Introduction

Biffa Waste Services Limited (Biffa) v. The Scottish Ministers [2025] CSOH 9 raises important issues regarding duties of care owed by a public authority and underscores the complexities involved when governmental assurances intersect with commercial contracts.

In the action, Biffa seeks damages in the region of £160 million from the Scottish Ministers for loss of profits and loss of investment and management costs arising from the delayed implementation of the Deposit Return Scheme (DRS) in Scotland.

Background

In July 2022, Biffa entered into a contract with Circularity Scotland Limited (CSL) to act as the logistics provider for the DRS. Biffa was the sole logistics provider appointed for the DRS and would have been responsible for the collection, counting, transporting and recycling of materials under it. CSL had been appointed by the Scottish Ministers to act as the DRS scheme administrator.

The scheme, which is intended to promote recycling by imposing an additional charge (deposit) on single-use containers, has faced repeated delays. Initially envisaged to launch in July 2022, the start date has been postponed multiple times, with the latest indicative date for launch now being 1 October 2027.

The delays to the DRS led to CSL entering into administration on 20 June 2023 and Biffa's contract was subsequently terminated by the administrators.

Issues

Biffa claims that the Scottish Ministers owed it a duty of care, based on an assumption of responsibility, which it breached, in failing to secure an exclusion under the Internal Market Act 2000 (IMA) from the UK government for the DRS within a reasonable period of time. Biffa also contends the Scottish Ministers were under a duty of care to alert Biffa to the fact that an IMA exclusion was required and that this had not been sought or granted to enable the DRS to be implemented in full.

In an alternative ground of action, Biffa contends there was a negligent misrepresentation based on a letter it received from a Scottish Minister in May 2022. Biffa contends the letter provided certain assurances about the DRS but failed to indicate that an IMA exclusion would be necessary for the scheme to proceed as planned.

Hearing

The action called for a legal debate at the instance of the Scottish Ministers who argued that Biffa's case was irrelevant such that decree of absolvitor should be granted, or alternatively the action should be dismissed.

The Scottish Ministers maintain that no duty of care was owed to Biffa as the decision to apply for an IMA exclusion was one related to political judgement and not a justiciable matter. If it was a justiciable matter, the Scottish Ministers deny there was any duty of care owed under the doctrine of assumption of responsibility. It is contended that Biffa did not or could not reasonably be taken to have relied upon the absence of any warning that an IMA exclusion would be required.

The Scottish Ministers also submitted that Biffa's allegations on breach of duty of care were novel and it would not be fair, just or reasonable to impose such a duty because this would promote the interest of Biffa over those of the general public.

The allegations that the letter of May 2022 amounts to a negligent misrepresentation on the part of the Scottish Ministers is also refuted.

Decision

The court considered the case law on assumption of responsibility and when a public authority might be taken to owe a duty of care. Whilst recognising that the Scottish Ministers have raised some important points which will require further consideration, the court was unable to say at this stage that Biffa's claim was necessarily bound to fail.

Lord Clark found Biffa's pleadings provide a sufficient basis for it to contend that it had a special relationship with the Scottish Ministers and that it had reasonably relied upon the assurances of the Scottish Ministers such that a duty of care might have arisen.

On the allegation of negligent misrepresentation, the court highlighted that the specifics of the alleged misrepresentation required examination in the context of the letter and surrounding circumstances.

It is important to note that, whilst the court allowed the case to proceed to a proof before answer (an evidential hearing), it did not rule on the substantive merits of Biffa's claim.

The court stressed that Biffa still required to prove in evidence that there was an assumption of responsibility by the Scottish Ministers, that such a duty would not be inconsistent with the statutory powers and duties of the Scottish Ministers, that Biffa reasonably relied upon the conduct of the Scottish Ministers, that a breach of duty occurred and that the breach caused the losses claimed.

Similarly, Biffa will also need to prove that the letter of May 2022 did satisfy the requirements of a negligent misrepresentation when viewed in the surrounding context and that it had reasonably relied upon this misrepresentation which caused a loss.

Implications

The decision of the court highlights the potential for public authorities to be held accountable for representations made to private entities and could well influence future government-private sector interactions.

As this case progresses, it is likely to offer important insights into the legal responsibilities of public authorities in their dealings with private sector partners and particularly with regard to when a public authority might assume a duty of care.