Hoffmann – La Roche v Secretary of State for Trade [1975] AC 295

In Hoffmann-La Roche v. Secretary of State for Trade [1975] AC 295, the House of Lords held, in summary, that the Crown was entitled in that case to an interim injunction without giving an undertaking as to damages where it was suing to enforce what was prima facie the law of the land (i.e. public interest), in contrast to where it may sue to enforce proprietary rights (i.e. private interest), unless the person against whom the injunction was sought could show a strong prima facie case why the Crown should be required to give the undertaking. By analogy then where an animal society sues to enforce the law of the land , for example, under a public interest provision like s. 52, Trade Practices Act 1974, it is highly arguable in a given case that it should not be required to give an undertaking as to damages as a condition of the grant of an interlocutory injunction.

This case raised the tricky question whether the Secretary of State was required to give an undertaking as to damages as a condition to the grant of an injunction where the Secretary sought to restrain Hoffmann-La Roche (“Hoffman”) from selling two tranquilising drugs at a price higher than the price fixed by the Monopolies Commission.

Hoffman owned the patents to two tranquilizing drugs, valium and Librium, and offered those drugs for sale to the public. Being concerned about aspects of those drugs, in 1971 the Secretary of State directed the Monopolies Commissionto investigate and report on whether the price charged for those drugs was excessive and contrary to the public interest. At the time, Hoffman enjoyed a monopoly in respect of the supply of those drugs to the UK market. The Commission’s report concluded that the price charged for the two drugs was excessive and it recommended changes to the drugs’ selling price. Hoffman was ordered to alter the sale prices in accordance with the report. Both Houses of Parliament approved the content of the Commission’s report. Hoffman contended that the orders made by the Commission were invalid alleging that the Commission failed to observe the requirements of natural justice and that the prices fixed were arbitrary and a penalty.

The Crown sought an injunction to stop Hoffman selling the drugs. The Crown contended that it was not required to give the usual undertaking as to damages as it was bringing the application in the public interest. Refusing the injunction at first instance, Mr. Justice Walton held that the legal questions involved were complex and until those issues could be explored at trial, the likelihood of the Crown succeeding was not sufficient to warrant granting an injunction without an undertaking ([1975] AC 295, 306, G-H).

The Crown appealed. The Court of Appeal unanimously overturned the decision at first instance, holding that there was a public interest in seeing the law enforced.

Hoffman appealed to the House of Lords. A majority of the law lords dismissed the appeal, Lord Wilberforce dissenting. Each of the four majority judges delivered separate opinions.

Lord Reid and Lord Morris of Borth -Y-Gest dismissed the appeal relying on the presumption of legality which attached to the Commission’s order ([1975] AC 295, 341, E (Lord Reid) and [1975] AC 295, 350, B, (Lord Morris)). Lord Morris also addressed the significant public interest in the commission’s order being obeyed ([1975] AC 295, 350, B).

Lord Diplock regarded as important the fact that the injunction involved enforcing a public right not a private right ([1975] AC 295, 363, B). Lord Cross of Chelsea spoke of the public interest in seeing the law (the order) being enforced ([1975] AC 295, 371, A). His Lordship held that refusing the injunction meant that the 10% of private purchasers of the drugs (ie those not covered by national health) would be out of pocket and would not enjoy the intended benefits of the Commission’s order until the probable end of the trial, then thought to be two years ([1975] AC 295, 372, A).

The importance of the case for animal law resides in the observations of the House of Lords in holding that that the Crown, a public authority, was not required to give an undertaking as damages, and of different law lords that there was a strong public interest in seeing the Crown enforce the law.