UK Trucks Claim Ltd v Stellantis NV (Formerly Fiat Chrysler Automobiles NV) and Others
| Jurisdiction | England & Wales |
| Judge | Sir Julian Flaux C,Lord Justice Snowden,Lord Justice Green |
| Judgment Date | 25 July 2023 |
| Neutral Citation | [2023] EWCA Civ 875 |
| Year | 2023 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Cases No: CA-2022-002254, 002257 AND 002264 |
and
[2023] EWCA Civ 875
Sir Julian Flaux CHANCELLOR OF THE HIGH COURT
Lord Justice Green
and
Lord Justice Snowden
Cases No: CA-2022-002254, 002257 AND 002264
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE COMPETITION APPEAL TRIBUNAL
ROTH J, DR WILLIAM BISHOP AND PROFESSOR STEPHEN WILKS
[2022] CAT 25
Royal Courts of Justice
Strand, London, WC2A 2LL
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
ADMINISTRATIVE COURT
Daniel Jowell KC and Jonathan Scott (instructed by Slaughter and May) for Traton SE and the other MAN Appellants
Meredith Pickford KC and Nikolaus Grubeck (instructed by Travers Smith LLP) for the DAF Appellants
Rhodri Thompson KC, Nicholas Gibson and Niamh Cleary (instructed by Weightmans LLP) for UK Trucks Claim Limited
Tony Singla KC and James White (instructed by Herbert Smith Freehills LLP) for Stellantis NV and the other Iveco parties
Paul Harris KC, Ben Rayment and Alexandra Littlewood (instructed by Macfarlanes LLP) for Daimler
Mark Hoskins KC and Jacob Rabinowitz (instructed by Freshfields Bruckhaus Deringer LLP) for the intervener
Volvo James Flynn KC, David Went and Emma Mockford (instructed by Backhouse Jones Solicitors and Addleshaw Goddard LLP) for Road Haulage Association Limited
Hearing dates: 9 to 11 May 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 email and by release to The National Archives.
Introduction and background
The principal issue on this appeal from the judgment of the Competition Appeal Tribunal (“CAT”) is whether the CAT erred in law in deciding to grant a Collective Proceedings Order (“CPO”) pursuant to which the Road Haulage Association Limited (“the RHA”) was made the class representative in preference to UK Trucks Claim Limited (“UKTC”) although both proposed class representatives satisfied the statutory criteria for certification. The issue of law, in broad terms, is whether a single class representative can represent a class in relation to a common issue in circumstances where there is an actual or potential conflict of interest between two groups of class members.
The collective proceedings in respect of which both the RHA and UKTC sought to be class representative were follow-on claims from a settlement decision of the European Commission in Case 39824-Trucks. By that decision the Commission found that five European group companies of truck manufacturers (‘original equipment manufacturers’ or ‘OEMs’) to whom I will refer individually by the abbreviations DAF, MAN, Iveco, Daimler and Volvo, had continuously infringed Article 101 TFEU and Article 53 EEA Agreement between 17 January 1997 and 18 January 2011 (with MAN's period of infringement having ended on 20 September 2010). The finding, as to which the OEMs admitted liability, was that they had exchanged information on future gross prices and colluded on the timing and passing on of the costs of the introduction of emission-reduction technologies mandated by the EURO 3 to 6 standards for trucks weighing 6 or more tonnes.
UKTC is a special purpose vehicle incorporated for the purpose of pursuing collective proceedings seeking follow-on aggregate damages from the OEMs on the basis of the Commission's decision. On 18 May 2018 it filed with the CAT an application under section 47B of the Competition Act 1998 (“the 1998 Act”) for a CPO on an opt-out basis for a proposed class consisting of those who, during the infringement period and for a run-off period until 31 December 2011, had acquired new trucks from the OEMs in the UK. The proposed class excluded those who acquired trucks for leasing out under operating leases of at least 12 months and those who had rented trucks for less than 12 months.
UKTC's economic expert, Dr Andrew Lilico, proposed simulation modelling, a somewhat novel approach for cartel litigation, as his primary method of calculating the loss suffered by the proposed class members (‘PCMs’). He would construct a simulation model of how the market would have operated in the infringement period in the absence of the cartel, and compare this model with the actual prices during that period. In doing so, he said that he would use nine sub-classes to account for the diversity between the PCMs. The aggregate damages would then be quantified by applying the percentage difference to the estimated amount paid by the PCMs as a whole.
The RHA is a trade association that promotes the interests of the road haulage industry. It issued collective proceedings seeking an award of non-aggregate damages on an opt-in basis. Unlike UKTC's claim, its proceedings included a claim specifically for loss alleged to have been caused by delay in the introduction of new EURO emissions technology. The RHA filed its own application under section 47B on 17 July 2018 for a proposed class comprising those who during the infringement period (and during a run-off period ending on 17 May 2019) had acquired new or used trucks from the OEMs in the UK or, where the purchaser's group had also purchased trucks from the OEMs in the UK, in the EEA. The RHA's proposed class excludes those who derive more than half their turnover from selling or leasing trucks.
To calculate the loss allegedly suffered by its PCMs, The RHA's economic expert, Dr Peter Davis, proposed to use econometric estimation of prices during and after the infringement period. This would allow the use of control variables to strip out the various determinants of price unrelated to the cartel. Dr Davis also suggested taking account of the varied composition of the class by conducting separate regression analyses for a series of sub-classes, defined essentially in terms of types of truck and truck transaction. This methodology, he says, will enable the estimation of the damage for each truck bought by each PCM, and the total damages for each PCM can then be quantified by aggregating the predicted damage for each truck on a ‘bottom up’ approach.
Issues before the CAT and the CAT judgment
The principal issues before the CAT were:
(1) In each case should it authorise the proposed class representative (‘PCRs’) to be the class representative under section 47B(8) of the 1998 Act, read with rule 78 of the Competition Appeal Tribunal Rules 2015 (“CAT Rules”)?
(2) In each case, does the methodology for calculating loss proposed by the economic expert satisfy the viability test formulated by the Supreme Court of Canada in Pro-Sys Consultants Ltd v Microsoft Corpn 2013 SCC 57 (“ Microsoft”) which is now applied under the collective proceedings regime in this jurisdiction?
(3) In each case, are the proceedings eligible for inclusion in collective proceedings under section 47B(6) of the 1998 Act, read with rule 79 of the CAT Rules?
(4) Could the CAT certify both sets of claims so that there were two overlapping sets of collective proceedings and if so, should it do so in the present case?
(5) If the CAT should not certify both sets of claims, which of the sets of proceedings should it certify?
The CAT answered those questions in a lengthy and detailed judgment dated 8 June 2022. As in the case of the CAT judgment in O'Higgins v Barclays Bank plc and others and Evans v Barclays Bank plc and others (respectively “ O'Higgins” and “ Evans”) [2022] CAT 42 in respect of which the same constitution of this Court heard the appeal shortly before the present hearing (and in respect of which we will hand down judgment at the same time as the present judgment), the present case was heard by the CAT before the guidance of this Court in BT Group plc v Le Patourel (“ Le Patourel”) [2022] EWCA Civ 593; [2022] Bus LR 660 (handed down on 6 May 2022) and London & South Eastern Railway Limited v Gutmann (“ Gutmann”) [2022] EWCA Civ 1077 (handed down on 28 July 2022) as to the correct approach which the CAT should adopt to certification hearings and the grant of CPOs. The judgment of this Court in Le Patourel came out shortly before the judgment of the CAT and is referred to once at [223] in that judgment, which follows the decision of this Court that there is no presumption in favour of opt-in over opt-out proceedings. However, the guidance which this Court provided in Gutmann was not available to the CAT in this case. This explains for example why the CAT analysed the Canadian jurisprudence in detail at [40] to [50] and elsewhere in its judgment. In Gutmann this Court pointed out at [41] and [42] (approving the analysis of the CAT in that case) the differences between the Canadian collective proceedings regime and our regime. Those differences highlight that (other than in relation to the Microsoft test which we have adopted) the Canadian jurisprudence only provides general guidance and regard must always be had to the fact that the legislative regimes are different (not least because the regime in Canada is exclusively opt-out).
We expect and hope that, in the light of the guidance given by this Court in Le Patourel and Gutmann and in the present judgment and the judgment in O'Higgins and Evans, the issues of certification, carriage and other issues raised by applications for CPOs can be dealt with by the CAT at shorter hearings...
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