Goode Concrete v CRH Plc

• Jurisdiction: Ireland
• Judge: Denham C.J.,Mr. Justice John MacMenamin,Mr. Justice Hardiman
• Judgment Date: 31 July 2015
• Neutral Citation: [2015] IESC 70
• Court: Supreme Court
• Docket Number: [S.C. Nos. 579, 580&581 of 2012],Appeal No. 579/2012 580/2012 581/2012
• Date: 31 July 2015

Between/

Goode Concrete

Plaintiff/Appellant

and

CRH Plc, Roadstone Wood Limited, Kilsaran Concrete

Defendants/Respondents

[2015] IESC 70

Denham C.J.

Hardiman J.

Clarke J.

MacMenamin J

Dunne J.

Appeal No. 579/2012

580/2012

581/2012

THE SUPREME COURT

Administration of justice – Objective bias – Shareholding – Appellant seeking to appeal against High Court judgments – Whether trial judge erred in law in hearing and determining applications in circumstances where there was a perception of bias

Facts: The appellant, Goode Concrete, appealed to the Supreme Court against three judgments and orders of the High Court: 1) A judgment delivered and an order made in January, 2011 whereby an application for interlocutory injunctive relief made by the appellant was refused and an order for the costs of that application was made in favour of the respondents, CRH Plc, Roadstone Wood Ltd and Kilsaran Concrete; 2) A judgment delivered and an order made in March, 2012 whereby applications brought by the respondents for security for costs were granted and it was ordered that the appellant provide security to the respondents on a phased basis; 3) A judgment delivered and an order made in May 2012 where the appellant was ordered to provide security for costs to the first and second respondents, CRH Plc and Roadstone Wood Ltd, in the amount of €110,000 and to the third respondent, Kilsaran Concrete, in the amount of €85,000. The single ground of appeal upon which the appellant was given leave to appeal was that the trial judge erred in law in hearing and determining those applications in circumstances where there was or could have been a perception of bias on his part due to his holding of interests in the shares of CRH Plc, which interests had not been disclosed and were unknown to the appellant.

Held by Denham CJ that, having considered a recusal and the issue of the perception of bias of a judge, and having applied the reasonable person test in Bula Ltd v Tara Mines Ltd (No. 6) [2000] 4 IR 412, a reasonable person would, in general, have a concern if a judge held shares himself or herself (not in a shares unit) in a company which was a party in an action being heard by that judge. Denham CJ observed that the issue of alleged perceived bias is a matter not only for the parties, or the trial judge, but there is the fundamental concern for the manifest impartial administration of justice, and the confidence which the People rest in the judiciary. Denham CJ noted that in this case the full facts were not before the court, neither known to the judge nor to the parties in November, 2010 and that no inquiry was made when the issue was raised. Denham CJ held that it is the responsibility of a judge to make the necessary inquiries into his or her holdings of shares in a company which is in litigation before him or her, and to inform the parties, so that an informed assessment may be made as to whether he or she should recuse himself or herself. Denham CJ held that it is not a burden of inquiry to be borne by the parties; if a judge holds shares (as opposed to shares held in a pension plan or units over which he or she has no control), then, in general, he or she should recuse himself or herself from hearing the action. Denham CJ noted that the trial judge held the shares himself and that they were not in a trust or any other type of fund.

Denham CJ held that, in all the circumstances of the case, the Court would allow the appeal, quash the three judgments and remit the three matters back to the High Court to be heard by another judge.

Appeal allowed.

Judgment delivered on the 31st day of July, 2015, by Denham C.J.

1 In these appeals the appellant alleges objective bias by a High Court judge, arising from his shareholding in CRH Plc. This is an issue of importance to the parties, but it is of even more significance as it is required to be considered in the context of the administration of justice.

2 Goode Concrete, the plaintiff/appellant, is referred to as ‘the appellant’. CRH Plc and Roadstone Wood Limited, the first and second named defendants/respondents, are referred to respectively as ‘the first and second respondents’. Kilsaran Concrete, the third named defendant/respondent, is referred to as ‘the third respondent’. The first, second and third named respondents are referred to collectively as ‘the respondents’.

3 The appellant has appealed three judgments and orders of the High Court (Cooke J.). These orders are:—

(a) A judgment delivered on the 20th January, 2011, [2011] IEHC 15, and an order made on the 20th January, 2011, perfected on the 2nd February, 2011, whereby an application for interlocutory injunctive relief made by the appellant was refused and an order for the costs of that application was made in favour of the respondents.

(b) A judgment delivered on the 21st March, 2012, [2012] IEHC 116, and an order made on the 21st March, 2012, perfected on the 8th May, 2012, whereby applications brought by the respondents for security for costs were granted and it was ordered that the appellant provide security to the respondents on a phased basis.

(c) A judgment delivered on the 15th May, 2012, [2012] IEHC 198, and an order made on the 15th May 2012, perfected on the 17th May, 2012, where the appellant was ordered to provide security for costs to the first and second respondents in the amount of €110,000 and to the third respondent in the amount of €85,000.

Grounds of Appeal

4 The single ground of appeal upon which the appellant was given leave to appeal is as follows: — that the learned trial judge erred in law in hearing and determining these applications in circumstances where there was or could have been a perception of bias on his part due to his holding of interests in the shares of the first named respondent, which interests had not been disclosed and were unknown to the appellant.

Background

5 The proceedings were first before the High Court on the 26th November, 2010, when the appellant sought entry of the case to the Competition List.

6 At that time Cooke J. indicated that he had shareholdings in CRH Plc. The words of Cooke J. may be found in the transcript and are as follows:—

‘JUDGE: There is one thing I should mention, that I don't know whether it causes a problem or not, but I have a vague feeling that a very small number of CRH shares feature somewhere in my pension fund.

MR. SREENAN: I see. Well, I don't know whether I should commiserate or not, Judge.

JUDGE: However, you'd better consider it.

MR. SREENAN: Absolutely. Thank you, Judge.’

[Transcript 26 November 2010, page 2 lines 31 to 33 and page 3 lines 1 to 3]

Mr. Paul Sreenan, S.C., appeared as counsel for the first and second respondents.

7 The appellant has submitted that the declaration was considered, and that given the nature of the declaration, and the fact that it would not be unusual for a person to hold a very small number of shares of a public company in a pension fund, the appellant had no difficulty with Cooke J. hearing the matter.

8 The appellant submitted that it became apparent later that the full extent of the financial interests held by the learned trial judge had not been revealed. On the 26th September, 2012, Mr. Peter Goode received information of the learned trial judge's shareholdings in CRH Plc, including that additional interests in the shares in CRH Plc were acquired by the learned trial judge on the 9th December, 2010, and that dividends were received on certain dates, including in May, 2012.

9 It was submitted on behalf of the appellant that the number of shares which appeared to be held by the learned trial judge or on his behalf after the December 2010 purchase, and at times when he heard and decided the matters now under appeal, was at least 8,966 shares. Taking a share price of €15.15, which was the closing share price of CRH Plc on the 9th December, 2010, the value of that holding was submitted to be approximately €135,835 on that date.

10 The solicitors for the appellant wrote to Cooke J. by letter dated the 16th October, 2012. Cooke J. indicated that the matter should be raised in open court. The appellant then brought a motion seeking that the learned trial judge recuse himself from the proceedings.

11 The motion came before the High Court on the 13th November, 2012, when Cooke J. set out details of his interests in the first respondent, and informed the parties that he would no longer be involved in the proceedings.

12 On the 13th November, 2012, the learned trial judge explained in open court:—

‘For 12 years prior to the end of 2008 I lived outside this country. When I retired from the European Court at the end of 2008 my wife and I sold the house we owned in Luxembourg, and the funds or the proceeds of that, together with other monies we had in Luxembourg, were transferred back to this country and put into the hands of various advisers who were acting on our behalf. My return also coincided with my reaching the age of 65, so that during 2009 I had to draw down various pension investments. These advisers were engaged throughout 2009 and 2010 in setting up the usual ARFs and PRSAs, as they are called.

When the matter came before me on the 26th November 2010 I was, of course, aware that these arrangements were being put in place and the funds were being put into various retirement funds and investments, but I was not following the matter on a day-to-day basis. When it came before me on the 26th November I was aware that I had a small holding in CRH, which I had had for quite some time, and I had assumed that it had been transferred from the holding I had in Luxembourg into the holdings here during 2009, and that was what was at the back of my mind on the 26th November. I was not conscious of the fact that there had already been made or was about to be made an additional...