Gerard Dowling and Others v Minister for Finance and Others

• Jurisdiction: Ireland
• Judge: Clarke J.
• Judgment Date: 31 July 2013
• Neutral Citation: [2013] IESC 37
• Court: Supreme Court
• Docket Number: [SC No. 292 of 2013]
• Date: 31 July 2013

Dowling & Ors v Minister For Finance

IN THE MATTER OF INJUNCTION TO RESTRAIN THE MINISTER FOR FINANCE FROM RE-SELLING IRISH LIFE GROUP LIMITED

AND IN THE MATTER OF SECOND COUNCIL DIRECTIVE 77/91/EEC

AND IN THE MATTER OF DIRECTIVE 2001/34/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

AND IN THE MATTER OF DIRECTIVE 2009/101/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

AND IN THE MATTER OF DIRECTIVE 2004/25/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

AND IN THE MATTER OF DIRECTIVE 2004/39/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

AND IN THE MATTER OF ARTICLE 63 OF THE TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION

AND IN THE MATTER OF ARTICLE 267 OF THE TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION

Dowling & Ors v Minister For Finance

BETWEEN/

GERARD DOWLING, PADRAIG McMANUS, JOHN PAUL McGANN, TIBOR NEUGEBAUR, PIOTR SKOCZYLAS, MURIEL SCORER, GEORG HAUG AND J. FRANK KEOHANE

PLAINTIFFS/APPELLANTS

AND

THE MINISTER FOR FINANCE

DEFENDANT/RESPONDENT

IN THE MATTER OF PROCEEDINGS:-

DOWLING & ORS v. MINISTER FOR FINANCE

IRISH LIFE & PERMANENT PLC v. CREDIT INSTITUTIONS (STABILISATION) ACT 2010

DOWLING & ORS v. COOKE & ORS

DOWLING & ORS v. IRELAND & ORS

[2013] IESC 37

Denham C.J.

Murray J.

Clarke J.

Appeal No. 292/13

(i) HIGH COURT RECORD NO. 239 MCA/2011

(ii) HIGH COURT RECORD NO. 116 MCA/2012

(iii) HIGH COURT RECORD NO. 36 COS/2013

(iv) HIGH COURT RECORD NOS. 2708 P/2013 AND 2709 P/2013

THE SUPREME COURT

INJUNCTIONS

Interlocutory injunction

Appeal against refusal of claim for interlocutory injunction to restrain sale of company - Injunction - Related constitutional challenge to underlying legislation - Related challenge to ownership of company - Standing - Delay - Applicable principles for consideration of delay - Bias - Test for establishment of objective bias - Whether trial judge correct to refuse interlocutory injunction - Whether arguable defence - Whether irreparable harm might be caused - Question of damages - Balance of justice - Where least risk of injustice lay - Whether court obliged to refer question to ECJ - Discretion of court - Dowling v The Minister for Finance [2014] IEHC 418, (Unrep, O'Malley J, 16/7/2013); Campus Oil Ltd v Minister for Industry (No 2) [1983] IR 88; Okunade v The Minister for Justice Equality and Law Reform [2012] IESC 49, [2012] 3 IR 152; Gilroy v Flynn [2004] IESC 98. (Unrep, SC, 3/12/2004); Union Ailmentaria SA v Spain [1990] 12 EHRR 24; Santex Spa v USSL (Case C-327/00) [2003] ECR I-1877; Universale-Bau (Case C-470/99) [2002] ECR I-11617; Bula v Tara Mines Ltd (No 6) [2000] 4 IR 412; Johnson v Chief Constable of Royal Ulster Constabulary [1986] ECR 1651; Amministrazione Delle Finanze Dell Stato v Simmenthal SpA [1978] ECR 629; Queen v Secretary of State for Transport [1990] ECR I-2433; Zuckerfabrik Suderdithmarschen AG v Hauptzollamt Itzehoe (Case C-143/88) (Unrep, ECR, 21/12/1991); Zuckerfabrik Soest GmbH v Hauptzollamt Paderborn [1991] ECR 1-145; Unibet (London) Ltd and Unibet (International) Ltd v Justitiaekanslern [2007] ECR 1-2271; Pringle v Government of Ireland [2012] IESC 57, (Unrep, SC, 19/10/2012); Le Pen v Parliament (Case C-208/03) [2003] ECR I-7939; Pafitis v Trapeza Kentrikis Ellados AE (Case C-441/93) [1996] ECR I-01347; AIB v. Diamond [2011] IEHC 505, (Unrep, Clarke J, 14/10/2011) and Fratelli Pardini SpA v Minister O Del Commercio Con Lestro (Case C-338/85) (Unrep, ECJ, 21/4/1988) considered - Credit Institutions (Stabilisation) Act 2010 (No 36), ss 9, 11 and 64 - Appeal dismissed (292/2013 - SC - 31/7/2013) [2013] IESC 37

Dowling v Minister for Finance

Facts: Permanent TSB Group Holdings plc and Permanent TSB were a holding company and related bank respectively that had received a cash injection of €2.7 billion in 2011 following a decision of the respondent/defendant due to the economic recession at the time. In return, the respondent acquired the life assurance business of these entities. It was the applicants"/plaintiffs" view that the respondent"s decision, made pursuant to the Credit Institutions (Stabilisation) Act 2010 (the '2010 Act'), was unreasonable and had resulted in a severe drop in the value of shares they held in the holding company. This was despite the fact that the holding company had held an extraordinary general meeting in July 2011 and voted against the planned intervention of the respondent. The appellants initiated a significant amount of litigation against the respondent.

These proceedings concerned an interlocutory application brought by the appellants to prevent the respondent from selling off Irish Life Group Ltd. ("Irish Life") which had been part of the transfer to the respondent. It was the appellants" case that the sale of Irish Life should be restrained until the conclusion of the related proceedings. The application was rejected before the High Court on the basis that by applying the principles of Campus Oil Limited v. Minister for Industry and Energy (No. 2) [1983] I.R. 88 it was held that although the appellants had legal standing to make the application and there was a fair issue to be tried, the balance of convenience lay in favour of rejecting the application. An appeal of that decision was subsequently launched.

The appellants argued that the principles of Campus Oil Limited v. Minister for Industry and Energy (No. 2) had not been correctly applied, and if they had, interlocutory relief would have been granted. Two preliminary points were also raised. Firstly, the respondent argued that the appellants had unreasonably delayed applying for the type of interlocutory relief sought thereby disentitling them from receiving it now. This was denied by the appellants who argued that sufficient expediency had been taken in bringing the application in all the circumstances of the case. Secondly, the appellants argued that the trial judge had been biased in hearing the interlocutory application which was derived from the fact that she had said in her decision by stating that 'there is no way I would have made an interim order in this matter because of the importance of the underlying issue"

Held by Clarke J. (with Denham C.J. and Murray J. concurring) that on the issue of delay, there was an expectation that a party seeking interim or interlocutory relief should move with sufficient expediency to enable the court to give adequate consideration to the issues and to allow the defendant to make adequate submissions. However, this did not mean a late application would be dismissed for delay as long as such delay was not considered unreasonable in the circumstances. In the circumstances of this case, it was held that the appellants had unreasonably delayed making their interlocutory application because of the fact the respondent had made it clear at an early stage that he intended to sell Irish Life but the interlocutory application had not been made until a late stage.

In regards to the appellants" assertion that the trial judge had been biased in hearing the interlocutory application, it was held that the appellants" point was misconceived. It was said that the term "interim order" as used in Irish procedural law meant an order that was to determine the temporary situation until a final determination could be made on a case and which was made on an ex parte basis. It was held that all this statement conveyed was that the court would not be prepared to consider granting an injunction until the substantive hearing without the respondent being allowed to make submissions. This was a statement that the Supreme Court agreed with entirely.

Finally, on the application of the Campus Oil Limited v. Minister for Industry and Energy (No. 2) principles, it was held that it was clear that there was the potential risk of irreparable damage to both the appellants and respondent depending on whether the interlocutory relief was granted or not. As the court was satisfied that the appellants had raised a fair issue to be tried and the respondent had an arguable defence, the key issue that had to be determined was therefore where the balance of convenience lay. It was held that the determining factor was the fact that if the injunction was granted, there would be a potential risk of irreparable damage to the national finances which the appellants acknowledged they would be unable to compensate. It was also held that if the injunction was refused, the court was satisfied that the respondent would be able to sufficiently compensate the appellants. The appeal would therefore be dismissed and a decision on the impact of the appellants" delay in bringing the application did not have to be determined.

Appeal dismissed

DOWLING & ORS v MIN FOR FINANCE UNREP 16.7.2013 2013 IEHC 299

COMPANIES ACT 1963 S205

TREATY ON FUNCTIONING OF EUROPEAN UNION ART S267

CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S9

CAMPUS OIL LTD v MIN FOR INDUSTRY (NO 2) 1983 IR 88

OKUNADE v MIN FOR JUSTICE 2013 1 ILRM 1 2012/37/10891 2012 IESC 49

GILROY v FLYNN UNREP SUPREME 3.12.2004 2004/19/4269 2004 IESC 98

UNION AILMENTARIA SA v SPAIN 1990 12 EHRR 24

SPRY PRINCIPLE OF EQUITABLE REMEDIES 8ED 2010

SANTEX SPA v USSL C-327/00 2003 ECR I-1877

UNIVERSALE-BAU & ORS C-470/99 2002 ECR I-11617

CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S11(4)

CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S64

BULA LTD v TARA MINES LTD (NO 6) 2000 4 IR 412

JOHNSON v CHIEF CONSTABLE OF ROYAL ULSTER CONSTABULARY 1986 ECR 1651 1986 3 A ER 135

AMMINISTRAZIONE DELLE FINANZE DELL STATO v SIMMENTHAL SPA 1978 ECR 629

QUEEN v SECREATARY OF STATE FOR TRANSPORT EXPARTE FACTORTAME 1990 ECR I-2433

UNIBET (LONDON) LTD & UNIBET (INTERNATIONAL) LTD v JUSTITIEKANSLERN 2007 ECR I-2271

ZUCKERFABRIK SUDERITHMARSCHEN AG v HAUPTZOLLAMPT ITZEHOE C-143/88 21.2.1991 ECJ

ZUCKERFABRIK SOEST GMBH v HAUPTZOLLAMPT PADERBORN 1991 ECR I-415

PRINGLE v GOVT OF IRELAND UNREP SUPREME 19.10.2012 2012/39/11518 ...