BNC Text K73

Royal Courts: hearing. Sample containing about 14006 words speech recorded in public context

6 speakers recorded by respondent number C648

PS5NN X m (Green, age unknown, solicitor) unspecified
PS5NP X m (Saville, age unknown, judge) unspecified
PS5NR X m (Duffy, age unknown, solicitor) unspecified
PS5NS X m (No name, age unknown, court official) unspecified
K73PSUNK (respondent W0000) X u (Unknown speaker, age unknown) other
K73PSUGP (respondent W000M) X u (Group of unknown speakers, age unknown) other

1 recordings

  1. Tape 115601 recorded on 1993-12-01. LocationGreater London: Central London ( Courts ) Activity: Hearing

Undivided text

Unknown speaker (K73PSUNK) [1] Relationship between trade and between members of state, strictly competition and I said I'd be the one erm relative case, just to demonstrate the course, Lord, erm I've usefully used the time this morning to do a, a brief aden am moire of the point, the [...] relevant photographs and the, just in case, if I can just hand that out ena enable me to, to speed through the admission, my Lord if I can just er ... take the [...] through it and apart, my Lord paragraph [...] five is triggered by an agreement which effects trade between members of states, er in windsurfing the court considered an argument that the causes and the contested agreement which had been struck down by the commission did not forward then article eighty five because they did not have that trade between members of states, the court replied, that argument must be rejected, article eighty five does not require that each and individual cause in the agreement should be capable of affecting into community trade, community law or competition applies to agreements between undertakings which may effect [...] member of states, only if the agreement as a whole is capable of effecting trade is it necessary to exam which other clauses of the agreement which havers there object, let's just say or, or effect the restriction of competition.
[2] The requirement effect on trade which member states of jurisdiction requirement, it is jurisdictionable because it is the first task that the commissioner of the court should undertake when considering [...] quote from wind surfing get in constant and [...] the concept and agreement which may effect trade is intended to define in the law governing cartels the boundary between the areas, respectively covered by community law and national law, it is not necessary law for the competition effected by the alleged restriction and the trade which is effected between members of states to be the same, an example in the defendants list of authorities it's in the principal and in that case the restriction of competition arose in relation to a product possible spirits which was itself used to manufacture other products namely cognac, it was argued that the that since there was no trade between members of state and possible spirits there could be no effect upon trade between member of states and so [...] twenty five could not apply, the court accepted that factual premise, there is no trade between member of state and import of spirits, but rejected the legal conclusion, they concluded that is was necessary for there to be an effect upon trade in the market where the restrictions occurred, they was trading another product which was related to possible spirits, and of course stated, it must be observed in that respect that any agreement who's object to effect is to a strict competition by fixing minimum prices for an intermediate product is capable of effecting intro community trade, even if there is no trading in that intermediate product between members of state, that the product constitutes the raw material of another project marketing elsewhere
Saville (PS5NP) [3] Yes
Green (PS5NN) [4] my Lord another factual situation which I'll simply referred to is the er on going debate in European commission or cases relating to up stream fuel, er, where there's very little trade, erm for technical reasons because of the isolation of the United Kingdom, however the commission has searched jurisdiction over restricted competition in the market because the fuels have a direct impact upon product, erm from production costs, product down stream of which there is trade
Saville (PS5NP) [5] mm
Green (PS5NN) [6] and er analogist principal applies in relation to article eighty six and to this article the effect upon trade must flow from the abuse, however, the definition of the market arises in relation to establishing dominants, there are many cases which established, the market in which an undertaking is dominant need not be the same market as where the abuse occurred accordingly to establish an article of eighty six case, dominants may be proven in a market where there is no effect upon trade.
[7] In the vast majority of cases they will of course on the facts be a closed link between the nature of the trade effective between members of states and the competition that is restricted by the contested clause, this is because given that the restriction flows out in the agreement the later sets the context for former, accordingly as a simply matter of fact, restrictions of competition operating relating to the same market in which trade is affected between member of states, a restriction must be appraised in the context of the market, if the parties to the agreement or the high percent market share of the market, then a relatively minor restriction assumes greatest significance, on, firstly, if the parties hold a small share of the market then what appears obstensively be a serious restriction may turn out upon an assessment of facts to be minor or relatively insignificant, contrary to the submission of the plaintiff, the restriction of competition can be determined without a assessment of market, the court of first instance have recently held that the necessement of the market has necessary pre pre-conditioned of any judgement concerning the allegedly [...] and competitive behaviour and your Lordship was taken to that paragraph [...] page ninety two, just siting recently the [...] and the present case the restrictions pleaded that paragraphs forty clements and the two twenty mason were for broadly to restrict the effects upon the insurance market, however the defendants have gone one step further and also identified other markets and sub markets in which the restrictions take immediate impact, this is logical for example in relation to the standard form agency agreement the restrictions have the most direct impact from the sub market to the provision of agencies services to names, competition is effected in this market since complete harmonization of secondary terms and trades are merely the criteria available to names when choosing an agent, however, the standard form contract also effects the wine and insurance market, the fact that the agent has unvetted powers to write any insurance which he sees fit affects the categories of insurance written within this is of course is the matter about which defendant makes complaint.
[8] My Lord I don't know if, if, if it's necessary to take your Lordship to the cases where there's quotes all set out
Saville (PS5NP) [9] No, I think I understand what you're saying
Green (PS5NN) [10] my Lord, my Lord erm ... my Lord that really brings me to what are, er my conclusions, my Lord erm, can I just practice my conclusions with two erm comments, first of all about the, the [...] my learned friend seems to paint erm in relation to this of course Mr made a point quite strongly that he agrees this is a relevant consideration and that er have exaggerated the situation and if they are willing to make a point a like this it would require evidence, they did point to their accounts, Lord erm I don't see to put in evidence, but the, the statutory statement of business served er filed by on the first of September this year with the D T I, revealed that has a total of sixteen and a half billion in it's members premium trust funds which is up four billion from the end of the previous year, erm, set against that the claims now made against the names is, is relatively speaking er small, erm my Lord
Saville (PS5NP) [11] yes
Green (PS5NN) [12] my Lord I don't think there's much point in going through that, we don't believe it's relevant we believe
Saville (PS5NP) [13] well that's right but erm, they may well be small certainly, but er, er what are the other names, premium trust funds there for?
Green (PS5NN) [14] well of a net, that to deal with claims er prospective claims, the future claims, of course all the existing policy holders have been paid and the premium trust funds are there to meet the future liabilities without
Saville (PS5NP) [15] yeah
Green (PS5NN) [16] leading into the [...]
Saville (PS5NP) [17] the bottom line is, is, is, is it not, that erm, er you're suggesting that your clients legal obligations to third party policy holders should be met by other names at , I mean that's the bottom line isn't it?
Green (PS5NN) [18] well no the
Saville (PS5NP) [19] isn't it?, well who's, who's gonna meet them then? ...
Green (PS5NN) [20] my Lord, the, the first point is the extent of what we're claiming
Saville (PS5NP) [21] well, answer the question Mr , if your clients aren't gonna meet these claims, who is?
Green (PS5NN) [22] my Lord well no doubt then the answer is that erm that would eventually have to meet them through funds which they will bring in to the market and which will go into the, the central fund
Saville (PS5NP) [23] yes and how are they going to bring those funds in?
Green (PS5NN) [24] from new trading ...
Saville (PS5NP) [25] what demands on, on
Green (PS5NN) [26] future trade
Saville (PS5NP) [27] demands on names
Green (PS5NN) [28] well my Lord in the same way that they've erm repeated the fund in the past
Saville (PS5NP) [29] yeah, would, would you advance me that one? ... thank you
Green (PS5NN) [30] my Lord I, I, it
Saville (PS5NP) [31] the suspect counsel to [...] is no they wouldn't, and they would raise precisely the same points as er being raised in this defence, er which are surely if there is anything in them, equally available to every other name [...]
Green (PS5NN) [32] my Lord we se , I don't think that's true because what we're saying and if and I believe it does flair from our keepers that erm we have to prove [...] we've got to prove that these restrictions would of lead to category of business from what the
Saville (PS5NP) [33] yeah, part , part of your argument Mr is that the, that the erm members and managing agents agreements are void ... now if that's not right er they're all void are they not?
Green (PS5NN) [34] my Lord erm what we're saying is that certain restrictions are void, if I can, if I can just work through one example, if the erm
Saville (PS5NP) [35] well er, I'm sorry to interrupt you, I'm sorry I do apologise, perhaps it's my tooth, it's making me even more testier than usual, erm, I, I thought your case was that these agreements were void
Green (PS5NN) [36] my Lord, this is a problem which erm your Lordship's had submissions from both parties and of course it goes to specialist separates, first of all one identifies, one takes one [...] and strikes out the defending clauses within the agreements that infringe article eighty five on then applies the, the test of severance to see whether the residual agreements remain or stand, but we certainly have not depleted that the entire arrangement avoid but we pleaded the restrictions are avoid, my Lord er and that's important because it could lead to consequence and we're pleading it that and if for example er power in the erm standard form agency agreement was rendered void because it was an unlawful restriction, it doesn't mean to say that erm an agent er a name might not of instructed an agent to write [...] business, what we're saying is they may not have instructed him to write all of the business that he did in fact did er write for example L M X spiral and, now if, if a particular defendant can say well have I been well you know proper position that I would of been and the restrictions not been in place I would of instructed the agent to do precisely what he did, then of course he has no defence, that's a que that's a [...] point, if he says well erm I, the facts suggest and established that I would never, ever have allowed the agents to underwr to write L M X spiral business and, and the only reason he was able to do that was because of the restrictions then he can escape liability for that part of the business underwritten
Saville (PS5NP) [37] yes
Green (PS5NN) [38] and we've, we've alleged in the pleading that he made that he would have suffered erm either all or some part of loses would of been avoided, but that depends upon the facts and we're
Saville (PS5NP) [...]
Green (PS5NN) [39] not claiming
Saville (PS5NP) [40] yeah, I see that, I see that, are, are you suggesting that those provisions in the members agents, managering agents agreements that the type of all those agents call upon your clients are void or valid? ...
Green (PS5NN) [41] my Lord if, if ... if it was, if that [...] was based upon illegal business we would say it was invalid, if it was based at the end of the day upon business that we would of erm permitted to have been written then we wouldn't have no [...] our defence to it
Saville (PS5NP) [42] what, what do you mean it might be illegal business?
Green (PS5NN) [43] well business that wouldn't, my Lord, that's perhaps the wrong description, business that would not of been written had the restrictions not been in place
Saville (PS5NP) [44] but erm, I, I thought it was both yours and Mr contention that through the doctoring of extensible authority and by, because of that doctoring your clients are not alleging that any contracts of insurance or re-insurance simply made on their behalf is unenforceable
Green (PS5NN) [45] my Lord that that's with respect right, erm certainly what, what he says that [...] doesn't necessarily lead to that conclusion all it does is have void what maybe authority between
Saville (PS5NP) [46] alright, well then building on that ... I don't quite understand it, if ... you're, you're saying that those provisions that allow agents to pull for whatever funds are necessary are what, void to what extent to the extent that the funds are or are said to be erm needed to satisfy claims on policies which had you known that which you say you ought to have known, you would not have er authorised the agents to write, type rather long that, but I
Green (PS5NN) [47] my Lord that, that I
Saville (PS5NP) [48] I think that I thought er
Green (PS5NN) [49] the, the chain sir the chain of logic and of course had it not been with one inter interposing there, had it not been for void restrictions, it would not have written, that's when they were written, they were written only because of the restrictions ... that's what enabled them to be written
Saville (PS5NP) [50] well could we perhaps have the agreements in front of us while we're looking at this point ... erm, where would be the best place to find them?
Green (PS5NN) [51] bundle four my Lord ...
Saville (PS5NP) [52] tab five of bundle four ... it's clause nine isn't it? ... now is that struck down? ... erm by your defence or any part of it?
Green (PS5NN) [53] well at, at, at the moment our, our defence of course goes to case, the defence by
Saville (PS5NP) [54] yes, well, er I follow that, but I'm sorry I put it rather badly Mr forgive me, part of your defence against the claim by er relates to erm these agreements, you must say that these agreements erm because they are of the standard form are anti competitive and therefore they or part of them are void, erm building on that presumably your defence says or employs er that because erm, you know there void, I dunno perhaps you can tell me this erm, all, all the er all parts of the void, all the power of the agent, the agreements with regard to premium trust funds and the like, er are also unenforceable as between er the erm name and his er members agent, erm and in consequence of that you say, as I understand it, er that that is, all that cause be lost which you can neither set up as a defence to claim under the central bi-law or at least as a set up or counterclaim, I just wanted to explore this aspect of it, erm, as to the consequences of your plea, does it mean that clause nine is put on one side wholly or to an extent in the latter case to what extent? ...
Duffy (PS5NR) [55] Robert this, this presumably implies that the agent is suing the name
Saville (PS5NP) [56] erm well it doesn't necessary apply that the agent is suing the name, the question is whether, what any right the agent has got, er the fact of the matter is as I understand it and tell me if I'm wrong, that your client has erm received a demand under clause nine er, er which he has failed to comply, I think that must follow because er if he had complied with it, then that would never of got as far as the central fund
Duffy (PS5NR) [57] of yes, I think it must be [...]
Saville (PS5NP) [58] yes
Duffy (PS5NR) [59] erm
Saville (PS5NP) [60] but really the question is was he legally obliged to comply within?
Green (PS5NN) [61] well look erm, my Lord the fact that, I, I think the answer would go like this, that, if the agent had sued the name then the defence would of been similar to that which is raised here, erm, but it would probably, it would of had additional elements because the name would have been enforcing ... through a, a, a slightly a slightly different
Saville (PS5NP) [62] mm
Green (PS5NN) [63] but similar change of causation, restrictions imposed by of which they are members ... and which they are party and we would say we had the same defence to the extent that they had written business which would not of been risen if the restrictions had not been made
Saville (PS5NP) [64] mm
Green (PS5NN) [65] but putting, cos they thought
Saville (PS5NP) [66] well I mean the, the agent hasn't or hasn't yet sued, but I wasn't really putting it like that, I was asking you whether it is your case as in presently stand looking at the defence you've raised to whether or not you have failed to perform your legal obligations under clause nine.
[67] ... Er, er my understanding to, to er about five minutes ago was that you were saying we have not failed to perform our legal obligations under clause nine, because clause nine er is either wholly or to be extent that it relates to the underwriting which we disapprove partially invalid out of being part of the erm, the anti competitive of erm the argument you're pursuing.
Green (PS5NN) [68] well, my Lord I think that follows from my previous answer that
Saville (PS5NP) [69] yeah
Green (PS5NN) [70] had they been suing then that would of been met with a defence er counter claim settle and so on, erm and that would of been the answer that you can't enforce the claim under clause nine because it's void, we didn't, we therefore can't, there's no duty to keep the agent in funds, sue it to clause nine, it been a void clause
Saville (PS5NP) [71] yes
Green (PS5NN) [72] I think the answer is that simply as it who were doing what the name would otherwise have done, erm ... for the reasons your Lordship has given ... and, and your Lordship has seen of course that the analysis of the relationship between the name and the agent, erm, certainly as far as Mr is concerned, indeed we said it certainly it follows from what, what article eighty five does, it doesn't effect the extensible authority point but and the
Saville (PS5NP) [73] yeah, no, not that we come back to that in a moment or to, I'm just trying to see where this leads us though Mr , erm as a matter of legal analysis, erm y-y-y- your complaint, one particular one we're talking about is that erm these standard, these are standard degrees which offend the competition rules ... now ... if it, if that's right ... would not the consequence by erm across the ball, you're saying you only, you only would render them invalid in so far as they happen to do any, happened to have done any particular name of, er that, I can't think, it didn't seem to be in any of the erm cases we've looked at where the competition rules were applied, but that was a necessary condition ... if, if, if it's [...] that if it's void, if people have suffered a loss as a result of it they can recover a lost, you don't have to show a loss do you in order to, to, to be declared void
Green (PS5NN) [74] there are, there are cases in which the exercise, well if, if, I think we can start with a right, the exercises were right, erm, if, for example the cases who simply that I refer to in relation
Saville (PS5NP) [75] mm
Green (PS5NN) [76] to bringing the claim, if it is pursued, the claim maybe good, it maybe bad and it depends upon the circumstances of the underline agreement, that's one example where something maybe good or it maybe bad, it's like an intellectual property ride, depending on how you exercise the right, it maybe good or it maybe bad, if you use it to block parallel imports or for some anti competitive purpose then it may be bad, erm ... it, it's not necessarily the case that if you have a clause in the contract it is always in every circumstance bad, where the clause itself allows ... the undertaking concerned, to exercise it in a particular way, now, erm ... so ... so that as a matter of principal not all clauses could be automatically said in a standard form contract to be good or bad and it may depend upon how they are to exercise in a particular way, what we have said is the, the, erm, the provision in ... on, on the, the unfettable authority, er, erm and powers of the agent, erm is void ... it would depend upon the facts of each individual case whether or not every other restriction as your Lordships seen again only through and the cases they side, erm that other provisions in a standard form contract may on the facts be had, it depends upon the significance of the particular clause in the circumstances, my Lord in, in answer to your Lordships question, I don't think it necessary follows that every clause is bad, but we do say it depends upon the facts ... and we have pleaded that not all loss might be ... erm ... defensible against. ...
Saville (PS5NP) [77] So, if erm ... so your, your, your principal complaint, I maybe wrong it maybe not your principal, look at page a hundred and twenty seven for your assistance, erm ... [reading] standard form of agreements restricted competitions, the service of the petitions or the agents provided so this is names and thereby restrict the competition as the agents them say [] erm then impose on [...] that it was a regime etcetera, erm ... that the, the competitive the anti competitive one is your sub paragraph one isn't it?, on page one, two, seven ... your saying look here is a of, of dictated through their bi-laws, a standard form that all agents must use, [...] you say, erm, er that that restricts competition because it means that agents are free, or as free as they ought to be, erm to compete with each other or providing services to outside names, I follow that, I didn't say I except it, but I follow that entirely, erm, but doesn't, doesn't, if you're right doesn't it follow that the agreements are void? ...
Green (PS5NN) [78] My Lord er, can I, there's, there's a quali qualified yes to that, yes if on analysis all the clauses are important secondary aspects of competition and if so then all of those clauses are void
Saville (PS5NP) [79] yes
Green (PS5NN) [80] and then one says applying the test of severance, er is there a, is there a residual agreement to be enforced, the answer maybe yes it maybe no ...
Saville (PS5NP) [81] but doesn't that bring us back you see to clause nine, erm, is, is, is that a clause which erm ... which you're, you're suggesting is anti competitive because er agents might compete with er each other as to what if any funds they might want to pull down, or
Green (PS5NN) [82] my Lord I, I suppose the answer to that is yes, it could be on the facts, it could be that if there was in a free market then they'd be all sorts of varieties of clause whereby the name and kept the agent funds, erm maybe
Saville (PS5NP) [83] yes
Green (PS5NN) [84] they'd be all sorts of ways in which they could of kept the agented funds, erm they could of been, but it's hard to imagine that, that
Saville (PS5NP) [85] mm, mm
Green (PS5NN) [86] the laws of that could of been an important element of competition
Saville (PS5NP) [87] so it follows that there is at least a risk that clause nine will be struck down on your defence ...
Green (PS5NN) [88] my Lord I think the, the answer to that is, is yes there is
Saville (PS5NP) [89] yes
Green (PS5NN) [90] that risk
Saville (PS5NP) [91] so then if we go back to the beginning of this discussion Mr , it must follow must it not that there is a risk, clause nine is inaccurable so as far as all names are [...] ...
(PS5NS) [92] Yes ...
Green (PS5NN) [93] well my Lord, the person behind me is saying yes, I'm just trying to think with the consequence not quite
Saville (PS5NP) [94] don't be don't necessary be influenced by those at [...]
Green (PS5NN) [...]
Saville (PS5NP) [95] although no doubt they are doing the best they can for you Mr , erm, but I mean that's why, that's what I was putting to you at the beginning.
Green (PS5NN) [96] My Lord the, the answer must be yes
Saville (PS5NP) [97] yes
Green (PS5NN) [98] I mean if it's [...] then it's the end to the clause, erm, er ...
Saville (PS5NP) [99] but then, is, does it not, the next point then does not er what Mr say have relevant cause, because if there is this risk which in the purposes of the argument rule, start if you like as a wheel and not a, a, a, a, a fanciful risk, the reasons yourself just put forward, er then it must follow that there is a risk, er that erm the members agents will not be able to call on names to provide the funds
Green (PS5NN) [100] oh well that maybe true and of course sir, er, that, that ... makes the question both of the obstantial authority and the member state responsibility under article ten of the nineteen seventy
Saville (PS5NP) [101] yeah
Green (PS5NN) [102] be directed
Saville (PS5NP) [103] but if that er risk was a material risk, what effect do you think it would have on the market?
Green (PS5NN) [104] my Lord I'm not really an insurance expert and I wouldn't like to speculate, my Lord it's entirely possible that, that erm the [...]
Saville (PS5NP) [105] but you're, you're been described as a, as a, as likely in the ordinary course of things to have a benign effect would it?
Green (PS5NN) [106] well no but competition my Lord, the, the fact that the competition rule applies, I don't think it's straight [...] clauses, my Lord corporate capital is now flowing into the existing is being
Saville (PS5NP) [107] and er it wouldn't be calculated to provide the erm, those people who have er policies at with er particular confidence would it?, and it wouldn't be calculated to assist in questions of er solvency and the like er which on any of you are all er considerable importance to the er European community. ...
Green (PS5NN) [108] My Lord ... first it was always open to to notify and eradicate this problem entirely, secondly there's the European court make clear the V D S, these sorts of consideration however valid do not of any circumstances provide exemption from the competition which have different objectives and names
Saville (PS5NP) [109] mm
Green (PS5NN) [110] now if have infringed the competition rules, then the fact that the consequences maybe significant severe for them, is, is irrelevant, erm it was significant for the
Saville (PS5NP) [111] but it's not it's not them, it's not
Green (PS5NN) [112] Belgium police officers
Saville (PS5NP) [113] them so much that I'm worried about it's the policy holders which I Mr
Green (PS5NN) [114] well my Lord previous policy, pass policy holders have been paid, all have to do in relation to the future is very rapidly notify their arrangements, if they get clearance they can then get exemption from the data notification back dated and the problems for the future are resolved.
[115] ... And that of course sets aside the
Saville (PS5NP) [116] mm
Green (PS5NN) [117] the sums in the premiums trust fund, it's a very simple answer my Lord to notify now ... in the same way the commission suggested that they should notify some ten years ago
Saville (PS5NP) [118] of course that wouldn't help would it on the er great mass of er policies that have presently been written in respect of which claims are likely to be received over the next fifteen to twenty years be included so help
Green (PS5NN) [119] well my Lord certain believers well certainly that may give rise to problems, erm, and then one may have to resolve those on the basis of the ostensible authority or even claims against the member of state under article ten of the directive, but, however, erm, on, on satisfactory or confusing to the market that might be
Saville (PS5NP) [120] mm
Green (PS5NN) [121] it is not the Armageddon situation that suggest.
[122] have it within their power to resolve the matter very speedily by going to the commission and providing full notification, even if they have to negotiate with the commission over provisions which the submission was moved, then they can get that exemption back dated and, and
Saville (PS5NP) [123] back dated to the date
Green (PS5NN) [124] date of notification
Saville (PS5NP) [125] of notification yes.
[126] ... I ask these questions because of course article five of the treaty of Rome basis a burden on this court, it doesn't er create rights in itself, I think everyone agrees with this, but it certainly er imposes a duty on this court erm to apply with er community laws, purposes and principals ... and I'm wondering whether erm, that, that is why I'm looking at the possible consequences of this er the inter relationship between the, for example, the directive and article eighty five, er and bearing in mind as I said to Mr the other day, the consequences erm of er these fees
Green (PS5NN) [127] what, with respect article five encloses upon your Lordship obligation to enforce the competition of the source
Saville (PS5NP) [128] yes, it also er imposes on me the obligation of course erm under G of article three doesn't it? ... which I imagine, but you can tell me if I'm wrong Mr is the one, is probably the one article erm, part of the article under which such things is the insurance directive is er produced, but I maybe wrong
Green (PS5NN) [129] my Lord I, I think what the, the insurance directive is brought under erm
Saville (PS5NP) [130] enforced proceeding one is it?
Green (PS5NN) [131] C three C, the abolition [...] of course freedom for movement for services and that is implemented in article fifty
Saville (PS5NP) [132] er yes you're probably
Green (PS5NN) [133] to establish them
Saville (PS5NP) [134] you're probably right, but the point remains of course and I have to have
Green (PS5NN) [135] my Lord
Saville (PS5NP) [136] I have to have in mind of course some, not just F, not also correctively now C
Green (PS5NN) [137] my Lord er C is the freedom of services
Saville (PS5NP) [138] mm
Green (PS5NN) [139] erm my Lord let me deal with G first cos I, as
Saville (PS5NP) [140] well I, I think I'll take agree Mr you know much more about these matters than I do, I just, my eye just lit upon that one I thought that would perhaps the one in which the insurance directive could be said to be attached, but if you've told me it's C I'm perfectly happy to accept it as being C.
Green (PS5NN) [141] my Lord I think, I think your Lordship will find that it's erm the reference in the first paragraph of directive, the first, it's sort of the first part of number fifty four
Saville (PS5NP) [142] yes
Green (PS5NN) [143] erm ... and that, that brings it into establishment
Saville (PS5NP) [144] yes, well er I be
Green (PS5NN) [145] of the greater [...]
Saville (PS5NP) [146] but er the point were made
Green (PS5NN) [147] my Lord G is the E R N, I mean it is central government monitory policy
Saville (PS5NP) [148] [laughing] yes alright [] well let's leave that one and let's see [...] and I stand corrected, but my point remains the same if er, erm, er my duty under article five is not to find to the anti competition laws is it?
Green (PS5NN) [149] your, your duty under article five is to be guided by the European court and indeed yes the competition law takes precedence over consideration of solvency and protection of policy holders, these are matters which can be reconciled under article eighty five three, not eighty five one
Saville (PS5NP) [150] mm
Green (PS5NN) [151] and with respect your Lordship doesn't have the er and I'm sure this will not be disputed, your Lordship doesn't have the erm jurisdiction to grant the exemption under article eighty five three only the commission in doing that
Saville (PS5NP) [152] which I wasn't suggesting I could, no ...
Green (PS5NN) [153] The have had er a long grade of time since the complaint was put to the commission, to put a notification in if they wanted to protect their position, but still they could of done so on, on a precautionary basis, and without prejudice basis they have not done so, a longer standing commissioner had invited them to do so ten years ago, they could do so this week on without prejudice basis and that may erm ... lead to security in the future that they now seek
Saville (PS5NP) [154] yes ... anyway we were talking about Mr Armageddon, erm, were not
Green (PS5NN) [155] my Lord, huh, my Lord that, let me point I was thinking
Saville (PS5NP) [156] because I not I can't remember if actually using that phrase, maybe used somewhere
Green (PS5NN) [157] not my phrase my Lord [laugh] but er a slight high [...] in relation to what he was saying
Saville (PS5NP) [158] mm
Green (PS5NN) [159] I think that our description of what he was in effect saying, my Lord we were simply pointing out
Saville (PS5NP) [clears throat]
Green (PS5NN) [160] that the reference to the accounts could not be viewed accurately without viewing the statutory statement of business which filed only just a month or so back reveals a sixteen and a half billion surplus in the members premium trust fund up from twelve and a half billion at the end of proceeding year.
[161] My Lord can I just turn to my ...
Saville (PS5NP) [162] yes
Green (PS5NN) [163] my Lord er, to only just final conclusions ... my Lord the first conclusion is that nothing in community law, nothing in the directives in the insurance companies act can be pointed to by which grants powers to them ... to regulate the insurance markets.
[164] They have subject limited statutory duties in the insurance companies act, but the fact they're subjected to duties in the same way that the ... underwriters, the underwriters are subject to duties does not make them regulators, but in any event even if we were wrong on that there is no exemption under article eighty five, one for regulators and, and your Lordship has seen a number of cases and I shan't go back to them is fully subject to the competition rules whether as a regulator or not.
[165] have held lengthy dialogue with the commission, no formal clearance what so ever has even been given ... commission suggested and encouraged to notify, but they did not, they had the opportunity to do so, they declined it, one might say is a market of risk takers, this is a risk that they took.
Saville (PS5NP) [166] mm, mm
Green (PS5NN) [167] That is quite true, yeah, point is clear, erm point three activities when, er activities er in the context of bringing action forward in article eighty five, one.
[168] ... In principal as the numerous authorities up to my Lordship to yesterday demonstrate and the reference are er an action which and there are four ways in which the cases described it, an action which er is the object of an agreement ... or er the means of an agreement ... or
Saville (PS5NP) [169] don't actually, don't actually directly say that the central bi-law is ... is anti competitive do you or do you?
Green (PS5NN) [170] my Lord we have said in a number of places the claims are erm unlawful and we refer to the fact that the claims come out of the central fund bi-law
Duffy (PS5NR) [171] er can you just stop me on that my Lord [...]
Saville (PS5NP) [172] yes
Green (PS5NN) [173] if put, put sample in, in er er at paragraph ... erm ... we said that it could be, we referred to paragraph two, two, three, this is the third paragraph I've turn up on page a hundred and thirty six on claim sees to recover and then we say the premises, the claim is unlawful as being in breach of article eighty five, alternatively, unlawful in seeking to enforce agreements
Saville (PS5NP) [174] sorry I've lost, er lost you
Green (PS5NN) [175] page a hundred and thirty six, paragraph two, two, three
Saville (PS5NP) [176] er, oh yeah
Green (PS5NN) [177] my Lord this is er, mason, and the claim of course being based upon the certain
Saville (PS5NP) [178] yes
Green (PS5NN) [179] bi-law
Saville (PS5NP) [180] but the bi-law itself, I mean there, there, there, there's nothing wrong, there'll be nothing wrong in your saying with the erm, what is article ten, erm, if ... erm ... but with this connection which you say exists between what they're calling for you to provide, erm and erm ... er what, oh sorry start again, you're saying the claims unlawful because they're seeking by er the central fund bi-law to recover sums that have been paused by their breaches of the
Green (PS5NN) [181] my Lord yes
Saville (PS5NP) [182] community law, other breaches
Green (PS5NN) [183] my Lord, yes
Saville (PS5NP) [184] so, per saying, there's nothing wrong with central and fund bi-laws
Green (PS5NN) [185] per say, nothing wrong with central and fund bi-laws as a mechanism and it's the exercise of that in these particular circumstances which is unlawful and, and we have pleaded, just erm ...
Saville (PS5NP) [186] yes
Green (PS5NN) [187] page a hundred and thirty two, para two twenty eleven in broad er we, we've put in purposely er sweeping up ... provision in our catalogue of restrictions, erm which simply says all bylaws and other regulations may be pursuant to the acts and all agreements made pursuant to the bi-laws which reinforce or implement any of the above restrictions
Saville (PS5NP) [188] yes yes
Green (PS5NN) [189] and that was really a generic way, but then we refer to the point of claims of course based upon the bi-laws
Saville (PS5NP) [190] yes ...
Green (PS5NN) [191] well so that's how it's pleaded and that's how we built it into the, these cases which I was referring to where an agreement is the object or the, the means or the consequence of an agreement, they enforce within [...] five, the action is unlawful and of course there's the final and fourth way in which it could be devoured this, because it, and again quoting the words from the cases, tends to have restricted affect on the market, I think your Lordship you can see how we pleaded it in paragraph two, two, three, it's enforcing the consequence of the unlawful underline previous. ...
Saville (PS5NP) [192] yes
Green (PS5NN) [193] Well the, the fourth point in relation to er we say that the point has been fully pleaded, corsation is a question of fact, the, er, it's not an issue which we say arises on these preliminary issues and can raise it er under order eighteen, rule nineteen, if they so wish, that is traditionally the places where it seems nexus points arise erm and they will put in, er app , we will put in, the defendants will put in appropriate evidence at that point, depending upon whether the, the strike out allows evidence and how they frame their strike out, but the nexus point is fully pleaded, we set out step by step and in relation to er restrictions how they were caused the loss, my Lord at that point, at this point we believe that's all we have to do and certainly we believe that it be sufficient to get over a strike out
Saville (PS5NP) [194] yes ...
Green (PS5NN) [195] my Lord the fifth point in relation to question three, C, we've always understood this to be a threshold bond, we've concentrated on the words capable in law ... in relation to section fourteen, there are two ways of viewing this and your Lordship will clearly have to take a view on whether er one or both of these is a proper issue under clause three, C one, first of all is, is, is section fourteen itself capable of restricting the competition, is it in itself a restriction of competition, well we took your Lordship the C B R case, the case of the commission in which an ouster clause was held to infringe article eighty five, because of it's interrelationship with the other restrictions and so section fourteen is bad if the other restrictions are made out as a matter of competition law, that we say is a question of fact and we therefore answer that part of three C by saying it's not capable in law
Saville (PS5NP) [196] you, you, yesterday you said you don't say that in the absence of restrictions the immunity is heard
Green (PS5NN) [197] no my Lord we, we, we, we pin section fourteen to those restriction, whenever a restriction arises
Saville (PS5NP) [198] yes
Green (PS5NN) [199] erm, and, and, it could arise in many different circumstances, erm one can imagine a situation which wrongly expel erm a name from the market, well whatever the motives, that clearly distorts competition cos there's one rule, one less competitor in the market, erm it, it's con , it, it's conceivable that an article eighty five argument could arise and ... an expel name could raise a point, whether he succeeds is another matter, but at that point and, and in relation to that he may say well I can sue you because you've excluded me you've restricted competition or you've excluded a group of names
Saville (PS5NP) [200] mm
Green (PS5NN) [201] erm and, and the market is being badly hit as a result of this, now we've a specialist in a certain type of business that leaves the market free for another syndicate and they've now picked up all the juicy business
Saville (PS5NP) [202] yeah I understand that, but when you use the phrase [...] itself as a competition, that erm, that didn't seem quite square with what we were saying yesterday
Green (PS5NN) [203] what, well my Lord
Saville (PS5NP) [204] when you said I do not say in the absence
Green (PS5NN) [205] yes
Saville (PS5NP) [206] restriction of amenities varied
Green (PS5NN) [207] well my Lord let me clarify and be quite clear
Saville (PS5NP) [208] you're, you're not saying that it, it, it, it is simply to be struck down without reference to any under lying
Green (PS5NN) [209] no my Lord I'm not saying
Saville (PS5NP) [210] restrictions no, well I'd rather I did
Green (PS5NN) [211] if there are if there are other restrictions then I say section fourteen is automatically void in it's entirety ... because it reinforces, it has to be independent effect of reinforcing the other restrictions ... it stands behind them boosting them on
Saville (PS5NP) [212] yes
Green (PS5NN) [213] and, and in that case it does have an independent effect, it's an incremental effect upon the restrictiveness and that makes it bad in itself
Saville (PS5NP) [214] yes
Green (PS5NN) [215] and that's why
Saville (PS5NP) [216] will it be completely void or void in so far as it be more to the point
Green (PS5NN) [217] no completely void because you can't severe the good from the bad in section fourteen, your Lordship couldn't take a blue pencil and, and, and find some words in section fourteen which say erm, you know, I can take out an article eighty five claim or I can allow an article eighty five claim but I can leave something else in
Saville (PS5NP) [218] coul couldn't you say that a matter of community law erm ... er simply a, a, a prohibition of that kind of er just has no effect just as far as erm any brief community
Green (PS5NN) [219] Lord er, er under article eigh
Saville (PS5NP) [220] law or the treat is concerned
Green (PS5NN) [221] no my Lord, no, not under article eighty five, and article eighty five and sub paragraph two
Saville (PS5NP) [222] mm
Green (PS5NN) [223] is automatically void and it is then a pure question of severance as to whether or not
Saville (PS5NP) [224] yes
Green (PS5NN) [225] one can leave extant a valid clause or some
Saville (PS5NP) [226] yes
Green (PS5NN) [227] part of that section is valid, and we say and we pleaded that it's not so forth
Saville (PS5NP) [228] yes er so, so if you're writing your arguments then er says no immunity in, in respect of any proceedings
Green (PS5NN) [229] it goes completely
Saville (PS5NP) [230] of any nature
Green (PS5NN) [231] it goes completely
Saville (PS5NP) [232] yes I see that
Green (PS5NN) [233] of course until they notify and get it exempted ... which is always opened to do ... it's always been opened of course to notify an answer when they get a bit of clearance should of been
Saville (PS5NP) [234] yes
Green (PS5NN) [...]
Duffy (PS5NR) [235] if we went to that, who, what, what, which was the case which dealt with the erm ... one arm satisfactory appeal procedure or, or that
Green (PS5NN) [236] C B R
Duffy (PS5NR) [237] can you give me the case reference?
Green (PS5NN) [238] yes my Lord it's, it's paragraph twenty eight of the commissions decision and
Saville (PS5NP) [239] what what you're just trying to complicate reference [...]
Duffy (PS5NR) [240] my Lord yes I'm just trying to find the ... my Lord it's er tab thirty six of the defendants authority
Green (PS5NN) [241] the defendants, defendants
Duffy (PS5NR) [242] yeah defendants list of authority, tab thirty six and I think it's paragraph twenty eight
Saville (PS5NP) [243] yes ...
Green (PS5NN) [244] well then of course erm for your Lordships notes that you ought to remember V E X where there was an immunity from national competition law which they were saying oh well we've got this immunity under national insurance law and national competition law
Saville (PS5NP) [245] mm
Green (PS5NN) [246] and erm article eighty five can't interfere and the court said, who, of course they can
Saville (PS5NP) [247] yes
Green (PS5NN) [248] but the second way in which section fourteen arises is this slightly more oblique way, erm, it's, it's not really the question of competition law it's more a question of administrative law or constitutional law, erm whether it arises on the question er, your Lordship will have to decide, but, if, if it does then we believe that our case is extremely strong, because what one is saying here is, is section fourteen a block to an article eighty five action, erm does it make it either virtually impossible or something lesser excessively difficult, er and we say er that that's one aspect and two can we show it's discriminatory, well we say first of all it is discriminatory because even on analysis of the bad faith argument they are putting in a claimant with an article eighty five case to an extraordinary length in order to make good his case, he first of all has to super declaration presumably that he is entitled to damages, but he can't get damages all he's entitled to is the declaration if then don't satisfy that claim by paying up and their not going to be ordered by the court to pay up because that's a claim for damages and you can't have that then you have to sue them again on the basis of breach of bad faith, er no other provision in English law would go to that effect ... and that of course even, even that assumes whether rightly or wrongly and we say possibly wrongly that er, er the failure to comply with the judgment of the declaration would be bad faith within the meaning of the act, but even assuming it's right it puts a plaintiff suing for breach of article eighty five in the worst position possible
Saville (PS5NP) [249] mm
Green (PS5NN) [250] certainly in a far worse position than any other English claimant alleging erm any of the courses of action which are permitted as an exception to section fourteen
Saville (PS5NP) [251] yes
Green (PS5NN) [252] and secondly we say that er we're setting aside the question of discrimination primary basis section fourteen is an absolute block on it and you can't have it more complete er, er ... undermining of article eighty five and again even if the bad faith point arises, er simply makes it and we say quite clearly excessively difficult to enforce article eighty five
Saville (PS5NP) [253] yeah ...
Green (PS5NN) [254] well that's section three C one
Saville (PS5NP) [255] yeah
Green (PS5NN) [256] question, issue three C two and three er we say that ... in relation to two as a matter of have categorize this as a question of law we say it probably categories a question of fact because if they're right in there analysis of law and article eighty directive, all it means is, is that there is no market outside and that the restriction is insignificant ... if that being so ... one would answer the question, is not capable as a matter of pure law of infringing article eighty five, but in the light of the discussion yesterday afternoon of course when my learned friend comes to apply for this strike out, we may have difficulty in contesting that provision it's not, not er, a, a major part of our case that we, we would have to re-consider it and, and I did ask your Lordship erm if your Lordship would minded to find otherwise not to block out at least the possibility of application for leave to amend and of course we'd have to make, have to consider whether we could make a proper case out of it on what we do
Saville (PS5NP) [257] yes
Green (PS5NN) [258] well in relation to the standard form contract ... there are cases er based upon prim er primarily article eighty five, one A which says agreements fixing terms and conditions, for with in article eighty five, it's based upon the facts that the, the, the decisions of the commission and the court, say that elements of secondary competition can be restricted and here we have a standard form contract which restricts all elements of secondary competition
Saville (PS5NP) [259] yes
Green (PS5NN) [260] not price
Saville (PS5NP) [261] er, this is not of, this is not of the point, in fact it's on it, it's a point which I asked you before and er it concerned, I think it's the same case as the one we've just been mentioning the, with the commission of objecting to erm appeal procedures on the grounds they are unfair, is that, that's the same one isn't it?, let me just perhaps look at it
Green (PS5NN) [262] my Lord I don't think that was a, I think that was the, the case or the case
Saville (PS5NP) [263] no, er it could be the yeah, but it is the case, yes, which one is that?
Green (PS5NN) [264] that I think is, it's about tab thirty ...
Saville (PS5NP) [265] is it exists [...]
Green (PS5NN) [266] tab thirty nine my Lord
Duffy (PS5NR) [267] Thirty nine defendants bundle ...
Saville (PS5NP) [268] yes that's quite, that's the on , that's the one, it's the fourth page in, I haven't got page numbers, but it's the last paragraph on the page of the paragraph for the publication [...] ... do you know the page?
Green (PS5NN) [269] my Lord yes
Saville (PS5NP) [270] it's the paragraph above, this is still rather puzzling me ... erm ... the ... commission were concerned ... because ... there could be what one could describe as arbitrary and unfair, rejections of application for membership is, is that your reading of it?
Green (PS5NN) [271] well yes and therefore they wanted the appeal procedure, erm to make it fair ... I'm not trying to put words in your mouth but that, term, to eradicate the possibility that someone could be able to exclude it from the market unjustifiably
Saville (PS5NP) [272] you mean for no, yeah
Green (PS5NN) [273] for no reason
Saville (PS5NP) [274] for no reason, yes
Green (PS5NN) [275] and whether one calls it fair and objective argument
Saville (PS5NP) [276] now I did ask you this before and still puzzling me, where, where does this fit in to article eighty five?
Green (PS5NN) [277] well erm there, there are very few cases in which the European commission or the court talk about fairness erm, when but, but, but
Saville (PS5NP) [278] no, no, well, well well let's use your language
Green (PS5NN) [279] erm
Saville (PS5NP) [280] a non arbitr , well let's use their language, objective criteria on which it's judge application to the membership, erm, and I'm only, I'm only imagining this, but I'm, but as a matter of common sense one would of thought that one wouldn't like subjective or arbitrary and er indeed unknown criteria to apply erm, as, as in my point of view, as a matter of fairness, but er ... my question is and it was before and I, I'm not sure I hoist in your answer, where, where does that fit in to article eighty five?,
[281] I'm not saying it doesn't, but where does, does it, well it obviously does, but where does it fit in?
Green (PS5NN) [282] well, here, I think it fitted in, I think it was this way, it's a little bit difficult to see from the decision itself, erm this do , when these were notified there were provisions in it for example in relation to admission and expulsion, which the commission objected to and erm, I think one can summarize that this must of happen, the commission said to the marketing question if you don't remove this restriction or if you don't erm eradicate what we see as the arbitrary element of [...]
Saville (PS5NP) [283] mm
Green (PS5NN) [284] we will not give you exemption
Saville (PS5NP) [285] no I, I'm pretty sure that that's what they were saying, yes
Green (PS5NN) [286] and they said if we, in turn, as it stands we could never give you exemption and therefore the only thing is to render it completely enoxious and then we can give you negative clearance because it will have no impact upon competition
Saville (PS5NP) [287] I, I don't know what the opposite of enoxious is
Green (PS5NN) [288] er enoxious
Saville (PS5NP) [289] let's assume it's noxious
Green (PS5NN) [290] it's noxious
Saville (PS5NP) [291] er, erm, obviously the commission felt it was er, it was funny, unacceptable if you didn't have erm for example objective criteria by which to judge applications to membership, now I can understand this a fairly proposition of fairness, but where does it fit in to article eighty five?
Green (PS5NN) [292] my Lord, my Lord er unless I've miss understood your Lordship it fits in the sense that if you think that unreasonably or even unfairly disclude someone from the market, you're are excluding someone who would compete in the market, you're taking someone out who may of had an impact on the market, may of brought prices down, offer better terms and conditions
Saville (PS5NP) [293] yes, yes but so you are
Green (PS5NN) [294] that's how it's effected
Saville (PS5NP) [295] if you exclude somebody on objective criteria
Green (PS5NN) [296] well then my Lord ah my Lord not all objective criteria and this I think is very important because you can have objective criterias as I, as I submitted last week that would be erm in order to trade in this market you must have capital of twenty million pounds and ten years experience, but that's uniform rule, it doesn't discriminate it's objective, but it would be anti competitive because here you are setting up the most important market er in this, erm as they say in Europe for the project futures market and you're excluding people who could be in there trading and who could be effecting the market
Saville (PS5NP) [297] and that, that would be because your, your twenty million pounds in it has really got no erm, had got no independent justification on arbitrary limiting a number of people able to compete, but what, what if you're able to satisfy everybody that you had to have some pay out capital, twenty million is ridiculous
Green (PS5NN) [298] my Lord yes
Saville (PS5NP) [299] but er ten thousand pounds
Green (PS5NN) [300] yes
Saville (PS5NP) [301] erm simply because erm the later in the market it was obviously important that erm people had some substance all be it very small er
Green (PS5NN) [302] the minimum necessary
Saville (PS5NP) [303] the, the minimum necessary
Green (PS5NN) [304] my Lord then all, what, then, was not restricting competition because the people you have excluded are not people who would be in the market in any event, you are already saying we've got the level of the, the, the hurdle, the wall or the barrier to such a low level that anybody who's outside it, it is simply not a competitor, we've got everybody in the market who could conceivably deserve to be there, but there's no restriction, no you maybe excluding criminals or fraudsters for a, until they've been re rehabilitated, er and you're excluding people who simply do not deserve to be there as competitors at all, but no capability of right to compete and that's why there is no restriction, everybody is in the charm circle who wants to be there and is capable of competing and that's what the commission are trying to get the rules down to, making sure that no one is outside of the wall who should be inside of the wall and that's why of course at the end of the day they can give their clearances, there's no restriction.
[305] ... My Lord I, I hope that you
Saville (PS5NP) [306] The other way of looking at it is, is to say that there, I mean there is a restriction and of course the membership is restricted, people who can put up ten thousand pounds, but erm, that is an entirely fair and reasonable restriction in all the circumstances and therefore come in more clear [...]
Green (PS5NN) [307] my Lord I don't think that's different, erm it's not the restriction, one saying that the res the, the, it's not restricting competition it's simply an entry condition, but it doesn't have the effect of taking anybody outside of the market who should be there
Saville (PS5NP) [308] mm
Green (PS5NN) [309] and, and, er of course that the commission looked at this as er, er, as a question to be looked at in the context of the market and of all facts, but they said you, if you want restrictions you can be sure that we won't give you any exemption for them, so you'd better remove every single solitary objection,objec er restriction that we identify, that's why at the end of the day they got er, it was a very, very strict approach by the commission, you can have nothing which is acceptable, you can get negative clearance but you've got to be cleaner than clean, whiter than white, so remove every possible restriction. ...
Saville (PS5NP) [310] So you're saying, you're saying it's a case where erm ... if the criteria are reasonable ... in the sense of being required for the what proper operation of market or something like that?
Green (PS5NN) [311] that er, we applied for test of proportionality, the minimum necessary, my Lord this is a, your Lordship's focus on admission rules which of course different to what we're concerned with here, admission to the market, erm, and it, it is the minimum necessary to ensure that all those who should be in the market and are capable of competing are in the market. ...
Saville (PS5NP) [312] Well, you see a person without ten thousand pounds is such capable of er, capable of competing
Green (PS5NN) [313] my Lord I don't know if it was ten thousand pounds
Saville (PS5NP) [314] no, or whatever it is, I mean erm
Green (PS5NN) [315] my Lord there may not be ... er if you've got no money to do anything with or no money to, to, to operate in even if the, remotely vaguely efficient way, that you, how can be said you'll capable of competing
Saville (PS5NP) [316] mm ... it's a pity we don't know what the ... I suppose we can find out, what the er ... what the London's future, future market membership requirements are ... it doesn't help, but there's nothing erm
Green (PS5NN) [317] my Lord that, that all these decisions
Saville (PS5NP) [318] the decision
Green (PS5NN) [319] are very brief and there, there, there commission have done almost pro forma, but er, well of course I mean a, erm, erm
Saville (PS5NP) [320] I just certain, satisfy certain erm cattle requirements and carry on business in the sugar trade and of must done so for a period of time, I'm looking at this, the third page in, top of the page, erm trade in office in London established without purpose ... erm ... now those the ...
Green (PS5NN) [321] of course we don't know what, as your Lordship says we don't know as a matter of fact what the, the height of the
Saville (PS5NP) [322] well it it says
Green (PS5NN) [323] or what
Saville (PS5NP) [324] the bracket is facts, well no, yeah but we, I think we know what the, the new wall is, facts eight paragraph above ... eight paragraph above ... it looks as though it ... the bottom of the second page er first page
Green (PS5NN) [325] mm
Saville (PS5NP) [326] that seems to set out, that seems to give the details of er ...
Green (PS5NN) [327] my Lord that these of course are just for the
Saville (PS5NP) [328] mm
Green (PS5NN) [329] the headings as to what the rules, membership rules were, they don't say the content of the rules erm
Saville (PS5NP) [330] well, the, I think it tells you a bit doesn't it?, it means
Green (PS5NN) [331] yeah, er very little
Saville (PS5NP) [332] mini , there's a minimum capital requirement, they've gotta of been carry on business as a former [...]
Green (PS5NN) [333] yes
Saville (PS5NP) [334] and they've gotta have a trade from an office in London
Green (PS5NN) [335] yes
Saville (PS5NP) [336] erm, so those are the three, those are the three criteria's
Green (PS5NN) [337] my Lord, I, my Lord I do recall about five years ago I, remember advising one of the future's markets and see [...] come to the life of me remember what was in them
Saville (PS5NP) [338] no
Green (PS5NN) [339] but they were enormous, they were, they were very substantial, but, erm, well I, I think that the point here is that one can have a minimum requirement, but depending upon the facts and the circumstances and the nature of the market, so on and so forth, well they have, the commission said, you can have no restrictions at all cos we're not going to give you exemption, so you'd better make sure that they are the absolutely bear minimum that are necessary to ensure that every person capable of competing can get into the market.
[340] My Lord erm, er one can't of course draw conclusions from one market to the next, they are all different certainly is a self regulatory market is different from a futures market
Saville (PS5NP) [341] mm
Green (PS5NN) [342] erm, but, it, it does come to a question of fact ... and of course we don't know what was in the notification, what information the er, the market administrator's, supervisors, er gave to the commission about the market and the market shares, er very little is actually stated in the [...]
Saville (PS5NP) [343] mm I know
Green (PS5NN) [344] about the actual market. ...
Saville (PS5NP) [345] yes the, the commission doesn't seemed to of addressed itself to, to, the only question it seemed to of addressed itself to are whether the criteria objective, erm, that there could be reasons when it takes decisions and erm ... there should be an appeal procedure
Green (PS5NN) [346] my Lord I, I think it takes the view and probably not unreasonably that assuming good faith on the part of the disciplinary tribunal and assuming that there is er review by the courts, you will have complete objectivity and someone who has been excluded for a good reason, maybe fraud or something of that nature should not be competing in the first place, but he will not be excluded unreasonably and therefore if he was excluded unreasonably erm the fact of he's exclusion could be anti competitive because it takes out of the market a player
Saville (PS5NP) [347] mm
Green (PS5NN) [348] and so provided that there's proper procedures, I mean I don't suppose the commission wanted to actually act as a, a review body for every person excluded from the market in Europe, and so they said well one's got to have a certain faith in the national courts as being an independent review, and such as that person is excluded from the market there must be a very good reason and he was an a [...] competitor
Saville (PS5NP) [349] yes
Green (PS5NN) [350] therefore no restriction of competition
Saville (PS5NP) [351] erm, what is this commission,w ,w is this a
Green (PS5NN) [352] my Lord this is, this is a proper commission decision unfortunately erm
Saville (PS5NP) [353] but I mean what is, is it an exclude or a negative
Green (PS5NN) [354] it's a negative clearance
Saville (PS5NP) [355] negative clearance, yes
Green (PS5NN) [356] my Lord that's why we say it was so strict, the commission said you're not getting exemption you have to remove everything from the market
Saville (PS5NP) [357] mm ... yes
Green (PS5NN) [358] every, every restriction out must go and then we'll give you clearance when it's entirely innocuous or when, the clauses [...]
Saville (PS5NP) [359] So there we have, the [...] still remain ... uncertain as to, as to what part of er article eighty five they receive to apply ...
Green (PS5NN) [360] my Lord I think it can only be
Saville (PS5NP) [361] and, and you're doing your best to try [laughing] I know []
Green (PS5NN) [362] huh, my Lord
Saville (PS5NP) [363] there are two, there are two ways you could look at it, either, either you could say, you could say yes or, in, in one sentence if you have any barrs on membership at all you are preventing competition, but that would be er a highly unreal statement to make, erm, and what you're, what you're saying is that if you look at it that way, the prevention restriction or distortion of competition must be some er malign or bad prevention restriction or distortion ... and er there's nothing bad about having objective criteria which would indeed erm prevent erm these people from competing cos they can't get into this, into the sugar market, er it will prevent them from competing in the sugar market, but that's not the sort of prevention article eighty five is talking about.
Green (PS5NN) [364] could er, I don't think that can be right because had that been right, had the commission been saying you've got restrictions but there not malign, then we'll be given you exemption, they would of said you've got restrictions but you've justified them
Saville (PS5NP) [365] mm
Green (PS5NN) [366] if they're saying there are no restrictions, cos they cannot, they simply cannot give there good clearance if there was something which is something of a restriction of competition, they must give exemption, they have no jurisdiction to do anything else, if they look at a clause and say
Saville (PS5NP) [367] well er, I, I, no, that's, that's, that's not what I was saying, I was saying article eighty five then concerned with, what one could describe as a malign or bad prevention, restriction or distortion
Green (PS5NN) [368] my Lord ... my Lord I don't understand what's supposed to be meant by malign or bad, it's concerned with appreciable and appreciable and er something which has an appreciable or a more audane minimize impact upon the competition if it arise erm here perhaps because it, it is er a question of fairness but not normally
Saville (PS5NP) [369] well er let me put it this way, if there, if there is good reason, good objective reason for preventing a person competing in the sugar market ... then article eighty five doesn't follow
Green (PS5NN) [370] my Lord, no, er if you have a good reason for preventing someone who is capable of being a competitor, eighty five applies but you can only exempt, if you've got a good reason for preventing someone who is incapable of being a competitor then eighty five one is inapplicable.
[371] ... You can't have a restriction of competition which falls outside of eighty five, one, it can be exempted. ...
Saville (PS5NP) [372] so you say it must be implicit in that decision that the, the commission was satisfied that the objective criteria er would separate the sheep from the goats, erm so that no one who would, would be excluded who was capable of competing
Green (PS5NN) [373] my Lord that, that must be right because that would only be the way in which they could give negative clearance, because the clause or the membership rules were inappreciable
Saville (PS5NP) [374] mm, mm no I see that
Green (PS5NN) [375] my Lord in a, in a sense that right at the very last page when they say a notified articles association, rules and regulations in there amended form no longer contain any clauses which constitute appreciable restrictions
Saville (PS5NP) [376] yes, negative terms comes I'm sorry, you did tell me, from which article?
Green (PS5NN) [377] from eighty five, one itself, it's dec it's negative clearance a decision from the commission that you don't fall within eighty five at all
Saville (PS5NP) [378] and that, that in term comes from which article?, who told the commission being given the right to make such a decision?
Green (PS5NN) [379] they, they have that power and er, erm article three I think regulation seventeen ... or er article erm, it's article two or three regulation, article two of regulation, seventeen of nineteen sixty two, you can apply to the commission for negative appearance
Saville (PS5NP) [380] sorry article
Green (PS5NN) [381] two, of regulation seventeen, perhaps I'd just give you the reference in er I'm sure it must be there, page, page twelve, one, one ... is regulation seventeen ...
Saville (PS5NP) [382] yes er yes
Green (PS5NN) [383] negative negative clearance article two, page twelve, twelve and
Saville (PS5NP) [384] yes, well thank you, thank you, it's a rather a, a slight discretion and that you for those information and we're on, on erm C three, C three C
Green (PS5NN) [385] C three C ...
Saville (PS5NP) [386] yes
Green (PS5NN) [387] erm my Lord with regards to [...] contract in general terms it's referred to in article eighty five one A, it's a an agreement as to terms and conditions, this standard form contract harmonizes all elements of secondary competition ...
Saville (PS5NP) [388] er I'm sorry what do you mean by that please?, harmonizes all, all
Green (PS5NN) [389] erm anything other than price if you like
Saville (PS5NP) [390] oh I'm so sorry, yes, yes of course
Green (PS5NN) [391] my Lord report, paragraphs seven twelve and two eleven, erm refer to the competition rules and indeed explicitly excepts that a curtailing of some competition in this area is in, in, in his view at least and the reports view, a good thing to protect solvency, protect policy holders and again we simply said to that V D S, fine, yes it goes to exemption, but it doesn't get you outside the competition rules. ...
Saville (PS5NP) [392] yes
Green (PS5NN) [393] My Lord point eight, erm, the evidence it all goes to insurance points, solvency and protection of policy holders ... and in that regard two points, first of all why one can simply say V D S, secondly ... all their justifications, even if it's true, the answer is V D S, but in any event they must sure even if, even if V D S was wrong in some way, they would have to show that the restrictions were the minimum necessary in order to achieve those legitimate policy objectives
Saville (PS5NP) [394] yes
Green (PS5NN) [395] and if they were disproportion or, or were excess in that regard they would fall within eighty five, one.
[396] ... My Lord, erm those are, those are my submissions my Lord, I was going to say something about my learned friends somewhat unusual request to your Lordship to make disparaging comments in judgment about the defendants case, my learned friend wishes to make disparaging comments we save a proper place for those in his submissions when he comes to apply to strike out, or [...] say anything about that, erm, my Lord erm perhaps erm as a, as a final point, erm Mr Bernard after having reviewed a piano recital once wrote, the only thing he enjoyed more than this directive performance was having his teeth pulled, I think your Lordship has not found that the last five and a half days are equally an under defended experience in relation to, to this mornings sir activity
Saville (PS5NP) [397] yes, erm
Green (PS5NN) [398] unless I can assist your Lordship further
Saville (PS5NP) [399] no, er, I, I, I rather, I stopped you Mr yesterday morning when you were ... about to engage on a exercise of saying where do we go from here
Duffy (PS5NR) [400] yes my Lord
Saville (PS5NP) [401] on the grounds that until I knew where I'd got to
Duffy (PS5NR) [402] yes my Lord
Saville (PS5NP) [403] erm, erm it might not be erm particularly helpful, but having thought about it again I, I quite like you, in, at least in broad outline er to hear what you have to say on the aspect orusese gnitteg ton er'uoy dias
Duffy (PS5NR) [404] yes my Lord
Saville (PS5NP) [405] I'm sorry about that, it really is more of a second thought, although I don't want to go into any detail and I'd like, like any broad [...] that you have to be in my mind in this case at least
Duffy (PS5NR) [406] could I just get my notes together?
Saville (PS5NP) [407] yes of course
Green (PS5NN) [408] my Lord if I, while my learned friend is, is
Saville (PS5NP) [409] well my [...] what position is Mr ?
Green (PS5NN) [410] Mr erm, my Lord I'm not certain I can wear Mr hat on this one
Saville (PS5NP) [411] no, no, no, I didn't mean you, you working for Mr what, what about him generally?
Green (PS5NN) [412] I think er that Mr is er Mr er suggestion is that in order to erm expedite matters he would be willing to, to submit his sort of comments, brief comment in writing and hopefully if Mr could fit in a quarter of an hour sometime on Friday
Saville (PS5NP) [413] I think that's gonna be erm asking to much Mr because we haven't er beginning to loom very close you know erm
Green (PS5NN) [414] yeah but he wondered if just that a short period of time could just get your Lordship a question of
Saville (PS5NP) [415] well this case I'm afraid doesn't lend itself to short [...] entirely impossible, er Mr maybe have to say erm will lead to the questions and then for example spent er a long time on questions this afternoon that I've had for you Mr
Green (PS5NN) [416] er my Lord, yes
Saville (PS5NP) [417] erm and it would be quite unfair erm
Green (PS5NN) [418] mm
Saville (PS5NP) [419] to try and repeat that
Green (PS5NN) [420] well
Saville (PS5NP) [421] he's not available tomorrow then?
Green (PS5NN) [422] well he, he, he might be, I mean if it
Saville (PS5NP) [423] mm
Green (PS5NN) [424] I don't think Mr available in the morning, Mr got lots
Duffy (PS5NR) [425] I'm, I'm available about eleven fifteen my Lord
Saville (PS5NP) [426] yes
Duffy (PS5NR) [427] I could make it eleven o'clock if necessary
Saville (PS5NP) [428] well I don't mind too much because I can erm, I can always be getting on with erm, the, the erm judgment on the, on the, the other issues, erm er
Duffy (PS5NR) [429] my Lord
Saville (PS5NP) [430] which I haven't yet got on to cos I wanted to hear most, at least most of the arguments on this aspect of the case, although it's got very in effect very little to do with the other, other, but it doesn't see [...] round, er I could get on with that to a degree, er, so I don't mind too much, but I think Friday is, is asking to much from Mr
Green (PS5NN) [431] my Lord may, may well be right, would, would the best thing be for simply er for Mr clerk to get in contact with your clerk and to try and arrange er with all the other clerks to try and arrange a system, mutually convenient time in the nearest possible future
Saville (PS5NP) [432] well I, I mean we cannot leave it lying around, erm ... do you know what Mr position is on Monday?
Green (PS5NN) [433] yes he starts a brand new trial, he starts a new trial
Saville (PS5NP) [434] mm
Green (PS5NN) [435] would er, the most sensible thing be to use tomorrow and er my [...] tomorrow is, is possible, but I just have a
Saville (PS5NP) [436] mm
Green (PS5NN) [437] an engagement very first thing in the morning, my Lord but Mr suggested, he goes upstairs and tries to find a, finds a
Saville (PS5NP) [438] well, well thank Mr very much, if you, if you could, I can accommodate Mr at any reasonable time tomorrow, erm, but although he may say he's only got, he only wants to rest for a quarter of an hour d'your, as you gather from the interchange from the bench, that's er, that will be the very minimum and I may well have questions to ask him, although I hope I'd asked most of them to Mr , so, erm, but I'm, I'm ... I think for everybody's convenience it, erm, unless he's got a specific time he could deal with, we either start say at eleven thirty, when Mr can be here or at two, erm, but if he's got some other clever idea I'm perfectly prepared to entertain him, but er we can't leave this hanging around, I've gotta write this and whichever way it goes we've gotta look at it again, er and although I suppose I'm not entirely unheard of and I disappear to the court of appeal next term it's gonna make things extremely awkward to try and arrange anything else next term, cos I've got two other judges to bear in mind as well as myself
Green (PS5NN) [439] it maybe my Lord that there's a judge upstairs better not to sit tomorrow afternoon but to sit on Friday
Saville (PS5NP) [440] yes, er who, who is the judge upstairs?
Green (PS5NN) [441] it's justice
Saville (PS5NP) [442] yes, but er
Green (PS5NN) [443] I think it maybe a deputy judge I think as well
Saville (PS5NP) [444] mm
Green (PS5NN) [...]
Saville (PS5NP) [445] see what you can find out Mr thank you very much.
[446] Erm, yes have you managed to gather your er notes
Duffy (PS5NR) [447] Er no my Lord perhaps I was, I was thinking about time to let me just sort out [...]
Saville (PS5NP) [...]
Green (PS5NN) [448] would you like, would you like to hear what I have to say on that one Mr er do you want?
Saville (PS5NP) [449] erm, well I think probably better, better for everybody to, to hear what he has to say
Green (PS5NN) [450] well if by way of suggestions, in, no, in a way because they are the plaintiffs
Saville (PS5NP) [451] mm, mm
Green (PS5NN) [452] erm, and erm
Saville (PS5NP) [453] oh yes
Green (PS5NN) [454] I think you'd probably find it easier to, rather than trying to make submissions to [...]
Saville (PS5NP) [455] yes
Duffy (PS5NR) [456] my Lord er as indicated to your Lordship yesterday, erm, er the primary position of er is that these issues can be decided and should be decided that in the manner that I've submitted to your Lordship, er and in the societies favour.
[457] In the event my Lord, erm, that er your Lordship felt that further guidance was required, there are the two routes that I've indicated to your Lordship briefly yesterday, there is the route of er seeking some information, if your Lordship felt it'd be of assistance to you in resolving any doubts that you may have from the [...] and your Lordship has seen yesterday the notice on co-operation which is in and at page eleven thirty two and is also the exhibit
Saville (PS5NP) [458] yeah
Duffy (PS5NR) [459] to Mrs affidavit S K R four and I also took you to their limities in relation to that.
[460] Your Lord if one turns to the issues of reference, er the commercial quarters as we discussed yesterday should only make a reference if it's necessary to do so in order to resolve the case and has the discretion whether to make a reference under article one seven, seven
Saville (PS5NP) [461] yes
Duffy (PS5NR) [462] erm and er, you know as you're exercising your discretion your Lordship there's the points in the white book, my Lord in the interim it would be the societies submission that there are three reasons why ... during the time that it may take to get any guidance from the European court, in the interim, the application of the bi-laws and in particular the provisions of the Act nineteen eighty two should be maintained and er given er their force, because clearly my Lord if there is to be a reference to the European court, matters will take some two years or so before the European court will give it's ruling ... that I think would be common ground with my learned friend
Green (PS5NN) [463] that's roughly the normal stage now
Duffy (PS5NR) [464] mm
Green (PS5NN) [465] not quite that long, but possibly
Duffy (PS5NR) [466] yes
Green (PS5NN) [467] see it
Duffy (PS5NR) [468] in the region of twenty months and two years, erm, in those circumstances my Lord er the issue must arise in the interim er is er able er to re-claim money for the central fund, these are monies that are as your Lordship knows under article ten, payable forthwith on demand and in the interim can it rely on the statutory effect of section fourteen of the act
Saville (PS5NP) [469] yes
Duffy (PS5NR) [470] and er qualified immunity from damages, my Lord there are three grounds why we say er that er in the interim were your Lordship minded to make a reference that recoveries from the central fund should be allowed to continue.
[471] My Lord the first er issue is as a matter of English law and the English law position, my Lord in making my main submissions to your Lordship I took you to the case, we looked at the statements of er the House of Lords and er Lord in particular with whom the other Law Lords agreed, my Lord do you wish to go back to the fact again?
Saville (PS5NP) [472] no, no, I, I, I just really want, cos I don't think there's any question of me this afternoon ruling on whether you're right or not on these points, but I just er on second I thoughts I want to have them in mind
Duffy (PS5NR) [473] very well my Lord
Saville (PS5NP) [474] at least, so you've got the factor ten, yes
Duffy (PS5NR) [475] and my Lord you've got on factor ten the references to Lord and the others
Saville (PS5NP) [476] yes
Duffy (PS5NR) [477] Law Lords, my Lord in addition there is also the continental television er case, which is at tab five of your Lordship supplementary er bundle.
[478] My Lord this is a, er a, a case with er strong facts, it's er the case that dealt with the red hot television Dutch television
Saville (PS5NP) [479] oh yes
Duffy (PS5NR) [480] and erm, in this case my Lord the, we have got both the judgement at the divisional court and at the court of appeal there is.
[481] The facts my Lord are, are set out, I'll leave your Lordship to, to read it
Saville (PS5NP) [482] this is tab
Duffy (PS5NR) [483] tab four and five my Lord for [...] supplementary authorities.
Saville (PS5NP) [484] one ... I'm not sure it is, unless I'm looking at the wrong
Duffy (PS5NR) [485] er the wrong bundle, it's the grey bundle my Lord ... it looks, looks like this, erm
Saville (PS5NP) [486] is that your, that's your, your pl plaintiffs authority preliminary issues
Duffy (PS5NR) [487] that's right my Lord
Saville (PS5NP) [488] erm, whereas I've been called, yes, here it is, yeah, tab four, seven, five
Duffy (PS5NR) [489] er tab four and five, tab four and five, we've been with tab four
Saville (PS5NP) [490] mm, mm
Duffy (PS5NR) [491] tab four is the divisional courts decision
Saville (PS5NP) [492] yes
Duffy (PS5NR) [493] my Lord you'll find the facts of the case, er set out at pages three to six, the character of the programme is described starting at three D
Saville (PS5NP) [494] yes ... I do have a, a general idea of what [...] was all about
Duffy (PS5NR) [495] exactly my Lord, erm
Saville (PS5NP) [496] not taken from that that I've ever seen it, but I do recognise [...]
Duffy (PS5NR) [497] I don't think any of us have ever seen it my Lord, erm the erm, the just, the, in this was a case where you will find er that er a reference was made for guidance as to the scope of the broadcasting directive
Saville (PS5NP) [498] yes
Duffy (PS5NR) [499] by the divisional court and er it was a case where the divisional court er had to er consider what it should do in the interim, the Lord Justice er in the divisional court judgement deals with the interim position at er page twenty five of the transcript, starting at letter F and er going through to er page twenty eight paragraph B and I think it might help my Lord if you could read that passage in the justice latest judgment. ...
Saville (PS5NP) [500] [cough] ... yes
Duffy (PS5NR) [501] and my Lord er the appeal to the court of appeal er which is at erm tab five was exclusively on the issue of whether Lord Justice and the divisional court were correct in the ruling they have docted for the interim, er and the court of appeal judgement, the main judgement is given by Lord Justice er reviewed with and the erm the heart of Lord Justice judgement on this issue is to be found at page nineteen my Lord of the transcript ... passage that begins [reading] my reading of this judgment [] down to the bottom of that paragraph at letter G, so from B to G on page nineteen. ...
Saville (PS5NP) [502] yes
Duffy (PS5NR) [503] Now my Lord, er, Lord Justice er agreed with er Lord Justice that's at twenty A, Lord Justice also agreed but er added er some further thoughts on the, er on the issue er his conclusion er is summarized at page twenty two paragraph G of er the transcript. ...
Saville (PS5NP) [504] yes, yes
Duffy (PS5NR) [505] Now my Lord, your Lordship would of seen from, in fact the same case, and now from the continental television case, both in the divisional court and in the court of appeal, that where a reference is to be made the court that is making the reference, it what is sort to be done is either to challenge a British statute or in the case of er, er the red hot Dutch case, in fact the terms were caused in the statute er something which in involves a ministerial decision, but in either of those instances the court has got to decide in the interim whether or not the statute or measure should remain in force and there is the priority of public policy as indicated in er Lord er speech referred to both in the divisional court and in the court of appeal in continental television in maintaining the law in force and a, a bonus has to be faced by the person seeking discipline the law to show us the simply strong case to justify the er, er the suspension of the law in the interim.
[506] My Lord ... making my main submissions to your Lordship, erm I submitted and it is position that there is no distinction between public and private acts, the thicken in the board, both the act and the central fund by the law should be taken as valid in the interim ... if your Lordship is minded to make a reference ... unless ... strong evidence of invalidity is produced, so your Lordship if you make a reference it needs to form a view as to the strength of the
Saville (PS5NP) [507] yes
Duffy (PS5NR) [508] of the erm
Saville (PS5NP) [509] well, well how would that
Duffy (PS5NR) [510] of the defendants case
Saville (PS5NP) [511] how would that fit into the present context, erm, we're assuming here that I haven't ... decided the er ... European courts or some of them in your favour
Duffy (PS5NR) [512] yes my Lord
Saville (PS5NP) [513] or alternatively, because I have, I have made this clear throughout, I come to the conclusion that the, the questions of this opposed er, or opposed in any form which any one here has suggest