Calor Gas Ltd v Express Fuels (Scotland) Ltd & Anor [2008] ScotCS CSOH_13 (25 January 2008)

Calor Gas Ltd v Express Fuels (Scotland) Ltd & Anor [2008] ScotCS CSOH_13 (25 January 2008)

The principal dealer agreements, including the five-year exclusivity and post-termination handling restrictions, operated to restrict competition in the cylinder LPG market, foreclosing entry and reducing inter-brand competition. Both provisions, individually and cumulatively, breached Article 81(1) EC Treaty. The anti-competitive effect was substantial given Calor's 50% market share and the mature, declining market. The restrictive clauses were not severable; thus, the agreements are void and unenforceable.

Citation
[2008] ScotCS CSOH_13
Parties
Pursuer: Calor Gas Limited; Defender: Express Fuels (Scotland) Limited; Defender: D Jamieson & Son Limited
Jurisdiction
Scotland
Judgment Date
25 January 2008
Procedural Posture
Commercial Action / Final Judgment
Outcome
principal dealer agreements declared void under Article 81(1) EC Treaty; Calor's claim for damages and interdict refused
Legal Topics
Vertical Restraints, Exclusive Dealing, Post Termination Restrictions, Severability, EC Treaty Article 81
Competition Law Contract Law Vertical Restraints Exclusive Dealing Post Termination Restrictions Severability EC Treaty Article 81

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Parties

Calor Gas Limited

Pursuer

Express Fuels (Scotland) Limited

Defender

D Jamieson & Son Limited

Defender

Procedural Posture

Commercial Action / Final Judgment

Legal Issues

  1. 1 Are Calor's principal dealer agreements void under Article 81(1) EC Treaty due to anti-competitive effects?
  2. 2 Does the five-year exclusivity and post-termination handling restriction restrict competition in the cylinder LPG market?
  3. 3 Is clause 10.4.7 severable if the exclusivity provision is void?

Ratio Decidendi

The principal dealer agreements, including the five-year exclusivity and post-termination handling restrictions, operated to restrict competition in the cylinder LPG market, foreclosing entry and reducing inter-brand competition. Both provisions, individually and cumulatively, breached Article 81(1) EC Treaty. The anti-competitive effect was substantial given Calor's 50% market share and the mature, declining market. The restrictive clauses were not severable; thus, the agreements are void and unenforceable.

Court Disposition

principal dealer agreements declared void under Article 81(1) EC Treaty; Calor's claim for damages and interdict refused

Orders

  • Permanent interdict refused
  • Claim for damages refused