Kennedy v Hearne

• Jurisdiction: Ireland
• Judge: FINLAY C.J.
• Judgment Date: 15 March 1988
• Neutral Citation: 1988 WJSC-SC 380,1988 WJSC-SC 391
• Court: Supreme Court
• Docket Number: 63/87,[1984 No. 6365P]
• Date: 15 March 1988

KENNEDY v. HEARNE (CONSTIT. VALIDITY)

BETWEEN

GILES J. KENNEDY PRACTISING AS GILES J. KENNEDY & COMPANY, SOLICITORS

Plaintiff/

Appellant

and

EDWARD G. HEARNE, MICHAEL HAYES AND THE ATTORNEY GENERAL

Defendants/

Respondents

1988 WJSC-SC 380

Finlay C.J.

Henchy J

Griffin J.

Hederman J.

McCarthy J.

63/87

120/87

THE SUPREME COURT

Synopsis:

WORDS & PHRASES

"Judicial function"

Income tax - Collection - Default procedure - Administration of justice - Procedure specified in s. 7 of Finance Act, 1968, does not constitute usurpation of the judicial function - Decision of High Court (6/2/87) affirmed - ~See~ Revenue, income tax - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

CONSTITUTION

Statute

Validity - Income tax - Collection - Default procedure - Role of Collector General - Administration of justice - Procedure specified in s. 7 of the Finance Act, 1968, does not constitute usurpation of judicial function - Decision of High Court (7/2/86) affirmed - ~See~ Revenue, income tax - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

CONSTITUTION

Courts

Administration of justice - Income tax - Collection - Default procedure - Role of Collector General - The procedure specified in s. 7 of the Finance Act, 1968, does not constitute usurpation of the judicial function - Decision of High Court (7/2/86) affirmed - ~See~ Revenue, income tax - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

CONSTITUTION

Personal rights

Infringement - Statute - Procedure - Operation - Collection of income tax - Default procedure - PAYE system - Whether procedure operated improperly - The plaintiff employer, a solicitor, failed to remit to the Collector General on or before 14/5/84 the amounts deducted as tax from the salaries of his employees in respect of the income tax month ending on 5th May - The Revenue Commissioners issued a notice specifying the estimated sum payable by the plaintiff but he did not dispute that sum or make a declaration of the proper amount of tax to be remitted by him in respect of that month - The plaintiff failed to pay the estimated sum within the seven days specified in a demand (dated 5/7/84) for payment of that sum - However, on 19/7/84 the plaintiff delivered to the Revenue Commissioners a declaration of the sum payable by him in respect of the said month and paid that sum, which was sufficient to discharge the plaintiff's obligations in respect of that month - The Collector General, who was then unaware of the payment, issued on 25/7/84 a certificate to the sheriff authorising him to distrain the plaintiff's goods - That certificate was subsequently withdrawn and no distress was levied - The procedure operated by the Revenue authorities is authorised by ss. 131 and 485 of the Act of 1967 and by s. 7 of the Act of 1968 - The plaintiff claimed, inter alia, that the manner in which the statutory procedure had been operated constituted an invasion of his rights under the Constitution, a declaration that the certificate of 15/9/84 was issued ~ultra vires~ the Collector General, and damages for libel - At the trial in the High Court, the defendants sought to prove that the plaintiff was a cheat and a person whose reputation did not merit an award of damages - The trial judge (Murphy J. - 6/2/87) upheld the validity of s. 7 of the Act of 1968; and he awarded the plaintiff #500 general damages for libel and a further #2,000 as aggravated damages - The parties appealed against the order of the High Court - Held ~(nem. diss.)~ that the procedure invoked by the Collector General was not unfair and did not fail to vindicate or defend the rights of the plaintiff taxpayer and, accordingly, did not constitute an invasion of the plaintiff's constitutional rights - Held that the Court had already held (see Revenue, income tax) that the issue of the certificate by the Collector General and the acts thereafter of the sheriff were nullities and that no purpose would be served in deciding the ~ultra vires~ issue - Held that, having regard to the original defamation and the damage sought to be inflicted on the plaintiff's character during the course of the trial, the sum of #2,000 was inadequate to compensate a solicitor for being publicly accused of being a cheat and of having no reputation - Held, accordingly, that the aggravated damages should be increased to #10,000 - Income Tax Act, 1967, ss. 131, 485 - Finance Act, 1968, s. 7 - Constitution of Ireland, 1937, Article 40 - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

DAMAGES

Assessment

Libel - Damage - Aggravation - Plaintiff employer - Remittance of employees" tax deductions - Default procedure operated by revenue authorities after payment - Authorities" defence to plaintiff's action - Defence included unjustified attack on plaintiff's reputation - Trial judge awarded aggravated damages - Such damages increased at hearing of appeal - ~See~ Constitution, personal rights - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531

|Kennedy v. Hearne|

DEFAMATION

Libel

Damage - Aggravation - Damages - Defence - Plaintiff's reputation attacked - Plaintiff employer remitted employees" tax deductions - Default procedure operated by revenue authorities after payment - Authorities" defence to plaintiff's action - Defence included unjustified attack on plaintiff's reputation - Trial judge awarded aggravated damages - Such damages increased at hearing of appeal - ~See~ Constitution, personal rights - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

ORDER

Purpose

Absence - Rights - Vindication - Officials" acts - Nullities - The court held that certain acts were nullities - The plaintiff sought a declaration that the officials had acted ~ultra vires~ - The court refused to determine that issue on the ground that no purpose would be served by doing so - ~See~ Constitution, personal rights - (63 & 120/87 - Supreme Court - 15/3/88)1989 IR 481

|Kennedy v. Hearne|

REVENUE

Income tax

Collection - Default procedure - Validity - Administration of justice - PAYE system - Role of Collector General - Employer's default remedied - Section 7, sub-s. 1, of the Act of 1968 states that, where a person has failed to remit tax in respect of an income-tax month, the Revenue Commissioners may serve him with notice of an estimate of the tax payable by him - Sub-section 2 provides that, in such circumstances, the person may dispute the estimated sum within fourteen days and that, if he does not do so, the estimated sum shall be recoverable from him - Sub-section 2 also provides that such person may furnish a declaration of the amount which he is liable to remit in respect of that month and may remit that amount with interest and costs and that, thereupon, the said notice shall stand discharged - Section 131, sub-s. 1, of the Act of 1967 applies the enactments relating to the recovery of income tax charged under Schedule E to the recovery of tax which an employer is liable to remit under the PAYE system - Section 485, sub-s. 1, of the Act of 1967 confers on the Collector General, where a person defaults in paying income tax, power to issue a certificate to the appropriate county registrar or sheriff certifying the amount in default and sub-s. 2 states that, on receipt of such certificate, the county registrar of sheriff shall proceed to levy the sum so certified by distraint on the goods of the defaulter - The plaintiff employer failed to remit to the first defendant (the Collector General) the sums which the plaintiff should have remitted within the statutory period in respect of his employees" income-tax deductions relating to a particular income-tax month - The first defendant issued a notice specifying the estimated sum payable by the plaintiff but the plaintiff did not dispute that sum or make a declaration of the proper amount due by him - The plaintiff did not pay the estimated sum within the seven days specified in a demand (dated 5/7/84) for payment of that sum - However, on 19/7/84 the plaintiff delivered to the Revenue Commissioners a declaration of the sum payable by him in respect of the said month and paid that sum, which was sufficient to discharge the plaintiff's obligations in respect of the said month - On 25/7/84 the first defendant, who was then unaware of the plaintiff's payment, issued a certificate to the sheriff authorising him to distrain the plaintiff's goods - The first defendant's certificate was subsequently withdrawn and no distress was levied - The plaintiff claimed (inter alia) a declaration that the provisions of s.7 of the Act of 1968 were invalid having regard to the provisions of the Constitution - The High Court (Murphy J. - 6/2/87) dismissed that claim and the plaintiff appealed against the dismissal - Held, in disallowing the appeal, that s.7 of the Act of 1968 does not purport to confer on the Collector General a role in the administration of justice contrary to Article 34, s. 1, of the Constitution - Held that there was no justiciable controversy between the plaintiff and the Collector General when the latter issued his certificate to the sheriff - Decision of the Court pronounced in conformity with Article 34.4.5 of the Constitution - Income Tax Act, 1967, ss. 131, 485 - Finance Act, 1968, s. 7 - Constitution of Ireland, 1937, Article 34 - (63 & 120/87 - Supreme Court - 15/3/88) [1988] ILRM 531 1989 IR 481

|Kennedy v. Hearne|

Citations:

FINANCE ACT 1968 S7

INCOME TAX ACT 1967 S485

FINANCE ACT 1968 S7(2)(c)

1 JUDGMENT delivered on the 15th day of March 1988 by FINLAY C.J.[Nem Diss]

2 The facts material to the issues arising in this case other than the issue already determined by the Court concerning the Constitutional validity of Section 7 of the Finance Act...