ABSTRACT

Lord Oaksey, reading for and agreeing with Lord Reid, said: It will be seen that a number of contingencies were involved before this inducement could operate; TECO must want to buy iron grade material instead of making it and they must want to buy it for use and not for immediate resale; some independent manufacturer must have started making the material; and the material must be of suitable quality and must be available at a competitive price. If then the independent manufacturers’ price were more than 30% below TMMC’s price the 30% compensation would not matter as it would still pay TECO to buy from the independent manufacturer, and if that manufacturer’s price were above TMMC’s price the compensation would not matter as TECO would in any case buy from TMMC. But if that manufacturer’s price were below, but less than 30% below, TMMC’s price, then the liability to pay compensation would probably induce TECO to buy from TMMC whereas, in the absence of Clause 5, they would probably have bought from the independent manufacturer. It is the possibility of that happening which, on the argument for TECO, makes it necessary to hold that the effect of Clause 5 will be to restrict TECO from using iron grade material supplied by any person other than TMMC and their licensees.