The Department of Energy and Climate Change (DECC) has lost an appeal to overturn a previous High Court decision that ruled in favour of 14 UK solar companies seeking damages from the government.
The Supreme Court of Appeal dismissed the government’s appeal after determining that the claimants suffered direct damage to their ‘possessions’ by the government’s “legally flawed” cuts to the feed-in tariff scheme in 2012.
DECC challenged the ruling made in July 2014 which sought damages under the Human Rights Act 1998 by proving that the claimant companies had ‘possessions’ for the purposes of the European Convention on Human Rights.
The claimants argued that, by the time the courts found the FiT changes illegal, a significant number of installations were already abandoned due to DECC’s proposal, damaging their possessions.
The legal argument hinged over whether potential business put at risk by the feed-in tariff changes were deemed ‘possessions’ in a legal context. The judge agreed with the previous judge’s ruling that signed contracts could be deemed as possessions but ruled that lost business which had not signed a pre-contract could not be defined as possessions.
The legal challenge was lodged by four claims: Breyer Group PLC, Homesun Holdings Ltd, Free Power for Schools LP and Touch Solar Ltd, who represented 19 claimants. In total, the claimants are seeking £195 million in damages, with claims ranging from £233,000 to over £27 million.
The ruling comes as yet another blow for DECC, who will now have to either settle out of court with the claimants, or chose to appeal the decision further – at taxpayers’ expense.
DECC declined to comment on the impact of the ruling for the department.