Rail Regulator successful in defending London and Continental Stations and Property Limited's application for judicial review

7 November 2003
ORR/19/03

The Rail Regulator, Tom Winsor, today welcomed Mr Justice Moses’s judgment which upheld the Regulator’s decision in respect of the terms under which the train operator, Midland Mainline, gains access to St Pancras Station. The application for judicial review of that decision was brought by London and Continental Stations and Property Limited (LCSP), owners of St Pancras Station.

The case centred on the compensation to be paid by LCSP to Midland Mainline for disruption caused during the construction of the international terminal at St Pancras Station, as part of the Channel Tunnel Rail Link.

Tom Winsor said: “The Court found no merit in the arguments put forward for challenging my decision.

“This judgment vindicates the efforts that I, and my staff at the ORR, make to ensure that we act fairly in discharging the full range of the Rail Regulator’s statutory duties”

Notes for editors

1. On 15 October 2002, Midland Mainline Limited made an application to the Regulator to direct London & Continental Stations & Property Limited, as the station facility owner for St Pancras Station, to enter into a station access agreement to replace its existing access agreement, dating from 1996, when it expires on 28 April 2003. The application was made under section 17 of the Railways Act 1993, which is concerned with compulsory third party access to railway facilities. Midland Mainline Limited made the application under section 17 because it could not reach agreement with London & Continental Stations & Property Limited on the levels of compensation payable by the station facility owner for the disruption caused to its business.
2. In a section 17 case, as in all applications to him, the Regulator must make a judgment according to the public interest criteria in section 4 of the Railways Act 1993. He must comply with the statutory procedures and the timescales set out in Schedule 4 to the Act. He is not required to accept the views of either the applicant or the facility owner as to what should be done and must determine the question of what capacity should be allocated and the terms on which it will be allocated in accordance with his assessment of what the public interest requires.
3. The ORR employed independent transport consultants, MVA, to give the Regulator advice on the appropriate arrangements for providing compensation to Midland Mainline Limited. A redacted copy of the consultants' report is available from the ORR website here.
4. A hearing was held on 24 January 2003 to test the provisional recommendations made to the Regulator by MVA on the form and level of compensation, and ensure all relevant issues had been identified. A redacted copy of the hearing transcript is available from the ORR website here.
5. Directions, under section 17 of the Railways Act 1993, were issued by the Regulator on 14 April 2003.
6. On 24 April 2003, it became apparent to the Regulator that London & Continental Stations & Property did not intend to sign the new station access agreement in accordance with the Regulator’s directions. The Regulator therefore applied to the Court, on 25 April 2003, for an injunction requiring London & Continental Stations & Property to enter into the agreement directed by the Regulator. During the course of the Court hearing, Legal Counsel for London & Continental Stations & Property told the judge (Ouseley J) that an application for judicial review was in the course of preparation and would be issued forthwith.
7. Subsequently, permission for judicial review was granted by the Court, and it was ordered that the provisions of the 1996 agreement should continue until the judicial review proceedings were determined. The judicial review hearing took place at the High Court on 14 and 15 October 2003, and the judgment of Mr Justice Moses was issued on 7 November 2003.
8. During the hearing in the High Court, Mr Justice Moses heard arguments from LCSP that questioned the fundamental basis upon which the Regulator reached his conclusions. In particular Mr Justice Moses was asked to consider whether, in directing that the compensation regime should hold MML financially neutral, the Regulator infringed Article 1 of the first Protocol of the European Convention on Human Rights; whether the Regulator failed to take into account the compensation regime under the 1996 station access agreement as LCSP and Midland Mainline had operated it; whether the Regulator was entitled to require LCSP to compensate MML for the increase in its business between 1996 and 2003; and, whether the Regulator acted in breach of his statutory duty to enable persons providing railway services to plan their businesses with a reasonable degree of assurance (Section 4(1)(g)).
9. LCSP also questioned the basis of the methodology for calculating compensation which the Regulator adopted in his decision. In each of these areas, Mr Justice Moses found that the Regulator was entitled to take the approach and reach the conclusions that he did. Mr Justice Moses therefore determined that LCSP’s application failed.
10. Mr Justice Moses also says in his judgment:
• “In considering the various challenges advanced to the Regulator’s directions I must, accordingly, bear in mind that he was reaching his conclusions in a field in which he was both expert and experienced. He was advised by experts. He gave ample opportunity to LCSP to challenge his provisional conclusions. That opportunity was far greater than that which was afforded by the statute. Further he was concerned with predictions of the future incapable of any exact measurement.”
11. The Judgment is available from this website.
12. Questions of costs and any application by LCSP for leave to appeal will be dealt with by the Court next week on a date to be arranged.

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