R v Secretary of State for Transport, ex parte Factortame

Legal Case Summary

R v Secretary of State for Transport, ex parte Factortame ECJ ([1990] 2 Lloyds Rep 351, [1990] 3 CMLR 1, C-213/89 (Factortame No.1)

Reaffirmed the supremacy of European Community law over the domestic laws of a Member State in the event of conflict

Facts

New British legislation required that to register a ship in Britain, most of its owners to be of British nationality. Subsequently, a group of fishermen from Spain requested a judicial review of this law, asserting that it breached EC laws.

Issues

In the event of incompatibility between domestic and EC legislation, where the EC has competence, so their laws shall have supremacy.

Decision/Outcome

The House of Lords found for the fishermen and in this watershed case, the Court viewed that they were empowered under EC law to restrict parliamentary legislation and disregard it where it juxtaposed with EC law. Subsequently, the supremacy of EC laws in areas where competences had been delegated sovereignty was affirmed. Moreover, it was found that a Member State could have financial liability imposed on them for breaching EC law and have private claims brought against them for remedies by any person who had experienced a directly connected loss resultant from the Member State’s actions (the principle of state liability). As it could not be evidenced that Parliament directly intended to contravene EC law, the statute ought be reasonably interpreted to give effect to EC law. Significantly, on the matter of kompetenz-kompetenz, that is who has the ultimate right to decide what falls in the European Court of Justice’s jurisdiction, the matter remains unclear.