The court considered the meaning of section 6 of the 1956 Act. It was argued that the trial Judge had erred in holding that an arrangement within the meaning of the expression exists when, by communications between the parties, ‘each has intentionally aroused in the other an expectation that he will act in a certain way’. It was submitted that the expression also required ‘that there must be mutuality in the acceptance of rights and obligations’.
Held:
Willmer LJ said: ‘I think it is highly significant that Parliament did not see fit to include any definition of ‘arrangement.’ I infer from this that it was intended that the word should be construed in its ordinary or popular sense. Though it may not be easy to put into words, everybody knows what is meant by an arrangement between two or more parties. If the arrangement is intended to be enforceable by legal proceedings, as in the case where it is made for good consideration, it may no doubt properly be described as an agreement. But the Act of 1956 clearly contemplates that there may be arrangements which are not enforceable by legal proceedings, but which create only moral obligations or obligations binding in honour. This seems to me to be entirely consistent with the dictum of Upjohn J. to which I have already referred. Nor do I consider that there is any inconsistency between that and the view expressed by the judge in the present case. For when each of two or more parties intentionally arouses in the others an expectation that he will act in a certain way, it seems to me that he incurs at least a moral obligation to do so. An arrangement as so defined is therefore something ‘whereby the parties to it accept mutual rights and obligations.”
Diplock LJ said that there were many ways in which arrangements might be made: ‘it is sufficient to constitute an arrangement between A and B, if (1) A makes a representation as to his future conduct with the expectation and intention that such conduct on his part will operate as an inducement to B to act in a particular way, (2) such representation is communicated to B, who has knowledge that A so expected and intended, and (3) such representation or A’s conduct in fulfilment of it operates as an inducement, whether among other inducements or not, to B to act in that particular way.’ and
‘Arrangement is not a term about; under section 6(3) of the Act. I agree with my Lords that it bears the meaning of that an ordinary educated man would ascribe to it. It involves a meeting of minds because under s.6(1) it has to be an arrangement ‘between two or more persons’ and, since it must be an arrangement ‘under which restrictions are accepted by two or more parties’, it involves mutuality and that each party, assuming he is a reasonable and conscientious man, would regard himself as being in some degree under a duty whether moral or legal to conduct himself in a particular way or not to conduct himself in a particular way as the case may be, at any rate so long as the other party or parties conducted themselves in the way contemplated by the arrangement.’
Judges:
Wilmer, Diplock LJJ
Citations:
[1963] 1 WLR 727, [1963] 2 All ER 807
Statutes:
Restrictive Trade Practices Act 1956 6
Cited by:
Cited – Fitzpatrick and Others v The Commissioner of Police of The Metropolis QBD 11-Jan-2012
The claimants, two solicitors and their employer firm sought damages alleging trespass and malicious procurement by police officers in obtaining and executing search warrants against the firm in 2007 when they were investigating suspected offences . .
Lists of cited by and citing cases may be incomplete.
Crime, Commercial
Updated: 04 May 2022; Ref: scu.450420