Christopher Vajda QC was the UK judge at the Court of Justice of the European Union from 2012 until the withdrawal of the UK from the EU in January 2020 when his mandate ceased. This is the text of the keynote speech he gave at the BEG spring conference on 22 May 2021.
I would like to begin by thanking the Bar European Group for being asked to deliver the keynote speech at this year’s conference. It is a particular honour and privilege to speak not as a serving judge but a former judge amongst the very distinguished judges that are here today, including, of course, our President. The only sadness is that we are meeting via our computers screens. The Bar European Group has, as our President has reminded us, a long and distinguished history. For me, and I am sure, many others a highlight of many previous annual conferences was the eloquent and erudite speech delivered by its former, and now sadly departed, President, Sir John Laws after an excellent dinner where he would regale us about the ancient and not so ancient civilisations of the particular place where the conference was being held. Most of us have a story about John. Let me share mine. We were working on a case together at the Bar when he informed me that he would go to New York for the weekend to meet up with his wife Sophie who was spending a term at a university there. When he arrived in the US he was asked by the somewhat curt immigration officer whether his short trip was for business or pleasure. John answered “Pleasure”. The immigration officer replied, “She must be quite a lady”. To which John retorted “She certainly is. She is my wife”.
That is enough of the past, now let’s look to the future. This is a good time to do so. Now in 2021, after over four years of uncertainty after the 2016 referendum as to what the legal relationship between the UK and EU would be following the withdrawal of the UK from the EU, we have the legal texts. At the EU-UK level there is the Withdrawal Agreement and now also the Trade and Co-operation Agreement (TCA). At the domestic level we have the EU (Withdrawal) Act 2018 and the EU (Withdrawal Agreement) Act 2020 giving effect to the Withdrawal Agreement and the EU (Future Relationship) Act 2020 implementing the TCA which came into force at the beginning of this year.
Standing back one can see that we have now entered a unique new legal relationship with the EU, unique not just from the UK perspective but also from the EU one as well. Take Northern Ireland as an example. The EU has accepted, for the first time, that the territory of a third country can be within the customs union and some aspects of the single market. The corollary of that is that the courts of that third country are entrusted with applying and enforcing the provisions of EU law applicable to Northern Ireland and that the reference procedure under Article 267 TFEU, familiar within the EU, continues to apply both to the courts of Northern Ireland and indeed the UKSC in respect of those provisions. So UK lawyers may still appear in preliminary references in Luxembourg. In the case of the rights of EU citizens in the UK the Withdrawal Agreement provides for a modified reference procedure in case of a dispute as to what their rights under the Withdrawal Agreement are. For its part, the TCA goes beyond what one might call a standard free trade agreement and introduces a number of innovations into such types of agreements, including the provisions on the “level playing field”. A huge amount has already been said and written, often in the form of very digestible blogs, about these major legal changes. This is a demonstration not only of the vibrancy of the UK legal community, which is something that struck me even more forcibly when I was a judge at the CJEU, but also of a huge interest as to how these new legal rules will work in practice.
I will limit myself this morning to two topics, retained EU case law and the future of EU law outside retained EU case law.
In essence retained EU case law is EU and domestic case law where the judgment was handed prior to 11pm on 31 December 2020, see s. 6 of the EU (Withdrawal) Act 2018. Put simply, it is EU case law frozen at that date. At the UK level the Supreme Court is entitled to depart from retained EU case law. The power has also been extended within England and Wales to the Court of Appeal and in Scotland and Northern Ireland to the equivalent appellate courts there, see s. 6(4) and the European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case law) Regulations 2020. The test for departing from retained EU case law is the same test as that used by the Supreme Court in deciding whether to depart from one of its previous decisions under the 1966 Practice Direction, namely whether it appears right to do so.
We have already had one case in the English Court of Appeal, TuneIn v Warner Music [2021] EWCA Civ. 441, a case involving interpretation of the Copyright Directive by the CJEU, where the Court rejected an application to depart from retained EU case law. What, to my mind, is interesting about TuneIn is that the judges sought, with a varying degree of precision, to list some factors as why it was the not the sort of case where it was appropriate to depart from the CJEU case law. This is an early indication that the Courts will be willing to set out a test, or more probably some general guidance. It stands in contrast to the approach of the House of Lords and Supreme Court under the 1966 Practice Direction which has been to eschew any such test or guidance so as to leave themselves with a largely free hand. In my view guidance from the Supreme Court on departure from retained EU case law is not only inevitable but also highly desirable if only to bring some degree of certainty to the task of the Court of Appeal, which is likely to face a number of requests to depart from EU retained case law. Clearly a litigant whose path to success is blocked by a CJEU judgment is likely to request the Court of Appeal to depart from that case law. This is an issue that the Supreme Court has not had to face under, what I might term, its domestic use of the Practice Direction since it is the only court with the power to depart from its own previous case law and perhaps understandably does not wish to fetter its own discretion in future cases.
Coming back to TuneIn, it was (and may still be) a dispute between two private parties where neither party has any incentive to consider what I might call the public interest although, of course, that does not preclude either party seeking to enlist what it perceives to the public interest in advancing its own case. Yet in a case where, as in TuneIn, one party is seeking to depart from previous case law there is, as all members of the Court of Appeal recognised, an important issue of legal certainty. If the Court accedes to the request, the Court will have to decide whether its judgment should be declaratory and hence in effect be ex tunc. That means the judgment would have retrospective effect to the date on which the power was granted. The alternative would be for the judgment to be ex nunc that is to say of prospective effect only. If, in order to reduce legal uncertainty, the court decides that its judgment will have prospective effect only, the court will come very close to acting as a legislator. Its decision will have consequences for other people. This is a “polycentric” question, to use the expression used by Professor Lon Fuller in ‘The Forms and Limits of Adjudication’ (1978) 92 Harv. LR 353, which Parliament, as the legislator, might be considered to be better equipped than the courts to carry out, in particular in the balancing of competing interests. However it is a task that has been entrusted to the courts and the courts cannot abdicate their responsibility.
The question is therefore how can the courts put themselves in the best position to discharge this responsibility. Where a party asks the Supreme Court to depart from its previous case law, the relevant Practice Directions (3 and 4) require that party to say so. The purpose of this is to give advance warning to the Court for it decide whether the appeal should be heard by more than the conventional number of five Justices. I understand that it is intended to amend those Practice Directions to make it clear that those provisions cover also with a proposed departure from EU Retained Case Law.
While this is welcome, the Supreme Court should, in my view, go further than simply requiring a party to notify the Court of a requested departure from retained EU case law. The fact that such a notification is felt necessary to alert the Court as to whether it should sit in a formation of more than five indicates that the case is potentially rather important. For reasons that I will elaborate on, I think that the Supreme Court should not only individually notify the four nations within the UK but also publicize such a requested departure on its website as soon as possible after the appeal has been lodged so that other interested parties would be alerted to the opportunity of making written and, if necessary, oral submissions. There are two reasons why, in my view, this would be beneficial.
First, the Supreme Court is a UK Court and it is important to give practical effect to that by ensuring that all the four nations that make up the UK are given notice of an appeal where one of the parties is inviting the SC to depart from retained EU case law which, one must remember, is law that applies across the UK and so is effect UK law, as opposed to, say, just English law.
I hope I will be forgiven for saying that, as those of us who are English lawyers, we may lose sight of the fact that the other UK nations may have different views on issues of public policy or whether a particular line of EU case law should be retained or dispensed with. During my time at the Bar I was instructed by the Welsh Government on issues relating to the implementation of EU agricultural and environmental Directives. It is a matter of public record that the Welsh Government did not always see eye to eye with Whitehall as how to implement and apply EU Directives in Wales. Let me give you a hypothetical example as to what might happen in the future. An English farmer asks the Supreme Court to depart from EU retained case law on say environmental standards. If the farmer were successful, such a judgement could affect farming practices in Wales. It therefore seems to me that the Welsh Government and Welsh interests should be notified of this in advance of a hearing by the Supreme Court so as to offer them the opportunity of intervening in the case. Such a notification system would demonstrate to Wales and Welsh interests that the Supreme Court is truly a UK court and not simply an English or London centric one.
As those of you familiar with CJEU procedures will know, the CJEU operates a similar notification system for cases lodged before it. The Statute of the CJEU requires it to notify all the Member States and EU Institutions of all incoming cases. In the case of a reference, the notification takes the form of a translation of the Order for Reference into the national language of all Member States. On the basis of that notification, a Member State can decide to intervene, which entitles it to see the written pleadings and make its own written and/or oral submissions. That is a feature that is greatly valued by the Member States and it is unthinkable that the Member States would consent to its removal. As a judge, I also found it useful and sometimes almost essential. I recall a reference case from Member State A where I was the Reporting Judge. All parties from that Member State and the Commission proceeded on the assumption that the starting point was some previous CJEU case law. However, Member State B intervened to argue forcefully why that line of EU case law was wrongly decided and should not be followed. As it turned out, Member State B was correct. But for the intervention the error might have been perpetuated.
Secondly, so far as other interested parties are concerned, publication on a court’s website would assist them in finding out about a pending case of importance to them. Again their contribution may prove to be of assistance to the Court in deciding this quasi legislative and polycentric question and result in a judgment which has been seen to take account of all relevant views. In the recent case of Halliburton v Chubb [2020] UKSC 48 the Supreme Court had to consider the duty of disclosure of an arbitrator, an issue that was of huge importance to the UK – and indeed international – arbitration community. There the Court had the benefit of a number of interventions from non-governmental associations who had different perspectives on the right approach to take. Those interventions were reflected in, if I may respectfully say so, the very impressive judgment of the Court. The arbitration community is well organised and the grapevine works well. One cannot, however, assume that all potentially interested parties would be so well informed in all types of cases where the issue of retained EU case law may arise.
I have focused on cases where a party is seeking to depart from EU retained case law. But logically there is no reason such a notification system should be confined to a possible departure from EU retained case law. It would be apt to cover any case where a party signalled its intention to request a departure from previous House of Lords or Supreme Court authority under the 1966 Practice Direction and, insofar as it is not already covered by Rule 40 of the Supreme Court Rules, to declarations of incompatibility under the Human Rights Act 1998. Rule 40 obliges that Court to notify the Crown in a case where a declaration of incompatibility is sought and the Crown is not already a party.
The Supreme Court already has an excellent website and there would, I think, be no practical difficulty in providing the necessary public notification on its website once the appeal notice has been lodged. Although forthcoming cases are put on the website, this is, unless I am mistaken, only a few weeks before the hearing which may not leave much, if any time, to make an application to intervene. A similar notification system should, in my view, be introduced mutatis mutandis for other appellate courts, such as the Court of Appeal.
Such a change would help bring such appellate courts closer to the citizens within the UK and should ensure that the courts have before them relevant arguments from all affected parties in the way that would occur if these polycentric issues were to be ventilated in Parliament. Happily we live in an era of greater transparency and participation in public life by the ordinary citizen referred to, in a previous era and now with a ring of antiquity, as the man on the Clapham Omnibus. For the types of cases I have referred to, I do not think that simply putting out a Daily Cause List with the names of the parties remains appropriate. In this respect the Competition Appeal Tribunal is a role model. It has an excellent website which publishes a summary of all its incoming cases.
I will now move on from the topic of EU retained case law and consider the future relationship, to use the term of the 2020 Act, between the common law and non EU retained case law, that is to say EU law as it may develop in the years to come. Common law, as we all know, is the law that is developed by judges. As Lord Goff observed in Kleinwort Benson Ltd v Lincoln City Council [1999] 2 AC 349 at p 377: “the common law is a living system of law, reacting to new events and new ideas, and so capable of providing the citizens of this country with a system of practical justice relevant to the times in which they live.”
We pride ourselves in this country on the development of the common law over the centuries. Happily the common law has also travelled well, particularly to the distant parts of the Commonwealth. But the success of the common law is, if I can mix metaphors, a two way street. That is to say that judgments of Commonwealth countries are cited in English courts when our judges are looking as to how the common law should develop in this country in the absence of an English precedent or indeed where Commonwealth courts have declined to follow an English case. All this is done without any statutory underpinning.
In the past and certainly before the UK acceded to what is today the EU in 1973, it would be rare indeed for English courts to cite judgments from countries or bodies that did not belong to what one might term the old commonwealth. There were many reasons for this. First, the absence of any common legal tradition and the fact that continental European legal systems were civil law systems, often based on the Napoleonic code which was alien to the legal systems within the UK. In many continental countries the idea that judges would create and develop the law, as in a common law jurisdiction, was anathema. Secondly, the judgments were generally not available in English and, even if they were translated, the drafting style was very different to the kind of judgment that we were used to. Judgments often consisted of a series of laconic assertions. Allied to that there was no regular contact between Judges in the UK and mainland Europe. Finally, in the case of the CJEU, there was little overlap in the subject matter of cases. In those pre 1973 days, the diet of the CJEU consisted mainly of coal and steel cases, customs and some free movement and competition law. All of this was unfamiliar and of little or no interest to those practising in the UK. I would add, as a personal aside, that in those days the UK competition law regime was largely based on the Restrictive Trade Practices Acts which looked at the form of the conduct rather than its effect and, so far as I am aware, were not adopted by any major country elsewhere in the world. The Acts were not really even understood within the UK other than by a few specialist gurus in the Inns of Court and the OFT. Remarkably, those Acts survived until 1998 when they were eventually pensioned off to be replaced by the Competition Act 1998, which is a domestic look alike to Articles 101 and 102 of the TFEU.
The position today post Brexit is very different. Let me start with the legal systems of some individual States on the European continent. The highest German courts either have English language translation of their judgments on their websites or provide a link to where one can find an English language version of their judgments. The German Constitutional Court has produced judgments in many important areas such as privacy which are of great relevance to the issues that we face in this country as well. Recently the German Federal Court of Justice (the highest German civil court) gave judgment in Sisvel v. Haier of 24 November 2020 on how to determine when a request for an injunction against an infringer of a standard essential patent, in a FRAND dispute, constitutes an abuse of a dominant position contrary to Article 102 TFEU. The judgment runs to 138 paragraphs and is written in a style that is understandable to UK lawyers. The judgment cites not only the CJEU case, C-170/13 Huawei v ZTE but also, with approval, the High Court judgment and that of the Supreme Court in Unwired Planet v Huawei [2020] UKSC 37. I should add that in Unwired Planet the Supreme Court itself carried out an exhaustive analysis of foreign cases, including cases from Germany, in dealing with the submission that the English courts were out of step with foreign courts on their approach to FRAND licensing. Judgment writing in France too is changing. While, in my judicial capacity, I still struggled, on occasions, with references made to the CJEU by the Conseil d’Etat and the Cour de Cassation, there is now a recognition within the senior French judiciary that judgments should be less laconic and give fuller reasons.
Where does the CJEU fit into all of this? I would suggest quite well. It is a court with which the UK legal profession has become very familiar not just in terms of subject matter of the cases but also style of judgment and indeed the more personal and discursive style of Opinions that bear a closer resemblance to judgments in the common law world. While the somewhat formulaic style of judgment may not be to everyone’s taste, the judgments themselves have become more “common law” in feel than the judgments pre UK Accession. The judgments recognise the importance of precedent in citing (possibly overciting) previous case law and applying the technique of distinguishing previous case law. So their technique of judgment writing is understandable. The judgments and Opinions are readily available in English and will continue to be so. Indeed the CJEU has every interest in ensuring the speedy availability of judgments and Opinions in English, not just because English remains an official language of the EU but also because the majority of the hits on the CJEU website are in English. CJEU judgments will deal with a large number of subject areas that will continue to be of relevance to the UK legal system.
Competition law is just one example. Let me refer to the recent Supreme Court judgment in Peninsula Securities v Dunnes Stores [2020] UKSC 36. The case concerned the lawfulness of a restrictive covenant accepted by a developer of a shopping centre in a lease granted to Dunnes, a retailer, for premises in the centre. Dunnes was in effect what is termed the anchor tenant. The lease was then assigned by the developer to a connected party, Peninsula. Peninsula subsequently sought to argue that the restrictive covenant in the lease was in restraint of trade. Peninsula faced a major difficulty since in 1968 the House of Lords had decided in Esso Petroleum v Harper’s Garage [1968] AC 269 that the restraint of trade doctrine was not engaged when a party has not given up a pre-existing freedom. This was the case for Peninsula which had taken the assignment of the lease with the covenant but it was not the case with the original developer. Nonetheless Peninsula had won in the Court of Appeal of Northern Ireland on the basis that there was no public policy reason (on which the doctrine is based) for the doctrine not to apply at the point of the assignment of the lease. What was the Supreme Court to do?
It began by reviewing the academic and the Commonwealth judicial reaction to Esso. It concluded that in the half century since Esso there has been no reasoned defence to the pre-existing freedom test. The question then arose as to what to do next. The Court decided that the so-called trading society test proposed by Lord Wilberforce, who was in the minority in Esso, was preferable. This test is whether the restrictions have “become part of the accepted machinery of a type of transaction which is generally found acceptable and necessary, so that instead of being regarded as restrictive they are accepted a part of the structure of a trading society”. Lord Wilson, giving the judgment of the Court, frankly conceded that the trading society test is conceptually unattractive. It is not rooted in principle. And, if I may say so, it seems to contain an element of circularity. That is to say when something is part of the accepted machinery of a type of transaction it is lawful. But by what token does one decide whether something is part of the accepted machinery? As Lord Wilson observed, at the time Esso was decided almost 100% of UK petrol stations had become subject to restrictive covenants yet Lord Wilberforce felt able to conclude “on balance”, without any evidence, that the practice had not become acceptable and necessary as part of the structure of a trading society. Notwithstanding these observations, the Court decided that Lord Wilberforce’s somewhat elastic test was preferable to the rather inflexible pre-existing freedom test. The Court therefore used the 1966 Practice Direction to depart from Esso.
What you may ask has any of this to do with EU law? The answer is that EU law has a developed competition law regime which had recently dealt with an analogous issue. Article 101 of the TFEU prohibits all agreements which have a more than de minimis anti-competitive effect unless they can be justified under specified gateways. As I indicated earlier, Parliament decided to model UK domestic competition law on EU competition law. The Chapter I prohibition in the 1998 Act equates to Article 101 TFEU. In 2011 Parliament decided no longer to exclude what are known as “land agreements”, which include leases and assignments, from the Chapter I prohibition. Such agreements had never been excluded from Article 101 TFEU. In November 2015 the CJEU decided C-345/14 Maxima Latvija. There the anchor tenant was given a right of veto over leases being granted to other traders in the same shopping centre. In competition terms the effect of this clause was similar to that of the restrictive covenant imposed on Peninsula. The CJEU applied its familiar case law on when a clause in an agreement has the effect of restricting competition within the meaning of Article 101 TFEU to restrictive covenants in shopping centres. It indicated that the national court needed to look at matters such as barriers to entry, the degree of retail concentration and the counter-factual. This approach provides more flexibility than the pre-existing freedom test but is more rooted in principle than the trading society test.
I am not saying that the approach of the CJEU in Maxima Latvija necessarily provided the answer in Peninsula. Rather I am saying is that it would have been good to have had the approach in Maxima Latvija “on the table” before the Supreme Court so that it had a fuller picture in deciding what was a better test than the pre-existing freedom test. By way of example, over 25 years ago in the landmark case of Woolwich Equitable Building Society v IRC [1993] AC 70 Lord Goff was able to draw, inter alia, on the case law of the CJEU on the recovery of unlawfully paid charges as support for his conclusion that the time had come for English law to recognise, in area untrammelled by EU law, that taxes paid by a citizen to a public authority pursuant to an ultra vires demand was in principle recoverable.
Going back another 25 years or so before Lord Goff’s speech in Woolwich, Lord Diplock delivered in 1971 the first Lord Upjohn Lecture, entitled “the Common Market and the Common Law”. The position was the reverse of what it is today. The UK was about to accede to the EEC, as it was then called. Today it has left. But, as one would expect, the lecture delivered by Lord Diplock in Gray’s Inn still repays reading today. I hope you will forgive me if I quote at a little length at what he had to say on the common law:
“Insularity is in more senses than one an attribute of the common law in the geographical context of Europe. As anyone who has worked intimately with European lawyers will know, many of our legal concepts reveal or perhaps conceal subtle differences from those of the civil law systems. … But in the wider geographical context of the world this insular system of the common law has shown remarkable powers of survival wherever it has once been introduced. … . There is, however, one respect in which English lawyers have in the past earned the reproach of insularity. Forty years ago when I was called to the Bar the study of comparative law was almost wholly neglected in this country. We have made little progress since then. It has become the practice, in appellate courts at any rate, to refer to decisions of courts of other countries in which comparable legal problems have been dealt with. But up to date, citation has been mainly limited to decisions of courts in other countries whose law is based upon the common law system.
…
This will not be the first time that English common lawyers have faced this kind of problem. In the eighteenth century, the law merchant, much of which owed its origin to civil law, was incorporated into the English common law by the genius of a Scot, Lord Mansfield. In consequence, the further development of commercial law throughout the world has been largely directed by decisions of English courts during the following century … Independently of our accession to the Treaty of Rome, the inevitable trend today is towards uniformity of the substantive law on matters affecting trade and intercourse which crosses national boundaries. There are few fields of human activity which in this shrinking world of speedy carriage and communication do not do that. Already there is a proliferation of international institutions, in which this country is a participant, devoted to the task of achieving uniformity of national laws.
This will be a two-way process. In the course of my lifetime in the law, I have been fortunate to work enough with European lawyers to believe that the common law has much to gain from closer contact with and understanding of the concepts of the civil law. I believe, too, just as strongly, that it has much to give.”
The words of Lord Diplock are as relevant in 2021 as in 1971. The common law thrives on adoption, assimilation and cross fertilisation, including from the flowers and fauna of the European legal systems. In this rich ecosystem the Bar European Group has an important role to perform. I am confident that it will rise to the challenge for the benefit not just of its own members but also for the wider legal community in the UK, including the judges. Let us remember that Sir John Laws was a great advocate of the common law. He would be proud to see the Group go forward in this way.
the European Advocate 