Dolan v Neligan

• Jurisdiction: Ireland
• Court: Supreme Court
• Judgment Date: 01 January 1969
• Docket Number: [1962. No. 2000 P.]
• Date: 01 January 1969

Supreme Court.

[1962. No. 2000 P.]

Dolan v. Neligan

HUGO A. DOLAN

Plaintiff

and

MAURICE P. NELIGAN

Defendant.

Revenue - Customs - Import duty - Overpayment by importer caused by unauthorised demands of customs official - Mistake of law - Whether monies overpaid were recoverable by importer - Statute - Interpretation - Customs Consolidation Act, 1876 (39 & 40 Vict. c. 36), ss. 25, 30, 31.

Witness Action.

On the 19th December, 1962, the plaintiff commenced an action in the High Court by plenary summons in which he claimed from the defendant, who had been a collector of customs, the return of monies overpaid by the plaintiff as import duty on certain goods. Sects. 30 and 311 of the Customs Consolidation Act, 1876, provide a procedure whereby, if a dispute arises, the importer can deposit the import duties demanded from him in relation to goods, bring an action to ascertain the proper rate of duty payable on the goods, and recover any monies in excess of the lawful duties, with interest. Sect. 25 of that Act provides inter alia:—". . . and the Commissioners of Customs are hereby authorised to return any money which shall have been overpaid as duties of customs, at any time within six years after such overpayment, on its being proved to their satisfaction that the same was overpaid in error; but no such return shall be allowed unless the claim for the same shall have been made and established within such period of six years."The jurisdictions, powers and duties of the Commissioners of Customs and Excise were conferred and imposed on the Revenue Commissioners by E.C.O. No. 2 of 1923. The facts have been summarised in the head-note and are stated in the judgments, post.

From the above judgment the plaintiff, and the defendant, appealed to the Supreme Court.

Sects. 30 and 31 of the Customs Consolidation Act, 1876, provide inter alia that, if any "dispute" should arise as to the proper rate of duty payable on imported goods. the importer "shall deposit" with the collector of customs the amount of the duties demanded by him, and that such amount shall be deemed to be the proper duty payable on the goods unless the importer commences an action within three months after the deposit to ascertain the duty properly payable; and that, on payment of the deposit, the collector shall deliver the goods to the importer; and that, if it be determined in such action that a duty less than the deposit was payable, the overpayment shall be returned to the importer with interest in satisfaction of all claims in respect of the importation of the goods.

The plaintiff imported certain initial consignments of goods of a single description and, although he did not accept that the correct rate of import duty had been applied in calculating the duties demanded from him by the defendant, he paid those duties during and after the year 1956 in order to obtain delivery of those consignments.

Subsequently the plaintiff imported further consignments of goods of the same description and a higher rate of import duty was applied in calculating the duties demanded from him in respect of the further consignments, whereupon the plaintiff, pursuant to ss. 30 and 31 of the Act of 1876. deposited the duties calculated at the higher rate and brought an action in the High Court to ascertain the correct rate of duty applicable to the further consignments and to recover any deposit monies in excess of the duties lawfully payable by him in respect of the further consignments. On the 22nd July, 1959 the High Court in that action found in favour of the plaintiff and decided the lawful rate of import duty, which was applicable to all the consignments. The lawful rate of import duty so ascertained was lower than the rate applied in calculating the demands made of the plaintiff by the defendant, a collector of customs, in relation to the initial consignments.

By letter dated the 27th November, 1959. the plaintiff duly made a claim for the repayment to him of the sum of £19,193 10s. 1d., being the amount of the import duties overpaid by him (but not deposited) as a result of the unauthorised demands relating to the initial consignments. The plaintiff then commenced these proceedings in the High Court to recover the said sum of £19,193 10s. 1d. as money had and received by the defendant to the use of the plaintiff.

Held by Kenny J.:—

1. That in the absence of ss. 30 and 31 of the Act of 1876, the overpayments would have been recoverable by the plaintiff from the defendant as monies had and received by him to the use of the plaintiff, because the overpayments had been paid by the plaintiff to the defendant in his capacity as a public official and as a result of unauthorised demands made by him in that capacity at a time when he could have withheld a privilege from the plaintiff if the latter had not paid the monies demanded.

Hooper v. Mayor and Corporation of Exeter 56 L.J.Q.B. 457.

William Whiteley Ltd. v. The King 101 L.T. 741.

Brocklebank Ltd. v. The King [1925] 1 K.B. 52 and

R. & W. Paul Ltd. v. The Wheat Commission [1937] A.C. 139, considered.

2. That, in the absence of those sections, the plaintiff would have been entitled to recover the overpayments, even though they had been made under a mistake of law, because that mistake had been caused entirely by the defendant.

Rogers v. Ingham 3 Ch. D. 351.

Ministry of Health v. Simpson [1951] A.C. 251 and

Kiriri Cotton Co. Ltd. v. Dewani [1960] A.C. 192 considered.

3. That the procedure provided in those sections was the sole remedy available to the plaintiff for the recovery of the overpayments and that, as there had been a dispute within the meaning of s. 30 of the Act and the plaintiff had not applied that procedure, he was not entitled to recover the overpayments from the defendant.

On appeal by the plaintiff it was

Held by the Supreme Court ( Ó Dálaigh ó dálaigh C.J., Haugh and Walsh JJ.) in allowing the appeal:—

1. That there had been a dispute within the meaning of s. 30 of the Act of 1876.

2. That the words "shall deposit" in the context of s. 30 of that Act mean that the duties demanded must be deposited by the importer in accordance with that section only if he wishes to avail of the procedures contained in ss. 30 and 31 of the Act.

3. That a payment of duties by an importer, even after a dispute has arisen as to the proper rate of duty payable, is not sufficient to make the provisions of ss. 30 and 31 of the Act applicable to a claim for the recovery of duties overpaid unless it is clear that the payment was made by way of deposit under those sections; and that, accordingly, those sections did not affect the plaintiff's claim as he had not sought to invoke them and had not paid the overpayments as such deposits.

4. That the overpayments had been paid by the plaintiff because of an erroneous interpretation of the law by the customs authorities.

5. That the provisions of s. 25 of the Act authorised the Revenue Commissioners to return monies overpaid as duties of customs within six years after they had been paid on its being proved to their satisfaction that the overpayments had been paid "in error," provided that the claim for the return of the overpayments had been made and established within such period of six years.

6. That the words "in error" in s. 25 of the Act included an erroneous interpretation of the law, whether made by the importer or by the customs authorities: and that money paid on foot of an erroneous charge is money paid "in error."

7. That, if the plaintiff's claim had been considered by the Revenue Commissioners under the terms of s. 25 of the Act, they could not have come to any other conclusion but that the overpayments had been paid "in error"because the Commissioners would have been bound to consider the matter by objective standards and in a judicial manner, and because the error had been established in the plaintiff's first action before his present claim had been made; and that, accordingly, the case must be treated as if it had been proved to the satisfaction of the Commissioners that the overpayments had been paid in error.

8. That the provisions of s. 25 of the Act do not merely confer a discretion on the Commissioners to return overpayments when the conditions in the section have been satisfied; but their effect is that, once the conditions have been satisfied, the Commissioners are not lawfully authorised to do otherwise than to return the overpayments.

Cur. adv. vult.

Kenny J. :—

Sect. 8 of the Finance Act, 1916, provided that there should be charged and paid on cider and perry imported into Great Britain or Ireland a customs duty of 4d. per gallon. Sect. 11 of the Finance Act, 1940, increased this duty to 3/- per gallon when the preferential rate applied, and provided that any article on which this duty was paid should not also be chargeable with duty on any sugar or other sweetening matter in it. Sect. 3 of the Finance Act, 1920, increased the customs duties payable on spirits by imposing the duties in Part 1 of the First Schedule to that Act. This Schedule listed a number of types of spirits such as brandy and rum and also included "unsweetened spirits other than those already enumerated" and preparations containing spirit. The customs duties on spirits have been increased on many occasions since the year 1920.

In July, 1956, the plaintiff, who is the owner of a well-known licensed premises in Dublin, learned that an English firm called Showerings were producing a drink called Babycham. This contained treated pear juice, water and sugar. It had no added spirit and resembled champagne in appearance.

It had an alcohol content of about 14.7% in terms of proof spirit and was a drink which was unknown in Ireland until the middle of the year 1956. The plaintiff, who realised what the attractions of this drink would be for adults and for children, decided to import it into the Republic of Ireland and a number of consignments...