Scottish Court of Session Decisions

Lambs born and raised on upland and similar terrain in the United Kingdom put on less weight than those raised on lusher pasture. The former are known as "lean lambs". Substantial numbers of lean lambs have traditionally been exported, there being a market for them principally in southern Europe.

The outbreak of foot and mouth disease in the United Kingdom early this year resulted in a ban on the export of certain animals, including lambs. That ban remains in force. The population of lean lambs is much greater than could be disposed of for domestic consumption; in Scotland the supply exceeds by some four times the anticipated demand. In addition to the economic consequences for producers, the ban creates serious animal welfare problems. There is inadequate grazing to feed the elevated population over the autumn and winter; there is a serious risk that, if steps are not taken substantially to reduce that population, many animals may die of starvation.

In recognition of those difficulties the European Commission has authorised the use of state aid for the culling of surplus lambs. The governmental body charged with devising and implementing an appropriate scheme is the Intervention Board Executive Agency ("the Board"). So far as concerned Scotland a scheme entitled "Livestock Welfare Disposal Scheme-Light Lambs" ("the Scheme") was promulgated by the Board on 31 August 2001. The Scheme is an extension of an earlier livestock scheme consequent on the outbreak of foot and mouth disease. In discharging its functions in Scotland the Board has been assisted by the Scottish Ministers through the Scottish Executive Environment and Rural Affairs Department ("SEERAD").

Abattoirs in Scotland which slaughter animals for human consumption require to be licensed for that purpose under the Fresh Meat (Hygiene and Inspection) Regulations 1995, as amended. The culling of animals (with a view to the subsequent rendering of their carcasses) could not, consistently with the licence terms, be carried out contemporaneously with the slaughter of animals for human consumption. Among other things the hygiene requirements for the former are more stringent than those for the latter. The authority charged with the administration of the 1995 Regulations is the Food Standards Agency.

The Board (with the co-operation of SEERAD) holds extensive information concerning licensed abattoirs in Scotland. It made use of that information in considering the form of the scheme to be devised for light lambs and the persons who should be invited to participate in implement of it. The Board also, in the summer of this year, made soundings in the industry as to which abattoir operators might be interested in participating and at what charges. By a relatively early stage the Board had devised certain criteria which it considered should be satisfied by any participating abattoir. These included a capacity to cull at least 2,000 lambs per day and a preparedness to do so continuously from the beginning of the Scheme until its completion in about December of this year. Satisfaction of the latter criterion would inevitably result in the abattoir surrendering, for the duration of the Scheme, its licence under the 1995 Regulations. Arrangements were made with the Food Standards Agency for expeditious re-licensing after completion of participation, by the issue subject to certain conditions of a new licence within five working days of reapplication.

The Scheme promulgated on 31 August 2001 listed three commercial abattoir operators in Scotland (one at Biggar, one at Dingwall and one at Turriff) for the purposes of the Scheme. It also listed a number of "collection centres", being commercial organisations providing places at which lambs destined for culling under the Scheme could be gathered.

The first petitioner in this application for judicial review is a company operating an abattoir at Stornoway on the Isle of Lewis. The second petitioner is a company which an operates an auction mart at Stornoway and has certain facilities there which could act as a collection centre for stock destined for the first petitioner's abattoir. The first petitioner was not included in the list of abattoir operators specified in the Scheme. Nor was the second petitioner included in the list of collection centres. The petitioners seek certain remedies relative to their non-inclusion in these lists.

No Answers were lodged prior to or at the first hearing of the petition but Mr. Howlin appeared at that hearing for the Board and for SEERAD and moved me to dismiss the petition. Although a number of factual issues remained unresolved there was by the conclusion of that hearing sufficient common ground as to the history of matters to allow me to reach a substantive conclusion. That history, in so far as not already narrated, may be summarised as follows.

Mr. Robert McEwan is a technical inspector with SEERAD whose personal services are currently contracted out to the Board. In the course of a visit to the Western Isles in the latter part of July 2001 Mr. McEwan had certain discussions with Mr. Angus Graham, the chairman of both petitioners. Mr. McEwan advised Mr. Graham that the scheme envisaged by the public authorities was one under which any participating abattoir operator would be required for its duration to surrender its licence to slaughter animals for human consumption. It appears that thereafter Mr. Graham and other officers of the petitioners explored the possibility of an arrangement whereby the first petitioner might be considered for participation in the prospective scheme on a basis which did not preclude the slaughter at certain times of animals for human consumption. In particular, they had in mind that the first petitioner might operate a "two week on/two week off" arrangement, that is, one under which it would cull lean lambs for a two-week period followed by another two-week period during which it would slaughter animals for human consumption, this alternate pattern being repeated over some months. The petitioners approached the Food Standards Agency which, according to the petitioners, indicated that such an arrangement would be acceptable to it. (This is disputed by the respondents but I proceed for present purposes on the assumption that it is accurate). On or about 27 August Mr. McEwan was again in the Western Isles when he was advised by the petitioners that they wished to propose the "two week on/two week off" arrangement. There is a dispute (to which I shall return) as to what reaction the petitioners then received from Mr. McEwan. In the event the petitioners thereafter sought to take matters further with the Board directly. Several telephone calls were made to it on each of 29, 30 and 31 August and on the last of those dates a fax was sent in which the first petitioner stated that it wished to participate in the prospective scheme and requested that "tender documents" be sent to it as a matter of urgency. No response was made to those communications. On 31 August the Scheme was promulgated as narrated above. A few days later the petitioners through a third party obtained sight of a copy of it. On 6 September a telephone conversation took place between Mr. Graham and Mr. Ian Aitken (Depute Group Manager-LWDS Operations) of the Board. On 8 September Mr. Aitken wrote to Mr. Graham confirming the terms of that telephone conversation, stating -

The petitioners' complain of the actings of the Board (and incidentally of SEERAD) on a number of grounds. Some of these relate to alleged procedural unfairness, others to the legitimacy of the Scheme adopted. One aspect of the alleged procedural unfairness turns on what the petitioners allege they were told by Mr. McEwan on or about 27 August. They allege that he then told them that the facilities which each of them could offer (as an abattoir and as a collecting centre respectively) fulfilled the Board's criteria for the purposes of the prospective scheme and that he recommended that they contact the Board "with a view to obtaining the necessary application forms and tender documents to be considered for nomination as a nominated abattoir and collecting centre". These allegations are denied by the respondents but, for the purposes of disposal of this application, I assume them to be true.

Sir Crispin Agnew for the petitioners submitted that, as Mr. McEwan had told the petitioners in late August that they fulfilled the requisite criteria and should apply to the Board and as the latter had then failed to respond to the petitioners' communications, the process was procedurally unfair since it excluded the petitioners from being considered in circumstances in which they had been led to believe that they could make an application which would be considered. Mr. McEwan, it was submitted, was to be taken for that purpose as an agent of the Board. There was, it was argued, further procedural unfairness in that the Board had apparently adopted a policy that any participating abattoir must surrender its licence for the duration of the Scheme without first giving to the petitioners an opportunity to make a formal application in which they could explain why, in the particular circumstances of the Western Isles, the petitioners should be treated as an exception to such a policy. Sir Crispin further submitted that, having regard to the letter of 8 September, it was clear that the Board was either unaware of the petitioners' proposal (for a "two week-on, two-week-off" arrangement) and how that might be an exception to the policy (and thus had failed to take into account a material consideration) or had totally disregarded that proposal without giving any adequate reasons for doing so. Finally, Sir Crispin submitted that a "one cap fits all" policy, requiring in every case the surrender of the licence for the duration of the Scheme, was unreasonable in the context of the special conditions of the Western Isles. In elaborating these submissions Sir Crispin cited R v North and East Devon Health Authority, ex parte Coughlan [ 2001] QB 213, especially per Lord Woolf M.R. at pp. 241-3, particular reliance being placed on category (b) in para. 57. With reference to the adoption by a public authority of a policy and the need to take account of individual or exceptional circumstances, reference was made to Elder v Ross and Cromarty District Licensing Board 1990 SLT 307, per Lord Weir at p. 311 and In re Findlay [1985] 1AC 318 per Lord Scarman at pp. 335-6. As to the concept of "unreasonableness" in administrative action Sir Crispin reminded me of the recent observations by Lord Cooke of Thorndon in R (Daly) v Secretary of State for the Home Department [2001] 2WLR 1622 at para. 32.

In relation to his first submission Sir Crispin characterised Mr. McEwan's alleged observations on or about 27 August as a "promise" giving rise to a legitimate expectation on the part of the petitioners that they would be given an opportunity to present their proposal (for a "two-week on/two week-off" arrangement) to the Board and have it duly considered before the Scheme was finalised. But it is necessary, in my view, to set any observations then made by Mr. McEwan in the context of the function which the Board was discharging at the material time. Faced with the impending crisis of a surplus of lambs beyond pastural capacity and armed with authorisation to devise a scheme for culling, the Board had set about making its own investigation and fixing its own criteria with a view to dealing with the problem. As Mr Howlin explained, it had, having regard to geographical factors, the experience and capacity of plants (both abattoirs and rendering plants), animal welfare, economic considerations and timescale, devised a scheme whereby operators, selected by it and willing to participate, were contracted on a commercial basis to carry it through. The scheme devised, conceived in the interests of the animal producers, involved as prerequisites a minimum capacity of throughput and a preparedness on the part of any participating abattoir to dedicate itself exclusively to the Scheme during its existence. There never was, nor did there require to be, any general invitation to abattoirs to participate in a tendering process. This explanation of the context Sir Crispin was not in a position to dispute. But, more importantly, Sir Crispin was unable to satisfy me that there was any legal framework which gave rise to a legitimate expectation on the part of the petitioners that a proposal emanating from them and inconsistent with the Board's criteria would be considered by the Board before finalising the Scheme. The observations made by Mr. McEwan, even taken at their highest for the petitioners, did not, in my view, create any such legitimate expectation, not least because there is no basis on averment or otherwise for the conclusion that Mr. McEwan had such authority as would allow any words of his to bind the Board in its relevant actions. Nor was any other framework identified that gave to the petitioners a legitimate expectation that representations made by them would be taken into account before any scheme was fixed on or promulgated. The circumstances are, in my view, materially different from those in R v North and East Devon Health Authority, ex parte Coughlan and in the case (A-G of Hong Kong v Ngu Yuen Shiu [1983] 2AC 629) referred to in category (b) in para. 57 thereof. The public authorities in the present case made no promise, by conduct or otherwise, which could found a relevant and legitimate expectation on the part of the petitioners.

As regards Sir Crispin's second submission, the Board was, in my view, quite entitled to adopt the criterion that participation in the Scheme, at least as first promulgated, should be conditional on a preparedness to surrender the slaughtering licence for the duration of the Scheme. The situation was quite different from that where, as in Elder v Ross and Cromarty District Licensing Board or In re Findlay, a statutory power or discretion is conferred upon a public body and a question arises of the significance of any general policy which the statutory body may adopt with reference to the exercise of that power. It is, in my view, mistaken to equiparate such a policy with the adoption of an executorial criterion such as that incorporated in the Scheme.

It is, in any event, plain that the Board did not wholly ignore the petitioners' proposal. If Mr Aitken's letter of 8 September accurately recorded the Board's position (and it was not suggested that it did not), the Board had by at least 6 September information before it as to the substance of what the petitioners proposed and had taken the view that, for the reasons there given, it had no current plans to contract for the first petitioner's services. The reasons given are intelligible (even if the petitioners find them unconvincing) and I am unable to conclude that the Board was unaware of what in substance was proposed or that it disregarded the information which it had.

As to Sir Crispin's final submission, I am unable to say that the Board's rejection of the petitioners' overtures was "unreasonable" (whether in the "Wednesbury" sense or in any other sense currently recognised in administrative law). While it is possible to argue, as Sir Crispin did, that the Western Isles should, for animal welfare or biosecurity reasons, be treated as a special case, there are at least equally compelling reasons why an appropriate scheme should be of general application and encompass the features adopted by the Board, including a prerequisite that any participating abattoir should have a substantial capacity and be prepared to commit that capacity exclusively to the Scheme during its subsistence. Indeed, on the figures put before me by Mr Howlin the petitioners could not, on the basis of the arrangement proposed by them, hope to complete the culling of lean lambs currently pasturing in the Western Isles with anything like the expedition reasonably demanded by the Board.

For these reasons I dismissed the first petitioner's application as irrelevant. Sir Crispin accepted that, if the grounds for review presented on behalf of the first petitioner failed, the petition in so far as presented by the second petitioner also failed.

I should add that at the discussion it became evident that part of the narrative set out in the petition (proceeding as it did on assumptions as to the mechanics of decision making within the public authorities) was inaccurate and that the form of the remedies sought might consequentially have been inappropriate. But, as I have reached my decision on the substance of the arguments advanced at the hearing, it is unnecessary further to discuss the terms of the petition. The petition also included a complaint of breach of Convention rights but this was not insisted in. I should add that some reference was also made in the petition and in argument to the possibility of the physical separation of abattoir and cutting facilities within the same premises but I did not understand this to be in the end material, the petitioners' primary concern being to operate the "two-week on/two-week off" arrangement for slaughtering and culling.