O'Brien v AON Insurance Managers (Dublin) Ltd

• Jurisdiction: Ireland
• Judge: Mr. Justice Clarke
• Judgment Date: 14 January 2005
• Neutral Citation: [2005] IEHC 3
• Docket Number: [No. 19385 P/2004]
• Court: High Court
• Date: 14 January 2005

[2005] IEHC 3

THE HIGH COURT

[No. 19385 P/2004]

O'Brien -v- AON Insurance Managers (Dublin) Limited

BETWEEN

EAMON O'BRIEN

PLAINTIFF

AND

AON INSURANCE MANAGERS (DUBLIN) LIMITED

DEFENDANT

Abstract:

Injunction - Employment law Interlocutory - Disciplinary procedure - Whether the rights provided for by the rules of natural justice apply to a preliminary investigation.

The plaintiff who was the Managing Director of the defendant company was required to take ‘enforced leave’ pending the outcome of an investigation into his conduct as managing director of that Company. Subsequently, the plaintiff sought an interlocutory injunction restraining the defendant from taking any steps to discipline him arising out of the investigation report and further an order from the court, which would in effect permit him to return to active duties as managing director.

Held by Clarke J. in refusing the application:

1. That the plaintiff failed to establish a fair case to be tried in relation to the contention that proceeding further with the contemplated disciplinary process would be contrary to his legal entitlements. The investigation report was part of a two stage process and the recommendation of the report did not amount to a sanction and therefore the issue of natural justice did not arise.

2. That there were at least substantial grounds upon which the defendant could have concluded that it was inappropriate for the plaintiff to continue in active employment until such time as the issues which had been raised were comprehensively dealt with.

Reporter: L.O’S

Mr. Justice Clarke

1 The plaintiff is the Managing Director of the defendant company ("the Company"). The Company is a specialist insurance and re-insurance management company which is licensed to operate within the IFSC. The Company's main activity is concerned with managing insurance and re-insurance companies which are in turn wholly owned by multi-national companies and which, in effect, act as self insurers for those multi national companies. The plaintiff as Managing Director of the company is responsible for the day to day management of the business pursuant to the terms of a contract of employment entered into between the plaintiff and a predecessor of the Company which contract of employment is dated 11th April, 1996. The events which lead to the dispute between the parties commenced in mid to late July 2004 when the management of the Company (including the plaintiff) became aware of what is agreed was a serious problem which suggested that signatures on important documents, including accounts and statutory documentation, had been forged by a former senior employee of the company. After a short period of time the issue was reported to senior officials in AON Captive Services Group ("ACSG") which is the direct line parent company. Thereafter a number of investigations and enquiries were undertaken. As a result of same an investigation into the conduct of the plaintiff, as Managing Director, was initiated. The plaintiff has been on what he describes as enforced leave since 21st August, 2004 as a result of, it would appear, decisions taken by senior officers of the parent companies. The initial reason given to the plaintiff was that he should be absent while an internal audit/review was carried out. However his absence from active work was continued during the investigation into his conduct referred to above and continues to this day.

2 It is of importance to set out the terms of reference of that investigation. The initial terms of reference and the objective of the investigators are summarised in a letter dated 14th September, 2004 from Juris Grinbergs Human Resources Director of the AON group to the plaintiff which states as follows:-

"the internal review of the operation of AON (Dublin) that was initiated following the discovery of certain documents containing forged signatures has identified a number of issues in relation to the corporate governance financial report and financial control of AON (Dublin)."

3 If substantiated these issues could have preferred implications for the professional of AON Dublin and ACSG and there standing with clients and regulators. Furthermore there may be a need to restate the financial results for prior years and review decisions made on the basis of those results.

INVESTIGATION

4 In the light of above you are advised that an investigation would be undertaken with the following aims:-

5 1. confirm or otherwise the findings relating to the alleged breaches of statutory and regulatory requirements and of company procedure policies and management instructions;

2. ascertain accountability for any breaches that may be confirmed;

6 3. to the extent that it is decided that there is evidence that the accountability for any breaches rests with yourself the investigation will also seek to determine whether there is evidence to suggest that you have been guilty of misconduct or gross misconduct in relation to which the company should commence disciplinary proceedings against you. This stage of the investigation would focus on the following allegations against you.

7 (a) whether there is evidence that you failed to prevent breaches of statutory and regulatory requirements, company procedures, policies and/or management instructions in circumstances where it was part of your role to prevent these types of breaches;

8 (b) whether there is evidence that you knowingly misrepresented information relating to the financial performance of the business such that senior management were given a false impression of how the business was doing. At our meeting on 8th September, 2004 we discussed the specific issues in respect of receivables and the accounting treatment of fiduciary income; and

9 (c) whether there is evidence that you failed to prevent such breaches and/or that you made such misrepresentations as you stood to gain from them personally. As discussed at our meeting on 8th September, 2004 there is evidence to suggest that there were discrepancies between the statutory accounts and the management accounts for AIM (Dublin) in respect of 2003 and prior...