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On 16 and 17 June 2010 the Supreme Court will hear the appeal of a decision made in the Extra Division, Inner House of the Scottish Court of Session [2009] CSIH 92

The appeal concerns the liability of Scottish Power for damage caused by a fire, and whether the correct construction of the Electricity Supply Regulations 1988 and the Electricity Act 1989 give rise to a private cause of action for a breach of the Regulations.

Background

Scottish Power (the “Defender”) was the electricity supplier for Morrison Sports Ltd.  On 6 March 1998, a fire started in Morrison’s sport shop at 23 Moss Street, Paisley.   The fire was said to be caused by a metal shim that had been wrapped around the prongs of a fuse in the electricity meter cupboard in the shop and it resulted in the building (and others around it) being damaged or destroyed.

An action was brought by the owners and tenants of the buildings that were damaged by the fire (the “Pursuers”).

The contentions of the Parties

The Pursuers allege (a) negligence at common law, on the basis that the fire was caused by the Defender’s employees; and (b) that the Defender was in breach of the statutory obligations imposed on them by Regulations 17, 24 or 25 (which relate to the sufficiency of supplier’s works, inspection of supplier’s works and supplier’s works on consumer’s premises).

The Defender, Scottish Power, claims that it is not responsible for the placement of the metal shim on the fuse and suggests that someone else had tampered with the fuse.  It also contends that the cases of the Pursuers, so far as they are based on the Regulations, are irrelevant as a breach of the Regulations does not give rise to private law remedies.

It claims that the Regulations should be interpreted in light of the decision of X v Bedfordshire County Council in which Lord Browne Wilkinson stated that liability for compensation for a breach of statutory duty arises only if (a) the obligation was imposed to protect a particular class of the public; and (b) Parliament had intended to confer on that class a private right of action for compensation for breach of duty.  The Defender argues that the Pursuers have failed to show that the Regulations satisfy this test and therefore no private right of action arises for breach of the Regulations.

The Pursuers contend that the Regulations should be interpreted with regard to the true intention of Parliament and that while section 29(3) of the Act imposes criminal sanctions for contravention of the Regulations, it also states that nothing within the provision “shall affect any liability of any such person to pay compensation in respect of any damage of injury which may be caused by contravention“.

Accordingly, the Pursuers contend that they have a course of action for compensation.

The Decision of the Inner House

The Inner House of the Court of Session, being Lady Paton, Lady Dorrain and Lord McEwan, refused the motions of the Defender.

It was held that Parliament’s intention as regards section 29(3) of the Act was to enable any member of the public to claim compensation for breach of the Regulations, founded on a breach of a statutory duty that causes damage or injury, and therefore a class of the public did not have to be determined.  Further, they stated that one of the purposes of the Act was to protect the safety of people and property and therefore the class of people should not be limited.

Scottish Power has appealed the decision, which will be heard next week by Lord Roger, Lord Walker, Lord Collins, Lord Clarke and Lady Hale.