Maxwell v Minister for Agriculture

• Jurisdiction: Ireland
• Judge: Mr. Justice McCracken
• Judgment Date: 01 January 1999
• Neutral Citation: [1998] IEHC 136
• Court: High Court
• Docket Number: [1996 No. 378JR]
• Date: 01 January 1999

[1998] IEHC 136

THE HIGH COURT

Record No: 378 J.R./1996

MAXWELL v. MIN FOR AGRICULTURE, FOOD & FORESTRY

BETWEEN

HUBERT MAXWELL

APPLICANT

AND

MINISTER FOR AGRICULTURE, FOOD AND FORESTRY

RESPONDENT

Citations:

EEC REG 805/68

EEC REG 1357/96 ART 4(a)

TREATY OF ROME ART 40(3)

ROYAL SCHOLTEN-HONIG V INTERVENTION BOARD FOR AGRICULTURAL PRODUCE 1978 ECR 2037

BRASSERIE DU PECHEUR V GERMANY 1996 ECR 1029

Synopsis

European

Judicial review; award of levies pursuant to Council Regulation No. 1357/96; Steer cattle production; discrimination between producers who export live steers and those who sell live steers to factories; interpretation of discrimination under 40(3) of the EEC Treaty; whether producers are competing producers for the purposes of Article 40(3); whether steer cattle sold for slaughter and those sold for live shipment are the same product; whether the discrimination is objectively justifiable; whether there was a right to damages for breach of the Regulation; whether the breach was sufficiently serious to warrant damages being awarded Held: Discrimination not objectively justifiable; damages awarded (Maxwell v. Minister for Agriculture, Food and Forestry - High Court 1996/378JR - McCracken J.- 11/08/1998) - [1999] 2 IR 474 - [1999] 1 ILRM 161

There was clear discrimination between producers who exported live and those who sold for slaughter in Ireland. The discrimination was not objectively justified. This was a very serious breach of Community law particularly in view of the fact that the regulation concerned was operating retrospectively. The applicant had no opportunity to take steps to mitigate the loss because at the time the steers were sold by him he did not know of the restrictions. He was entitled to damages based on a loss of £45 per head in respect of 2,035 animals which amounted to £91,575. The High Court so held in upholding the applicant's claim.

1 Mr. Justice McCracken delivered the 11th day of August 1998.

THE BACKGROUND

2 The Applicant is a very substantial farmer who, I am satisfied on the evidence, both rears steers for export and also to some degree acts as a dealer in buying in steers to fill export orders. At the relevant time, all his steers were sold by him to Dillon Livestock Exports Limited, which firm actually exported the steers to countries outside the European Union. Between 25th March, 1996 and 9th June, 1996 the Applicant sold two thousand one hundred and twenty five steers to Dillon Livestock Exports Limited for export. During the same period he sold one hundred and sixty eight steers to factories within the State for slaughter. It should be noted, however, that steers which are exported live in what is known as the live trade are lighter and leaner than those slaughtered in Ireland and are not considered to be fully "finished", in that if they were to be sold to the factories in Ireland they would probably be kept for a further two or three months and fattened.

THE BSE CRISIS

3 On about 20th March, 1996 an announcement was made in the United Kingdom House of Commons by the Agricultural Secretary that there was a possible link between Bovine Spongiform Encephalopathy (BSE) and Creutz-Feld Jakob Disease in humans. This announcement had a catastrophic effect on the beef market throughout the European Community, and in particular in this State. At this time there were already premiums payable under EEC Commission Regulation No. 805/68 in respect of male bovine animals, designed to compensate producers for a reduction in intervention price, and by Council Regulation No. 1357/96 provision was made for additional payments to be made to further compensate producers for losses arising out of the BSE crisis. Specific sums were allotted to Member States, and Ireland was allotted sixteen million ECUs. Article 4(a) of the Council Regulation provided:-

"Member States may use the amounts set out in the annex to make payments to producers in the beef and veal sector who are facing acute problems as a result of the market situation, which are not fully addressed by the measures referred to in Articles 1, 2 and 3".

4 I am quite satisfied on the facts that the Applicant is a producer within the meaning of this Article, notwithstanding the fact that he may also be a dealer, and it is common case that in those circumstances he is one of a class of persons intended to be benefited by the Regulations. It should be noted that the Regulation merely allots the specific sum to the Member States, and makes no provision as to how this sum is to be disbursed other than to provide that payments must be made by the Member States by 15th October, 1996 at the latest.

5 The Respondent decided that the moneys would be disbursed on the basis of a payment of a subsidy of £50 per animal on cattle marketed between 25th March and 9th June, 1996. As far as the public were concerned, advertisements appeared in the press in early August headed "BSE Compensation Package", the relevant portion of which reads:-

"A special package of £50 flat rate payment per animal for producers of:"

(i) Steers slaughtered in a licensed export premises in the period 25th March, 1996 to 9th June, 1996. This will be paid automatically by way of a top-up under the 1996 De-Seasonislation Slaughter Premium Scheme,

(ii) Heifers and young bulls slaughtered in licensed export premises in the period 25th March, 1996 - 9th June, 1996 (young bulls) and 25th March, 1996 - 29th June, 1996 (heifers). Applications forms now available from all local offices of the Department.

(iii) Heifers slaughtered in local abattoirs in the period 25th March, 1996 - 29th June, 1996. Application forms now available from all local offices of the Department,

(iv) Steers sent for live export during the period 25th March, 1996 - 9th June, 1996. The Department will send application forms directly to the producers concerned."

6 It was further provided that the closing date for receipt of completed application forms was 20th August, 1996.

7 These proceedings are concerned with the subsidy for steers sent for live export. The Applicant duly applied for an application form which was sent to him. On the first page it contained certain notes, in a question and answer format. The form also contained a number of terms and conditions.

8 In answer to the question "What animals are eligible?" the form states:-

"Any male animal that was reared on the farm up to 25th March, 1996 and that was exported live between 25th March, 1996 and 9th June, 1996 inclusive, subject to an overall individual limit of ninety animals."

9 The terms and conditions include the following:-

10 2 "3. The "scheme" shall mean the Scheme of BSE Compensation Payments for live cattle exported to non-EU countries between 25th March, 1996 and 9th June, 1996.

11 4. A "Producer" shall mean an individual farmer whose holding is located in the State and who is a natural or legal person and who is a registered herd owner under the Bovine Tuberculosis Eradication Scheme.

12 5. An "Eligible Animal" shall mean a male animal that can be identified by its BTE ear tag number that was exported to a non-EU country between 25th March, 1996 and 9th June, 1996.

13 6. Payment will be made to producers who submit a valid application listing eligible animals under the Scheme.

14 7. Producers may be asked to furnish proof of ownership of the animals on which he/she is claiming the premium.

15 8. The premium will be payable only once on each eligible animal.

16 9. The rate of payment will be £50 per animal.

17 10. Each producer may not qualify for the premium on more than ninety eligible animals.

18 11. The premium will not be paid on animals that do not have a valid BTE ear tag number."

19 While this document refers to "the Scheme", the evidence is that the only place in which such a Scheme is defined is in the application form itself.

20 In relation to that part of the package which gives compensation for heifers and young bulls slaughtered in licensed export premises and for heifers slaughtered in local abattoirs during the relevant period the Department produced what is called "Help Sheet and Terms and Conditions". On this Help Sheet it is stated that the cattle eligible for the Scheme are:-

"Heifers and young bulls applied for -"

1(a) In the case of Heifers

21 were slaughtered in a licensed meat export premises in the State or in a licensed abattoir in the State in the period 25th March, 1996 to 29th June, 1996 or,

(b) In the case of young Bulls,

22 were slaughtered in a licensed meat export premises in the period 25th March, 1996 to 9th June, 1996 and,

(c) In the case of young Bulls

23 (i) were uncastrated and under two years old at slaughter and were reared solely for beef production

24 (ii) Were BTE ear tagged.

25 i (iii). Were owned, possessed, held and maintained by the Applicant immediately prior to slaughter."

26 Notwithstanding this last comment, the terms and conditions contain the following in capital letters:-

"HERD OWNERS WHO APPLY FOR GRANTS ON MORE THAN FORTY HEIFERS SLAUGHTERED IN LICENSED ABATTOIRS IN THE PERIOD 25TH MARCH, 1996 TO 29TH JUNE, 1996 MUST PROVE THAT THOSE ANIMALS WERE IN THEIR OWNERSHIP AND POSSESSION ON 25TH MARCH, 1996. PROOF SHOULD BE SUBMITTED IN THE FORM OF BTE HERD TEST, MARKED DOCKET ETC."

27 These...