonstrator (“TLCD”) invitation. The purpose of the TLCD grants was to assist in
enabling projects of that kind to demonstrate that they would work and could be replicated
elsewhere. Any grant offered was for up to 50% of the capital expenditure required for the
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project. The balance of the funding had to be provided by the applicant from other sources.
This was described as “match funding”. The total value of grants available to be awarded
under the TLCD invitation was up to £40m. Of that total sum, 40% was allocated by the
European Regional Development Fund (“ERDF”). The respondents issued the grants and
the ERDF funding had to be claimed by the respondents from the ERDF by the end of the
calendar year to which the allocation related. The remaining 60% of the £40m total was
provided by the respondents from public funds.
[4] In late 2016, CRL applied for a grant for the construction and delivery of a
demonstrator biofuel production facility in Grangemouth. The total capital expenditure
required for the project was estimated by CRL at just over £18m. The grant applied for by
CRL in respect of that capital expenditure was for £9m. CRL’s proposal was to build an
anaerobic fermentation process plant. The plant would process low-value waste and
residues from whisky distilleries (draff and pot ale) and from agricultural farms (potatoes).
The processing would generate the substances acetone, butanol and ethanol, which
constitute biofuel, and it would also generate high-grade animal feed.
[5] After carrying out due diligence on CRL’s application, in the exercise of their powers
under section 153 of the 1990 Act, by letter dated 30 March 2017 the respondents offered an
LCITP grant to CRL for up to £9m of eligible capital expenditure costs and up to £100,000 of
eligible enabling costs in connection with the project (“the offer of grant”). The offer of grant
was made subject to various terms and conditions which were set out in the letter. The
terms and conditions included the requirement for CRL to achieve specified milestones in
relation to the project by particular dates. One of the milestones required CRL to provide
written confirmation and supporting evidence of match funding of a minimum of 50% of the
project capital expenditure (ie £9m) by 31 March 2017. Another milestone was that CRL
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