Byrne v Judge O'Leary and Others

[2011] IESC 38,

Supreme Court

[S.C. No. 49 of 2007]
Byrne v. OÆLeary
John J. Byrne
Judge Sean O'Leary, Noreen Mackey, Paul Rowan and Michael Cush (inspectors appointed by order of the High Court to Ansbacher (Cayman) Limited)

Case mentioned in this report:-

The People (Attorney General) v. Casey (No. 2)IR[1963] I.R. 33.

Company law - Investigation - Report - Evidence - Interview - Inspectors - Not all inspectors present at interview of witness - Court order requiring re-interview by all inspectors if veracity of evidence in dispute - Whether veracity of evidence given in interview in dispute - Meaning of veracity - Whether statements of fact or belief - Companies Act 1990 (No. 33), ss. 7(4), 8 and 12.

Words and phrases - "Veracity" - Whether subjective or objective concept.

Cur. adv. vult.

Hardiman J

10th October, 2011

[1] This is an appeal from the order of the High Court of the 19th December, 2006, whereby the applicant's application for judicial review of the order of the respondents as inspectors appointed under the Companies Act 1990 was refused on all grounds. The reasons for this order were set out in the judgment of the High Court (Gilligan J.) delivered on the 7th December, 2006 (see [2006] IEHC 412).


[2] The inspectors were appointed pursuant to ss. 8 and 17 of the Act of 1990, for the purpose of investigating and reporting to the High Court on the affairs of Ansbacher (Cayman) Ltd. (previously known as Guinness and Mahon Cayman Trust Limited) in relation to four specific matters set out in the judgment of the High Court and "any related matters". The specific matters included the question of:-

"… whether the affairs of the company were conducted with intent to defraud its creditors or the creditors of any other person or otherwise for a fraudulent or unlawful purpose and if so to identify the statutory provisions involved and the persons in default in each case…"

The inspectors

[3] Under the terms of a High Court order of the 22nd September, 1999, the former President of the High Court, Declan Costello and the second and third respondents were appointed inspectors. Subsequently, Mr. Justice Costello resigned from this position and, according to the affidavit of the first respondent, the first and fourth respondents were appointed additional inspectors pursuant to an order of the 8th December, 2000.

[4] This staggered process of appointment, and perhaps other factors, led to a position in which a very relevant part of the proceedings of the inspectors were conducted by two only, and not by all four, of them. Specifically, the applicant, now the appellant, was interviewed by the inspectors once only. This occurred on the 24th January, 2001. Two only of the inspectors were present, the first and third respondents.

The order of the 25th May, 2001

[5] Four months after the interview with the applicant, an order of the High Court (Finnegan J.) was made pursuant to s. 7(4) of the Act of 1990. This order appears to have been made ex parte and insofar as is relevant it provided as follows:-

"Where it has not been found practical for all four inspectors to be present at an interview at which a witness's evidence has been taken under oath or where that witness has been interviewed prior to the appointment of a particular inspector, the inspector or inspectors who was/were absent from that interview shall not be precluded from further examining that witness or reporting to the court on that witness subject to the following:-

That the veracity of the evidence given by that witness during the said interview is not in dispute or if the veracity of the evidence given by that witness during the said interview is in dispute that the said interview is conducted in full again with the said inspector or inspectors in attendance."

[6] Sections 7 and 8 are the sections of the Act of 1990 which permit the court to "appoint one or more competent inspectors to investigate the affairs of a company in order to inquire into matters specified by the court".

[7] Section 7(4) provides that:-

"Where the court appoints an inspector under this section … it may, from time to time, give such directions as it thinks fit, whether to the inspector or otherwise, with a view to ensuring that the investigation is carried out as quickly and as inexpensively as possible."

[8] The application under s. 7(4) of the Act of 1990 for the order which was made on the 25th May, 2001, appears to have been made ex parte. On the hearing of this appeal, the affidavit on which the application was grounded was not produced. It is also notable that the application was made some four months after the applicant had been examined on oath. It was therefore designed retrospectively to rectify any difficulty or weakness arising from the fact that only two of the four inspectors had participated in that exercise. This was so, even though the last two inspectors to be appointed (the first and fourth respondents) had received their appointments in December, 2000. One can only suppose that this rectificatory order was made on the basis that it would have added to the length and expense of the inquiry if the evidence of the applicant had to be reheard. But that might have been a cheaper option in the end. It must also be doubtful if a provision aimed at ensuring speed and cheapness can authorise persons to form a view of and report on oral testimony which they have not heard but which has previously been heard by others. But that question does not immediately arise.

The central point in the case

[9] The applicant was only interviewed once. Neither the second respondent nor the fourth respondent was present at that interview. Accordingly, these two inspectors could only join in the making of the report to the court on the basis that "the veracity of the evidence given by that witness during the said interview is not in dispute".

[10] This interpretation of the order of the 25th May, 2001, appears to be undisputed. In the inspectors' submissions to this court, at p. 4, it is said that:-

"It is not disputed that the result of the order of the High Court dated the 25th May, 2001, pursuant to s. 7(4) of the Companies Act 1990 was that where:-

(a) a witness's evidence was being heard by fewer than all four inspectors on the basis that it was not practical for all four inspectors to be present, and

(b) the veracity of that evidence was in dispute, "

the interview of that witness would have to be conducted in full again with the attendance of the previously absent inspectors. It is the respondents' submission that the veracity of the applicant's evidence at the interview of the 24th January, 2001, by the first and third respondents was not in dispute."

[11] Based on the foregoing, the issue between the parties can be very simply expressed. The applicant says that "veracity" means objective conformity with fact. The respondents, the inspectors, say that "veracity" "must relate solely to the subjective internal belief of a person". If that person...

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