Dairies say watchdog's probe was irregular

Woodlands Dairy and Milkwood Dairies hope that the Competition Tribunal will dismiss complaints against them in the latest of a number of attempts by several of the companies implicated to have the case against the industry thrown out.

These attempts late last year drew scathing comment from Competition Appeals Court Judge Dennis Davis about perceived abuse of legal process.

In overturning an appeal by Clover, Ladismith Cheese, Parmalat, Lancewood and Nestlé SA, Davis spoke out strongly against lawyers whose actions he implied were undermining the legal system's integrity. But Milkwood and Woodlands are challenging the basic procedure the commission followed when it expanded its investigation, after alleged abuse by three companies, to the entire dairy industry, alleging seven serious irregularities perpetrated during the investigation in breach of the Competition Act.

The companies believe their constitutional rights were violated in the process.

Legal counsel Jeremy Gauntlett in the heads of argument refers to the “bizarre situation” the commission is defending, likening it to Alice's trial in Lewis Carroll's Alice in Wonderland, where the Queen ordered, “Sentence first — verdict afterwards”.

Gauntlett will argue that the commission's decision to use a single complaint, laid against Clover, Parmalat and Lancewood at the time, to investigate the entire dairy industry was unwarranted, and that the companies were subjected to the “most invasive treatment” before any complaint had been initiated against them.

Because the commission had “put the cart before the horse”, Milkwood and Woodlands argue that information obtained should be inadmissible, and the companies are asking for an order to that effect.

Source: Business Day

Published courtesy of