Emerald Meats v Minister for Agriculture (No. 2)

JurisdictionIreland
CourtSupreme Court
JudgeBLAYNEY J.
Judgment Date03 March 1997
Neutral Citation1997 WJSC-SC 2914
Date03 March 1997
Docket Number[S.C. Nos. 262 and 272 of 1991],262/272-91

1997 WJSC-SC 2914

THE SUPREME COURT

Hamilton C.J.

Blayney J.

Denham J.

262/272-91
237/241-92
EMERALD MEATS LTD v. MIN AGRICULTURE
BETWEEN/
EMERALD MEATS LIMITED
Plaintiff/Respondent

and

THE MINISTER FOR AGRICULTURE, IRELAND, THE ATTORNEY GENERAL, GOLDSTAR MEATS LIMITED AND RANGELAND MEATS LIMITED
Defendants/Appellants

Citations:

EEC REG 3889/89 ART 2(a)

EEC REG 4024/89 ART 6

EEC REG 404/89 ART 4

EEC REG 4024/89 ART 4(1)(2)

EEC REG 4024/89 ART 1(2)

EEC REG 4024/89 ART 1(1)

EEC REG 234/88

EEC REG 4024/89 ART 1(3)

EEC REG 3632/85 ART 3(5)

EEC REG 105/85

EEC REG 3021/91

EEC REG 3885/90 ART 1(a)

TREATY OF ROME ART 173

EEC REG 4024/89 ART 4(1)

TREATY OF ROME ART 215(2)

MULDER & HEINEMANN V COUNCIL & COMMISSION 1992 1 ECR 3061

PINE VALLEY DEVELOPMENT LTD V MIN FOR ENVIRONMENT 1987 ILRM 747

TREATY OF ROME ART 189

FRANCOVICH V REPUBLIC OF ITALY 1992 2 CMLR 66

TREATY OF ROME ART 177

RATCLIFF V EVANS 1892 2 QB 524

HOGAN & MORGAN ADMINISTRATION LAW 2ED 634

Synopsis:

E.C. Law

Appeal; allocation of meat imports pursuant to GATT quota under E.C. regime; plaintiff imported meat "for and on behalf of" meat processors; whether plaintiff entitled to quota as "importer" under regime; whether duty on Department of Agriculture to forward plaintiff's application to E.C. Commission; whether plaintiff entitled to general and/or special damages from State; whether Art. 177 reference required Held: Plaintiff entitled to quota as importer; Department under duty to forward application; plaintiff entitled to general and special damages; Art. 177 reference not required (Supreme Court: Hamilton C.J., Blayney J., Denham J. 03/03/1997)

Emerald Meats Ltd. v. Minister for Agriculture & Ors.

[1997] 1 IR 1- [1997] 2 ILRM 275

1

JUDGMENT delivered on the 3rd day of March 1997 by BLAYNEY J. [NEM DISS]

2

The issues which fall to be determined on this appeal cannot be understood without sufficient knowledge of the context in which they arise Accordingly, I propose to Start by outlining what this is.

3

It concerns a European Community regime which permits a certain quantity of frozen beef and veal to be imported into the community each year, free from the normal community tariff, but subject to a duty of 20 per cent. In the judgment of the learned High Court judge, and in the argument before this Court, the annual quantity permitted to be imported was referred to as the "GATT Quota", and the meat imported pursuant to the quota was referred to as "Gatt meat" I shall use the same terms throughout this judgment.

4

Up to 1985, Ireland was permitted to maintain a ban on the imports of meat, so it was not until 1986 that GATT meat could be imported. In that year Ireland was allocated a quota of 455 tonnes. In 1987 it was allocated 395 tonnes, in 1988, 418 tonnes and in 1989, 381 tonnes. The manner in which the quota was distributed was the responsibility of the Department of Agricultures as the responsible authority for the State. The Department decided that the quota should be allocated amongst meat processors on the basis of certified figures of usage of meat for processing.

5

The Plaintiff/respondent, Emerald Meats Limited (to which I shall refer as Emerald) is a small company wholly owned by its managing director, Mr. John McCarthy, expect for one share which is owned by his wife. Emerald trades in meat but is not a meat processor. Mr. McCarthy applied to the Department of Agriculture for a share of Ireland's quota of GATT meat but his application was turned down. He then approached some of the meat processors and offered to buy the right to their quota or the GATT meat when imported. A quota had a considerable value because, even after the 20 per cent duty had been paid, the meat could be put on the market in the community at approximately one half of the prevailing community price.

6

Mr. McCarthy was successful in purchasing the right to a substantial part of the Irish quota in the years 1987 and 1988 - the crucially important years in the case as will appear later - the quantity of GATT meat involved being 159 tonnes in 1987 and 385 tonnes in 1988.

7

Mr. McCarthy's dealings with the meat processors were mainly conducted on the telephone and if a contract had been agreed he would normally send a note confirming the terms. The Department of Agriculture was aware from the outset that Emerald was purchasing the quotas. Mr. McCarthy had informed the Department of what he was doing and told them that he would be applying to them for import licences. The learned trial judge accepted Mr. McCarthy's evidence of what the Department's requirements were. He was told that the Department would require a letter from the meat processor to whom the quota had been allocated releasing the Department from its obligation to issue an import licence to the meat processor, and it was suggested to him that the letter of release could be an authority to the Department to issue a licence to "Emerald Meats Limited for and on behalf of" the meat processor, and if this were done, the licence would be granted using this formula. Mr. McCarthy adopted this suggestion and whenever he agreed to purchase a quota he told the meat processor that the Department required a letters of release and he indicated the terms in which the letter should be written, namely, that Emerald was acting as agent for the meat processor or for and on behalf of the meat processor.

8

This is the way that Mr. McCarthy operated in 1987 and 1988. The licences to import the GATT meat were issued to Emerald by the Department of Agriculture "for and on behalf of"the relevant meat processor and Emerald took all the necessary steps to import the meat pursuant to the licences.

9

In 1989 Mr. McCarthy adopted a new system. In that year the relevant licences were issued to Emerald as the transferee of the meat processors who were entitled to the licences instead of for and on behalf of the meat processors. No issue arises in the case in regard to 1989 so it is not necessary to say anything further in regard to it.

10

The immediate cause of the conflict between the parties was that in 1990 the community regime in regard GATT meat was changed drastically. Instead of part of the total GATT quota being allocated to each Member State to be distributed in the manner determined by the competent authority of such State, Council Regulation No. 38889/89 (adopted on the 11th December 1989) and Commission Regulation No. 4024/89 (adopted on the 21st December 1989) provided that 90 per cent of the total GATT quota of 53,000 tonnes, i.e., 47,700 tonnes, should be apportioned for importers who could prove that they imported GATT meat during the previous three years. The 10 per cent balance, i.e., 5,300 tonnes, was apportioned for traders who could furnish proof that in 1988 or in 1989 they had imported or exported at least 50 tonnes non-GATT meat. Furthermore, it no longer the Member States which decided how the quota should be distributed. This function was now taken over by the Commission (Article 6 of Regulation No. 4024/89).

11

The meat processors were directly affected by this change. As long as the previous regime was in force, it was immaterial that they sold their quotas to Emerald. It did not affect their right to continue to receive them each year from the Department. But that situation was now finished. In future the distribution of the quota was in the hands of the Commission and the parties entitled to the major part of it were what the learned trial judge referred to in his judgments as "traditional importers" i.e importers who had imported GATT meat during the previous three years.

12

Article 4 of Regulation No. 404/89 provided that Member States should forward to the Commission by the 31st January 1990 at the latest the list of applicants for a quota of GATT meat. Emerald applied to the Department of Agriculture to be included in the list of applicants on the basis of the GATT meat it had imported in 1987, 1988 and 1989 and twelve meat processors made a similar application based on the same imports claiming that Emerald had been their agent and accordingly it was they and not Emerald who were the "importer".The Department accepted that Emerald was the "importer" in respect of 1989 and included it in the list of applicants in respect of its imports in that year, but in respect of the years 1987 and 1988 the Department rejected Emerald's application and included instead the meat processors who had sold their quotas to Emerald in each of those years.

13

These proceedings were then immediately instituted by Emerald against the Minister for Agriculture, Ireland and the Attorney General by the issue of a plenary summons on the 31st January 1990, the date on which the Department of Agriculture submitted to the Commission the list of applicants under Article 4 of Regulation No. 4024/89. The relief claimed in the endorsement of claim was as follows:

14

2 "(1) An order requiring the defendants herein to comply with the obligations under Article 4(1)(2) of European Commission Regulation No. 4024/89 by forwarding to the European Commission a list of applicants for licences under the said regulations including the plaintiff's application for a quantity of frozen beef based on import quantities of 920 tonnes for the years 1987, 1988, 1989.

15

(2) A declaration that the plaintiff was entitled to be regarded as an applicant for a licence under the said regulations in respect of the said amounts of frozen beef,

16

3 (3)damages for breach of duty and negligence calculated on the basis of £500,000 per annum continuing from the 31st January 1990."

17

After the pleadings between Emerald and the State had closed, an application was made by the fourth defendants, who are meat processors, to be added as notice parties and by order of the High Court dated the 4th February 1991 they were added as...

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