In this blog post Jack Williams of Monckton Chambers discusses a new Court of Appeal judgment, Industrial Cleaning v Intelligent Cleaning Equipment [2023] EWCA Civ 1451 (“Industrial Cleaning”), in which the Court decided to depart from retained case law.
This blog has previously discussed the Court of Appeal’s and Supreme Court’s power (contained in section 6 of the EU Withdrawal Act 2018 and the European Union (Withdrawal) Act 2018 (Relevant Court) (Retained EU Case Law) Regulations 2020 (SI 2020/1525)) to depart from retained EU law. It has also previously discussed the Court of Appeal’s first consideration of that power in TuneIn Inc v Warner Music UK Ltd & Anor [2021] EWCA Civ 441 (“TuneIn”), in which the Court decided not to depart (and set out eight key reasons for not doing so). Those blog posts are not repeated here.
In Industrial Cleaning, the Court has decided to depart from retained case law. In particular, it departed from the CJEU’s decision in C-482/09 Budejovicky Budvar Narodni Podnik v Anheuser-Busch Inc EU:C:2011:605 (“Budvar”) concerning when the period required for acquiescence for the purposes of the Trade Marks Act 1994 started to run.
In doing so, Arnold LJ makes some helpful observations on the sorts of factors that the Courts are – and are not – likely to take into account when determining whether it is “right” to depart from retained case law.
First, he rejected a submission that the Court should be readier to depart from Budvar on the basis that, if it were a domestic precedent, what the Court said would constitute obiter dicta. This, Arnold LJ held, was “of little weight” since, firstly, the CJEU does not follow domestic rules of precedent and, secondly, what was more relevant is that the relevant point formed part of the CJEU judgment’s dispositif: [82].
Second, however, he did take into account the following factors:
– “neither the Advocate General’s Opinion nor the Court’s judgment contained any analysis of the issue, but simply stated a bald conclusion”: [83]
– the AG and Judges “do not appear to have had the benefit either of receiving any arguments on this point”: [83]
– Budvar was “an isolated judgment”, not entirely consistent with other EU cases, which distinguished the position from TuneIn, where the CJEU “had developed its jurisprudence on the issue of communication to the public of copyright works over the course of no less than 25 judgments, including three Grand Chamber judgments”: [84]. In stark contrast, in Industrial Cleaning, the case law of the General Court and the practice of EUIPO “both appear to be at variance with Budvar”: [85].
– whether the original Court “had far greater experience of the issue than this Court”: [84]
– “the question of legal certainty. One of the main reasons why the Supreme Court is cautious about departing from its own precedents is that doing so risks undermining legal certainty. In the present case, however, this consideration is of little weight. Few trade mark proprietors are likely to have based their commercial strategies on this aspect of Budvar. Moreover, a well-advised trade mark proprietor would be aware that EUIPO and the General Court have taken a different approach and that the Court of Justice might depart from Budvar”: [86].
– the extent of “any academic criticism” of Budvar, although this was “of little weight” since it was a “narrow issue in a specialised field” on an issue which has not “attracted much academic commentary at all”: [87].
– the extent to which Budvar “unduly restricted the proper development of the law”.In this regard, Arnold LJ noted that it is “important” that courts are able to apply the legislation “which best serves its objectives” – something which applying Budvar would not do, since experience suggested that there have been a number of complex disputes which would have been prevented by prompt action: [88].
The position from 2024
The legal framework for departing from (what will be called) “assimilated” case law alters from next year. Under section 6 of the EU Withdrawal Act 2018 (as modified by the Retained EU Law (Revocation and Reform) Act 2023) Parliament has provided that, in deciding whether to depart from any assimilated EU case law, the court “must (among other things) have regard to”:
(a) the fact that decisions of a foreign court are not (unless otherwise provided) binding;
(b) any changes of circumstances which are relevant to the assimilated EU case law; and
(c) the extent to which the assimilated EU case law restricts the proper development of the law.
Likewise, Parliament has directed that a court may depart from its own assimilated domestic case law “if it considers it right to do so having regard (among other things) to”:
(a) the extent to which the assimilated domestic case law is determined or influenced by assimilated EU case law from which the court has departed or would depart;
(b) any changes of circumstances which are relevant to the assimilated domestic case law;
(c) the extent to which the assimilated domestic case law restricts the proper development of domestic law.
It remains to be seen whether this (rather permissive and discretionary) new test will alter the judicial practice and the criteria as applied in TuneIn and Industrial Cleaning. As I said in my oral evidence to Parliament on the (then) Bill, the new statutory test is:
“essentially a nudge to the courts—a gentle nudge but a nudge none the less—in order to encourage greater departure from retained case law. It achieves that by essentially modifying the test for when certain courts—the Court of Appeal upwards, generally speaking —may depart from retained case law, and it does so by listing three particular factors. As a normal matter of statutory interpretation, when certain factors are listed, they are to be given greater significance and weight. Each of those factors in its own terms is encouraging departure. What you do not see there, for example, which was very clear in the House of Lords practice direction, which this is moving away from, is whether it is right to depart from case law, based on legal certainty grounds and taking into account that change in case law by judges necessarily is different from changes that the politicians and Parliament bring into force prospectively. That has implications for certainty, because one does not know what cases the judges may or may not apply, but also for something that has not been discussed this morning: the separation of powers. This puts an awful lot of policy decisions in the hands of judges.”
Sweeping up the threads
So where does this leave us? Drawing inspiration from the factors listed in TuneIn, Industrial Cleaning and section 60A of the Competition Act 1998, it strikes me that the following is a list of relevant factors that the courts are likely to take into account when deciding whether it is “right” to depart from assimilated case law (even when applying the new test):
– whether there has been any change to the assimilated version of the underlying EU Law (or Retained EU Law);
– in circumstances where the EU Law (or Retained EU Law) implemented obligations arising under international law, whether there has been any material change in international law;
– whether the CJEU or previous domestic court was particularly well-placed to interpret the instrument in question;
– academic commentary or criticism;
– jurisprudence in other countries where courts take a different approach to the CJEU or previous domestic court on similar issues;
– legal certainty;
– the number of assimilated cases on point;
– the substantive merits of the submissions for departure;
– the size of the judicial panel in the assimilated case;
– whether the United Kingdom and European Union have diverged culturally, economically or politically since Brexit;
– the nature and scale of the change in the law that the departure would cause, taking into account the separation of powers and appropriateness of judicial, rather than Parliamentary, law making;
– the benefits of harmonious interpretation, for instance if the relevant issue relates to or could affect trade between the United Kingdom and the European Union;
– whether the previous court received arguments on the point in question;
– whether the assimilated case contained any substantive analysis of the issue, or simply stated a bald conclusion; and
– whether and to what extent the assimilated case furthers the objective of the law in question.
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