Champerty offends the rules of public policy

The High Court has ruled that champerty offends the rules of public policy. The Court held that professional third party funding, by an entity that has no independent or bona fide interest, for a share of the profits, is prohibited.

This is the first case in Ireland directly concerning the acceptability of professional third party litigation funding.

Persona Digital Telephony Ltd. and Sigma Wireless Networks Ltd. sought a declaration that entering into an agreement with Harbour Fund III Limited Partnership is not an abuse of process, and, or does not breach the rules on maintenance and champerty.

The case relates to the awarding of the second GSM mobile telephone licence to ESAT Telephone Ltd. by the Minister for Public Enterprise. Persona Digital Telphony Ltd. and Sigma Wireless Networks Ltd., unsuccessful in the competition process, are impecunious as a result.

The third party entity, Harbour III and Harbour Litigation Fund were incorporated in 2015 as a limited partnership in the Cayman Islands with a fund of £230 Sterling to invest in commercial litigation worldwide.

The Court found that maintenance and champerty continue to be torts and offences in Ireland. The Court also found that it could not develop the ingredients of a statutory offence in a manner that fundamentally changes the nature of the offence.

Persona Digital Telphony Ltd. and Sigma Wireless Networks Ltd. were seeking damages, including exemplary damages, for misfeasance in public office, breach of duty, including legitimate expectations, constitutional rights, rights under European Union Law and a declaration that the European Communities (Mobiles and Personal Communications) Regulation, 1996, breach European Union law. 

The failure to record, on the face of the warrant, the decision of the Director of Public Prosecutions to proceed by way of summary trial renders the warrant bad

The High Court has ruled that the failure to record, on the face of the warrant, the decision of the Director of Public Prosecutions to proceed by way of summary trial (i.e. judge alone) is a "fatal flaw", rendering the warrant bad. 

A minor convicted of possession of controlled drugs for unlawful sale or supply challenged the validity of his detention under Article 40 of the Constitution on the basis that the warrant, on foot of which the minor was committed to prison, fails to record the decision of the Director that the matter be tried summarily.

Mr. Justice Seamus Noonan, in his written judgment, stated that it is not in dispute that an accused is brought before the District Court on foot of a charge sheet. Or that the accused cannot know the form of trial (i.e. summary or indictable) until the Director's decision has been conveyed to a District Court judge. It is "settled law" that the Director alone decides the venue, subject to the District Court judge determining that the offence is minor. Indeed, the trial cannot proceed until the Director invokes the relevant jurisdiction.

It seems to me beyond argument that if the Director has determined that the accused be tried by jury, the District Judge cannot embark on a summary trial and, were he or she to do so, any resultant order would be quashed for the asking. That can be the only reason that in such circumstances the District Judge has no jurisdiction to try the accused. I cannot see how any other construction is possible. It must follow as a matter of logic that if the Director has made no decision one way or the other equally the District Judge has no jurisdiction.

Paraphrasing precedent, Mr. Justice Noonan described the decision of the Director as an "essential ingredient to the exercise of that jurisdiction". In the absence of such a decision by the Director there is simply no jurisdiction vested in the District Court.

Therefore Mr. Justice Noonan concluded that the failure to record, on the face of the warrant, the decision by the Director to proceed by way of summary trial renders the warrant bad. 

Breath specimen printouts must be produced in both English and Irish to comply with the law

The High Court has ruled that breath specimen printouts must be produced in both English and Irish in order to comply with the Road Traffic Act 2010 and the (Prescribed Form and Manner of Statements) Regulations 2011 (S.I. 541/2011).

The case was referred to the High Court from the District Court by Judge Conal Gibbons.

On April 21st, 2014, Mihai Avadenei was stopped on Wolfe Tone Quay in Dublin by Gardai operating a speeding check because he was doing 80 kilometers in a 50 kilometer per hour zone. Using the Drager Alcotest apparatus Mr. Avadenei was asked to provide a breath specimen for the presence of alcohol, which he failed.

At Store Street Garda Station Mr. Avadenei provided another breath specimen using the Evidenzer Irl apparatus. The Evidenzer Irl apparatus produces a document which is tendered as a certificate in court for what would otherwise be hearsay. During cross-examination Judge Gibbons heard that the only document produced by the Evidenzer Irl was in English only, despite the fact the apparatus could produce the same document in Irish.

At the conclusion of the Prosecution's case, solicitor for Mr. Avadenei submitted that there was no case to answer because the document was not a duly completed statement as there was no equivalent in Irish.

After the case was adjourned until a later date to allow for written submissions, Judge Gibbons accepted that the document, purporting to show the concentration of alcohol in the breath of Mr. Avadenei, was not a duly completed statement.

Arising from the foregoing, Judge Gibbons asked the High Court whether he was entitled to hold that the document was not a duly completed statement within the meaning of section 13 of the 2010 Act.

(i) On the facts so found, was I entitled to hold that the document purporting to show the concentration of alcohol in the breath of [Mr. Avadenei] is not a "duly completed" certificate within the meaning of s[ection] 13 of the Road Traffic Act 2010 and S.I. 541/2011, namely the Road Traffic Act 2010 (s.13) (Prescribed Form and Manner of Statements) Regulations 2011? 

Mr. Justice Seamus Noonan found that there are two lines of authority with regard to defective certificates in drunk driving cases:

The first can be said to arise in cases where certificate evidence is sought to be adduced in circumstances where there has been a technical error in the completion of the relevant certificate which doe not breach a mandatory statutory provision and does not result in any misleading and thus prejudice to the accused.

The second line of authority with regard to defective certificates holds that:

[...] where the relevant statute mandates the adoption of a particular procedure, a failure to adhere to that procedure will deprive the relevant certificates of any evidential value irrespective of whether or not the accused has been in any way misled or has suffered any prejudice as a result.

In the case of Mr. Avadenei, Mr. Justice Noonan took the view that the certificate falls into the second line of authority and, therefore, has no evidential value and cannot be admitted in court.  

Unconstitutionally obtained evidence should not be automatically deemed inadmissible at trial

The Supreme Court has ruled that evidence obtained unconstitutionally should not be automatically deemed inadmissible at trial. The judgment refines the test for the exclusion of evidence first set out in the case of O'Brien in 1965 and again in Kenny in 1990.

The case stems from Gardaí in Waterford investigating three robberies on a bookmakers premises in mid-2011.

Two separate but connected issues  arose in the Supreme Court case. The first issue relates to the proper interpretation of the passage on appeals by the Director ect., on certain criminal proceedings. Specifically, whether Judge Mary Ellen Ring had erroneously excluded evidence in circumstances where it is accepted that the Judge was bound to follow, and properly applied, the Kenny judgment to the facts:

Can it be said that  a trial judge properly applied the established case law of a higher court by which that trial judge was bound, even if this Court takes the view that the established case law in question requires to be revisited in a material respect?

Mr. Justice Frank Clarke found that a trial judge can be properly described as having erroneously excluded evidence even where the trial judge was bound to follow what turns out to be an erroneous judgment. On that basis, Mr. Justice Clarke was satisfied that an appeal to the Court under section 23 is permissible.

The second issue concerned the statutory requirement that excluded evidence must be "compelling" for its exclusion to be appealed. Compelling evidence is defined as meaning that:

[...] the evidence is reliable, of significant probative value, and such that, when taken together with all other evidence adduced a jury might properly convict.

After establishing that there was sufficient material on the record of the trial to enable the Court to be satisfied that the evidence is compelling, Mr. Justice Clarke concluded that it was not necessary to reach a conclusion on a motion, submitted on behalf of the Director of Public Prosecutions, to introduce additional evidence.

The question before the Court was whether O'Brien or Kenny are correct, or, whether the test set out requires refining by identifying a point not identified in either case.

In O'Brien, the Supreme Court held that evidence should not be excluded if it can be shown that those gathering the evidence had knowledge that their actions were in breach of constitutional rights. Where as in Kenny, the Supreme Court held that evidence may be excluded if it can be shown that constitutional rights were breached, regardless of the knowledge or level of care involved, save in highly unusual and exceptional circumstances.

Mr Justice Clarke, in his judgment, felt O'Brien does not go far enough, while Kenny goes too far. Refining the test, Mr. Justice Clarke set out five principles.

One, the onus is on the prosecution to establish the admissibility of all evidence. However, Mr. Justice Clarke was keen to emphasis that the test which follows does not concern the integrity or probative value of the evidence. Rather, the test is concerned with objections to the admissibility of the evidence where it relates solely to the circumstances in which it was gathered.

Two, where a warrant is challenged the onus is on the prosecution to establish either: (a) that the evidence was not gathered in circumstances of unconstitutionality, or; (b) that, if the evidence was gathered in circumstances of unconstitutionally, it remains appropriate for the Supreme Court to admit the evidence.

Three, any facts the prosecution need to establish in order to discharge the onus must be established beyond reasonable doubt.

Four, evidence obtained in deliberate and conscious violation of constitutional rights should be excluded save in exceptional circumstances considered in existing precedent. If the evidence is obtained in violation of constitutional rights, but the prosecution shows  this was not conscious or deliberate, a presumption against the admission of the evidence arises. Moreover, where evidence is obtained in breach of constitutional rights but not deliberately or consciously, the evidence should be admitted where the prosecution can establish that the breach was inadvertent or due to later legal developments.

Five, evidence that could not have been constitutionally obtained  or gathered should be excluded, even if those involved in gathering evidence were unaware due to inadvertence of the absence of authority.

Mr. Justice Donal O'Donnell expressed agreement with the approach taken by Mr. Justice Clarke. While Mr. Justice John Murray concurred in part with Mr. Justice Adrian Hardiman, who, among others, dissented.

Mr. Justice Hardiman questioned whether the Court had jurisdiction to hear the appeal because an error on the part of Judge Ring had not been established. Indeed, the majority agreed that Judge Ring had not erred. Mr. Justice Hardiman also observed that a trial judge who follows a binding authority that is subsequently overturned by a higher court does not commit an error.

Both parties agreed that a decision on a retrial should be set aside until after the substantive issues were determined.

The Oireachtas may not delegate points of principle and policy

The Court of Appeal has ruled that legislation prohibiting the sale of psychoactive substances is unconstitutional.

The three-judge Court unanimously found Section 2(2) of the Misuse of Drugs Act 1977 violates Article 15.2.1 resulting in the secondary legislation the Misuse of Drugs Act 1977 (Controlled Drugs) (Declaration) Order 2011 (S.I. No. 551 of 2011), invalid.

Mr. Justice Gerard Hogan found Section 2(2) of the 1977 Act unconstitutional because the section proclaims to give law making powers to the government that, in the absence of appropriate principles and policies, are vest exclusively in the Oireachtas:

The fundamental difficulty here is that the 1977 Act determined that only "certain" dangerous or harmful drugs would be controlled, thus leaving important policy judgments to be made by the Government rather than by the Oireachtas. 

The case concerned the prosecution of Stanislav Bederev, who was charged on April 26th, 2012, for possession for sale of Methylethcathinone. Mr. Bederev brought a High Court challenge seeking to halt criminal proceedings on the grounds that section 2(2) of the 1977 Act was unconstitutional, thus invalidating the 2011 Order.

In May 2014, Mr. Justice Paul Gilligan found the legislation was directed at drugs that would have a negative and detrimental effect on individual health and society.

Comment: Despite what was reported in the media in the 24 hours after the judgment, the Court of Appeal did not accidentally legalise hard drugs.  

Surrogate, as birth mother, must be registered on birth certificate as the legal mother

The Supreme Court has ruled, by a six to one majority, that the surrogate mother of twins, as the birth mother, is entitled to be registered as the legal mother on the birth certificates. The judgment overturns the High Court ruling by Mr. Justice Abbott in March 2013.

The issues arose from the radical developments in assisted reproduction and were issues for the legislature, not for the courts to address, observed Chief Justice Susan Denham.

The lacuna surrounding particular rights of children born through surrogacy merits the outstanding issues being left to the legislature:

Any law on surrogacy affects the status and rights of persons, especially children: it creates complex relationships and has a deep social content.

In separate judgments, only Mr. Justice Frank Clarke dissented, while the remaining panel agreed the appeal should be allowed. However, Mr. Justice O'Donnell stressed his decision to allow the appeal was based on the fact that the Civil Registration Act 2004 requires the surrogate mother, as the birth mother, to be registered as the the mother on the respective birth certificates.

The case centers around twins born to a surrogate mother, using sperm and ovum from the genetic parents.

While the genetic father of the twins was registered on the birth certificates, the Registrar of Births refused to register the genetic mother because she was not the birth mother. The Registrar maintained that the surrogate mother must be registered on the birth certificates.

The core issue was the registration of a "mother" under the Civil Registration Act 2004, observed Chief Justice Denham. The Constitution does not provide for a definitive definition of "mother". Nor does the Constitution prevent the development of legislation on surrogacy.

The State relied on the status of the Latin legal maxim, mater semper certa est - the mother is always certain. However, Chief Justice Denham observed that the maxim is not part of Irish common law and the words merely recognise a fact that the woman who gives birth to a child is the mother of the child.

As it stands, neither Irish jurisprudence or existing legislation addresses the outstanding issues on surrogacy arrangements, Chief Justice Denham observed. Citing the lacuna in the law as being the basis for her decision, the appeal was allowed.

In applying the test for Supplementary Welfare Allowance the deciding officer must have regard to the complexity of the applicant's family circumstances

The Department of Social Protection must reconsider the decision to grant a single person's Supplementary Welfare Allowance to a separated father of four children, the High Court has ruled. Kevin McCormack cared for his four children full time prior to separating from his wife in 2011 and moving back to Dublin to seek employment.

Mr. McCormack applied for Supplementary Welfare Allowance in July 2012. In his application, Mr. McCormack sought the maximum available for one parent with three children. However, in August 2012, the Department refused his application for the maximum €900 sought because it was in excess of the €475 monthly limit for a single person. Mr. McCormack appealed to the Appeals Officer, but the application was disallowed in December 2012.

A solicitor on behalf of Mr. McCormack made an application to the Chief Appeals Officer requesting a review. In November 2013, the Chief Appeals Officer gave a reasoned written decision for rejecting the application to review the decision of the Appeals Officer:

[...] as the housing and other basic needs of the children were met by their primary carer and the applicant received no increase in respect of those children on his primary social welfare payment, they were not dependent on [Mr. McCormack] for support and could not be regarded as dependent children. 

Ms. Justice Marie Baker found the decision making process of the Department was flawed in assessing the application because it only had regard to Mr. McCormack's accommodation needs without having regard to the complexity of his family circumstances:

I am satisfied that the decision making process was flawed as a matter of law in that the decision body took an erroneous view of the test it had to apply, and looked only to the accommodation needs of [Mr. McCormack] himself without having any regard to the complexity of his family relationships [...].

Ms. Justice Baker also found that the children could not be viewed as living primarily with one parent, or having one primary carer.

Photographic evidence must be supplied with speed camera summons

The High Court has ruled that photographic evidence must be included with the summons issued to an accused. There must also be evidence that the "permanent visual record" (i.e. photographs(s)) has been given to an accused prior to the trial commencing.

The case was referred to the High Court by District Court Judge Mary Devins after Michael Gilvarry of County Mayo was summonsed for doing 93 kilometres per hour in an 80 kilometres per hour zone in Ballina on October 30th, 2011.

During the case several witnesses were called, including Inspector John McDonald from the Garda Fixed Charge Processing Office. In evidence Inspector McDonald gave an overview of, inter alia, the Office's prosecution works dealing with the capture of information.

In the course of cross-examination Inspector McDonald accepted that a copy of the photographic image should be provided to an accused before the trial began.

The Inspector gave evidence to the existence of a contract between the Minister for Justice, the Garda Commissioner and the Go Safe Company, which was entered into in November 2009. The contract governed the outsourcing of functions from June 1st, 2011. Although he was not in a position to provide a copy of the contract to the Court.

Inspector McDonald also gave evidence that the "permanent visual record" provided by the Prosecution was the same as the original, but admitted that he was not familiar with the process of enhancement.

At the end of Mr. McDonald's evidence Ms. McGregor for Mr. Gilvarry made a total of five submissions.

Ms. McGregor submitted that there was no evidence before the Court that a "permanent visual record" was served on Mr. Gilvarry as required by the 2010 Act. Ms McGregor further submitted that there is no presumption with the 2010 Act that the relevant "permanent visual record" has been served on an accused.

Ms. McGregor submitted that the contract between the Minister for Justice, the Garda Commissioner and the Go Safe Company is the foundation of a number of presumptions relied upon by the Prosecution. Ms. McGregor cited sections 81(2)(ii), 81(6)(a) and (b) as examples.

Ms. McGregor submitted that the contract must be in evidence in order to prove: (i) that the person is authorised (e.g. Derek Walsh, the Go Safe Operator who gave evidence), and; (ii) the extent of the functions. Moreover, as the contract was not in evidence, the Court was not entitled to presume its existence or apply presumptions that might flow from its existence.

Finally, Ms. McGregor submitted that the "permanent visual record" is enhanced after downloading to the server and is therefore tainted as a result.

Judge Mary Devins adjourned the matter until November 2012, when she questioned the Director of the Go Safe Company about the contract. Mr. Browne said that the contract started on November 16th, 2010 and would run until November 15th, 2015.

Having indicated that she was unable to find any precedent dealing with the issues that arose in this case, Judge Devins posed three questions to the High Court.

One, was there evidence before the Court that the photographic evidence was served on Mr. Gilvarry as required by the 2010 Act? 

Two, does the prosecution need to provide a copy of the contract between Go Safe and the Minister for Justice or is it sufficient to give evidence of the existence of a contract? 

Three, is the photographic evidence tainted because it is enhanced after downloading to the server?

Answering the first question, Mr. Justice Kearns concluded that it is insufficient for a member of the Gardaí to state that it is normally the case that photographic evidence is included with the issued summons:

There must be evidence that it has in fact been given to an accused person before the trail commences. The evidential shortfall can easily be remedied if the statutory declaration of service of the summons were to also state that the summons, together with the "permanent visual record attached", have been served on [Mr. Gilvarry] prior to the trial.

On the second question, Mr. Justice Kearns found that it is not a necessary proof for the prosecution to provide a copy of the contract, or to formally prove every detail of the contract between Go Safe and the Minister for Justice. It is merely sufficient that the prosecution call a witness who is familiar with the parts of the contract that indicate that: (i) a contract envisaged by the relevant section was made; (ii) the parties to the contract, and; (iii) that contract is still in existence.

While there was no issue about the quality of the photographic evidence in this case, Mr. Justice Kearns observed that it is not necessary under the 2010 Act to prove that the technology used is accurate or in good working order. However, Mr. Justice Kearns observed that it is open to a defendant, such as Mr. Gilvarry, to give evidence that the photograph(s) furnished to him and submitted to the court were altered.

The constitutional right to conduct business in Irish is not absolute

Peadar Ó Maicín, a native Irish language speaker, has lost a Supreme Court case to have a bi-lingual jury selected from a specially designated area of Connemara where most people speak Irish.

Mr. Justice Hardiman observed that while there is no legislation requiring a juror to be competent in English or Irish, he described it as "as extraordinary state of affairs" in need of "urgent legislative action".

In his dissenting opinion, Mr. Justice Hardiman described the actions of the State in promoting the Irish language as "uniformly minimalist and grudging". Mr. Justice Hardiman did not believe there is any other country:

in which a citizen would not be entitled to conduct his business before a court in the national and first official language, and to be understood directly by such court in that language

However, the Supreme Court agreed that the case raised important constitutional issues on balancing language rights against the duty to prosecute crimes before a representative jury.

The High Court held Mr. Ó Maicín was not entitled to have his case heard by a judge and bi-lingual jury without a translator.

Mr. Ó Maicín is facing trial charged with two offences; assault causing harm and unlawfully producing an article (a broken whiskey bottle) capable of inflicting serious injury during a fight.

The State opposed the appeal on the basis that there would have to be a test of competence in the Irish language. But this would be impossible due to random jury selection.

In a majority four-one judgment, the Supreme Court held that while Mr. Ó Maicín has a constitutional right to conduct business and his trial in Irish with the aid of a translator, the right is not absolute.

ComReg benchmarking must be in line with EU directives

The imposition of price control by ComReg that could have reduced the cost of making mobile calls have been struck down in the High Court.

The European Union and ComReg have been attempting to reduce the fees that mobile companies charge each other for carrying calls, as these affect the prices paid by consumers.

The higher charges make it difficult for new companies to get a grip in the market.

Vodafone had appealed two decisions by ComReg, imposing new maximum wholesale charges to other mobile companies for service called ‘Mobile Voice Call Termination’.

Mr. Justice John Cooke noted ComReg had directed Vodafone to adopt a particular cost recovery method, and charge a maximum of 2.6 cent per minute from January 1st 2013, and 1.04 cent per minute from July 1st.

Mr. Justice Cooke observed, the issues concerned the nature of ComReg in its entitlement to take account of relevant directives on pricing and cost recovery methods.

The pricing instruction devised by ComReg to Vodafone was a result of benchmarking of what Vodafone charged against seven European Union member states.

Vodafone argued that the ComReg devised methodology was incompatible with European Commission rules, and that ComReg had acted unlawfully in benchmarking prices without reference to actual costs in Irish markets.

Mr. Justice Cooke observed that ComReg in its benchmarking approach in the price control decision was beyond the powers designated to ComReg under European Commission regulations.

The result produced by the use of a benchmark based upon only seven European Union countries is a result so flawed by its random nature and uncertain reliability that it could not constitute a sufficiently robust basis for the application of European Commission regulations.

The court allowed the appeal in part and set aside the direction by ComReg to Vodafone, ensuring that its mobile termination rates are set at 2.6 cent and 1.04 cent per minute.

While only Vodafone sought to challenge the decision of ComReg, the ruling will also have implications for the other mobile phone operators.

The case in the High Court related to a price-control decision by ComReg of November 2011 for the service known as ‘Mobile Voice Call Termination’.

Mr. Justice Cooke adjourned making final court orders, placing a stay on the judgment until September 24th.

New laws must contain adequate principles and policies

On July 26th, Mr. Justice Gerard Hogan ruled offences against David Douglas, charged under section 18 of the Criminal Law Act 1935 were unconstitutional due to being insufficiently precise and lacking any ‘clear principles and policies’ in relation to defining the scope of the prohibited conduct.

The case against Mr. Douglas, observed massaging his penis through his clothing in a Dublin City centre café on two consecutive days, cannot proceed after Mr. Justice Hogan ruled the offences of causing scandal and injuring the morals of the community are unconstitutional.

The charges related to separate incidents at the café in January 2009.

Mr. Justice Hogan stressed the importance that there was no allegation that Mr. Douglas had exposed himself. It was also contended Mr. Douglas either desisted or disguised his activities when other people approached.

Counsel for Mr. Douglas argued the offences breached the rights of Mr. Douglas under the constitution, including the right to equality before the law and protection of personal liberty. The Criminal Law Act 1935, section 18 provides:

Every person who shall commit, at or near and inside of any place along which the public habitually pass as of right or by permission any act in such a way as to offend modesty or cause scandal or injure the morals of the community shall be guilty of an offence under this section and shall on summary conviction thereof be liable to a fine not exceeding [IR£500] or, at the discretion of the court to imprisonment for any term not exceeding [six months].

Mr. Justice Hogan ruled the words ‘or cause scandal or injure the morals of the community’ in section 18 of the 1935 Act were ‘hopelessly’ and ‘irremediably’ vague and lacked any real principles and policies in relation to the scope of the prohibited conduct.

However, Mr. Justice Hogan emphasised that the ruling does not prevent the Oireachtas legislating to create new offences which would address conduct of this nature, but any new laws must contain adequate principles and policies.

Private prosecution of indictable offences permissible

Mr. Justice Gerard Hogan in a seminal High Court ruling upheld the right of citizens to bring private prosecutions against individual banking officials.

The ruling will allow hotelier Patrick Halpin to bring private prosecution agaisnt two officials of the Irish Banking Resolution Corporation Mr. Halpin alleges behaved dishonestly during discussions about a rescue plan for his business. 

In the first case of its kind since the banking collapse, a summons has been issued to compel banking officials to attend a Distrct Court to answer allegations.

The decision to proceed further with the case will be a matter for the Director of Public Prosecution once the District Court hearing has taken place.

Mr. Justice Hogan in his written ruling noted that:

the underlying purpose of the private prosecution is still the same, namely, to draw to the public prosecutor's attention to the case with the implicit request that the prosecution be taken over.

While the ruling allows for private prosecution, there are risks involved, such as the substantial legal costs should the prosecution fail.

The ruling came after Mary Kelly and Declan Buckley, the former a current employee and the latter a former employee of the Irish Banking Resolution Corporation sought a judicial review to halt the private prosecution against them.

Mr. Halpin has run hotels in Dublin and in County Clare for the past twenty five years, these include the Aberdeen Lodge and Merrion Hall boutique hotels in Dublin, and Halpin's Townhouse in Kilkee, County Clare.

The Irish Banking Resolution Corporation appointed a receiver to two of the companies last year after Mr. Halpin got into financial difficutly in recent years over borrowings with the former Anglo Irish Bank.

Mr. Halpin claims he was invited to a meeting with Ms. Kelly and Mr. Buckley in February 2012 to discuss the sale of Merrion Hall in an attempt to pay down the debt. The meeting occurred prior to a receiver being appointed.

Mr. Halpin claims both himself and his accountant were left with the impression from the meeting that the matter would be considered further by Anglo Irish Bank, and that Anglo Irish would welcome proposals.

However, Mr. Halpin claims he later learned from a letter he subsequently received that the decision to appoint a receiver had already been made, and that both Ms. Kelly and Mr. Buckley were aware of this at the meeting, but deliberately concealed this knowledge from Mr. Halpin.

Subsequently, Mr. Halpin initiated a private prosecution against Ms. Kelly and Mr. Buckley in the District Court, alleging offences of dishonesty under the Criminal Justice (Theft and Fraud Offences) Act 2001, and succeeded in getting the District Court to issue a summons against both individuals. The argument  put forward in the High Court  to halt the private prosecutions was that private prosecutions  had been effectively abolished by the Criminal Justice Act 1999.

It was also put to the High Court that there had to be a preliminary examination procedure for a private prosecution to take place.

Mr. Justice Hogan disagreed with the argument that private prosecutions had been effectively abolished because the 1999 Act abolished the traditional practice of holding a preliminary investigation in the District Court to determine if sufficient grounds existed for sending a person forward for trial to a higher court.

Mr. Justice Hogan placed a stay on the private prosecution until January to allow Ms. Kelly and Mr. Buckley to appeal to the Supreme Court.

Strict legal requirements must be met to execute search warrant

A retired Central Bank administrator who got four years and a €5,000 fine for the possession of hundreds of thousands of child porn images and videos had his conviction quashed because of  the incorrect date on the search warrant.

The Court of Criminal Appeal overturned the conviction of Raphael Farina after the Court found that the search warrant  used to search his home was dated incorrectly and consequently  did not permit entry to the apartment  of Mr. Farina in Dublin city centre.

Counsel for Mr. Farina, Ms. Aileen Donnelly SC told the Court of Criminal Appeal that a combination of five flaws in the search warrant obtained, rendered the search warrant invalid in law and incapable of permitting entry to the apartment.

Among the flaws were a misspelling of the address as ‘Springer’s Yard’, instead of the correct address as ‘Spranger’s Yard’. Another flaw was the absence of information regarding the issuing District Court area and number. The date of the search warrant as May 6th 2007 was actually issued on June 6th 2007.

The court also heard  that an alteration was made to the search warrant, with a line drawn through the May 6th 2007 date, after its execution.

Mr. Justice Donal O’Donnell noted that before a search warrant to enter a home can be executed, the legal requirements must be strictly met. He found that the defect in the date was fatal to the warrant because the document on its own terms stated that entry was permissible within seven days of May 6th 2007.

Mr. Justice O’Donnell noted the search warrant was meant to be understood in simple terms. Further, the warrant must be taken as it would appear when presented to the accused man.

Judgement was not reserved because Mr. Farina  has been in custody since 2011. No retrial was ordered.

A prisoner, whose original punishment was commuted, is serving sentence and not a commutation and is therefore entitled to remission on good behaviour

The Supreme Court has ruled that a prisoner, whose original punishment of the death penalty was later commuted to forty years in prison, is serving a sentence and not a commutation, and is therefore entitled to remission on good behaviour.

Noel Callan has been in prison since June 27th, 1985. Mr. Callan was convicted and sentenced to death for the capital murder of Garda Sergeant Patrick Morrissey on December 3rd, 1985. His imprisonment under the sentence of death lasted until May 29th, 1986 - when the President of Ireland, on advice of the Government, commuted the death sentence to Penal Servitude to forty years. In 1997 Penal Servitude was abolished and replaced by imprisonment.

Counsel on behalf of Mr. Callan submitted that he is a prisoner serving a sentence of imprisonment. Therefore Mr. Callan is entitled to remission of at least one quarter, perhaps even up to one third, under section 11(5) of the Criminal Law Act 1997 and by article 59 of the Prison Rules 2007. 

Originally Counsel submitted on behalf of the State that Mr. Callan is serving a "full sentence of forty years". When the case was heard in the High Court before Mr. Justice Michael Hanna, both parties agreed that Mr. Callan is, in law, a prisoner serving a sentence of forty years. Although the parties disagreed on whether the terms of the "sentence" excludes remission. 

However, on day three of the High Court hearing the State called the Principal Officer in the Department of An Taoiseach to give evidence. Mr. Kennedy produced a letter in Court dated May 29th, 1986, from the Secretary of the Government to the President that contained the actual advice:

At a meeting held today, the Government decided to advise the President in the exercise of the power vested in him by Article 13.6 of the Constitution to commute to Penal Servitude for forty years the sentence of death by the Special Criminal Court on the 3rd of December 1985 on Noel Callan on his conviction of the capital murder of Garda Sergeant Patrick Morrissey. Pursuant to that decision, I have been directed by the Taoiseach to convey the Government's advice to the President to commute the sentence of death accordingly.  

The advice in the letter does not specify that the commutation from the death penalty to penal servitude was on the understand that it would be served without remission. This caught Counsel for the State by surprise.

After the evidence of Mr. Kennedy, a new submission on behalf of the State argued that Mr. Callan is serving a commutation and therefore falls outside the scope of the Prison Rules. However, Mr. Justice Hardiman pointed out the difficulties with this argument:

It is suggested that [Mr. Callan] was liable to be held in custody for forty years without being subject to the obligations of, or entitled to the protections contained in, the Prison Rules. It must be doubted whether that form of imprisonment would comply with the Constitution or with the State's international obligations.

Accordingly, on appeal to the Supreme Court, a third submission was made on behalf of the State. Counsel submitted that Mr. Callan is not a sentenced prisoner but is entitled to the benefits of the Prison Rules with the exception of Rule 59.

Despite acknowledging the Government had continued to apply remission as if the rule applied to prisoners serving sentences of penal servitude, Counsel for the State suggested that remission could not apply to Mr. Callan because precedent held that the predecessor to Rule 59 did not apply to such prisoners. Expressing his "grave distaste" for such arguments, Mr. Justice Hardiman quipped:

It would have been quite possible to amend the Prison Rules but this was not done. Instead, it was simply decided to proceed as though the Carney case had never happened [...]. The State case continued in this way until Penal Servitude was itself abolished in 1997, forty years after Carney was decided. But, fourteen years later again, when [Mr. Callan] claimed he was entitled to remission it was solemnly decided to rely on Carney [...].

The eventual case submitted on behalf of the State was that Mr. Callan is serving a commutation and not a sentence. However this argument was rejected by Mr. Justice Hardiman on four grounds.

One, when Mr. Callan challenged the legality of his detention under Article 40 the Governor of the Prison established the legality of his detention citing the order of the Special Criminal Court, the advice of the Attorney General, and the letter dated May 29th, 1986.

Two, the forty year period of imprisonment was described by the State as a sentence.

Three, all prisoners sentenced to Penal Servitude of forty years have been released by Executive action.

Four, the submission on behalf of the State that Mr. Callan is serving a commutation is "in terms of logic, law and language" nonsense, as it means "the action or process of changing or altering.

Therefore Mr. Callan was awarded a Declaration stating that he is eligible to earn remission by good conduct under Rule 59(1) of the Prison Rules 2007.  

Obligation on banks to assess creditworthiness of borrowers

In 2012 the High Court awarded KBC Bank €17,694,130 in damages against Dublin based law firm BCM Hanby Wallace (now Byrne Wallace) over failures to ensure the bank had security for the loans.

The Supreme Court has directed the High Court to reconsider findings that there was no contributory negligence by KBC Bank in how the bank suffered muti-million euro losses to struck-off solicitor Thomas Byrne and property developer John Kelly.

KBC Bank incurred the losses due to the failure in having security for €25m loans advanced to Mr. Byrne and Mr. Kelly.

The Supreme Court ruling addressed seminal issues relating to the duties of banks to the shareholders when advancing loans, including the responsibility to investigate the financial standing of borrowers.

Mr. Justice Brian McGovern in the High Court found the matter was about ‘multiple failures’ repeated across several separate loan transactions. He rejected arguments of contributory negligence by KBC Bank on the grounds that the bank was entitled to rely on assurances from professionals retained by KBC Bank. The Supreme Court ruled Mr. Justice McGovern had erred in how the issue of contributory negligence by KBC Bank was addressed.

Mr. Justice Nial Fennelly said that while BCM Hanby Wallace negligence related to obtaining security for the loans was a direct and proximate cause of the loss, there was an issue as to whether it was the only effective cause of the loss. It was important in this context to distinguish between the two types of contributory negligence alleged against KBC Bank. The first type of contributory negligence is the want of care in making decisions to lend. The second type of contributory negligence is the failing to verify or supervise the solicitors’ performance of their duties.

On the assumption KBC Bank failed to exercise due care in lending, Mr. Justice Fennelly was satisfied KBC Bank was exclusively responsible for those decisions.

Mr. Justice Fennelly found it was not the task of BCM Hanby Wallace to check the financial soundness or reliability of Mr. Byrne and Mr. Kelly. He also found that the High Court erred in finding there was no contributory on grounds of finding the actions of the borrowers were merely an inevitable or necessary cause, and not a proximate cause, of the loss.

Mr. Justice Fennelly noted the effective cause of the loss was the decision to lend to Mr. Byrne and Mr. Kelly, combined with the negligence of BCM Hanby Wallace.

Mr. Justice McGovern remarked that aspects of the loans to Mr. Byrne were "highly questionable". He noted the "somewhat careless" approach of KBC Bank in its actions.

On the second type of contributory negligence, the failure to verify or supervise the solicitors’ performance of their duties, KBC Bank was entitled to rely on the expertise of BCM Hanby Wallace to put in place security. Although it may be argued that the responsibility of KBC Bank in this context was so small it should not be fixed with any responsibility, there is no absolute rule.

Mr. Justice McGovern argued that if evidence showed the errors of BCM Hanby Wallace were so obviously the errors could not have been overlooked, there was a fault on the part of KBC Bank and it was open to BCM Bank Wallace to argue the obligations KBC Bank had in accordance with European Union Regulations on Licensing and Supervision of Credit Institutions. Also see 2009 and 2013.

The European Union Regulations requires the banks to manage business in accordance with ‘sound administrative and accounting principles’. The banks are also required to put in place and maintain internal control and reporting arrangement to ensure  business in managed.

Mr. Justice Fennelly directed that Byrne Wallace appeal  be allowed on the issue of contributory negligence and the matter should be reconsidered by the High Court.   

Commercial rent must be in line with present market conditions

A High Court ruling in March that will see the rent paid by Bewley’s for its Grafton Street premises fall, could have far-reaching implications for upward only rent reviews in Ireland.

Mr. Justice Peter Charleton said the amount of rent Bewley’s pays Ickendel Limited must fall in line with current market conditions.

Upward only rent reviews, where commercial leases were subject to occasional reviews, and where rent could only rise or remain flat but never fall, have been a contentious issue in recent years with the dramatic decline property prices.

Ickendel, owned by developer Johnny Ronan’s Treasury Holding Group, had taken a case against Bewley’s arguing that it could not reduce rents because its lease agreement only permitted upward only rent reviews.

The High Court had heard that both parties entered into a lease agreement in 1987 with rent reviews every five years since then, and the 2007 review, at the height of the boom, fixed at €1.46 million. Despite this, the same figure was claimed in 2012.

Bewley’s had claimed that the rent review was ambiguous and argued that the lease agreement did have a provision to allow rent to fall as long as it was not below the threshold set in 1987.

Mr. Justice Charleton concurred, saying that:

[t]he parties bargained so as to agree never to fall below that initially agreed rent and I cannot see that they bargained thereafter for anything other than a fair open market rent. That can rise and that can fall.

Mr. Justice Charleton said that it was not in accordance with “business sense” that a rent agreed five years ago “should govern a hospitality market changed for the worse”.

Comment: The objective of section 132(3) of the Land and Conveyancing Law Reform Act 2009  is that any reviewed rent is to reflect the market conditions prevailing at the time of the review. However, this section does not apply where the lease, or an agreement for such a lease, is entered into prior to the commencement of the section. Thus, this section would not have been applicable in the case of Bewley’s. Section 132 came into effect from February 28, 2010 (S.I. 471/2009).  

McCann Fitzgerald PDF    

The function of legislation is one that cannot be delegated by the Oireachtas to any other body

The Supreme Court has ruled that Registered Employment Agreements which set the pay rates for several employment sectors are unconstitutional.

The Supreme Court found that the provisions of Part III of the Industrial Relations Act 1946 unconstitutional, observing that:

there is a wholesale grant, indeed abdication, of lawmaking power to private persons unidentified and unidentifiable at the time of grant to make law in respect of a broad and important area of human activity and subject only to a limited power of veto by a subordinate body ... Nor did the Oireachtas retain any capacity for review either by the Oireachtas or by a member of the Executive responsible to it, of the agreements actually made.

The Supreme Court found that there was no obligation on the Labour Court or the parties to the agreements to consider the interests of the parties who would be bound by the agreements and those who are not parties to the agreements. Moreover, once the agreement is registered it is binding on everyone, and it may only be varied on the application of the original parties.

The Supreme Court found that the Act allowed the parties to an agreement to make any employment related law on the condition that the Labour Court considers such a law to be "substantially representative" of those working in the sector.

Comment: The McGowan ruling mirrors the John Grace Fried Chicken ruling, where the High Court found the Joint Labour Committee wage settings mechanism unconstitutional.

Genetic mother has right to legal recognition on birth certificate

A genetic mother ("CR") has been declared the legal mother of twins born to a surrogate mother in a significant case at the High Court. By arrangement with her sister, "CR" provided ova, fertilised by sperm provided by the husband of the genetic mother, "OR". As a result of that fertilisation, which took place in vitro, the twins, "MR" and "DR" were created.

Mr. Justice Henry Abbott in the High Court ruled that the "CR" was the legal mother and that she was entitled to have her name on the birth certificates. Until now, only the women who gave birth can be registered as the mother.

The couple had sought to challenge the refusal of the State to allow the genetic mother to be listed as the mother on the birth certificates. 

The surrogate, sister of  "CR", did not object to the couple’s application.

Mr. Justice Abbott said the input of the birth mother was to be respected and treated with "care and prudence". But 'the mother is always certain' (maxim mater semper certa est) principle, which the state argued meant the birth mother was always the legal mother, did not survive the enactment of the Constitution, "as it applies to the situation of in-vitro fertilisation".

"To achieve fairness and constitutional and natural justice for both the paternal and maternal genetic parents, the feasible inquiry in relation to maternity ought to be made on a genetic basis and on being proven, the genetic mother should be registered as the mother," Mr. Justice Abbott said.

Mr. Justice Abbott also ruled that the word "mother" in Article 40.3.3 of the Constitution had a meaning "specific to the article itself". This was related to the existence of the unborn only when the foetus was in the womb and not otherwise.

The state argued that Article 40.3.3 had defined motherhood as the birth mother only.

Mr. Justice Abbott noted that positive legislation in Ireland on surrogacy was "totally absent" and so the contract entered into by the couple and the surrogate mother was "not illegal". But he said its performance in the Irish legislative context "would not be enforceable by any court".

View: Guidance Document 2012 (Justice)

NAMA is a public authority for the purpose of EU Regulations on access to information on the environment

Mr. Justice Colm Mac Eochaidh yesterday ruled that the National Asset Management Agency (or “NAMA”) is a public authority for the purposes of the European Communities (Access to Information on the Environment) Regulations 2007.

The ruling by Mr. Justice Mac Eochaidh is considered as having implications for a range of public authorities.

However, the ruling will have no implication for the Freedom of Information Act, which is due to be amended as part of a process that will include the National Asset Management Agency under the legislation.

The Agency claimed that it was not a public authority within the meaning of the 2007 European regulation. But Mr. Justice Mac Eochaidh said this was “absurd”.

Mr. Justice Mac Eochaidh re-affirmed the ruling of Ms. Emily O’Reilly, Commissioner for Environmental Information, who ruled in September 2011 that the Agency is a public authority within the meaning of the regulation.

An application to remit the matter to the commissioner was yesterday dismissed by Mr. Justice Mac Eochaidh.

Ms. O’Reilly issued her ruling in light of a refusal by the National Asset Management Agency to supply information, sought by a journalist in 2010, on the basis that the Agency is not a public authority within the meaning of the 2007 regulations.

An appeal to the Supreme Court is open to the National Asset Management Agency.

Reasons must be given for administrative decisions

The Supreme Court has rejected the decision of the Minister for Justice not to grant a certificate of naturalisation for Irish citizenship to a Syrian national. The five judge Court held that the Minister was obliged to provide reasons for his refusal, but failed to do so.

Ruling in favour of Ghandi Mallak, Mr. Justice Nial Fennelly observed that the developing law of Irish courts provides "compelling evidence" that it must be unusual for a decision maker to be allowed to refuse to give reasons.

Mr. Justice Fennelly also observed that law serves to provide a remedy where it can be shown that fairness is lacking.

Indeed, administrative decisions are not excluded from review and any opinion formed by the Minister must be held in good faith, factually sustainable and reasonable.

Mr. Mallak and his wife arrived in Ireland in 2002, obtaining asylum in 2003, later applying for a certificate of naturalisation as part of the citizenship process.

However, the first application was rejected because Mr. Mallak was not residing in Ireland long enough. He applied again in December 2005, only to be rejected in November 2008. The Minister did not disclose the reasons.

Documents relating to his case were sought under the Freedom of Information Act, including the reasons for rejecting the application.

Mr. Mallak was informed by the Office of the Information Commissioner that the refusal of the Minister to give reasons was in accordance with section 18 of the Freedom of Information Act.

Additional requests to the Department of Justice disclosed material Mr. Mallak claims he was previously unaware of and, as a result, had no opportunity to meet any adverse findings.

Later, Mr. Mallak appealed the High Court ruling of 2011 to the Supreme Court where Mr. Justice Fennelly observed that the failure to give reasons means it is not possible for Mr. Mallak to decide whether he has a basis for applying for judicial review of the substance of the decision.

The Supreme Court ruling will have implications for other administrative decisions where it can be shown that fairness is lacking.