The matter came back to the Divisional Court (Hobhouse LJ, Collins J and Moses LJ) which ruled on 31 July 1997 that HMG had committed a sufficiently serious breach of Community law in passing the offending provisions of the Merchant Shipping Act 1988, and that that breach gave rise to damage for which Factortame should be compensated. The court rejected a claim by Factortame for exemplary damages. The decision was appealed by HMG to the Court of Appeal (Lord Woolf MR, Schiemann LJ and Walker LJ) which rejected the appeal on 8 April 1998. HMG appealed again to the House of Lords (Lord Slynn, Lord Nicholls, Lord Hoffmann, Lord Clyde and Lord Hope).