England and Wales High Court (Queen's Bench Division) Decisions

IN THE HIGH COURT OF JUSTICE
QUEENS BENCH DIVISION
LEEDS DISTRICT REGISTRY
MERCANTILE LIST

		26 July 2007

1. Introduction

1. This is a sale of goods dispute. It arises out of the sale of approximately 1000 kg of chilli powder by Lion Foods Limited ("Lion") to Hazlewood Grocery Limited ("Hazlewood") in the spring of 2005. The chilli powder was incorporated by Hazlewood into foodstuffs manufactured by it. These foods were distributed to its customers including the major supermarkets. Many of them were sold by the supermarkets under a home label.
2. It is common ground that the chilli powder was contaminated with minute quantities of an industrial dye known as Para Red. It is also common ground that Para Red is not a permitted additive in food stuffs. It is also now common ground that the very low levels of Para Red did not create any risk to the health of the members of the public purchasing the foods.
3. Nevertheless in late April or early May 2005 the Food Standards Authority ("the FSA") quarantined both the chilli powder and foodstuffs that incorporated it. In addition it advised a recall of all such manufactured foodstuffs and posted a list of affected products on their web site. Some 23 of the posted foodstuffs had been manufactured by Hazlewood using the contaminated chilli powder.
4. Later on 19^th May 2005 the FSA issued new guidance. In that guidance it took a less stringent attitude to dyes such as Para Red. In particular it set a level considerably higher than the level found in the chilli powder with which this case is concerned.
5. By that time Hazlewood had incurred substantial losses as a result of the quarantine, the recall and the posting of the 23 products on the FSA web site. The extent of such losses was, for much of the case controversial. There were issues, for example as to the extent to which the quarantined or recalled products could have been re-used following the change of heart of the FSA. However damages, subject to liability have now been agreed in the sum £562,500 plus interest at an agreed rate from 1st June 2005.
6. Hazlewood contend that Lion were in breach of contract by supplying the chilli powder contaminated with Para Red even at the low levels found. They rely on a number of express and implied terms of the contract. Lion deny that they were in breach of contract. They rely on the fact that Para Red was undetectable by what they contend was the accepted method of testing at the time. They make the point that the level of contamination was so low that there was no danger to human health, and thus was perfectly safe to be incorporated into foodstuffs. Hazlewood's loss was caused by an over-reaction of the FSA to the levels of Para Red found by a new and more sensitive method of testing. The over-reaction was put right on 19^th May 2005 and confirmed in the following year.

2. Representation

7. Hazlewood was represented by Thomas Keith instructed by Eversheds of Infirmary Street, Leeds LS1 2JB. Lion was represented by Mark Simpson and Paul Casey instructed by Plexus Law of Monument Street, London EC3NR 8NB.
8. I immediately acknowledge the very considerable assistance I had both from Counsel and Solicitors during the trial. I was provided with very full skeletons, closing submissions, the pleadings, witness statements and the expert reports in both written and electronic form. They were of considerable assistance in the preparation of this judgment. I am most grateful to all concerned.

3. Witnesses

9. The issues have narrowed very substantially since the claim was issued on 22^nd May 2006. In the result there was in fact very little dispute between the parties as to the primary facts. Indeed there are contemporaneous documents that establish most of the relevant facts.
10. Despite this Lion, or their advisors, felt it necessary to make serious allegations amounting to an allegation of dishonesty against Hazlewood's principal witness Andrew Regan, its Technical Director and to a lesser extent against its Managing Director, Patrick Wood.
11. I shall deal with the details of the attack later in this judgment. As will appear it failed. In my view it was an unnecessary attack which significantly added to the time taken for the evidence.

Witnesses of Fact

12. 3 witnesses gave live evidence for Hazlewood – Mr Regan, Mr Wood, the Managing Director of Hazlewood and David Price. 2 witnesses gave evidence for Lion – Anthony Tattersall its Technical Manager and Steven Woollands, the Chief Executive of Lion Food Holdings Ltd.
13. I was satisfied that all of the witnesses of fact were honest witnesses doing their best to assist me. In some cases their recollections of events that took place 2 or more years ago proved fallible. That did not make them dishonest witnesses. In any event there were, as I have noted, contemporaneous documents that shed light on the true position.

Expert Evidence

14. Three experts gave evidence - Professor Blanchfield on behalf of Lion; Dr Dinsdale and Dr Farnell on behalf of Hazlewood. Each of the experts produced full and helpful reports that cast light on the nature of contamination of food by azo dyes in general and Para Red in particular, on the methods of testing for azo dyes. They also dealt in detail with and passed comment on the various decisions of the FSA and its European Counterpart.
15. I found all of the reports extremely useful and have borrowed from them quite extensively in preparing this judgment. There was, in fact, much common ground between the experts. They differed in their opinions of the decisions of the FSA and in their interpretation both of the relevant regulations and of express or implied terms of the contracts. It might be thought that neither of these two areas are strictly within the province of expert evidence.
16. However, despite this slight criticism, I was greatly assisted by the expert evidence in general and have no hesitation in thanking all of the experts for their help in this by no means straightforward case.

4. The Facts

4.1 Background

17. Hazlewood carries on business as a manufacturer of various food products for supply to retailers and onward supply to the general public. The retailers include the large supermarket chains such as Tesco, Sainsbury, Morrisons and ASDA. It is a subsidiary of Hazlewood Foods Limited which in turn is a subsidiary of Greencore Group plc.
18. Lion is a wholly owned subsidiary of Lion Foods Holdings Limited. Lion's predecessor company had carried on business as an importer and processor of herbs and spices for many years from its premises in Runcorn, Cheshire. It was also a manufacturer of ready-made sauces and condiments such as tomato ketchup, mustard and salad dressings. In February 2006 the decision was taken to close down the Lion operation in Runcorn, and consequently, Lion Foods Holdings Limited now carries out its operations solely through Spicemanns (another subsidiary) and Lion is now a shell company with no assets. The business as a whole now only blends and distributes herbs and spices.

4.2 Dyes in foods

19. Colours may be used to make foods more attractive to the consumer. For example, canned peas have an olive green colour in their natural state, but consumers prefer peas which are bright green, and this can be done by adding a green dye. Colours can be 'natural', i.e. extracts from other plant or animal products (e.g. the red colour betanine from beetroot), or synthetic.
20. Certain fabric dyes were used in food until it was discovered that they could have harmful effects on the consumer. Sudan I-IV and Para Red are not permitted in foods, as they are suspected of being genotoxic carcinogens. Sudan dyes are commonly used for colouring solvents, oils, waxes, petrol and shoe/floor polishes; Para Red is used in paints and printing inks.
21. According to Dr Farnell Para Red is a powder. It is soluble in oil. One method of applying it is to dissolve it in oil and to use a spray gun. If used in that way he thought there would be a thin coating of Para Red on the product. However he was also of the opinion that it could be applied in other ways and that there was no way of knowing whether it was applied in liquid or solid form.
22. Sudan I-IV are azo dyes that may split into amines in the body after oral intake. Some of these amines are classified as carcinogenic, and no dose or tolerable daily intake can be laid down for these amines. Para Red is from the same family of dyes and is assumed to be a genotoxic carcinogen based on the azo structure and the positive in vitro genotoxicity findings.
23. The European Parliament and Council Directive 94/36/EC on colours for use in foodstuffs (as subsequently amended) is implemented in the UK by the Colours in Food Regulations 1995 (as subsequently amended). It will be necessary to consider the regulations in more detail later in the judgment. EC (and hence UK) colours in food legislation is based on "positive lists", i.e. only those colours listed are permitted. There is no "prohibited list" but colours not on the positive list are not permitted. The actual wording in Section 3(1) of the Colours in Food Regulations 1995 states "No person shall use in or on any food any colour other than a permitted colour". The Sudan colours and Para Red are not listed and therefore may not be used in or on foods.

4.3 The 2003 banning of the Sudan dyes

24. There have been two major Sudan I incidents, in 2003 and 2005, both resulting in major product recalls in the UK. Both in fact were caused by chilli powder imported from India in September 2002, produced by Volga Spices, Mumbai, and sold by Gautam Export Corporation, Mumbai, to a British importer EW Spice Ltd, Ashby de la Zouch, Leicestershire. This in turn was sold to East Anglian Food Ingredients, Clacton, Essex, which supplied a number of food manufacturers.
25. In May 2003, French scientists found Sudan I in food products, eventually traced back to chilli powder from East Anglian Food Ingredients, and this resulted in the FSA requiring the July 2003 recalls.
26. Since July 2003, under EC Decision 2003/460/EC it has been a requirement for all consignments of dried and crushed or ground chilli coming into the EU to be accompanied by a certificate of analysis demonstrating the absence of Sudan I. These controls were extended in January 2004 when EC Decision 2004/92/EC was adopted to cover curry powder, and to include related dyes Sudan II, III and IV. In the absence of this certificate, relevant products must be detained under official supervision until the importer has had the product tested and has provided an analytical report. If appropriate, adulterated products must be destroyed. The decision also requires random sampling and analysis of relevant products to be carried out at ports and airports, and for local enforcement authorities to carry out sampling and testing of products already on the market.
27. The Sudan legislation did not specify any particular method for detecting Sudan dyes; thus it was left to the FSA in collaboration with the industry, to determine how compliance with the legislation was to be assessed.

4.4 Testing Methods

28. It is important to note that analytical method development and validation is a complex and expensive process. International standard protocols, and in some areas, legislative requirements exist for method validation which are designed to ensure that their operating characteristics are objectively assessed in relation to the purpose for which they are intended. It is, unfortunately, often the case that analytical methods suddenly become required urgently yet they take a considerable time to develop to the extent that they are unequivocally fit for the purpose of food control.
29. For some period of time prior to the reporting of the presence of Para Red in chilli powder to the Commission, methods were being developed for determination of azo-dyes in a number of laboratories, including some of those that later became part of the Illegal Dyes Analytical Network. All of the methods being developed were based on the technique known as high performance liquid chromatography (HPLC), but some used a detection technique known as ultraviolet (UV) or diode array (DAD) detection, whilst others used tandem mass spectrometric (LCMS) detection^[1].
30. The FSA had funded some method development work based on UV/DAD detection in a Public Analysts' Laboratory. On 16 September 2003, the FSA published an HPLC method 145A, stated to be for collaborative trials. It was prefaced by:

"Note: This procedure will be validated in the FSA collaborative trial programme to assess methods of analysis of interest or of particular concern. It was developed in the Lincoln Sutton and Wood Norwich Laboratory as a relatively "simple" method for the determination of Sudan I in chilli products. The method is applicable to other products, e.g. chutneys".

31. Some time later the FSA issued an HPLC method 145B. This was prefaced by a similar statement except that the method had been developed in the West Yorkshire Analytical Services Laboratory. It is noteworthy that both 145A and 145B methods stated that any results be rounded to the nearest 1mg/kg or ppm (parts per million). The HPLC method was incapable of detecting contamination at levels lower that 0.5 ppm.
32. Tests using the LCMS method were capable of detecting much lower levels of contamination. Using the LCMS method it is possible to detect levels as low as 10 ppb (parts per billion). According to Dr Farnell:

"It is difficult to determine accurately when LCMS development work started but a method published by Calbiani et al early in 2004 indicates that development work must have begun in 2003 at the latest".

33. It is, however, plain that by early 2005 some commercial laboratories were offering to carry out the testing of samples by the more accurate LCMS method. Thus I was shown an e-mail dated 3^rd March 2005 to Lion from Leatherhead Food International offering to test by a LCMS method with an accuracy of 10ppb. Similarly the Central Science Laboratory Web Page updated on 31^st March 2005 offers LCMS methodology with a similar accuracy. It was agreed between Dr Farnell and Professor Blanchfield that from March 2005 at least 5 commercial laboratories well known to the food industry were offering testing with LCMS methodology. At least 4 of these were in the UK.
34. It is perhaps worth noting that contamination at this level will have no noticeable effect on the colour of the product. According to Professor Blanchfield there needs to be hundreds of parts per million before there is a noticeable effect on colour. Thus, if contamination is found at this sort of level it is likely to be there adventitiously. It is also to be noted that any dye such as Sudan I or Para Red found in an ingredient such as chilli powder will be significantly diluted in any finished product made with the chilli powder. In paragraph 7.1.11 of his report Dr Dinsdale accepted the estimate that the maximum chilli powder in the products manufactured by Hazlewood was 0.27%.

4.5 The FSA Guidance in 2003 and 2004.

35. In September 2003 the FSA published guidance to the food industry, asking companies to withdraw and recall contaminated products as soon as they were identified, and to ensure that they were not contaminated with Sudan dyes if they contained chilli imported from India supplied to them prior to 30 July 2003.
36. On 18^th February 2004 the FSA produced guidance on Sudan dyes imported from India. That guidance made a number of points including:

1. Sudan dyes are not permitted colours under the Colours in Food Regulations 1995. Their presence, at any level, is not permitted in food for any purpose.

2. The FSA has asked companies to withdraw and recall contaminated products as soon as they are identified.

3. The use of validated methods by official food control laboratories is an important requirement of the EU Additional Measures Directive for Food 93/99/EEC. In fact neither HPLC nor LCMS were validated methods at that time.

4. The FSA are carrying out collaborative tests on 2 methods of analysis which have been developed to determine the presence of Sudan I. The two methods were methods 145A and B. In the guidance these methods are said to have been "shown to work". Both of these use HPLC methodology.

37. There was a minor dispute between the experts as to whether the wording of the guidance could be said to amount to a "recommendation" to use HPLC methodology. In the end Professor Blanchfield agreed that it is probably better to describe it as a "recognition" rather than a "recommendation". In my judgment this is the better view. In the light of this evidence I cannot accept paragraph 107 of Mr Simpson and Mr Casey's closing submissions that the FSA recommended the use of HPLC methodology.
38. In paragraph 105(5) of their closing submissions Mr Simpson and Mr Casey submit that the effect of the FSA guidance was that levels of contamination less than 0.5 – 1 ppm were permitted. They repeated the submissions in their concluding oral submissions.
39. I cannot accept that submission. There are a number of reasons for this. I accept that HPLC methodology was more commonly used than LCMS methodology but that does not mean that the FSA did more than "recognise" HPLC methodology. HPLC methodology had not been validated by the FSA. There is no express statement by the FSA setting a limit of 0.5 ppm. Indeed they had consistently used the phrase "not permitted at any level". I agree with the submission of Mr Keith that there was no single approved methodology and no agreed permitted minimum level.

4.6 The 2005 Sudan I incident

40. Between July 2003 and January 2005 the FSA issued 56 food alerts on Sudan dyes, involving more than 200 products.
41. In February 2005 Premier Foods informed the FSA that a customer sample of Crosse & Blackwell Worcester Sauce in Italy had tested positive for Sudan I, and that a 2002 batch of chilli powder has tested positive for Sudan I. Five of Premier Foods products could be affected, and Premier Foods provided the FSA with a list of more than 160 customers in the UK.
42. The FSA took the February 2005 Sudan I Worcester sauce incident very seriously. By 14^th February 2005 hundreds of products had been identified as being potentially affected. On 15^th February 2005 there was a meeting with representatives of the food industry at which the FSA required full disclosure of affected products. On 18^th February 2005 there was a press release by the FSA and some 360 products were posted on the FSA website. On 22^nd February 2005 the FSA advised local authorities to consider enforcement action. In all by 8^th March 2005 some 580 products were listed on the FSA web site.
43. There were a number of articles in the press at about that time all drawing the possibility of cancer to the public's attention. As Mr Keith said in his opening submissions – "Food scare stories sell newspapers".
44. One such article appeared in the World of Food Ingredients in March 2005. It is not necessary to quote extensively from the article. A number of passages seem to me to be relevant:

"The Sudan I episode in the UK has been described as the biggest scare since BSE and has put the whole food industry on guard.

Any report of a 'cancer causing chemical' in our food is bound to create disturbing headlines, even if the following report acknowledges that the risk to health is tiny.

For the past 18 months, there have been literally hundreds of additional but less well-publicised cases of foods being recalled due to contamination with one or more of a group of chemicals known collectively as Sudan Red I-IV. Everything from curry pastes, to ready meals and palm oils has been affected. The latest incident was remarkable only for its size and the number of products/brands involved.

The unpalatable fact for the food industry is that the practice of using Sudan Red as a food colourant has been known about for many years, and has been banned since the 1990s [in the 1995 regulations]".

45. Hazlewood was affected by the Sudan I scare. According to Mr Regan a total of 36 product lines were withdrawn from sale by Hazlewood as a consequence of Sudan I contamination; there were nearly 109,000 cases of affected end products. Customers affected by the withdrawal included Asda, Tesco, Morrison's, Booker, Sainsbury and Iceland. Mr Regan had a key role in co-ordinating the response to the Sudan I incident and liaising with customers. In particular, he was responsible for determining what Hazlewood should do, where it stood, and how it should respond. In making these difficult decisions he liaised with the Group Technical Director, Helen Sisson.

4.7 The contracts between Hazlewood and Lion

46. There is a long history of trading between Hazlewood and Lion going back to the 1990s. In the middle of February 2005 Hazlewood sought assurances from Lion that the products supplied by Lion were Sudan free. On 23^rd February 2005 Lion issued a position statement in which they confirmed that all products were free from artificial colorant including Sudan dyes. It confirmed that the recent Sudan alert had no impact on Lion.
47. It will be necessary later in this judgment to make reference to a contract for the sale of chilli powder by Lion to Hazlewood referred to throughout the hearing as Batch 2. It is said to be relevant because Hazlewood were willing to place on the market products manufactured using Batch 2 at a time when they knew that Batch 2 contained Para Red at the very low level of 80 ppb. That is said to undermine Hazlewood's case.
48. The case is however primarily concerned with the supply of approximately 1000kg of Chilli Powder 40 H/U ("the Product") sold and delivered pursuant to Purchase Orders 103377 and 103378 both dated 15 March 2005 and Purchase Order 104289 dated 6 April 2005. The precise dates when the Product was delivered is not now clear. However it seems likely that 100kg was delivered on 16 March 2005, 400kg was delivered on 21 March 2005 and 500kg was delivered on 8 April 2005.
49. In the pleadings issue was joined as to the terms that were incorporated. Hazlewood contended that the terms of a Supply Agreement dated 12^th November 2003 and the terms set out in the Raw Material Specification issued on 6^th January 2004 (and signed by Lion on 19^th February 2004) were incorporated into the contract.
50. By the time the matter reached trial issues had narrowed and the contract terms were not in dispute. It was accepted that the Raw Material Specification was incorporated into the contract.

The Raw Material Specification

51. The Specification contained a number of terms that have been relied on:
52. Under the heading General Quality Requirements the product was required to

"Be free from foreign and extraneous matter;

comply with all UK & EU legislation concerning toxic or other objectionable substances in foodstuffs…; and

comply with all UK & EU food regulations and any other statutory requirements…".

53. It is common ground that the relevant regulations are EC Regulation 178/2002 and the Colours in Food Regulations 1995.
54. Under clause 7 it was provided that the composition would be "Chilli 100%; under clause 8 it was provided that there be no additives.
55. Clause 10 is headed "Safety/Quality Parameters". Under the heading "Raw Materials" is a table setting out various parameters for a total of 11 possible contaminants. I shall not set out the whole table but simply take 3 of the contaminants as examples of the table:

Test	CCP	Frequency	Test Int/Ext	Lab status	Sample Size	Spec limits	Responsibility
Lead		Tested on delivery sampling	Internal	Lab Cred		<10 ppm	Lab personnel
Arsenic		Tested on delivery sampling	Internal	Lab Cred		<5 ppm	Lab personnel
Zinc		Tested on delivery sampling	Internal	Lab Cred		<50 ppm	Lab personnel

56. A number of points can be made about this table:

1. Not all of the tests were for elements such as Lead, Zinc or Arsenic; there were also tests for bacteria, moisture content, ash, smell and particle size.

2. The fact that the specification permits, for example, 5 parts per million of arsenic shows that the product cannot be literally 100% Chilli powder.

3. The table contains no reference at all to any of the Sudan dyes or Para Red. Thus there is no express permitted amount of Para Red in the contract.

4. Lion changed its specification as a result of the events in this case. In their new (dated 2^nd November 2005) specification they limit the Sudan dyes to 10 ppb and Para Red to 20 ppb.

Implied terms

57. It is furthermore common ground that there were a number of terms that were implied by law. In particular it is admitted that it was an implied term that the chilli powder at the time of sale should be:

1. reasonably fit for its purpose, namely use in the manufacture of food products in all respects suitable to be sold on to the general public;

2. in accordance with their description; and

3.of satisfactory quality.

4.8 The Eurofins test

58. On 21^st April 2005 Eurofins, a testing laboratory in Hamburg, carried out a test on products that included chilli powder supplied by Symrise. It is not in dispute that the chilli powder was supplied by Lion to Perfecta and from Perfecta to Symrise. That test, which used the LCMS methodology gave a reading for Sudan I of only 15 ppb and for Para Red of 180 ppb.

The Sudan I mini scare

59. Para Red had not, until then, been the subject of any food scare. Indeed it was the Sudan I result that provoked attention from the FSA.
60. On or about 23^rd April 2005 Mr Woollands, the Chief Executive of Lion, prepared an internal document giving a history of the events that had taken place, the actions that had been taken by Lion and the steps that needed to be taken in the future.
61. At 1 p.m on 21^st April 2005 Perfecta notified Lion of the result of the Eurofins test. By 6 p.m the same day Lion had conducted a full trace on all the 2000 kgs it had handled. At 8 a.m the following morning the FSA was notified. In the meantime Perfecta had already started to notify its customers.
62. At 12 noon on 22^nd April 2005 the FSA advised Lion to inform its customers to quarantine stock of raw material and any finished goods which may have used the raw material.
63. In addition Lion Foods were requested to advise their customers to inform their customers' customers of the situation and to quarantine stock accordingly. All quarantined stock was to be held pending a final decision by the FSA during the afternoon of 22nd April 2005. The FSA expressed concern at the very low level of 15 parts per billion, and wished to investigate further the German laboratory results.
64. Lion complied with this advice and notified its customers. Later that afternoon the FSA decided that it would not be able to make a final decision till the following week.
65. Lion contacted its supplier – Ramón Sabater – demanding a lot of information including an investigation into the cause of the contamination. It sent samples of its retained stock to CCFRA (an industry recognised laboratory). In a letter sent out the same day Ramón Sabater made the point that Para Red was a new colorant to the capsicum market and had not been tested for. In future all capsicum would be tested for the absence of Para Red.
66. At 6 p.m on 22^nd April 2005 CCFRA results for Sudan I were received at 10 ppb. In the meantime at least one retailer – ASDA – instituted a product recall.
67. Mr Woollands' internal document reveals that by about 23^rd April Lion had set up a crisis management team, contacted solicitors and prepared a press release. Lion were thus taking matters very seriously.
68. On 26^th April 2005 the FSA gave its decision. It decided not to order a recall based on the Eurofins result for Sudan I. The letter gave a number of reasons for this decision. The test result did not provide convincing evidence of Sudan I in the chilli powder. They were not accompanied by levels of uncertainty and were at the limits of detection for the method employed.

The Para Red scare.

69. The FSA did not initially react to the level of Para Red detected by the Eurofins test. However, after receipt of the letter of 26^th April, Perfecta contacted the FSA to query what the FSA's position was in relation to Eurofins' alleged detection of Para Red at 180ppb.
70. On 29th April 2005 Dr Baynton of the FSA wrote again to Perfecta and Lion Foods to request that the chilli powder be resubmitted to CCFRA to be tested for Para Red, and saying:

"Based on the information presented in the Eurofins certificate of analysis it would appear that the presence of Para Red is genuine. However, as soon as the Agency receives the result of the analysis from Campden and Chorleywood we will be able to issue definitive advice on this.

In the mean time we would advise that products using this cayenne pepper should be quarantined until we have confirmation of the para red test results".

71. The test results for Para Red were received from CCFRA by Perfecta and Lion Foods later on 29 April 2005. Those results showed that Para Red had been detected in the chilli powder using an LCMS method at 120 ppb and 200 ppb.
72. In response to these results, Dr Clair Baynton of the FSA wrote to Lion Foods and Perfecta Ltd on 3 May 2005 saying

"I wrote to Philip Noakes of Perfecta Limited on 29 April regarding the potential contamination of cayenne pepper with the dye, para red. A copy of this letter was sent to you. We can now confirm that the analysis of the cayenne pepper carried out by Campden and Chorleywood has identified that para red is present at 200ppb. You have also informed me that separate analysis requested by Lion Foods has confirmed para red to be present at 120ppb.

Based on the information presented in the Eurofins certificate of analysis, and the analysis subsequently carried out by Campden and Chorleywood the presence of para red is clearly genuine. As para red is a dye which is not permitted for food use and is assumed to be a genotoxic carcinogen, the advice of the Food Standards Agency is that the product itself or products containing the contaminated cayenne pepper need to be recalled and destroyed. I would be grateful if you could cascade this information on to your customers as similar action will be required by them."

73. Dr Baynton notified Mr Regan of Hazlewood in similar terms of the decision on the same day.
74. On 5^th May 2005 the FSA published advice on its website. In the light of the criticisms that have been levelled at the FSA during the course of the trial it is convenient to set it out.

"The Foods Standards Agency has published a list of 35 foods which have been found to contain the illegal food dye Para Red:

The Agency has been informed that 35 food products have been found to have been made with a spice that could contain an illegal dye, Para Red. The products are being withdrawn from sale.

Our advice:

"At the levels found the risk from eating any of these foods is very small, but as a precaution it would be sensible not to eat them. The amounts of Para Red found in the spices are very low. "People who have any of the foods listed below can contact the store where they bought them for a refund.

Then there is an extensive list of sauces, mainly.

…

Background

The contamination of spices with illegal dyes is a European-wide issue and the Agency has been pressing the European Commission to lead a co-ordinated approach to the issue The Commission will hold a meeting with Member States on Tuesday, 10th May, to consider the best way to tackle the problem.

The Agency's Director of Food Safety Dr Andrew Wadge said,

Para Red like Sudan I is an illegal dye that should not be in food. People understandably don't expect or want it to be in their food. At the levels being found the risk is likely to be very small indeed, but it is right that food businesses are removing these products from sale.

We are pleased that the European Commission is going to develop a European-wide approach to tackling this issue. Concerted action across Europe is the most effective way forward.

Para Red is an industrial dye that is not permitted for use in food. It is chemically similar to Sudan I, a dye which was implicated in the contamination of other food products in February. The Agency's independent scientific experts advise that it would be prudent to assume that Para Red, like Sudan I, could be a genotoxic carcinogen and so exposure to it should be as low as reasonably practical."

75. Professor Blanchfield is highly critical of the decision of the FSA on 3^rd May 2005. He makes the points that the level of Para Red found was extremely low, that it would be further substantially diluted in any manufactured product, and that contamination at this sort of level could only be adventitious. It might, for example, have come from the labelling on the sacks.
76. In paragraph 108 of their closing submissions Mr Simpson and Mr Casey submit that the FSA decision to recall was treated by the industry as a "radical change of policy by the FSA". Between paragraphs 112 and 127 they develop in considerable detail a submission that the FSA was both wrong and irrational.
77. I do not accept that there was a "radical change of policy by the FSA". Their policy was that azo dyes at all levels were not permitted. Nor can I accept that the decision to recall can be described as "unreasonable" in the sense that it could be challenged in an application for judicial review. It has to be remembered that this incident came very shortly after the Sudan I scare, there was heightened public awareness of the carcinogenic qualities of the azo dyes and there was considerable press interest in the topic. Furthermore a number of other European countries reacted in the same way as the FSA.
78. In my view the decision taken by the FSA on 3^rd May 2005 was understandable in the light of the situation. It was also predictable. It cannot, in my judgment, be said that it was a decision that no reasonable food authority could have made.
79. In their closing oral submissions Mr Simpson and Mr Casey described the decision as a mistake. They rely on the fact (as will appear below) the FSA relaxed their position on 19^th May 2005 – some 16 days later. However, as Mr Keith pointed out it has to be borne in mind that there was no accepted minimum acceptable level of azo dyes either in Europe or in the UK and that the decision was in accordance with the stated policy of zero tolerance. Furthermore, although the food industry clearly regarded the decision as unreasonable the FSA had to take into account interests other than the food industry. The FSA are not parties to these proceedings; in all the circumstances I am not prepared to categorise the decision as a mistake.

4.9 The effect of the contamination on Hazlewood

80. During the afternoon of Friday 29 April 2005 Mr Regan received a phone call from Mr Tattersall at Lion indicating that the FSA were advising that products containing chilli powder supplied by Lion be quarantined. Hazlewood received a similar instruction from the FSA on 3^rd May 2005.
81. Hazlewood immediately blocked the remainder of the affected batch of chilli powder to avoid further use in end products.
82. In paragraph 20 of his witness statement Mr Regan describes it as a very worrying time.

Although the levels of Para Red detected were low, as I had come to expect based on my previous experience, the FSA were taking a zero-tolerance approach. We relied upon Lion's statement and were bound to follow the FSA instructions that all product should be withdrawn and destroyed, albeit that we recognised that the risk to health appeared negligible. It is fair to say that as a matter of public perception, testing methodology and levels detected were of little relevance. The key issue was that a dye linked to cancer had been found in food products, which clearly should not have been there. This was the attitude of the FSA, our customers and of the media reporting of the incident.

83. In his witness statement Mr Regan describes in detail the steps taken by Hazlewood in response to the FSA instruction. In summary it had to identify the affected batch of chilli powder, identify the affected end products, locate any unused raw material and contact its customers to recall delivered goods.
84. Approximately 23 of Hazlewood's product lines were affected. Many of these were supermarket own brands such as "ASDA Green Tikka Curry Sauce", "Tesco Korma", and "Iceland Tikka" A total of 103,747 cases of these goods were affected.
85. Hazlewood also had tests carried out by CCFRA and one batch of chilli powder (number BH0500001) was found to contain Para Red. Overall the amount of Para Red found in the various chilli powder samples varied between 120-240ppb.
86. All of the recalled and quarantined stock of end product and of the batch of affected chilli powder was subsequently destroyed.
87. At one stage in these proceedings there were issues in relation to this. However damages, subject to liability have been agreed in the sum of £562,500 plus interest at Bank of England base rate plus 1% from 1st June 2005. It is thus not necessary to go into the issues in detail.

4.10 Attempts to discover the source of the Para Red contamination

88. As already noted Lion attempted to obtain an explanation for the Para Red contamination from Ramón Sabater. A partial explanation is to be found in 2 e-mails dated 3^rd May 2005 and 5^th May 2005 and in the notes of a telephone conversation that took place on 5^th May 2005 between Pepe Sabater and Mr Woollands and Mr Tatersall. The explanation is summarised in a letter dated 10^th May 2007 from Plexus to Eversheds.
89. In paragraph 12 of their closing submissions Mr Simpson and Mr Casey summarise the effect of the evidence in relation to the attempts to discover the source of the contamination.

(1) In an email dated 3 May 2005 Ramon Sabater stated that they had purchased a batch of raw chilli flakes from an Uzbekistan source in November 2004 ("the Uzbekistan Chilli"). Six weeks previously (i.e. in late March 2005) a Dutch customer had informed them that chilli powder that they had supplied contained Para Red. Ramon Sabater had informed affected customers, but had not informed Lion because it had not been supplied with chilli powder derived from the Uzbekistan Chilli. At this point in time, Ramon Sabater considered that the Para Red in Batch 1 were present as a result of "cross-contamination" with the Uzbekistan Chilli^[2];

(2) A handwritten note of a conversation between Mr. Woolands and Mr. Tattersall of Lion and Pepe Sabater dated 3 May 2005 seemed to suggest that Ramon Sabater had stated that the chilli powder derived from the Uzbekistan Chilli^[3] and supplied to Barts Spices had tested positive for Para Red at 1.2ppm and repeated the cross-contamination claim^[4];

(3) However, in an email dated 5 May 2005, Ramon Sabater stated that it carried out a tracing exercise in respect of Batch 1 and, because there was no other explanation, had concluded that 12kgs of the Uzbekistan Chilli had been added to Batch 1^[5];

(4) The reasoning behind this claim appears in Lion's record of the conversation referred to by Ramon Sabater in its email of 5 May 2005. It seems that Ramon Sabater could not account for 12kgs of the Uzbekistan Chilli and therefore concluded that it had been added to Batch 1. When Mr. Woollands asked Ramon Sabater for documentary confirmation of this, he was informed that there was none^[6].

90. Both sides consider that this explanation is unsatisfactory. It would only account for contamination at a level of 7.2 ppb whereas the contamination was at a level of between 120 ppb and 240 ppb. Furthermore much of the explanation was unverifiable and not regarded by Mr Woollands as satisfactory. No further explanation was sought because Lion felt that they had got to the end of the line of their inquiries. Mr Tattersall was sent to attempt an audit but he could not find anything more conclusive.
91. In the result the source of the Para Red contamination remains a mystery.
92. Professor Blanchfield is, however, strongly of the view that contamination at such low levels could only be adventitious. As 240 ppb would not be anything like sufficient to colour chilli powder it was unlikely that anyone would have added those quantities deliberately.

4.11 Lobbying from the Food industry

93. There is no doubt that there was a body of opinion within the food industry that the FSA approach to these very low levels of contamination was unreasonable. In the result there was significant lobbying of the FSA in order to attempt to persuade them to change their zero tolerance approach.
94. On 9^th May 2005 an e-mail was sent from the Spices and Seasoning Association to Dr Baynton of the FSA. It urged amongst other things an EU-based approach to handling these types of incidents. An essential part of a co-ordinated approach would be agreement on the testing to be carried out. The Association recommended the adoption of testing with HPLC methodology and a limit of contamination at 1 ppm.
95. On 12^th May 2005 Eversheds wrote a letter to the editor of The Grocer. The letter makes a number of points including the suggestion that the response of the FSA is disproportionate to the actual risk to health and that the zero tolerance approach of the FSA and European regulators to these types of dyes and other contaminants presents practical difficulties and needs to be revisited.
96. On 19^th May 2005 Eversheds, on behalf of Hazlewood submitted a detailed position paper making many of these points. It included:

"The general approach to food safety in this country typically centres around the setting of appropriate thresholds for substances, having regard to the potential risk that such substances might pose. We have not seen any toxicological evidence that is relied upon by the FSA. No advice from the Committee on Carcinogenicity has been made available and we understand that the European Food Safety Authority are undertaking a review of the available toxicological data. Pending such review, there would appear to have been no proper risk assessment in relation to the illegal Azo-dyes in question. It is submitted that a threshold level needs to be set immediately for specified Azo-dyes in the finished product so that food industry can operate with certainty."

97. Not surprisingly this document provided Lion's legal team with forensic material to deploy in these proceedings. However it has to be remembered that the FSA had to take into account interests other than those of the food industry. Furthermore the fact that Hazlewood lobbied the FSA to change their stance is not in the end decisive as to whether the chilli powder conformed to its contractual requirements.

4.12 Meeting of the EC Standing Committee on the Food Chain and Animal Health ("SCOFCAH")

98. On 10^th May 2005 there was a meeting of SCOFCAH to assess the situation with regard to adulteration of spices and other foods with industrial dyes, in particular the recent findings of Para Red.
99. Amongst the conclusions were:

"2. Analytical methods: UK, NL, FR and ES agreed that their laboratory would work in a network in order to further develop analytical methods or p-Red, to extend the method to other similar dyes in food and to improve consistency of results. DE will explore the possibility of participating in the network (feedback by 12 May). Tentative timescale: 2 weeks.

7. Pending the results of the exercise described in paragraph 2, it should be considered that the limit of detection (LOD) for most illegal dyes similar to Sudan I in spices using HPLC is in the range of 0.5 – 1 mg/kg. For the time being, all food ingredients or foods prepared from spices containing illegal dye(s) above the relevant LOD using HPLC should be withdrawn from the market. All foods analysed and found to contain the illegal dye(s) above the relevant LOD should also be withdrawn from the market."

4.13 Meeting of the FSA on 12^th May 2005.

100. There was a Board Meeting of the FSA on 12^th May 2005. The minutes of the meeting demonstrate that there was lengthy discussion on the Para Red situation. It is covered in items 12 to 23 of the minutes. I shall not lengthen this judgment by setting it out verbatim. It set out the history of the Para Red scare. In paragraph 16 it summarises some of the conclusions of the SCOFCAH meeting. In paragraph 17 it reported views expressed at the meeting but which were not included in the Conclusions.

"The Commission had made clear at the meeting that the presence of any dyes not permitted for use in food would be unacceptable at any level. The limit of detection for the HPLC method had been set, for the time being, at between 0.5 and 1mg/kg (0.5 - 1 parts per million). Where an illegal dye was found above this level, using this technique, either in the spice itself or a food in which it had been used, the product would need to be withdrawn from the market. HPLC is used routinely by all member states. The Commission had not set a limit of detection for testing with LC-MS but had advised that if testing was carried out using this method and an illegal dye was found, companies had to take action to withdraw the food concerned."

101. In paragraph 22 there is reference to the difficulties of maintaining a proportionate approach when dealing with issues that could be amplified by the media. In paragraph 23 there is reference to the attitude of other countries. Denmark, France, Ireland and Sweden had reacted in the same way as the UK; Others (Netherlands and Germany) had not publicised their action but had nevertheless acted promptly to withdraw affected products from the market.
102. Mr Simpson and Mr Casey invited me not to accept at face value the information in paragraph 23 as to the evidence of other countries. In evidence Professor Blanchfield said he was unable to verify the information. Mr Simpson and Mr Casey described it as self serving to justify a mistaken decision taken on 3^rd May 2005.
103. The comments form part of the official minutes of the meeting. They are corroborated in an e-mail sent by Kaarin Goodburn of the Chilled Food Association on 13^th May 2005 to its members. In paragraph 6 of the email she notes:

"Dr Bell noted that Denmark, France, Ireland and Sweden (to a large extent) had taken the same action, and that even where countries had not publicised to the extent as in the UK they had undertaken withdrawals, e.g Germany and NL".

104. In those circumstances I find that the statements were indeed made at the meeting and I have no grounds for saying that they were not true.
105. On the same day Dr Baynton wrote to all interested parties reporting the outcome of the SCOFCAH meeting on 10^th May 2005. The letter includes the following paragraph:

"The Commission made clear at the meeting that the presence of dyes not permitted for food use is not acceptable at any level. In the absence of the risk assessment by EFSA, and pending the outcome of the working group on methodologies, a limit of detection (LOD) for most illegal dyes similar to Sudan I has been agreed in the range of 0.5 - 1 mg/kg when HPLC is being used as the method of analysis. Where analysis has been carried out using LC-MS and levels of illegal dyes are confirmed below the LOD for HPLC member states should continue to take action, products will need to continue to be withdrawn from the market."

106. Professor Blanchfield complains that the last sentence of this paragraph is not reflected at all in the official guidance from SCOFCAH. He is correct that it goes further than paragraph 7 of the official conclusions. It does however not go further than paragraph 17 of the Minutes of the 12^th May Board meeting.

4.14 the FSA Guidance of 19^th May 2005

107. On 19^th May 2005 Dr Baynton wrote to interested parties a letter including the following:

"The Agency's position remains that the presence of illegal dyes in food is not acceptable. The Agency funded the development of an HPLC detection method in September 2003, which has become the standard method for detecting Sudan I and related dyes. However, recently we have seen a number of results reported using LC MS methods for Sudan I and para red. As you know, at last week's meeting Member States agreed to establish a Working Group, co-ordinated by the UK, to further develop analytical methods for these dyes for the benefit of all Member States. It was recognised that there was an urgent need for this work, given the different approaches used between laboratories and within Member States.

This work, which began immediately, is already showing that LC MS methods for Sudan I and other related dyes are not available in many laboratories and there can be considerable variability in results between laboratories analysing the same samples. Concerns have also been raised that LC MS methods can produce false positive results at low levels.

In the light of these developments and until these issues are resolved by the Working Group we advise that the recommended method for detecting Sudan I and para red should be that based on HPLC. The limit of detection for this method was agreed by Member States at the 10 May meeting as being 0.5 – 1.0 mg/kg. Any food or food ingredients found to contain the dyes by this method should be withdrawn from sale.

The Agency will review its position in the light of further advice from the European Commission arising from the work initiated on 10 May."

108. It will thus be seen that the FSA had changed its position since 12^th May 2005 and was no longer requiring withdrawal from sale of foods unless the levels of dyes were in excess of 0.5ppm. Professor Blanchfield describes the guidance as:

"a complete volte-face from the guidance of 12 May. LCMS testing, on the basis of which the original recall had been required on 3 May, was no longer to be used. Instead, the "recommended method" for detecting Sudan 1 and Para Red was to be HPLC with an LOD of 0.5-1mg/kg".

109. There is some disagreement between Professor Blanchfield and Dr Dinsdale as to the effect of the FSA guidance of 19^th May 2005. Professor Blanchfield's view is that the EU and the FSA had in effect authorised the presence of Para Red at levels of 0.5 ppm or less. Dr Dinsdale disagrees. He considers that the acceptance of Para Red in small quantities was eventually accepted as a practical measure to enable trade to continue.
110. It will be necessary to look at Hazlewood's reaction to this decision in relation to a different order that has been referred to as Batch 2. It did not affect the position with regard to the 1,000 kg with which this case is concerned. As already noted the foodstuffs that were withdrawn or quarantined were destroyed and did not return to the market.
111. In paragraph 107 of their closing submissions Mr Simpson and Mr Casey further submit:

107. "the only conclusion that can be reached is that the FSA (1) recommended that HPLC should be used in the detection of azo dyes; (2) contemplated that the industry would use this method (3) presumed until May 2005 that this method was in fact being used by the UK food industry; and (4) was satisfied that products testing negative for azo dyes using this method complied with the Sudan legislation and with the statutory safety requirements of EU and United Kingdom law".

112. I do not accept this submission. In my view it is inconsistent with the published guidance in 2004 and the attitude of the FSA in the light of the Sudan scares of early 2005.

4.15 Position of ASDA and Tesco

113. On 24^th May 2005 Tesco issued a letter to its suppliers with amended testing requirements. In the letter it set out the history including the FSA letters of 12^th and 19^th May 2005. It recorded that it had had a discussion with the FSA. It required its suppliers to test to a level of 0.5 ppm of Sudan dyes and Para Red. It only required suppliers to report levels above 0.5 ppm.
114. ASDA, however, took a stronger line. Their guidelines published on 31^st May 2005 were to the effect that no product would be permitted to enter their food chain with any banned dye including Para Red. In policy 33 ASDA noted that guidance was awaited from the EU on recommended analytical methods. It required to be notified of any positive values whatever level or method of analysis.

4.16 Further Guidance from SCOFCAH and the FSA

115. On 23 June 2006 the EU Commission's SCOFCAH met. Its record included an interim report by the UK delegation on the interim results from the illegal dyes analytical network. After discussion conclusions were reached which included that:

1. the UK would finalise the analytical report to be put towards a future standing committee for endorsement.

2. in order to ensure a consistent approach an action limit of 500 ppb should be used for illegal dyes in food ingredients.

3. an approach should not be seen as Member States accepting adulteration and therefore the food industry should continue to investigate sources of contamination when found below 500 ppb and take measures to reduce levels where possible.

116. On 28^th June 2006 Dr Rodri Evans of the FSA wrote to interested parties giving an update of the position. The update reported on the meeting of SCOFCAH that had taken place on 23^rd June 2006 and included that:

"it is generally accepted that the "As Low As Reasonably Practicable" (ALARP) approach should be adopted when dealing with contamination of foods by genotoxic carcinogens such as Sudan I or Para Red. Given the apparent potential for adventitious contamination at low levels, we believe that a practicable approach would be to establish an action limit for the presence of illegal dyes in food ingredients such as spices, and also in palm oil.

The UK proposed that if contamination is discovered below the level of 0.5ppm, Member States would not take action to remove products from the market.

However, should contamination be identified at or above this limit, then Member States would continue to withdraw affected product. The action limit would apply irrespective of whether the HPLC or LC-MS/MS analytical methods had been used.

At the meeting, all Member States agreed to implement the action limit.

The risk to consumers presented by contamination of ingredients such as spices at levels below 0.5ppm would be very low, and adoption of this action limit will allow effective functioning of the market in spices and other food ingredients, whilst ensuring a strong level of consumer protection.

The adopted position cannot formally be adopted into European law as action limits can only be established for products of animal origin. However, the Commission will be informing relevant European trade associations of the decision, and requesting further information on the results of monitoring being undertaken by manufacturers."

117. It may be thought that this letter together with the SCOFCAH minutes give considerable support to Dr Dinsdale's view that the FSA were taking a practical approach and were not in fact condoning contamination at levels of less than 500ppb.

4.17 Batch 2

118. On 22^nd March 2005 Lion delivered to Hazlewood/Greencore of a different chilli powder (chilli powder El Grande).
119. On 6 May 2005, Lion notified Greencore that preliminary test results indicated the presence of Para Red at a level of 80ppb. The e-mail stated that the FSA advice was to withdraw all stock and inform customers to do the same.
120. It appears that in a telephone conversation that same day Steven Woollands advised David Price that Lion were taking a second opinion on the results due to a lack of confidence in a single test result of 80 ppb using LC-MS. Lion had raised significant concerns in relation to the LC-MS methodology, whose accuracy they said was questionable.
121. Hazlewood themselves sent a sample of the chilli powder to CCFRA^[7] for testing. It is not clear when the sample was sent. During the course of the trial a further copy of the test certificate was obtained from CCFRA. It records that the test was carried out on 6^th May 2005 and confirms the presence of Para Red at a level of 80 ppb. It is not clear when that result was sent to Hazlewood.
122. Hazlewood carried out a traceability exercise on the chilli powder. The quantity affected was 875 kg. Half was unused and quarantined. The other half had been used to manufacture 2 ASDA products, a Doritos product and products for Morrisons. Only a small amount of the Morrisons product had been sent out. Fortunately it had not yet reached the supermarket shelves. Hazlewood notified Morrisons by phone and e-mail of the potential problem.
123. Hazlewood quarantined all the potentially affected product and sent samples of the end product for testing against all azo dyes. In each case the products were shown to have less than 50 ppb of any azo dye including Para Red.
124. On 9^th May 2005 there was a conversation between Mr Woollands and Mr Wood. Mr Wood told Mr Woollands the steps that Hazlewood had taken as summarised above. Mr Woollands told Mr Wood that Lion was having the chilli powder retested and that new test results were expected by the middle of the following week. For reasons that were not fully investigated at the trial Lion did not in fact have the chilli powder retested. It would appear that the information given by Mr Woollands to Mr Wood was untrue.
125. In an e-mail dated 10^th May Mr Woollands said:

"We agree with your assessment that raw material showing a presence of Para Red of ppb would be undetectable in the finished product, however, until such time as the FSA provides clarity to this situation, Lion assumes that their current recall instruction as communicated on 6^th May stands".

126. Following receipt of the letter from the FSA dated 19^th May 2005 which set the limit of detection at 0.5ppm there were a number of exchanges of e-mails between employees of Hazlewood/Greencore.

9.31 a.m on 20^th May 2005 from Leigh Dixon to Greg Hunn and Frances Swallow

127. Leigh Dixon summarised the letter from FSA and described it as "excellent news".

9.40 a.m on 20^th May 2005 from Greg Hunn to Leigh Dixon

128. Greg Hunn agreed that the news was good and asked what the situation was about the food in the system that had been tested with LCMS and shown to have low levels that would not be detected with HPLC.

10.29 a.m on 20^th May 2005 Leigh Dixon to Greg Hunn

129. Leigh Dixon said that there had been no decision on recalled stock that appeared on the FSA web site. Further discussions were needed. [In contrast to the Batch 1 products none of the Batch 2 products had appeared on the FSA web site.]

11.05 a.m on 20^th May 2005 Greg Hunn to Leigh Dixon

130. Greg Hunn sought clarification on the products made from the Batch 2 chilli powder.

11.37 a.m on 20^th May 2005 Leigh Dixon to Greg Hunn

131. Leigh Dixon stated that Hazlewood would be releasing all products that have raw materials with low levels of detection by LCMS as they were well below HPLC levels.

10.17 a.m on 23^rd May 2005 Greg Hunn to Leigh Dixon

132. This e-mail includes the following:

"I put this past Margaret and the concensus was that, this is fine in the light of what is presently known (and the interpretation of the FSA letter) but should anyone's opinion on the validity of the LCMS change and they DO NOT give clemency on historical facts then we could be in recall again and knowing your customer involved that could be a painful issue".

10.36 a.m on 23^rd May 2005 Leigh Dixon to Patrick Wood and others

133. Leigh Dixon reported Greg Hunn's concerns as to the potential embarrassing situation as a result of the release of stock with known ppb presence in the raw material. Nevertheless he agreed with the decision to release the stock.
134. Thus it can be seen that the stock made from the Batch 2 chilli powder was released by Hazlewood.

5. The attack on Mr Regan's credibility

135. I have set out the facts relating to Batch 2 in some detail because they formed the basis of the attack on Mr Regan in cross-examination.
136. On one reading of his first witness statement paragraphs 5 or 20 might be thought to state that any measurable level of contamination in the product was unacceptable and would be damaging to the brand. In fact, however, Hazlewood released to the market the Batch 2 products in the knowledge that the chilli powder contained very low levels of Para Red.
137. Furthermore in paragraph 39 of his witness statement Mr Regan stated in terms that Hazlewood had not released to its customers products containing ingredients that been found to contain Para Red. In his second witness statement – dated 4^th May 2007 - Mr Regan recognised that this was wrong and set out in details the facts relating to Batch 2. All of the e-mails summarised above were exhibited to the first witness statement.
138. The results of test commissioned by Hazlewood on the Batch 2 chilli powder were not disclosed until after the trial commenced.
139. Mr Regan initially told me that Batch 2 had not been retested on behalf of Hazlewood^[8]. Later he said he could not remember whether Hazlewood had commissioned a test^[9]. There was no test result within Hazlewood's control. Overnight he contacted CCFRA and they provided him with the test result. He disclosed this the following morning.
140. In cross-examination Mr Regan explained that the error in paragraph 39 of his witness statement was because he was focussing on Batch 1. The claim was about Batch 1 and no part of Batch 1 was released. He acknowledged that he had made an error and that he had not read all of the documents put before him.
141. It was suggested to him that this was a disingenuous reply and that Mr Regan did not mention Batch 2 because it was damaging to Hazlewood's case. Mr Regan did not accept that. He made a number of points in the course of his evidence. He made the point that the release took place after the FSA's guidelines of 19^th May 2005. He also pointed out that (with the exception of Morrisons) the Batch 2 products had never been in the market place and had not appeared on the FSA web site.
142. When cross-examined about paragraphs 5 and 20 of his witness statement he made the point that he was working within a regulatory framework:

MR SIMPSON: Can I go back to my question, Mr Regan. Is it your case that it would be damaging for any retailer to be linked to the sale of contaminated products, in so far as there is any measurable quantity of Para Red in the product?

A. I think it would be damaging in terms of the FSA guidelines if a product had been implicated to them that was outside the guidelines of the FSA.

Q. So your case, as I have understood it, is any measurable Para Red in the original ingredient or spice means that that ingredient or spice is not a satisfactory quality for you?

A. I think -- again, I think I find it difficult to answer that question, because we are working within the guidance of a regulatory body. So my answer would be more comment or guesswork, really.

143. Mr Regan was further cross-examined on Day 3 of the trial after the test commissioned by Hazlewood from CCFRA had been produced. Mr Simpson suggested that at the time Mr Regan made his second witness statement he knew perfectly well that there was a second test that confirmed the original reading of 80 ppb. It follows from this that he was suggesting that Mr Regan was lying when he told me that there was no re-test and further lying when he said he could not remember whether there was a retest. In so far as the second witness statement suggested that Mr Regan was doubtful about the reading of 80 ppb that was disingenuous and misleading because at all times Mr Regan was aware of the results of the second test.
144. Mr Regan did not accept that. He maintained that he had genuinely forgotten about the second test. One of his crucial answers was:

A. I think the reason being -- in terms of my lack of recollection, for lack of a better word -- is that the testing which was occurring at the time was after Para Red batch one and there were routine tests that were occurring at the time that we were sending off to the laboratory, and I failed to recall that routine testing was occurring at the time. Clearly the test had occurred and clearly it had been sent off in terms of routine testing.

145. I have considered the attack on Mr Regan with some care. In the end I have no hesitation rejecting it. There are a number of reasons for this. An allegation of dishonesty is, of course, a serious allegation to make. It thus needs to be squarely proved. In his first witness statement Mr Regan exhibited the e-mails that I have set out above. If he was wishing deliberately to conceal the release of the Batch 2 stock it is hardly likely that he would have exhibited them. If he had wished to conceal the existence of the second test it is not likely that he would have rung up CCFRA and himself obtained the test certificate from them. This claim is in relation to Batch 1; I do not for my part find it surprising that Mr Regan should have made the mistake he did in paragraph 39 of his witness statement. In my view his explanation is acceptable. It is, to my mind by no means clear that the sale of the Batch 2 stock is damaging to Hazlewood's case. It took place after the 19^th May letter; the end products had been tested and shown to be free to levels of 50 ppb.
146. In paragraph 93 of their closing submissions Mr Simpson and Mr Casey note that during the course of the trial I may have expressed a degree of scepticism at the allegation that Hazlewood had sought to conceal the supply of Batch 2. Notwithstanding this scepticism they have maintained the allegations in their closing submissions. For the reasons given above the submissions are rejected. I still think it a pity that Lion should have thought it right to make and persist in such serious allegations in this case.

6. The issues

147. The issue in this case is whether the supply by Lion to Hazlewood of the chilli powder containing between 120 and 240 ppb of Para Red was a breach of the express or implied terms of the contract.
148. Hazlewood no longer pursue a claim based on clause 7 of the Raw Material Specification but they still maintain that there is a breach of EC Regulation 178/2002, the Colours in Food Regulations 1995 and that the chilli powder was not free from foreign and extraneous matter. They also contend that there were breaches of the terms implied by sections 13 and 14 of the Sale of Goods Act 1979 (as amended).

6.1 The Colour in Food Regulations 1995

149. Under reg 3(1):

"No person shall use in or on any food any colour other than a permitted colour".

150. Under reg 7(4):

"No person shall sell any food having in it or on it any added colour other than a permitted colour …".

151. It is common ground that Para Red is not a permitted colour within the meaning of the regulations. Hazlewood's case is accordingly very simple. The 1000 kg of chilli powder sold by Lion had within it measurable quantities of an illegal dye. It matters not whether it was added adventitiously or deliberately. It matters not that the amount was so small that it was undetectable by HPLC methodology. The presence of the illegal dye constitutes a breach of the regulations. The words of the regulations are clear and do not permit of any other construction.
152. Lion's argument is summarised in paragraphs 8.3 and 8.4 of Professor Blanchfield's first report:

"The trace amounts of Para Red detected were far below the level required to affect the colour of the chilli powder. Recalling the use of Para Red in printing inks, it is likely that the contamination occurred adventitiously and that the most likely source of the contamination is contact with ink at some stage of the production process. Contamination of the chilli powder at such low levels, and in such circumstances, cannot reasonably be described as Lion "using" Para Red "in or on food";

Accordingly, at the time of import and the time of supply, the subsequently discovered presence of trace amounts of Para Red, undetectable by the HPLC method then in force, did not constitute a failure to comply with the technical requirements of EC Regulation 178/2002 and the Colours in Food Regulations 1995(4). Moreover, in light of the conclusions of the SCFCAH meeting on 23 June 2006, echoed in the FSA letter of 3 July 2003, it is clear that the chilli powder would be regarded today by the relevant regulatory authorities as compliant with EC and UK law. I know of no technical or legal reason why the chilli powder in question could not be incorporated as an ingredient in food for human consumption, nor of any reason why food products already incorporating the chilli powder would be unfit for human consumption, assuming that they were fit in other respects not connected with the chilli powder".

153. In paragraph 2.3 of his second report Professor Blanchfield adds this:

"The Colours in Food Regulations 1995 state "the noun 'colour' means a food additive which is used or intended to be used for the primary purpose of adding or restoring colouring in a food," Para Red at the very low level found in the batch of chilli powder supplied to the Claimant cannot have been "used or intended to be used for the primary purpose of adding or restoring colouring to the chilli powder" (levels of the order of 1000 times greater would be needed for such a purpose). Hence, for the purposes of the Regulations, Para Red at the level found in the batch of chilli powder is not a "colour" and its presence at that level is therefore not an infringement of the Regulations".

154. In their opening submissions Mr Simpson and Mr Casey make the point (which they describe as "absurd") that if Hazlewood is right the FSA are permitting breaches of the regulations in permitting Para Red at the levels contained in the current guidance.
155. In paragraph 6 and 7 their closing submissions Mr Simpson and Mr Casey in effect adopt the arguments of Professor Blanchfield. They put the matter thus:

6. "When the statutory definition of "colour" in regulation 2(1)^[10] is applied to Regulation 3(1)^[11], it is clear that the legislation primarily prohibits the positive act^[12] of using a food additive in or on food in circumstances where it is used or intended to be used for the primary purpose of adding or restoring colouring in a food. Where, however, a non-permitted dye is present in food as a result of accidental contamination, there can be no "use" of the dye within the meaning of Article 3(1), nor can the dye be regarded as a "colour" within the meaning of Article 2(1).

7. Whilst it is correct that regulation 7(4)^[13] imposes liability on a seller for the sale of food contravening the Colours Regulations in circumstances where the seller need not be responsible for, or even aware of, the presence of the non-permitted substance, such liability is nevertheless contingent on a "colour" within the meaning of regulation 2(1) being used in or on "that food" (i.e. the food that is actually sold by the seller) within the meaning of regulation 3(1). Thus, a seller cannot be liable for the onward sale of food containing a non-permitted colour under regulation 7(4) unless a third party has added a non-permitted substance for the purpose of adding or restoring colour to that food".

156. Whilst I see the force of Lion's arguments I cannot accept them. In my view the words of regulation 7(4) are plain and are to be construed in accordance with Hazlewood's submission.
157. I would make the following comments on the arguments addressed to me:

1. In my view the argument in paragraph 2.3 of Professor Blanchfield's second report and in Mr Simpson and Mr Casey's closing submissions is misconceived. Para Red either is or is not a colour within the meaning of the regulations. Whether it is a colour cannot, in my view be determined by the amount present. It is common ground that Para Red is a synthetic dye. If added to foods in appropriate quantities its purpose is for adding or restoring colour. In my view it is a colour within the meaning of the regulations. It is to be noted that if Professor Blanchfield is correct then Para Red at levels detectable by HPLC methodology would not be colours^[14].

2. If the argument is correct it would mean that the frequent statements by the FSA to the effect that the presence of the Sudan Dyes/ Para Red at any level was not permitted was an incorrect statement of the law.

3. In my view the presence of the Para Red in the chilli powder shows that it has been "added" within the meaning of the regulations. It is not necessary for Hazlewood to show that it has been added deliberately.

4. The object of the regulations is to protect the public. I cannot for my part think that parliament intended there to be an investigation of how a colour was added before determining whether there was a breach of the regulations. It is the presence of the contaminant and not its source which the regulations seek to prevent.

5. Whilst I accept that the construction of regulation 7(4) that I prefer leads to the conclusion that the FSA are condoning the sale of chilli powder containing levels of azo dyes that breach the regulations, I do not regard that conclusion as absurd. I agree with Dr Dinsdale that the decision appears to have been a pragmatic decision based on considerations of trade between Member States. Furthermore there are a number of statements from the FSA to the effect that illegal dyes at any level are not permitted in food. Thus the FSA appear to have been fully aware of the regulations and to take the same strict view of their effect.

6. It is by no means clear to me what level of contamination contravenes regulation 7(4) if Lion's argument is correct. It is in particular not clear what words need to be read into regulation 7(4). It is not for example possible to incorporate a clause that refers to the guidance from the FSA because the FSA guidance at the end of April was one of zero tolerance.

158. I am conscious that the construction of the regulations that I prefer means that it is not necessary for me to make any findings on whether the Para Red was added deliberately or was present by accident or as a result of negligence by some person unknown. In case the matter goes further and the matter becomes relevant on appeal it is right that I should make the following findings:
159. In my judgment there is insufficient evidence for me to determine how Batch 1 became contaminated with Para Red. I accordingly find that the source of the contamination is unknown. It follows in my judgment:

1. Hazlewood have not proved that Para Red was added to the chilli powder deliberately by anyone.

2. Lion have not proved that the presence of Para Red was not as a result of deliberate addition. Whilst I see the force of Professor Blanchfield's view that it is probable that it was not added deliberately to the whole batch, it may have been added deliberately to a small part of the chilli powder and been diluted.

3. Equally Lion have not proved that the presence of Para Red was not as a result of negligence and was there as a result of pure chance.

6.2 EC Regulation 178/2002

160. Hazlewood's case is that there is a breach of Article 14 but I was referred in addition to the precautionary principle set out in Article 7.

Article 14 provides:

"1. Food shall not be placed on the market if it is unsafe.

2. Food shall be deemed to be unsafe if it is considered to be:

(a) injurious to health;

(b) unfit for human consumption.

3. In determining whether any food is unsafe, regard shall be had:

(a) to the normal conditions of use of the food by the consumer and at each stage of production, processing and distribution, and

(b) to the information provided to the consumer, including information on the label, or other information generally available to the consumer concerning the avoidance of specific adverse health effects from a particular food or category of foods.

4. In determining whether any food is injurious to health, regard shall be had:

(a) not only to the probable immediate and/or short-term and/or long-term effects of that food on the health of a person consuming it, but also on subsequent generations;

(b) to the probable cumulative toxic effects;

(c) to the particular health sensitivities of a specific category of consumers where the food is intended for that category of consumers.

5. In determining whether any food is unfit for human consumption, regard shall be had to whether the food is unacceptable for human consumption according to its intended use, for reasons of contamination, whether by extraneous matter or otherwise, or through putrefaction, deterioration or decay".

…

161. All of the experts agree that the chilli powder was not injurious to health within the meaning of Art 14 2(a). Thus the crucial question to be decided is whether the chilli powder was fit for human consumption. In my view the levels of Para Red in the chilli powder did not make it unfit for human consumption. In paragraph 7.1.9 of his report Dr Dinsdale makes the point:

In my opinion, therefore, it breached Article 14(2) in that it was unfit for human consumption by virtue of being unfit for the commercial purpose of being used as a food ingredient [Article 14(5)].

162. Mr Keith makes a similar point in his closing submissions.

"Article 14 is in a sense confusing because it includes unfitness as defined in 14.5 within the definition of "unsafeness" in 14.1; but it is nonetheless clear from 14.2 and 14.5 that "unfitness" is different from and to be distinguished from harm to health.

The definition of "unfitness" in 14.5 incorporates the concept of consumer "acceptability" which comes very close to the concept of saleability in the agreed implied term as to fitness for purpose. It specifically refers to "contamination, whether by extraneous matter or otherwise", yet which by reason of Article 2(a) need not be injurious to health in order to be unlawful".

163. I accept that food can unsafe either on the grounds specified in Art 14.2 (a) or (b). Thus it can be unfit for human consumption even though it is not injurious to health. I equally accept that the presence of extraneous matter is relevant to the question of whether the food is so unfit. However the Article does not provide that any contamination will render the food unfit; it simply requires the Court to have regard to the contamination in determining whether it is so unfit.
164. In my view the level of contamination in this case did not make the food unacceptable for human consumption. No doubt that was a major factor that influenced both SCOFCAH and the FSA in the decisions that were made in the middle of May 2005 and the summer of 2006.
165. It follows that contrary to the submission of Mr Keith I do not think there was a breach of Article 14.

6.3 Free from foreign and extraneous matter.

166. Logically there are 2 distinct questions that need to be addressed. The first is whether Para-Red is foreign and extraneous matter within the meaning of the Raw Material Specification; the second is whether the quantities of Para Red found within the chilli powder were so small that it can properly be described as free from foreign and extraneous matter.

Foreign and extraneous matter

167. In paragraph 67 of their closing submissions Mr Simpson and Mr Casey put the position in this way:

67. "Against this legal background, Lion's case is that "foreign and extraneous matter" is a technical term or term of art within the food industry and denotes solid objects that are foreign to food, such as glass, metal, packaging fragments, cigarette ends, insect remains, dirt sand and soil etc, and does not include chemical contaminants such as Para Red at 240ppb. Indeed, Prof. Blanchfield gave evidence that in his 61 years in the food industry, he had never encountered "foreign and extraneous matter" or its associated terms used to refer to trace amounts of chemical substances".

168. In paragraph 68 they refer me to a number of regulations that they contend support their view. In his closing oral submissions Mr Keith met this by producing The Colouring Matter in Food Regulations 1973. In these regulations it is plain that dyes are within the definition of colouring matter.
169. In paragraphs 69 to 73 Mr Simpson and Mr Casey develop the argument. They express the conclusion in paragraph 74

74. "It is emphatically not. It is a chemical contaminant that is only detectable using the sophisticated apparatus used for LCMS analysis, is not a solid object and does not take the form of particulate matter. Indeed, the expert evidence of Dr. Farnell and Prof. Blanchfield was that it would typically be added by being dissolved in oil and would coat the chilli particles in the chilli powder, though obviously only at a sub-microscopic level"^[15].

170. In paragraphs 77 to 82 there is a detailed analysis of Dr Dinsdale's evidence including a reference to paragraph 7.3.7 of his report and to his cross-examination.
171. In paragraph 32 and 33 of his closing submissions Mr Keith deals with the matter very much more succinctly:

32. "Para Red was clearly foreign and extraneous matter. It was a powder soluble in oil (per Farnell, Day 4 p. 143 lines 12 to 14). It was an identifiable, synthetic substance, present in a detectable quantity, which should not have been there. "When you get a material which is so alien to the product, I can't see any other way to class it than as "foreign and extraneous", per

Dr Dinsdale, Day 3 p. 141 lines 8 to 12.

33. Only two arguments seem to be put forward by Lion in answer to this part of Hazlewood's case. One is that is that only foreign objects or items which are visible to the naked eye are prohibited. Yet:

(1) there is no sound reason for confining the prohibition to such objects or items. One person's eyesight may be better than another's. There is no logical basis for distinguishing e.g. bits of a shoe from the polish on that shoe;

(2) if a substance such as Para Red is discoverable using the LC-MS testing method, then it is something that should not be there".

172. I do not accept that the meaning of "foreign and extraneous matter" in this contract is within the expertise of any of the experts who gave evidence before me. Nor do I accept that the words are a "term of art" within the food industry. They are ordinary English words and fall to be construed in that context.
173. In my view the Raw Material Specification has to be read as a whole. In particular it seems to me that the construction of the General Quality Requirements has to take into account the Safety/Quality parameters set out in Clause 10. As I have already noted clause 10 sets out specific permissible limits for 11 possible contaminants.
174. It seems to me in the light of clause 10 that other possible contaminants such as Para Red or an azo dye are within the meaning of the phrase "foreign or extraneous matter". As Mr Keith points out Para Red is "matter"; it is foreign or extraneous because it is not there naturally and not supposed to be there. This is so whether the Para Red has been introduced into the chilli powder adventitiously or deliberately. Accordingly I prefer the arguments of Mr Keith on this point.

Free from

175. In his second report Professor Blanchfield argues that free from cannot mean "absolutely free from".

"Scientifically, "free from..." can never mean "absolutely free from...". As I point out in paragraph 4.4.1 of my main Report.

Analytical methods are very much a "moveable feast", with continuous improvement, particularly of instrumental equipment, making possible detection and determination of ever smaller amounts of the substance being sought, so that "not present" (or, more correctly stated, "not detected") yesterday becomes "parts per billion" today or even "parts per trillion" tomorrow. It is therefore neither meaningful nor possible to state that a substance being tested for is not present. It is only possible to state that it is not detected by the method currently in use."

176. Thus the question to be decided is whether "free from" means "undetectable by the method currently in use" as suggested by Professor Blanchfield. To my mind there are a number of difficulties with this interpretation. As the facts of this case show it is not always possible to say what method is currently in use. LCMS methodology was being offered to Lion by at least 5 laboratories from early March 2005. The Eurofins test was carried out on 21^st April 2005. Thus there would be considerable uncertainty as to the permitted level. Professor Blanchfield's interpretation does violence to the meaning of "free from".
177. In paragraphs 85 to 87 of their closing submissions Mr Simpson and Mr Casey seek to rely two further points. First, they rely on the concession by Hazlewood that they could not contend that the chilli powder was not 100% Chilli.
178. Second, and in their closing oral submissions Mr Simpson and Mr Casey sought to rely on an answer given by Dr Dinsdale in cross-examination. Dr Dinsdale were persuaded to agree that "free from" was to be judged by "an" acceptable method of testing. As HPLC was an acceptable method of testing and was only accurate to 0.5 ppm it followed that free from was to be construed as a reference to that level.
179. In my view neither of these arguments are of any assistance or indeed relevant to the meaning of the word "free from". The fact that Hazlewood have chosen not to pursue the claim based on 100% Chilli does not assist me in the meaning of free from. Dr Dinsdale cannot give expert evidence on the meaning of free from and his views are of little assistance. I do not accept either the premise in the argument or the conclusion sought to be drawn from it. It is, to my mind confusing the meaning of "free from" with the method of testing whether the substance is in fact "free from".
180. In both his skeleton argument and his closing submissions Mr Keith referred me to the decision of the House of Lords in Arcos v Ronassan^[16] in which the contract was for the sale of staves of half an inch in thickness. Of the staves in fact supplied, only about 15 per cent complied with that description, but the rest were nearly all less than nine sixteenths of an inch thick. Despite findings that they were commercially within, and merchantable under, the contract specification and that they were reasonably fit for their purpose (which was the making of cement barrels), the buyers were held entitled to reject. Lord Atkin said that

"if the seller wants a margin he must, and in my experience does, stipulate for it".

181. I agree with Mr Keith that "free from" means what it says – absolutely "free from". It follows that the chilli powder was not free from foreign and extraneous matter.

6.4 Reasonably fit for its purpose

182. Section 14(3) of the Sale of Goods Act 1979 provides that:

"Where the seller sells goods in the course of a business and the buyer, expressly or by implication, makes known

(a) to the seller. . ..

any particular purpose for which the goods are being bought, there is an implied term that the goods supplied under the contract are reasonably fit for that purpose, whether or not that is a purpose for which such goods are commonly supplied, except where the circumstances show that the buyer does not rely, or that it is unreasonable for him to rely, on the skill or judgement of the seller…".

183. It is not in dispute that Hazlewood purchased the chilli powder for the purpose of being incorporated into manufactured foods for onward resale to the retail market. It is not in dispute that the sale by Lion was a sale in the course of a business and that they were aware of the purpose for which the chilli powder was bought. It is not suggested that this is a case where it was unreasonable for Hazlewood to rely on the skill of Lion. Thus the question to be determined is whether the chilli powder was reasonably fit for Hazlewood's purpose.
184. Hazlewood submit that it was not. They rely on a number of matters:

1. they contend that the relevant date is the date of the sale i.e. March and April 2005

2. at that time the market was jittery as a result of the 2005 Sudan I incident. (It will be recalled that some 580 products were posted on the FSA website by 8^th March 2005).

3. the FSA were at that time operating a zero tolerance attitude to the Sudan dyes. The guidance dated 18^th February 2004 made it clear that they were not permitted at any level.

4. Para Red is from the same family of dyes as the Sudan dyes and is not a natural or expected material.

5. they contend that the FSA made on 3^rd May 2005 was both predictable and not unreasonable in all the circumstances.

6. they contend that the chilli powder contaminated with Para Red even at levels of 120 – 240 ppb was not reasonably fit for its purpose because even at that level it and any products manufactured from it were liable to be the subject of a recall by the FSA.

185. I was referred to the decision of Tomlinson J, at first instance, in Britvic v Messer^[17]. This is a case with some similarities to the present in that it concerned the contamination of soft drinks with benzene in the CO₂ supplied by Messer. Benzene is a known carcinogen but in the levels found was not injurious to health.
186. I shall not lengthen this judgment by extensive citations from the judgment. I was referred to paragraphs 76 – 78 , 91 and 92 of the judgment.
187. There are in fact significant differences in the facts of the Britvic case and this case. In their second skeleton argument Mr Simpson and Mr Casey analyse these differences with some care. For convenience I set out the submissions:

10. "The distinctions between Britvic and the present case are obvious, and fundamental. In the present case the product supplied did not breach the FSA standard current at the date of supply (1000ppb) or the European limit subsequently adopted (500 to 1000ppb). Nor did the end products did contain any measurable Para Red.

11. A table setting out the comparative levels of Para Red and benzene in the relevant raw ingredients (Batch1, Batch 2 and the CO2) and in the relevant end products (Hazlewood's ready-made foods and sauces and the carbonated drink products) is attached to this document as Annex 1".

Contamination of the product supplied

12. "In Britvic, the amount of benzene present in the CO2 exceeded the subsequently adopted European standard by many orders of magnitude (10,000ppb as opposed to 20ppb, a factor of 50).

13. By contrast, the chilli powder in Batch 1 met the industry standard of 1000ppb prevailing at the date of supply, the standard of 500-1000ppb imposed by SCFCAH at its meeting on 10 May 2005 and adopted by the FSA on 19^th May 2005, and that standard as reaffirmed by SCFCAH at its meeting on 23 June 2006".

Conclusion

16. "It is thus abundantly clear that the two points that were determinative of Tomlinson J's decision in Britvic are nowhere to be found in the present case. In particular:

1) The chilli powder in Batch 1 satisfied the standard set by the industry, the FSA and SCFCAH both prior to, and after the date of supply; and

2) There was no measurable Para Red in the finished products. In fact, the most sensitive method of analysis then available was incapable of detecting dyes such as Para Red at levels tantamount to vanishing point".

188. The flaw in this argument, as I see it, is the repeated submission that the FSA and industry standard as at the date of supply was 1000 ppb. I cannot accept that submission. As I have demonstrated the FSA had repeatedly stated that no level was permitted for any purpose. The highest that can be said is that the 2 methods recognised by the FSA used HPLC methodology and thus would not have detected levels of less than 500ppb. Furthermore I do not accept that there was any settled industry standard in March 2005 either in respect of the method of testing or of the limit of detection.
189. In paragraphs 15 to 17 of his closing submissions Mr Keith deals with this point in detail. I shall not set out the points he makes. I do however accept his submission.
190. I agree with Mr Simpson and Mr Casey that the Britvic case is of limited value in the resolution of this dispute. I do not, however, agree that it follows that on the facts of this case Hazlewood must lose.
191. In my view the sale of the chilli powder contaminated with measurable quantities of Para Red was not reasonably fit for its purpose when sold because products manufactured from it were liable to be posted on the FSA website and to be subject to recall as a result of advice or instruction from the FSA.
192. In their closing submissions Mr Simpson and Mr Casey suggest that the advice from the FSA on 29^th April 2005 did not compel a recall of the products manufactured with the chilli powder. It was only advice. In their oral closing submissions they accepted that that submission is unrealistic. The recall of the products was the inevitable and foreseeable consequence of the FSA advice. Indeed the FSA considered instructing local authorities to institute enforcement proceedings.

It is true that the FSA relaxed their guidance on 19^th May 2005. Furthermore the relaxed guidance was, in substance adopted in June 2006. None of this, however, affects the fact that as at the date of sale the FSA's attitude was one of zero tolerance. Furthermore, for reasons already given, the decision of the FSA to advise a recall products was both predictable, in line with decisions of other European countries and cannot be said to have been unreasonable.

193. I therefore conclude that there was a breach of section 14(3) of the Act.

6.5 Satisfactory quality

Section 14(2) of the Act provides:

"Where the seller sells goods in the course of a business, there is an implied term that the goods supplied under the contract are of satisfactory quality.

(2A) For the purposes of this Act, goods are of satisfactory quality if they meet the standard that a reasonable person would regard as satisfactory, taking into account any description of the goods, the price (if relevant) and all other relevant circumstances.

(2B) For the purposes of this Act, the quality of goods includes their state and condition and the following (among others) are in appropriate cases aspects of the quality of goods-

(a) fitness for all the purposes for which goods of the kind in question are commonly supplied,

(b) appearance and finish,

(c) freedom from minor defects,

(d) safety, and

(e) durability".

194. As Mr Keith points out in his closing submissions this term adds very little to the previous discussion. In my view a reasonable person would not regard the chilli powder contaminated with measurable quantities with Para Red as satisfactory because the products manufactured with it at the time of the sale were liable to be posted on the FSA website or to be recalled by the FSA.
195. It is true that chilli powder similarly contaminated would not have been recalled after 19^th May 2005. It is equally true that the foods manufactured with the chilli powder had no measurable quantities of Para Red. However, none of this affects the point that as at the date of sale the FSA were adopting a zero tolerance attitude to azo dyes. As already noted this attitude was in line with the decisions taken by other European countries and cannot be castigated as unreasonable. Thus the recall of 3^rd May was predictable.

7. Conclusion

196. In my view this claim succeeds and there will be judgment for Hazlewood accordingly.

JOHN BEHRENS
26 July 2007

Note 1   . Dr Farnell pointed out that both HPLC and LCMS are based on liquid chromatography, a very well-known chemical technique. The difference between the two techniques was with the method of detection. A mass spectrometer was significantly more expensive than a diode and thus many laboratories across the world would not have had access or the ability to develop the LCMS test.    [Back]

Note 2   D3(1)/481    [Back]

Note 3   i.e. the chilli powder contaminated at 1.2ppm    [Back]

Note 4   D3(1)/480    [Back]

Note 5   D3(1)/570    [Back]

Note 6   D3(2)/810    [Back]

Note 7   CCFRA is the laboratory that carried out the original test that had produced a figure of 80 ppb.    [Back]

Note 8   Day 1 page 132 line 2;    [Back]

Note 9   Page 138 line 8; page 142 line 10    [Back]

Note 10   “The noun ‘colour’ means a food additive which is used or intended to be used for the primary purpose of adding or restoring colouring in a food.” [E/57]    [Back]

Note 11   “No person shall use in or on any food any colour other than a permitted colour” [E/59]    [Back]

Note 12   The New Oxford English Dictionary defines “use” as to “Make use of (a thing) esp, for a particular purpose; utilize”.     [Back]

Note 13   “No person shall sell any food having in or on it any colour other than a permitted colour that has been used in or on that food without contravening any of the provisions of regulations 3,4,5 and 6.” [E/60]    [Back]

Note 14   Professor Blanchfield made the point that to have any effect on the colour the level of contamination would have to be many hundreds of parts per million. HPLC methodology can detect contamination at 500 ppb (a figure less than the figure necessary to have any noticeable effect on colour). Thus at 500 ppb it would be arguable that the Para Red was not added deliberately and thus not a colour.    [Back]

Note 15   Day 4 124/4-10 and 143/12-14    [Back]

Note 16   [1933] AC 470    [Back]

Note 17   [2002] 1 LLR 50    [Back]