Gerard Dowling and Others v Minister for Finance and Others
Jurisdiction | Ireland |
Court | High Court |
Judge | Ms Justice Iseult O'Malley,MR. JUSTICE McGOVERN |
Judgment Date | 15 August 2014 |
Neutral Citation | [2014] IEHC 418 |
Date | 15 August 2014 |
BETWEEN:
AND
AND
AND
[2014] IEHC 418
THE HIGH COURT
Banking – Financial institution – Recapitalisation – Ministerial proposals rejected at EGM – Direction order sought by minister under Credit Institutions (Stabilisation) Act 2010 – Second Company Law Directive
During the midst of the recent banking crisis, the respondent minister had proposed the recapitalisation of the Irish Life and Permanent group (‘ ILP’) at an EGM in 2011. This proposal was rejected by shareholders. Following the rejection, the respondent proposed a direction order to be issued under the provisions of the Credit Institutions (Stabilisation) Act 2010. This order saw the ILP group effectively come in to state ownership. The applicants, shareholders and a former director in the group, applied to have that direction order set aside alleging that the takeover was illegal and had affected their interests adversely.
Held by Mrs Justice Iseult O’Malley, that three issues were before the Court. Firstly, whether the provisions of s 7 of the Act had been complied with? Secondly, whether the respondent’s opinion on the necessity for the order was reasonable? Finally, was the opinion flawed by errors of law? Having considered the submissions by the parties, Justice O?Malley stated that the third issue was crucial, and there was no need to consider the first two issues until the error of law matter had been resolved. Having taken consideration of the EU case law on the Second Company Law Directive, the Court considered that it could not determine the matter without referring the issue of the EU jurisprudence to the CJEU. A number of findings of law and fact were therefore made to that end.
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S9
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S7
DOWLING & ORS v MIN FOR FINANCE UNREP SUPREME 19.12.2013 2013/14/4144 2013 IESC 58
DOWLING & ORS v MIN FOR FINANCE UNREP FEENEY 2.3.2012 2012/10/2639 2012 IEHC 89
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S11
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S7(2)
CREDIT INSTITUTIONS (FINANCIAL SUPPORT) ACT 2008
EEC REG 407/2010
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 125
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 122(2)
EEC DECISION 2011/77 ART 3(5)
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF INVESTMENTS FIRMS) REGS 2006 SI 660/2006
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 70
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 3(1)(A)
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 3(1)(B)
CENTRAL BANK ACT 1971 S11(1)(B)(v)
CENTRAL BANK ACT 1942 S6A(2)
CENTRAL BANK ACT 1942 S5A(11)
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 70(1)
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 70(4)
EUROPEAN COMMUNITIES (CAPITAL ADEQUACY OF CREDIT INSTITUTIONS) REGS 2006 SI 661/2006 REG 19
IRISH TAKEOVER PANEL ACT 1997 TAKEOVER RULES & SUBSTANTIAL ACQUISITION RULES RULE 9
IRISH TAKEOVER PANEL ACT 1997 TAKEOVER RULES & SUBSTANTIAL ACQUISITION RULES RULE 9(1)
IRISH TAKEOVER PANEL ACT 1997 S9
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 107
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 107(1)
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 107(3)(B)
CENTRAL BANK & CREDIT INSTITUTIONS (RESOLUTION) ACT 2011
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S63
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S63(3)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S47
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S52
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S53
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S61
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(A)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(B)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(E)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(F)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(G)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S4(H)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S7(4)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S9(4)
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 260
EEC DIR 77/91 ART 25
EEC DIR 77/91 ART 29
EEC DIR 77/91 ART 8
CHARTER OF FUNDAMENTAL RIGHTS OF THE EUROPEAN UNION ART 17
EUROPEAN CONVENTION ON HUMAN RIGHTS ACT 2003 S3
COLLINS ENGLISH DICTIONARY 11ED 2011
DOWLING & ORS v MIN FOR FINANCE UNREP PEART 28.6.2012 2012/10/2702 2012 IEHC 436
ASSOCIATED PROVINCIAL PICTURE HOUSES LTD v WEDNESBURY CORP 1948 1 KB 223 1947 2 AER 680
KEEGAN & LYSAGHT, STATE v STARDUST VICTIMS COMPENSATION TRIBUNAL 1986 IR 642 1987 ILRM 202
MEADOWS v MIN FOR JUSTICE & ORS 2010 2 IR 701 2011 2 ILRM 157 2010 IESC 3
INQUIRY UNDER THE COMPANY SECURITIES (INSIDER DEALING) ACT 1985, IN RE (NO 1) 1988 AC 660 1988 2 WLR 33 1988 1 AER 203 1988 4 BCC 35
DUNNES STORES IRL CO & ORS v RYAN & MIN FOR ENTERPRISE 2002 2 IR 60
DOWLING & ORS v MIN FOR FINANCE UNREP SUPREME 24.5.2012 2012/10/2668 2012 IESC 32
O'KEEFFE v BORD PLEANALA & O'BRIEN 1993 1 IR 39 1992 ILRM 237
HEANEY & MCGUINNESS v IRELAND & AG 1994 3 IR 593 1994 2 ILRM 420 1994/10/3029B
SYNDESMOS MELON TIS ELEFTHERAS EVANGELIKIS EKKLISSIAS & ORS v GREECE & ORS 1994 2 CMLR 348 1992 ECR I-2111
EEC DIR 77/91 ART 25(1)
EEC DIR 77/91 ART 29(1)
KARELLA & KERALLAS v MIN FOR INDUSTRY ENERGY & TECHNOLOGY & ORGANISMOS ANASYGKROTISEOS EPICHEIRISEON AE 1991 ECR I-2691 1993 BCC 677 1994 1 BCLC 774 1993 2 CMLR 865
EEC DIR 77/91 ART 41(1)
EEC DIR 77/91 ART 42
KERAFINA-KERAMISCHE-UND FINANZ HOLDING AG & VIOKTIMATIKI AEBE v GREECE & ORGANISMOS OIKONOMIKIS ANASYGKROTISSIS EPICHEIRISSEON AE 1992 ECR I-5699 1993 2 CMLR 277
TREATY OF ROME ART 93
PAFITIS & ORS v TRAPEZA KENTRIKIS ELLADOS AE & ORS 1996 ECR I-1347 1996 2 CMLR 551
EEC DIR 77/91 ART 29(3)
DIAMANTIS v GREECE 2000 ECR I-1705 2001 3 CMLR 41
KEFALAS & ORS v GREECE & ANOR 1998 ECR I-2843 1999 2 CMLR 144 1998 AER (D) 205
CMSN v SPAIN 2008 ECR I-10139 (CASE NO C-338/06)
REAL DECRETO LEGISLATIVO 1564/1989 (SPAIN)
EEC DIR 77/91 ART 29(6)
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 119
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 126
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION TITLE VIII
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 119(3)
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 120
COMPANIES ACT 1963 S205
PRINGLE v IRELAND & ORS 2013 2 CMLR 2 2013 AER (EC) 1
TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 267
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S60
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S9(8)
CREDIT INSTITUTIONS (STABILISATION) ACT 2010 S9(3)
EUROPEAN COMMUNITIES (REORGANISATION & WINDING-UP OF CREDIT INSTITUTIONS) REGS 2011 SI 48/2011 REG 9
1. Introduction | 5 |
2. The parties | 7 |
3. The witnesses | 7 |
4. Background- The economic crisis and the Irish banks | 10 |
5. Specific evidence relating to ILP | 12 |
6. The Programme for Support | 14 |
7. The Memorandum of Understanding | 14 |
8. Council Regulation 407/2010 (11 th May 2010) | 16 |
9. The Implementing Decision | 17 |
10. United Kingdom loan | 17 |
11. The Prudential Capital Assessment Review 2011 | 18 |
12. The BlackRock assessment | 19 |
13. PCAR | 19 |
14. Legal requirements for capital adequacy | 19 |
15. PLAR and deleveraging | 20 |
16. Central Bank decision | 20 |
17. The Updated Memorandum of Understanding | 20 |
18. Developments after PCAR and PLAR | 22 |
19. The company's reaction | 24 |
20. Shareholder reaction to the FMPR | 25 |
21. Irish Takeover panel approval | 26 |
22. State Aid approval | 26 |
23. The Extraordinary General Meeting, 20th July 2011 | 32 |
24. Correspondence between the company and the Minister | 35 |
25. Submissions made to the Minister on behalf of shareholders | 37 |
26. The Credit Institutions (Stabilisation) Act, 2010 | 39 |
27. The Proposed Direction Order | 46 |
28. Compliance with s.7 of the Act | 47 |
29. The application for the Direction Order | 50 |
30. The purposes of the order | 53 |
31. The details of the order sought | 55 |
32. Alternative means of raising capital | 58 |
33. The "False Market" Issue | 63 |
34. The... |
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