Campus Oil Ltd v Minister for Industry and Energy

JurisdictionIreland
JudgeMr. Justice Murphy,Mr. Justice Keane
Judgment Date24 March 1983
Neutral Citation[1983] IEHC 4
Docket NumberNo. 9256P/1982
CourtHigh Court
Date24 March 1983

[1983] IEHC 4

THE HIGH COURT

No. 9256P/1982
CAMPUS OIL LTD. v. MIN. INDUSTRY & ENERGY

BETWEEN:

CAMPUS OIL LIMITED ESTUARY FUEL LIMITED McMULLAN BROTHERSLIMITED OLA TEORANTA P.M.P.A. OIL COMPANY LIMITED AND TEDCASTLEMcCORMACK AND COMPANY LIMITED
Plaintiffs

and

THE MINISTER FOR INDUSTRY AND ENERGY, IRELAND, THE ATTORNEYGENERAL AND IRISH NATIONAL PETROLEUM CORPORATION LIMITED
Defendants

Subject Headings:

EUROPEAN COMMUNITIES: Treaty of Rome

EVIDENCE: status quo

INJUNCTION: interlocutory

1

Judgment of Mr. Justice Keanedelivered the 24th day of March, 1983.

2

The defendants have applied to the Court for an order giving themliberty to amend the defence already filed by the addition of acounterclaim; for an interim injunction restraining all the plaintiffsother than the fifth-named plaintiff from failing to comply with the provisions of the Fuels (Petroleum Oils) Order, 1983 ("the 1983Order") and in particular, Articles 4, 7 and 14 thereof; and for amandatory injunction directing those plaintiffs to comply with the provisions of the order and with the shipping programme laid down by thefirst named defendant.

3

The proceedings were commenced by plenary summons issued on the 1stSeptember, 1982, by the plaintiffs, a group of Irish owned companiesengaged in the business of importing petroleum products for resale in the State. The events leading up to the issuing of the proceedings havebeenfully set out in the Statement of Facts incorporated in the Reference ofcertain question arising in the proceedings by Murphy J. to the Court ofJustice of the European Communities. It is unnecessary to set them outagain in this judgment; it is sufficient to say that the proceedingsseek to prevent the defendants from implementing what has become knownas the "mandatory regime" under which the plaintiffs, incommon with all other persons importing petroleum products into theState, are required to take a defined proportion of their requirementsof such products from the Whitegate Oil Refinery which is owned andoperated by the third-named defendants on behalf of the State.

4

By Notice of Motion dated the 1st September, 1982, the plaintiffsapplied to the High Court for an interlocutory injunction restrainingthe defendants from implementing the mandatory regime. In theproceedings, the plaintiffs claim that the Fuels (Control of Supplies)Order 1982 (S.I. No. 280 of 1982) (the predecessor of the 1983 Order) is ultra vires as being inconsistent both with certain articles of the Treaty establishing the European Economic Community and with certainarticles of the Constitution. The application for an interlocutory injunction was heard by Murphy J. on the 8th and 10th September, 1982;and was refused by him on the 13th September, 1982. He gave his reasonsfor refusing the application in a written judgment on the 22ndSeptember, 1982.

5

Subsequent to the hearing of the motion, Murphy J., decided to refer thequestions already mentioned to the Court of Justice of the EuropeanCommunities. This application was opposed by the defendants on thegrounds that it was either unnecessary or premature to refer anyquestion to the Court of Justice at that stage. The defendants appealedfrom the order of Murphy J., to the Supreme Court, but that Court heldthat it had no jurisdiction to entertain an appeal from such a referencemade in the exercise of his jurisdiction in that behalf by the learnedHigh Court Judge. The reference by Murphy J., has accordingly now beentransmitted to the Court of Justice.

6

While these legal skirmishes were in progress, the first and fourthnamed defendants were endeavouring to implement the mandatory regime;but it was becoming increasingly apparent, that notwithstanding therefusal of Murphy J., to grant the interlocutory relief sought, some atleast of the plaintiffs were unwilling to comply with the regime pendingthe ultimate outcome of the present proceedings. A considerable volumeof correspondence between the first and fourth named defendants and theplaintiffs was exhibited, to which it is unnecessary to refer in detail.It is sufficient to say that in the case of the third named plaintiff,the defendants were confronted with an unequivocal refusal to complywith the regime until theconclusion of legal proceedings, this being conveyed by telex from MrNoel McMullan to the Secretary of the Department of Energy on March 3rd.It is clear, however, that what precipitated the present application wasthe equally unequivocal intimation on behalf of two of the multinationalcompanies - Irish Shell Limited and R.P. (Ireland) Limited - that they were not prepared to comply with the regime until such time as it wasapplied to all importers without distinction. The defendants say that arefusal by the multinational companies to comply with the regime wouldmean the closure of the refinery within a matter of days; and that theonly method open to the defendants of ensuring that the compliancehitherto given by the multinational companies is maintained is bysecuring by appropriate legal process the compliance of such of theplaintiffs as are unwilling voluntarily to comply.

7

The parties to the present application have made complaints in theaffidavits filed by them or on their behalf as to the conduct of theother parties. The plaintiffs for their part said that the mandatory regime is being operated inequitably, because there are importers whoare selling petroleum products within the State without complying withthe regime and without any attempt being made by the defendants tosecure their compliance. For their part, the first and fourth nameddefendants say that some of theplaintiffs have availed of the higher prices permitted to be charged bythe relevant pricing regulations brought in to offset the effect onimporters of the mandatory regime, while continuing to make purchases onthe spot market without complying with the mandatory regime, thereby, asit is said, making an unjustified profit from the increase in thepermitted prices. It seems to me, however, that these complaints,although made the subject of vigorous charges and counter charges in theaffidavits, are not material to the issue that has to be resolved on the present application. The issue which now has to be determined is whetherthe plaintiffs are bound in law to abide by the regime until such timeas these proceedings have been determined; and whether in suchcircumstances the defendants are entitled to an interlocutory injunctioncompelling them to comply with the regime.

8

The principles applicable by the Court in determining whetherinterlocutory relief should be granted have generally been accepted asbeing correctly stated in the following passages from Kerr onInjunctions, 6th Edition, at p 2 and pp 15/16, which were cited withapproval by Lavery J. in Educational Company of Ireland Limited .v.Fitzpatrick and Others ( 1961 I.R. 323 at p 336):-

"The interlocutory injunction is merely provisional in its nature,and does not conclude a right. The effect and object of the"interlocutory injunction is merely to keep matters in statuquo until the hearing or further order. In interfering byinterlocutory injunction, the Court does not in general profess toanticipate the determination of the right, but merely gives it as itsopinion that there is a substantial question to be tried, and that tillthe question is ripe for trial, a case has been made out for thepreservation of the property in the meantime in statu quo. Aman who comes to the Court for an interlocutory injunction, is notrequired to make out a case which will entitle him at all events torelief at the hearing. It is enough if he can show that he has a fairquestion to raise as to the existence of the right which he alleges, andcan satisfy the Court that the property should be preserved in itspresent actual condition, until such question can be disposedof"

"The office of the Court to interfere being founded on the existence of the legal right, a man who seeks the aid of the Court mustbe able to show a fair prima facie case in support of the titlewhich he asserts. He is not required to make out a clear legal title,but he must satisfy the Court that he has a fair question to raise as tothe existence of the legal right which he sets up, and that there aresubstantial grounds for doubting the existence of the alleged legalright the exercise of which he seeks to prevent. The Court must,before disturbing any mans legal right, or stripping him of any of therights with which the law has clothed him, be satisfied that theprobability is in favour of his case ultimately failing in the finalissue of the suit. The mere existence of a doubt as to the plaintiff'sright to the property, interference with which he seeks to restrain,does not of itself constitute a sufficient ground for refusing aninjunction, though it was always a circumstance which calls for theattention of the court."

9

In a number of recent cases, however, reliance has been placed on thedecision of the House of Lords in American Cynamid Company .v.Ethicon Limited (1975) AC 396 and in particular the speech of Lord Diplock in that case where he disapproves of the application of the balance of probability criterion in the context of the exercise of thisdiscretionary power and states the applicable principle asfollows:-

"The Court no doubt must be satisfied that the claim is notfrivolous or vexatious; in other words, that there is a serious questionto be tried."

10

Murphy J., in his judgment in the earlier motion in this case, haspointed out that the approval by Lavery J., of the passages cited fromKerrshould be considered in the light of the observation by the learnedJudge later in his judgment that the plaintiff has to establish"that there is a fair question raised to be decided at thetrial" which he describes as almost identical with anotherformulation of the test by Lord Diplock in the speech already referredto, viz.

"The Court must no doubt be...

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