Vodafone Ltd & Ors v The Office Of Communications

A Woolwich claim is grounded in the principle of legality. Money paid to a public authority under an ultra vires levy is prima facie recoverable as of right. Restitution is measured by the amount exceeding what the authority could lawfully have charged under the legislation actually in force when payment was made. The court may assess that lawful amount where existing legislation entrusted the assessment to the authority. It may not hypothesise new primary or secondary legislation, or use a broad counterfactual to reduce recovery. The approach in British Oxygen [1959] 1 WLR 587, Waikato [2003] UKPC 50 and Hemming [2013] EWCA Civ 591 was confined to identifying the excess over the lawful charge under the existing regime.

Ofcom increased annual licence fees for mobile spectrum under the Wireless Telegraphy (Licence Charges for the 900 MHz frequency band and the 1800 MHz frequency band) (Amendment and Further Provisions) Regulations 2015. Those regulations and the fee decisions were quashed in earlier judicial review proceedings: EE Ltd v Office of Communications [2017] EWCA Civ 1873.

The parties agreed that the operators were legally obliged to pay only the lower sums prescribed by the Wireless Telegraphy (Licence Charges) Regulations 2011. The High Court held that restitution was the difference between the sums paid under the 2015 regulations and those due under the 2011 regulations: [2019] EWHC 1234 (Comm). Ofcom appealed, arguing that restitution should instead reflect what it could and would have charged lawfully under a counterfactual analysis. The central issue was whether such an analysis was permissible in a Woolwich claim.

1. Appeal dismissed. Sir Geoffrey Vos gave the leading judgment. Lord Justice Underhill agreed fully with the analysis and conclusions, and Lord Justice Simon agreed with both judgments.
2. Under the Wireless Telegraphy Act 2006 and the Wireless Telegraphy (Licence Charges) Regulations 2011, the operators’ statutory liability during the relevant period was limited to the sums prescribed by the 2011 regulations. The quashed 2015 regulations could not retrospectively authorise the additional charges.
3. The principle in Woolwich Equitable Building Society v Inland Revenue Commissioners [1993] AC 70 is that money paid to a public authority pursuant to an ultra vires demand is prima facie recoverable as of right. The public authority is enriched, and the enrichment is at the payer’s expense, to the extent that the receipt exceeded the amount lawfully due.
4. There was no general counterfactual principle requiring the court to ask what the authority might have done, or what new delegated legislation it might have enacted. The recoverable amount was the excess over what Ofcom could lawfully have charged under the existing legislative regime. That distinction preserved the principle of legality.
5. South of Scotland Electricity Board v British Oxygen Co Ltd [1959] 1 WLR 587, Waikato Regional Airport Ltd v Attorney General of New Zealand [2003] UKPC 50 and R (Hemming (trading as Simply Pleasure Ltd)) v Westminster City Council [2013] EWCA Civ 591 were examples of determining the lawful charge under the existing statutory scheme. They did not support hypothesising new legislation. A court could assess the lawful amount where the statutory decision-maker had failed to do so, even if some imprecision remained.
6. There was no need to determine subjective devaluation under Benedetti v Sawiris [2014] AC 938, or to net off the value of spectrum access by reference to hypothetical fees. The EU-law argument likewise required no detailed determination because domestic law provided the same recovery.
7. The operators were entitled to restitution of the difference between the sums paid under the 2015 regulations and those due under the 2011 regulations.

• Court of Appeal (Civil Division): In Vodafone Ltd & Ors v The Office Of Communications [2020] EWCA Civ 183, the court dismissed Ofcom’s appeal and upheld the restitutionary measure determined by the High Court.
• High Court, Commercial Court: The court held that the operators could recover the difference between the sums paid under the 2015 regulations and the sums payable under the 2011 regulations: [2019] EWHC 1234 (Comm).
• Court of Appeal judicial review: The court quashed the 2015 fee decisions and regulations in EE Ltd v Office of Communications [2017] EWCA Civ 1873. The High Court had previously dismissed the judicial review application: R (EE Limited) v Office of Communications [2016] EWHC 2134 (Admin).