17 April 2006
Competition cases invariably involve complex factual and legal issues covering everything from the relevant regulatory environment to the current and historic market context applicable to the undertakings involved. For those handling the day-to-day legal requirements of companies, this kind of background is lifeblood. When a competition law issue, however, evolves (or disintegrates) into an action before the Competition Appeal Tribunal (CAT), those best equipped to explain the key relevant factors to the tribunal/court - more often than not the solicitor - invariably defer to a barrister, who is then asked to cram years of hands-on knowledge into a few days' preparation. Are solicitors guilty of sacrificing efficacy because they are labouring under a misapprehension about the rigours of advocacy?
On 31 March 2006, the CAT handed down a decision in a case brought by Albion Water against the Director General of the Office of Water Services (Ofwat). Albion had appealed to the CAT against an Ofwat decision which held that Thames Water Utilities had not abused its dominant position in relation to the terms and conditions it offered to Albion for so-called 'common carriage' access to its infrastructure. Albion applied to Thames in 2000 for permission to use Thames's pipes to supply water from two disused boreholes that it planned to develop.
During the course of negotiations, Albion complained to Ofwat concerning various elements of Thames' proposed access price, which it considered excessive. After prolonged procedural exchanges, Ofwat rejected a complaint which had been lodged by Albion, and Albion appealed to the CAT. The CAT set aside Ofwat's decision on certain narrow grounds of lack of reasoning, but ruled that remittal or replacement of Ofwat's decision was neither necessary nor appropriate.
Secreted within the 80-odd-page decision is a complicated analysis of the quirks of the water industry, the way it is regulated and the legislation that forms the basis of this regulation. This is then topped off with a relatively full recitation of the history of a saga that lasted more than seven years.
The Albion-Thames encounter is one of three water industry-related cases pending before the CAT. As the first full substantive decision, it has set the tone for the rest. Although this deluge of water cases can be explained in many different ways, they have piqued the CAT's curiosity. Unlike any of the other utility markets, there has been little or no incursion into water supply and waste water treatment sectors by 'new' competition, despite Ofwat's oft-stated enthusiasm for such things. The CAT has been keen to understand why water is, at least apparently, different.
The answer to that question, however, requires an in-depth knowledge of water regulation and the socio-economic, environmental and health considerations that underpin that regulation. Can a barrister learn all this while preparing for the case? Would solicitors who are actively involved in water industry work not know it all as a natural concomitant of what they do?
Motion practice before the CAT is relatively informal. Hearings often take the form of protracted conversations between the parties' representatives and the CAT members. If the CAT had its way, I am sure it would prefer solid background expertise to fancy advocacy skill. Indeed, Albion frequently represented itself in this case, and others, and has given as good as it has got.
If the hype is to be believed, soon more and more competition cases are going to be fought out before the courts. Solicitors must ask themselves whether 'stage-fright' is going to stand between them and the efficient handling of their cases. After all, a little more head-to-head competition between solicitors and barristers cannot be such a bad thing, can it?