DPP v Hegarty

• Jurisdiction: Ireland
• Judge: Mr. Justice William M. McKechnie
• Judgment Date: 28 July 2011
• Neutral Citation: [2011] IESC 32
• Court: Supreme Court
• Docket Number: [S.C. No. 350 of 2008]
• Date: 28 July 2011

DPP v Hegarty

IN THE MATTER OF SECTION 16 OF THE COURTS OF JUSTICE ACT 1947

BETWEEN

THE PEOPLE (AT THE SUIT OF THE DIRECTOR OF PUBLIC PROSECUTIONS)

PROSECUTOR

AND

PAT HEGARTY

ACCUSED

[2011] IESC 32

[Appeal No. 350/2008]

THE SUPREME COURT

CRIMINAL LAW

Competition

Corporate crime - Contingent offence - Prevention, restriction or distortion of competition - Price fixing - Finding that offence committed - Conviction - Double punishment - Jus tertii - Right to good name - Whether undertaking committed offence - Whether director or manager could be convicted in absence of conviction of undertaking - Whether prosecution of undertaking necessary - Whether accused entitled to rely on position of company - Whether finding that undertaking committed offence violated constitutional rights - R v Donald [1986] 83 Cr App R 49, People (DPP) v Roseberry Construction Ltd [2003] 4 IR 338, R v Dickson [1991] BCC 719, R v Cogan [1976] QB 217, A v Governor of Arbour Hill Prison [2006] IESC 45, [2006] 4 IR 88 and Cahill v Sutton [1980] IR 269 considered - Competition (Amendment) Act 2006 (No 4) - Competition Act 2002 (No 14) - Competition (Amendment) Act 1996 (No 19), ss 2(2 ) and 3(4)(a) - Competition Act 1991 (No 24), s 4(1) - Restrictive Trade Practices (Confirmation of Orders) Act 1972 (No 8) - Restrictive Trade Practices Act 1953 (No 14) - Courts of Justice Act 1947 (No 20), s 16 - Case stated answered in favour of prosecution (350/2008 - SC - 28/7/2011) [2011] IESC 32

People (DPP) v Hegarty

Facts: The accused was the Manager / Officer of an oil company and was accused of entering into an agreement with other undertakings within the meaning of s. 3 Competition Act 1991 to fix the price of gas oil. It was asserted that a recorded conviction against the company was a sine qua non to a personal conviction. The trial judge rejected the propositions and agreed to submit by way of case stated two questions to the Supreme Court. The Circuit Court stated to questions to the Supreme Court, firstly, as to where an individual was prosecuted pursuant to s. 3(4)(a) Competition Act 1996 whether an adjudication as to whether the undertaking committed the offence could be undertaken when no prosecution was initiated and secondly, whether it was necessary that the undertaking be convicted of the offence before the individual could be convicted. The question arose as to the rights that the accused was entitled to rely upon.

Held by the Supreme Court per McKechnie J. (Murray, O' Donnell JJ. concurring) that the true meaning of s. 3(4) of the Act of 1996 was that the undertaking did not have to be convicted of an offence before the director or manager. It was an essential ingredient of the offence that the company itself must have committed the office. It was the duty of the trial court to ensure that rights were not violated. The accused had to respond to the charges as they affected him and could not assert a prejudice or plead a detriment which was that of the company alone. The questions posed would be answered: (A) Yes; (B) No.

Reporter: E.F.

COURTS OF JUSTICE ACT 1947 S16

COMPETITION ACT 1991 S4(1)

COMPETITION (AMDT) ACT 1996 S2

COMPETITION (AMDT) ACT 1996 S3(4)(A)

COMPETITION ACT 1991 S3

COMPETITION (AMDT) ACT 1996 S2(2)

CRIMINAL PROCEDURE ACT 1967 S4E

CRIMINAL JUSTICE ACT 1999 S9

COMPETITION ACT 1991 S4

COMPETITION ACT 2002 S3

COMPETITION (AMDT) ACT 1996 S3(4)

CONSTITUTION ART 38.1

CONSTITUTION ART 40.3

R v DONALD 1986 83 CR APP R 49 1986 CRIM LR 535

A v GOVERNOR OF ARBOUR HILL PRISON 2006 4 IR 88

R v DICKSON & WRIGHT 1991 BCC 719 1992 94 CR APP R 7

R v ONTARIO CHRYSLER (1977) LTD UNREP 7.3.1994 1994 CANLII 8758 (ON CA)

PINTO & EVANS CORPORATE CRIMINAL LIABILITY 2ED 2008 80

THEFT ACT 1968 S18 (UK)

RESTRICTIVE TRADE PRACTICES ACT 1953

RESTRICTIVE PRACTICES ACT 1972

COMPETITION (AMDT) ACT 2006

TREATY OF ROME ART 81

TREATY OF ROME ART 82

TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 101

TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 102

COMPETITION ACT 1991 S5

COMPANIES ACT 1963 S297

COMPANIES ACT 1990 S137

SAFETY HEALTH & WELFARE AT WORK ACT 2005

DPP v ROSEBERRY CONSTRUCTION LTD 2003 4 IR 338 2003/20/4492

CRIMINAL LAW ACT 1967 S4(1) (UK)

CRIMINAL LAW ACT 1967 S4 (UK)

TRADE DESCRIPTIONS ACT 1968 S20(1) (UK)

R v COGAN; R v LEAK 1976 QB 217 1975 3 WLR 316 1975 2 AER 1059

COMPETITION (AMDT) ACT 1996 S3(4)(B)

COMPANIES ACT 1990 S150

COMPANIES ACT 1990 S160

CAHILL v SUTTON 1980 IR 269

1 JUDGMENT of Mr. Justice William M. McKechnie dated the 28th day of July, 2011.

2 1. This is a consultative case stated by His Honour Judge Groarke of the Western Circuit, pursuant to s. 16 of the Courts of Justice Act 1947, wherein, by reference to the circumstances so outlined, he seeks the opinion of this Court on two questions. The facts, as agreed or so found, and upon which the case is stated, are as follows.

3 2. On the 21 ^st May, 2008, Mr. Hegarty, the accused person, attended at Galway Circuit Criminal Court to answer two charges preferred against him on Bill No. MS 55/04, the first of which reads as follows:-

"Statement of Offence: "

4 Being a Manager or Officer of an undertaking which entered into an agreement which had as its object the prevention, restriction or distortion of competition, contrary to s. 4(1) of the Competition Act 1991 and s. 2 of the Competition (Amendment) Act 1996, as provided for by s. 3(4)(a) of the said Act.

5 Particulars of Offence:

6 Patrick Hegarty, between the 1 ^st day of January, 2001, and the 11 ^th day of February, 2002, both dates inclusive, in the County of Galway, were a Manager or Officer of Fate Park Limited t/a Sweeney Oil/Rabbit Oil, an undertaking within the meaning of s. 3 of the Competition Act 1991, such company having committed an offence, (emphasis added) namely entering into an agreement with other undertakings again within the meaning of s. 3 of the Competition Act 1991, which had as its object the prevention, restriction or distortion of competition in the trade of gas oil in Galway city and county, by directly or indirectly fixing the selling price of gas oil, and authorised or consented to the doing of the acts constituting that offence."

7 Count No. 2 on the indictment is in identical form, save that the trading product was kerosene.

8 3. On a previous occasion, namely the 9 ^th May, 2007, Mr. Hegarty was also called upon to answer the same charges, but on that occasion, a company named Sweeney Oil Limited t/a Rabbit Oil was cited on the indictment as his co-accused. That company faced two charges arising out of the same set of circumstances. The first was that it had entered into an agreement with other undertakings, which had as its object the prevention, restriction or distortion of competition by directly or indirectly fixing the selling price of gas oil in Galway city and county, contrary to s. 2(2) of the Competition (Amendment) Act 1996 ("the 1996 Act"). Again, count No. 2 on the indictment was in identical form, save that the product was kerosene.

9 4. For reasons which have never been evidentially explained, but described in submissions as being technical in nature, the Director of Public Prosecutions ("the D.P.P.") on that occasion (the 9 ^th May, 2007,) entered a nolle prosequi in respect of the company. The prosecution against the accused was then adjourned so that an abridged book of evidence could be served; hence the new trial date of the 21 ^st May, 2008, was fixed.

10 5. At the commencement of that trial, counsel on behalf of the accused moved a motion under s. 4(E) of the Criminal Procedure Act 1967, as inserted by s. 9 of the Criminal Justice Act 1999, to quash the indictment on the basis that any successful prosecution against his client was contingent on Fate Park Ltd. having committed a particular criminal offence. (See "Particulars of Offence" at para. 2 supra). This could only be established by a conviction being secured against it. Since that company had never been prosecuted for such an offence, it was therefore not possible for the jury to return a guilty verdict against Mr.Hegarty. The D.P.P. disagreed with this proposition. Whilst accepting the contingency as an ingredient of the offence, the D.P.P. argued that the same could be established otherwise than by formal conviction.

11 6. Having heard submissions from Mr. Edward S. Walsh S.C., on behalf of the accused, and Mr. Denis Vaughan-Buckley S.C., on behalf of the D.P.P., the trial judge rejected the submissions of the prosecution. Being dissatisfied with such ruling, expressed whilst the matter was still pending, the learned judge agreed to submit by way of case stated the following two questions for the opinion of this Court:-

"Where an individual is prosecuted pursuant to s. 3(4)(a) of the Competition Act 1996 [ sic]:"

(a) whether an adjudication as to whether the relevant undertaking has committed an offence can be undertaken when no prosecution has been initiated against the undertaking, and

(b) whether it is necessary that the undertaking be convicted of the offence before the individual can be convicted."

12 7. The submissions made before the Circuit Criminal Court have largely been repeated before this Court and can be summarised in the manner following. First, however, it is convenient to refer to the relevant statutory provisions.

13 8. Section 4 of the Competition Act 1991 ("the 1991 Act") provides, inter alia, that all agreements between undertakings, which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services, are prohibited and void. Price fixing is a notorious example of such "hard core" activity. Any entity engaged for gain, inter alia, in the supply or distribution of goods, is...