CASE SUMMARIES 18 December 1995

The following notes of judgments were prepared by the reporters of the All England Reports.

Damages

Birse Construction Ltd v Haiste Ltd and ors; CA (Nourse, Roch LJJ, Sir John May); 5 Dec 1995

On the true construction of s 1(1) of the Civil Liability (Contribution) Act 1978, which provided that "any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage", the words "the same damage" meant damage suffered by the same person.

Richard Gray QC (Fenwick Elliott) for the appellant; Robert Akenhead QC, Adrian Williamson (Alastair Thomson & Partners) for the respondent.

Insolvency

Doorbar v Alltime Securities Ltd; CA(Hirst, Peter Gibson LJJ, Forbes J); 30 Nov 1995

Where, at a creditors' meeting to approve a voluntary arrangement, the chairman "agreed" under r5.17(3) of the Insolvency Rules 1986 (SI no 1925) to put an estimated minimum value on a creditor's unliquidated or unascertained debt so as to entitle that creditor to vote at the meeting, he was doing no more than expressing his willingness to put that value on the debt. It was not necessary for him actually to reach an agreement as to the debt's value with the creditor or anyone else. It would materially diminish the utility of voluntary arrangements if creditors with such claims were free not to be bound by the arrangement simply by choosing not to agree a minimum value which was not to their liking.

Anthony Zacaroli (Isadore Goldman) for the debtor; Amanda Tipples (Tinklin Springall, Beckenham) for the creditor.

Insurance

Amey Properties Ltd v Cornhill Insurance plc; QBD(Comm Ct)(Tucker J); 7 Nov 1995

Where an insurance company wanted to defend an indemnity claim under a motor insurance policy by relying on a clause in the policy which required the vehicle to be kept in good repair, the insurance company had to prove that the insured had been negligent in the upkeep of the vehicle. The test of recklessness did not apply in motor insurance cases but applied in employer liability insurance and property insurance.

Alistair Schaff (Ince & Co) for the plaintiff; Roger Ter Haar QC (Beachcroft Stanleys) for the defendant.

Jurisdiction

Egon Olderndorff v Liberia Corpn; QBD(Comm Ct)(Clarke J); 16 Nov 1995

A contract made between a Japanese company and a German company was subject to art 3 of the Rome Convention 1980 even though the parties had not expressly agreed whether English or Japanese law was to apply because the plaintiff had demonstrated with reasonably certainty that the parties had intended English law to govern. As art 3 was similar to the position at common law a similar test could be applied. Therefore the fact that the contract expressly provided for arbitration in London, and was in a well-known English charter party which contained standard clauses with well-known meanings in English law, was sufficient for the contract to come within art 3 and accordingly be governed by English law.

Victor Lyon (Watson Farley & Williams) for the plaintiff; Graham Dunning (Holman Fenwick & Willan) for the defendant.

Pharmacies

R v Yorkshire Regional Health Authority, ex p Suri; ex p Gompels; CA (Russell, Thorpe, Ralph Gibson LJJ); 29 Nov 1995

The potential effect of the relocation of a pharmacist's premises upon the business of competitors providing pharmaceutical services in the same area was not something which a Family Health Services Authority should consider when deciding, under r 4(3) of the National Health Service (Pharmaceutical Services) Regulations 1992 (SI no 662), whether the change was a "minor relocation". The essential question for the committee was one of geography and topography and the fact that the relocation significantly affected a competitor did not prevent its being minor.

Eldred Tabachnik QC, Jonathan Fisher (Charles Russell); Alice Robinson (Charles Russell) for the applicants; Jonathan Harvie QC, Judith Beale (David F. Charlton, Nottingham) for Boots the chemists; Simon Hawkesworth QC, Keith Freeman (J.E. Perrett, Harrogate) for the health authority; Cherie Booth QC, Heather Cooper (Stephen W. Buckell, Tamworth) for Lloyds Retail Chemists.

Tax

MacArthur (inspector of taxes) v Greycoat Estates Mayfair Ltd; ChD (Sir John Vinelott); 6 Nov 1995

Yearly interest payable by a property company but agreed to be capitalised for a stated period was deductible from the company's profits under the Income and Corporation Taxes Act 1988, s 338 as a "charge on income". The relief afforded by s 338, and its predecessor s 248 of the Taxes Act 1970, was not limited to "short interest" as claimed by the Revenue.

Launcelot Henderson QC (Inland Revenue Solicitor) for the Crown; Andrew Park QC and Hugh McKay (Herbert Smith) for the taxpayer.

Value added tax

Customs and Excise Commissioners v Robert Gordon's College; HL (Lord Keith of Kinkel, Lord Lloyd of Berwick, Lord Nicholls of Birkenhead, Lord Steyn and Lord Hoffmann); 16 Nov 1995

A school, which was exempt from VAT in respect of supplies of education, did not make exempt self-supplies under the Value Added Tax Act 1994, sch 10, paras 5 and 6, when it started to use its sports facilities which it had developed on its own land, having waived VAT exemption with regard to the development. The school used the facilities under a non-exclusive licence agreement with a company, which had also waived exemption, to which it had granted a lease of the facilities. Under EC law, each transaction in the chain of supply was to be looked at separately for VAT purposes to ascertain the value added at each stage. The grant of a licence to the school was a taxable transaction and input tax could be recovered in respect of payment under the licence.

David Milne QC, Colin Tyre (Clyde & Co for Paull & Williamsons, Edinburgh) for the school; DRA Emslie QC and James Campbell (Customs & Excise Solicitor) for the Crown.