Cyril Reaney and Others v Interlink Ireland Ltd (t/a DPD)
|Mr. Justice Gilligan
|30 November 2012
| IEHC 609
|[No. 5797 P/2008]
|30 November 2012
 IEHC 609
THE HIGH COURT
PRACTICE AND PROCEDURE
Lodgment made in proceedings arising out of termination of franchise agreement - Lodgement intended to satisfy entirety of claim - Several causes of action in proceedings - Certain of causes of action disallowed - Separate awards of damages in respect of remaining causes of action - Lodgment not compliant with rules - Notice of lodgment failed to specify causes of action in respect of which lodgment made and to specify sum lodged in respect of each cause of action - Award slightly lower than total of lodgment - Whether strict compliance with rule required - Whether lodgment valid - Whether Calderbank letter relevant to question of costs in particular circumstances - Whether submission of defendants that plaintiffs exaggerated and subsequently withdrew aspects of claim relevant in extremely contentious proceedings - Desirability of settlement of proceedings out of court - Exercise of discretion - Pedley v Cambridge Newspapers Ltd  1 WLR 988 and Norbrook Laboratories Ltd v Smithkline Beecham (Ireland) Ltd considered - Civil Liability and Courts Act 2004 - Rules of the Superior Courts 1986 (SI 15/1986) O 22, rr 1 and 6 - Partial costs order made (2008/5797P and 2010/6530P - Gilligan J - 30/11/2012)  IEHC 609
Reaney v Interlink Ireland Ltd t/a DPD
RSC O.22 r6
RSC O.22 r1(5)
PEDLEY v CAMBRIDGE NEWSPAPERS 1964 1 WLR 988 1964 2 AER 794 1964 108 SJ 375
NORBROOK LABORATORIES LTD v SMITHKLINE BEECHAM 2000/13/4975
RSC O.22 r1(3)
O'DONNELL v MCENTEE & TIERNEY 2009 IEHC 563 2009/45/11212
LACKEY v KAVANAGH 2012 IEHC 276 2012/22/6378
ELY v DARGAN
RSC O.22 r1
WINDOW & ROOFING CONCEPTS LTD v TOLMAC CONSTRUCTION LTD 2004 IEHC 28 2004/43/9962
RSC O.56 r1(A)
VEOLIA WATER UK PLC v FINGAL CO COUNCIL (NO 2) 2006 IEHC 240 2006/57/12085
1. I refer to my judgment as delivered herein on the 31 st July, 2012. In the course of that judgment the plaintiffs were awarded €31,900.00 in respect of the Parceline account, €255,307.00 being the value of the franchise as terminated by the defendants and €8,680.00 in respect of monies due pursuant to the Pulsar account.
2. An issue has arisen as to whether or not the plaintiffs are entitled to VAT on the amounts as awarded and following submissions of the parties, I am satisfied that the plaintiffs are entitled to recover VAT in respect of the award of damages in respect of the Parceline contract and the value of the franchise as terminated, but not in respect of the €8,680.00 pursuant to the Pulsar contract as the sum agreed included VAT.
3. The parties agree that the appropriate rate of VAT payable to the Revenue Commissioners is 21% and thus, the amount to be awarded in respect of the Parceline contract is €38,599.50, and the amount in respect of the value of the franchise €308,921.00. Both these sums together with the €8,680.00 in respect of the Pulsar contract come to a total figure of €356,200.00.
4. Initially, on the 6 th January, 2011, the defendants lodged a sum of €253,075.00 in court and subsequently by way of notice of additional lodgement as dated the 4 th October, 2011, lodged a further sum of €109,168.23, bringing the total lodgement of monies in court to a figure of €362,243.23. The wording of the lodgements was to the effect that the sums as lodged were enough to satisfy all of the plaintiffs claim in the consolidated proceedings and liability was denied in respect of the said claims.
5. On the face of the lodgement documents the plaintiffs fail to secure an award in excess of the sums as lodged in court by the defendant.
6. Mr. Hanratty on behalf of the defendants moves the court for an order pursuant to O. 22, r. 6 which in the particular circumstances of the situation that arises herein, would result in the difference between the amount of the award and the amount lodged in court being repaid to the defendants and the balance of the lodgement being retained in court with the plaintiff being entitled to the costs of the action up to the time when such payment into court was made in respect of the issues or issue upon which he shall have succeeded, and the defendants would be entitled to the costs of the action from the time such payment into court was made other than such issues or issue as aforesaid. In accordance with the further provisions of 0. 22, r. 6, the costs would set off against one another and, if appropriate, any balance due to the defendants would be paid from the monies retained in court which the defendants had originally lodged, and the balance would then be paid out in favour of the plaintiff. These various provisions are subject to the trial judge coming to a conclusion that for special cause shown and mentioned in the order, the provisions of O. 22, r. 6 should not apply.
7. However, an issue has been raised as to whether or not the defendants lodgement is valid and in this regard the plaintiffs rely on O. 22, r. 1(5) which states:-
"r. 1(5) where money is paid into Court in satisfaction of one or more of several causes of action the notice shall specify the cause or causes of action in respect of which payment is made, and the sum paid in respect of each cause of action, unless the Court otherwise orders."
8. In the particular circumstances of this case the sums as lodged were indicated to be in satisfaction of all claims and did not specify the cause or causes of action in respect of which payment was made and no application was made to the court for any order that would be at variance with the rule as set out in O. 22, r. 1(5) of the Rules of the Superior Courts, at all times applicable to these proceedings.
9. Mr. Hanratty on the defendants behalf, indicates to the court that there is no Irish authority available relating to O. 22, r. 1(5) pertaining to lodgements and that he has never previously come across such a situation in practice. He contends on the defendants behalf that there was no objection to the form of the lodgement and no particulars were sought in respect of same and, in essence, simply because there has not been strict compliance with the lodgement provisions as set out in the Rules of the Superior Courts does not result in the lodgement as made being deemed invalid.
10. It is further contended on the defendants behalf that for the court to exercise its discretion in such a way as to, in effect, set aside the consequences that would otherwise flow from the lodgement, the court would have to be satisfied that some serious and real prejudice had accrued to the plaintiff by reason of the non-compliance with the rule. In the particular circumstances Mr. Hanratty submits that there is no evidence whatsoever being suggested to the court that such was the case.
11. If the court is to exercise its discretion, Mr. Hanratty submits that a feature that would loom large in the mind of the court is that when the lodgement was made, whether it was valid or not, it was an opportunity for the plaintiff to settle the case for a sum actually substantially in excess of what the court ultimately held they were entitled to, an opportunity which was passed over and passed over twice because there was a lodgement and then a top up of the lodgement. The plaintiff can justify the first pass over because the sum in the first lodgement was less than the amount of the award but not in respect of the second top up lodgement.
12. Mr. Hanratty also submits that the court should bear in mind the Calderbank offer which was made without prejudice as to costs on the 26 th February, 2010. The Calderbank letter of offer indicated that the defendants would pay the plaintiffs €96, 769.00 and that this figure was based on the value of the franchise on an earnings multiple basis. In the alternative, the plaintiffs were offered by the defendants a payment of such sum as was received from the purchaser of Depot 28 territory, being the subject matter of the franchise. A third option was an indication that the plaintiffs could opt to accept any of the above offers within fourteen days of the expiry of sixteen months if no sale had been achieved and as a further fourth option, the defendants offered to pay the plaintiffs such sum as determined by an agreed independent valuer on an earnings multiple basis. All offers were made on the basis of paying the plaintiffs reasonable costs as incurred up to the date of the letter.
13. Further, Mr. Hanratty contends that the plaintiffs claim was grossly exaggerated up until the first day of the trial. The claim for the Parceline account was €229,000.00 and announced for the first time in Mr. Ó hOisín's opening to have been reduced to €40,000.00. There was then a claim for €497,000.00 for non-payment of commission which was dropped and a claim for unspecified losses which was also dropped.
14. Mr. Hanratty contends that even if contrary to his submissions the court is to hold that the lodgement is invalid, the court in its discretion should not award the costs to the plaintiffs in this case and, in essence, he contends that the real question is whose fault was it that this case went to trial and the only reasonable conclusion is that it is the plaintiffs fault, and that they are the ones who are responsible for the costs that have been incurred and that could have been avoided if the lodgement had been accepted by them, whether or not it is...
To continue readingRequest your trial