DRM Contract Administration Ltd v Proton Technologies AG

• Jurisdiction: Ireland
• Judge: Mr. Justice Garrett Simons
• Judgment Date: 25 August 2021
• Neutral Citation: [2021] IEHC 554
• Court: High Court
• Docket Number: 2018 No. 8976 P

Between

DRM Contract Administration Limited

Plaintiff

and

Proton Technologies AG

Defendant

[2021] IEHC 554

2018 No. 8976 P

THE HIGH COURT

Defamation – Judgment in default of appearance – Renewal of plenary summons – Defendant seeking to set aside default judgment – Whether the service of the proceedings was irregular

Facts: The defendant, Proton Technologies AG, was a company registered in Switzerland and provided email services. It was alleged that the user of one of its email accounts defamed the plaintiff, DRM Contract Administration Ltd, in two emails sent to third parties. The defendant regarded the claim against it as unstateable on the basis that, as a mere conduit for the transmission of data, it was not liable for the defamatory content of any emails sent via its service. The officers of the defendant company made a decision not to contest the proceedings. It was said that in Switzerland the claim for defamation would be rejected by a judge even where it was not contested as the civil court applies the law ex officio. It seemed to have been assumed that the Irish Courts would adopt a similar proactive approach. The plaintiff applied for, and obtained, judgment in default of appearance. Upon learning of this, the defendant issued a motion seeking to set aside the judgment. The plaintiff opposed that motion. The plaintiff took the precaution of issuing its own motion seeking to renew the plenary summons. This was done in an attempt to protect its position in respect of the limitation period in the event that the service of the proceedings was set aside as irregular.

Held by the High Court (Simons J) that the service of the proceedings was irregular: first, service was not effected in accordance with Order 11E of the Rules of the Superior Courts; secondly, the fact that the plenary summons itself, rather than notice of the summons, had been sent to the defendant represented a breach of Order 11A, rule 6 of the Rules of the Superior Courts. Simons J held that judgment in default of appearance may only be properly entered where there has been scrupulous compliance with all procedural requirements. Simons J held that the balance of justice favoured the setting aside of the default judgment. Simons J held that the defendant had demonstrated that it had a credible defence to the proceedings, which had a real chance of success. Simons J held that it would be disproportionate to allow the default judgment to stand having regard to: (i) the existence of what appeared to be a very strong defence under the domestic regulations implementing the Directive on Electronic Commerce (Directive 2000/31/EC); and (ii) the balance of prejudice as between the plaintiff and the defendant. Simons J held that the default judgment entered on 2 July 2020 would be set aside pursuant to Order 13, rule 11 and Order 13A of the Rules of the Superior Courts. Simons J held that any potential prejudice to the plaintiff would be mitigated by the renewal of the plenary summons and the making of appropriate costs orders. Simons J held that the Norwich Pharmacal order (Norwich Pharmacal Co. v Customs and Excise Commissioners [1974] A.C. 133) granted on 21 January 2019 should also be set aside in circumstances where the proceedings were not properly served; moreover, the proofs for a disclosure order, as summarised in Board of Management of Salesian Secondary School v Facebook Ireland Ltd [2021] IEHC 287 had not been met.

Simons J held that the plaintiff’s application to renew the plenary summons pursuant to Order 8 of the Rules of the Superior Courts would be allowed. Simons J held that it was in the interests of justice that the plaintiff be afforded an opportunity to serve the summons in compliance with the Rules of the Superior Courts, and that it retain the benefit of the date of the institution of the proceedings on 15 October 2018 for the purpose of the limitation period.

Default judgment set aside. Summons renewed.

Appearances

Sean Corrigan for the plaintiff instructed by Sharon Oakes Solicitor

Anthony Thuillier for the defendant instructed by William Fry Solicitors

JUDGMENT of Mr. Justice Garrett Simons delivered on 25 August 2021

INTRODUCTION

1 This judgment addresses the fallout of a tactical decision made by the defendant not to contest a claim for defamation brought against it. The defendant is a company registered in Switzerland and provides email services. It is alleged that the user of one of its email accounts defamed the plaintiff in two emails sent to third parties.

2 The defendant regards the claim against it as unstateable on the basis that, as a mere conduit for the transmission of data, it is not liable for the defamatory content of any emails sent via its service. The defendant relies in this regard on the exemptions and immunities in favour of intermediary service providers under the Directive on Electronic Commerce ( Directive 2000/31/EC).

3 It has been explained on affidavit that the officers of the defendant company, having weighed up the financial cost of engaging legal representation here, made a decision not to contest the proceedings in this jurisdiction. It is said that in Switzerland the claim for defamation would be rejected by a judge even where it was not contested as the civil court applies the law ex officio. It seems to have been assumed that the Irish Courts would adopt a similar proactive approach.

4 Having made this tactical decision, the defendant chose not to enter a formal appearance to the proceedings, notwithstanding that it had received the plenary summons by way of email and tracked post. (As discussed presently, one of the issues to be addressed in this judgment is whether the formal requirements for service had been complied with by the plaintiff).

5 The plaintiff subsequently applied for, and obtained, judgment in default of appearance. Upon learning of this, the defendant issued a motion seeking to set aside the judgment. The plaintiff opposes this motion. The plaintiff has, however, taken the precaution of issuing its own motion seeking to renew the plenary summons. This has been done in an attempt to protect its position in respect of the limitation period in the event that the service of the proceedings is set aside as irregular. The limitation period for defamation proceedings is normally one year.

6 Both motions came on for hearing before me on 20 July 2021. It was agreed between the parties that the motion to set aside the default judgment should be heard first, and that the court should then hear the motion to renew the plenary summons de bene esse. This is because, depending on the outcome of the first motion, the second motion might become redundant. Judgment was reserved in respect of both motions until today's date.

PROCEDURAL HISTORY

7 These proceedings relate to two emails alleged to have been sent via the defendant's email service on 10 May 2018, and 25 August 2018, respectively. The emails were sent using the pseudonym “ConcernedTaxPayer11”.

8 The content of the two emails has been set out verbatim as an annex to the statement of claim. The gist of the emails is that the managing director of the plaintiff company, Mr. Darragh Quinn, had engaged in fraudulent activities in respect of the N56 Kilkenny to Letterilly road project. The alleged fraudulent activities are said to involve “the extortion of monies (or taking a ‘cut’)” from sub-contractors and suppliers to the project. It is also alleged that Mr. Quinn has a conflict of interest in respect of the public procurement of road projects.

9 The emails were, seemingly, sent to a number of politicians, to two newspaper groups and to certain members of Donegal County Council.

10 Mr. Quinn has instituted separate defamation proceedings in his own name arising out of these emails ( Quinn v. Proton Technologies AG High Court 2019 No. 3540 P).

11 Prior to the institution of the within proceedings, the solicitor acting on behalf of the plaintiff had engaged in correspondence with the defendant during the course of September and October 2018. This correspondence called upon the defendant to furnish full details of the author of the emails; to desist from publishing any further defamatory material; to publish an apology; and to make proposals with regard to compensating Mr. Quinn for the damage done to his good name. In subsequent letters in the chain of correspondence, the plaintiff's solicitor stated that “an Irish Defamation Jury will be asked by Counsel to approve exemplary damages against you for 10 million euro”.

12 In reply to this correspondence, the defendant explained that, in accordance with Swiss law, it was precluded from divulging the identity of the account user without a formal process. It was suggested, therefore, that the plaintiff should make an international data request through a formal MLA request. The abbreviation “MLA” stands for mutual legal assistance. In the event, however, no such application was made, and, instead, the plaintiff instituted the within proceedings on 15 October 2018.

13 The defendant, in the pre-litigation correspondence, had also invited the plaintiff to report the emails to the defendant's “abuse team”. It was explained that the abuse team would investigate whether the content of the emails was in breach of the defendant's terms and conditions. In the event, however, it seems that the user of the email account unilaterally deleted same prior to any investigation by the abuse team.

14 A plenary summons issued out of the Central Office of the High Court on 15 October 2018. The principal relief sought is damages for defamation, including aggravated and exemplary damages.

15 The plenary summons is endorsed for service outside of the jurisdiction and bears the following endorsement.

“Lugano Convention 2007: The Irish High Court has power under the Jurisdiction of Courts and Enforcements of Judgments...