Garden Cottage Foods v Milk Marketing Board

Garden Cottage Foods v Milk Marketing Board [1984] AC 130

Civil procedure; abuse of dominant position; damages and injunctive relief

Facts

The Milk Marketing Board (MMB) produced most of the bulk butter in the UK. They announced they would no longer sell any to Garden Cottage Foods (GCF). They would henceforth only sell to four specific distributors. GCF asserted this was an abuse of a dominant position contrary to Treaty of Rome 1957 Art.86 and sought an injunction to prevent the policy being implemented. At first instance, it was held that there was a serious issue to be tried but damages would be an appropriate remedy if the claimants succeeded, and injunctive relief was, therefore, refused. The Court of Appeal doubted that damages would be an available remedy and granted the injunction. The MMB appealed.

Issues

The MMB asserted that if there are rights of action available for breach of Art.86 and remedial damages are available, the Court of Appeal could not overrule the decision of the judge at first instance who had exercised his discretion. Further, the injunction as drafted should not have been granted because it lacked precision. GCF argued the Treaty had direct effect in the UK creating individual rights which the UK courts should enforce. Where competition matters are in issue, public policy dictates that injunctive relief should be granted where there is a risk of damage to the competitive structure, even if the standard conditions for injunctive relief are not satisfied.

Decision/Outcome

The appeal was allowed. It was arguable that breach of Art.86 would result in individual rights of action to pursue compensation. The first instance judge was entitled to hold that damages would provide an appropriate remedy, and there was no justifiable basis on which the Court of Appeal could interfere with his discretion to refuse injunctive relief.