Judge hits errant dairy with £200k costs

A High Court battle between two Sikh-owned dairy businesses ended in June with the loser, Johal Dairies of Wolverhampton, facing a legal bill estimated at £1 million.

This week Johal failed in a bid to persuade trial Judge David Cooke to allow it to enter an appeal against his original judgement.

The judge could see no compelling arguments for the appeal nor any real prospect of it succeeding.

He ordered the company to pay rival JN Dairies legal costs, starting with a payment of £200,000 prior to further decisions on costs and compensation.

At the trial, Judge Cooke heard how a milkman sacked by JN Dairies, also of Wolverhampton, was paid £40,000 by Johal to steal confidential documents from his former employers. Johal subsequently paid his fare to India prior to the trial and he took no part in the court case.

The court was told that stolen information about JN customers was used by Johal to approach a number of JN customers with undercutting offers.

The story of the “undercover spy” and the milk wars in Birmingham and the Black Country was revealed at the Birmingham Civil Justice Centre in an eight-day trial in March, with judgement reserved until June.

The firms were competing fiercely to supply independent supermarkets and shops but Johal was found to have acted unlawfully by paying driver Gurbir Singh, an illegal immigrant, to steal the information about JN customers.

Singh committed the act on November 8, two days after being sacked by JN Dairies because he could not prove his legal status in the UK. He sneaked into the firm’s Millfields Road distribution centre at 2am and removed delivery invoices, which detailed confidential addresses, volumes sold and prices charged by the dairy.

The files were passed to a Johal director, Surbjit Johal, the court heard.

JN customers testified that they had been offered cheap or free milk by the firm. One customer was offered four weeks’ milk supply free and another free milk for three months.

The Judge concluded the theft of invoices was a pre-arranged plan, called Johal’s denials implausible and found against the company and Gurbir Singh.

JN Dairies founder and director Jaspal Singh Nijjar was delighted with the outcome. He said: “We do not have a problem with fair competition, and indeed have been successfully competing with Johal Dairies and other companies for a number of years, but unlawful activity to attack our business will not be tolerated by JN Dairies, nor will the law allow anyone to get away with it.”

For Johal, announcing its intention to seek permission to appeal, a spokesman had said the firm was extremely surprised and disappointed by the judgment. It maintained its denial of any wrongdoing and said it would continue with business as normal, confident that it enjoyed the loyal support of customers and suppliers.

Evidence that Johal had been offering customers cut price deals on milk infuriated farmers who supply the so-called “middle market” retailers.

Following the collapse of the giant Dairy Farmers of Britain (DFB) co-operative – many of whose 1,000 or so members were forced to sell milk below the cost of production – the High Court revelations incensed dairy farmers. They believe cut price deals to retailers always exert downward pressure on prices.