Judgment

Neutral citation:

[2009] CAT 36

Published:

21 Dec 2009

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Summary:

Judgment of the Tribunal on a claim for damages brought by Enron Coal Services Limited (in liquidation) (“ECSL”) against English Welsh & Scottish Railway Limited (“EWS”) under section 47A of the Competition Act 1998. The claim was based on a finding by the Office of Rail Regulation that EWS had infringed Article 82 of the EC Treaty and the Chapter II prohibition. The ORR had found that EWS had pursued, without objective justification, selective and discriminatory pricing practices that placed ECSL at a competitive disadvantage.

EWS provided coal haulage services to ECSL. ECSL alleged that EWS’ infringement caused ECSL to lose a tender for the haulage of coal by rail to power stations operated by Edison Mission Energy Limited (“EME”) and also a real or substantial chance of securing a four year “end-to-end” (“E2E”) contract to supply coal to one of those power stations, Ferrybridge C.

This was the first follow-on claim for damages to reach trial in the Tribunal. The issue of causation was at the centre of the litigation. In evaluating ECSL’s loss of chance, the Tribunal regarded the case as one of those where the loss depended not only on ECSL’s own behaviour but also on the hypothetical action of a third party, EME. Accordingly the Tribunal held that two main questions fell to be decided: (a) whether it was more likely than not that ECSL would have sought to negotiate with EME for a four year E2E contract to supply coal to the Ferrybridge C power station; and (b) whether there was a real or substantial chance that negotiations between EME and ECSL would have led to the award of a four year E2E contract to supply coal to the Ferrybridge C power station.

On the (a) question the Tribunal unanimously concluded that ECSL had not proven that it was more likely than not that ECSL would have sought to negotiate with EME for a four year E2E contract to supply coal to Ferrybridge C.

On the (b) question the Tribunal unanimously concluded that ECSL had no real or substantial prospect of supplying coal to EME on an E2E basis; instead this was a speculative prospect. There is ample evidence about the unwillingness of EME to enter into a long-term coal supply contract.

The Tribunal unanimously held that ECSL had thus failed to prove that the breach of statutory duty by EWS caused any claimed loss.

This is an unofficial summary prepared by the Registry of the Competition Appeal Tribunal.