John Meagher v Dublin City Council and Health Service Executive (No.2)
| Jurisdiction | Ireland |
| Judge | Mr. Justice Hogan |
| Judgment Date | 28 May 2014 |
| Neutral Citation | [2014] IEHC 280 |
| Court | High Court |
| Date | 28 May 2014 |
[2014] IEHC 280
THE HIGH COURT
BETWEEN
AND
LEGAL PRACTITIONERS (IRELAND) ACT 1876 S3
DANSKE BANK A/S v MEAGHER UNREP SUPREME 1.4.2014 2014 IESC 38
LARKIN v GROEGER 1990 1 IR 461 1988/9/2514
MOUNT KENNETT INVESTMENT CO & GREENBAND INVESTMENTS v O'MEARA & ORS UNREP CLARKE 29.3.2012 2012/29/8517 2012 IEHC 167
COMPANIES (AMDT) ACT 1990 S29(2)
COMPANIES (AMDT) ACT 1990 S29(3)
VEOLIA WATER UK PLC & ORS (T/A VEOLIA WATER CONSORTIUM) v FINGAL CO COUNCIL (NO 2) 2007 2 IR 81 2006/57/12085 2006 IEHC 240
Costs – Legal Practitioners Act 1876 – Charging Order – Creditors – Fair Proportion of funds – Procedure – Solicitor Costs
The factual background to this case involved a previous judgment made in favor of the plaintiff who sought to recover certain unpaid invoices in respect of the provision of accommodation and other services, which he had provided to asylum seekers. As a result of the previous judgment the plaintiff was entitled to recover the sum of €106,640 from the Health Service Executive (HSE) and also the plaintiff was entitled to recover four days” costs as against the HSE. The issue that was brought before Hogan J. in the High Court was whether or not a charging order should be made pursuant to s. 3 of the Legal Practitioners (Ireland) Act 1876 in respect of both that costs order and the further sum of €106,640 in favor of the plaintiff”s solicitors (CCK).
Hogan J considered all of the facts and submissions in order to decide whether a charging order for CCK would be appropriate. CCK became concerned about obtaining their remuneration from their client”s recovery due to the impact of a third party creditor Danske Bank. Danske bank was a creditor to the original plaintiff who obtained a judgment for the outstanding sum owed by the plaintiff and had a receiver appointed to garnish any award to the plaintiff to Danske bank. CCK however maintain that it is entitled to a charging order under s. 3 of the 1876 Act such as would entitle it to a charge in respect of the solicitor and client costs associated with the recovery of the sum of €106,640 from the HSE. Considering the principles established in Mount Kennett Investment Co. v. O”Meara [2012] IEHC 167, Hogan J declared that it cannot be said that either the law of the 1876 Act or its underlying policy requires or mandates that the courts should as an invariable rule accord such legal teams a form of super-priority status over other creditors. Hogan J decided that the legal teams should recover only a fair proportion of the funds recovered in a case of this kind and in the present case, the plaintiff”s legal teams have obtained a separate order for costs and that order is itself designed to reflect proportionately a fair balance between the interests of plaintiff and defendant. Hogan J noted that the interests of the plaintiff”s legal team must in the circumstances be deemed to be adequately safeguarded by the making of the costs order and therefore it was unnecessary in this instance to make a charging order under s. 3 of the 1876 Act.
1. On 1 st November 2013 I delivered my first judgment in these proceedings: see Meagher v. Dublin City Council [2013] IEHC 474. The plaintiff sought to recover certain unpaid invoices in respect of the provision of accommodation and other services which he had provided to asylum seekers in the period between 1997-2002 at the request of both Dublin City Council and the Health Service Executive ("HSE"). While I dismissed the claim against the Council, I ultimately ruled that the plaintiff was entitled to recover the sum of €106,640 from the HSE. I also ruled that the plaintiff was entitled to recover four days' costs as against the HSE.
2. The issue which now arises is whether I should make a charging order pursuant to s. 3 of the Legal Practitioners (Ireland) Act 1876 ("the 1876 Act") in respect of both that costs order and the further sum of €106,640 in favour of the plaintiff's solicitors. This issue arises in the following way.
3. These proceedings began in 2005 and proceeded in a very leisurely fashion. Indeed, the proceedings were not even served until April, 2008 and even then only after the making of an order extending time for the service of the proceedings. Further delays ensued, with the result that the matter was only set down for trial in August, 2012. The proceedings themselves came on for hearing before me in March, 2013 and, following two short adjournments, ultimately concluded on 9 th July, 2013, following a ten day hearing. I then reserved judgment and delivered that judgment on l st November, 2013.
4. For reasons which will become apparent later in this judgment, it has not proved necessary to consider whether one possible effect of a delay of that kind might be to disentitle the plaintiff's solicitors to the benefit of a charging order under s. 3 of the 1876 Act to which they might otherwise have been entitled.
5. In the meantime, however, Danske Bank had issued proceedings in January, 2013 against Mr. Meagher. On 23 rd February, 2013, Danske Bank obtained judgment by default against Mr. Meagher for the sum of €6.98m. Mr. Meagher appealed that decision to the Supreme Court, but on 1 st April, 2014, that Court dismissed the appeal: see Danske BankA/Sv. Meagher [2014] IESC 38.
6. Danske then applied to this Court (Kelly J.) to have a receiver appointed. Such an order was duly made and Kelly J. directed that all sums that may be due to John Meagher from the defendants in these present proceedings - including any judgment which he might obtain - should be amenable to a garnishee order.
7. In June, 2013 the plaintiff's solicitors, CCK Law Firm ("CCK"), applied to this Court for a charging order pursuant to s. 3 of the Legal Practitioners (Ireland) Act 1876 ("the 1876 Act"), in respect of any judgment so recovered. Section 3 of the 1876 Act essentially creates a mechanism whereby the plaintiff's legal team can in effect become secured creditors with a prior entitlement to be paid out of the funds thus recovered.
8. Section 3 of the 1876 Act provides:-
"In every case in which an attorney or solicitor shall be employed to prosecute or defend any, suit, matter or proceeding in any court of justice, it shall be lawful for the court or judge before whom any such, suit, matter or proceeding has been heard or shall be pending to declare such attorney or solicitor entitled to a charge upon the property recovered or preserved, and upon such declaration being made such attorney or solicitor shall have a charge upon and against, and a right to payment out of the property of...
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