Scottish Power Generation Ltd v British Energy Generation (UK) Ltd
| Jurisdiction | Scotland |
| Judgment Date | 25 April 2002 |
| Docket Number | No 43 |
| Date | 25 April 2002 |
| Court | Court of Session (Inner House - Extra Division) |
EXTRA DIVISION
Lord Macfadyen
Process—Interim orders—Basis on which interim orders should be made by the court—Court of Session Act 1988 (cap 36), sec 47(2)1
Section 47(2) of the Court of Session Act 1988 provides that the court may make such order regarding interim possession of any property to which the cause relates, or regarding the subject matter of the cause, as the court may think fit.
The pursuers and defenders were parties to a contract called the Nuclear Energy Agreement, which regulated the terms on which the first defenders sold electricity to the pursuers and second defenders and contained complex provisions for determining the price. These provisions were dependent on an arrangement in the English electricity market, so when that arrangement was brought to an end in March 2001, the price was no longer calculable in terms of the Nuclear Energy Agreement, as estimated invoices could not be corrected by reference to the actual price under the English arrangements. After March 2001, the pursuers paid under estimated invoices under reservation of their contention that the amounts were excessive. In their pleadings, the parties advanced competing contentions as to the practical consequences of the abolition of the English arrangements. The Lord Ordinary granted an interlocutor to the effect that pending resolution of the cause the excess, as calculated by methodology proposed by the pursuers, should be placed in a designated account.
Held (1) in relation to an interim order the Lord Ordinary must (a) identify the issues in the action, including the legal basis of the claim, (b) consider whether there is a prima facie case that an obligation exists and that there is a continuing or threatened breach of that obligation which the order will address, (c) avoid innovating significantly on the parties' contractual rights and obligations, and (d) consider the balance of convenience, bearing in mind the harm to either side and the relative strength of their cases (p 526E–F) (2) the Lord Ordinary had failed to analyse the legal basis of the parties' positions, innovated on their rights and in considering the balance of convenience discounted the general rule which seeks to preserve the status quo without giving sound reasons for doing so and placed insufficient weight on the prejudice to the first defenders (p 529B–C); and appeal allowed.
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