McMahon v Irish Road Haulage Association

• Jurisdiction: Ireland
• Judge: Miss Justice Laffoy
• Judgment Date: 24 March 2009
• Neutral Citation: [2009] IEHC 145
• Docket Number: [No. 2148P/2007]
• Court: High Court
• Date: 24 March 2009

[2009] IEHC 145

THE HIGH COURT

[No. 2148P/2007]

McMahon v Irish Road Haulage Association

BETWEEN

PATRICK McMAHON

PLAINTIFF

AND

IRISH ROAD HAULAGE ASSOCIATION

DEFENDANT

CONSTITUTION ART 40.3

COMPANIES ACT 1963 S25

GLOVER v BLN LTD 1973 IR 388

HANRAHAN v MERCK SHARPE & DOHME (IRL) LTD 1988 ILRM 629 1988/5/1234

MCDONNELL v IRELAND & ORS 1998 1 IR 134 1996 2 ILRM 222 1996/6/1697

O'KEEFFE v KILCULLEN & ORS UNREP O'SULLIVAN 24.6.1998 1998/28/11429

GARVEY v IRELAND & ORS 1981 IR 75 1979 ILRM 266 1979 113 ILTR 61

ADDIS v GRAMOPHONE CO LTD 1909 AC 488

DINNEGAN v RYAN 2002 3 IR 178 2002/7/1456

DOOLEY v GREAT SOUTHERN HOTELS LTD 2001 ELR 340 2001/6/1434

CONTRACT

Damages

Breach - Fair procedures - Implied term - Whether damages recoverable for breach of contractual right to fair procedures - Terms and conditions - Implied term of right of member of association to fair procedures leading to expulsion from association - Appropriate level of damages for breach leading to distress and embarrassment - Audi alteram partem - Glover v BLN Ltd [1973] IR 388 applied; McDonnell v Ireland [1998] 1 IR 134 and Dinnegan v Ryan [2002] 3 IR 179 considered (2007/2148P - Laffoy J - 24/3/2009) [2009] IEHC 145

McMahon v Irish Road Haulage Association

Miss Justice Laffoy

1 The defendant is a company limited by guarantee not having a share capital, which was incorporated on 13^th July, 1973. Its primary object, as stated in its memorandum of association, is to organise, represent and protect the road transport industry and the business of road hauliers in the State or abroad. The articles of association of the defendant provide that its business shall be managed by the Council which consists of the officers of the defendant who are ex officio members, and members who are appointed by the Regional Divisions and the County Branches of the defendant which are established by the Council in accordance with the articles of association. As I understand it, in 2006 the Council comprised in the region of 40 to 45 officers and representatives. In 2006 the only provision in the articles of association for the expulsion of a member of the defendant was Article (11) which provided as follows:

"If the conduct of any member is such as shall in the opinion of the Council be injurious to the character or interests of the Association or render him unfit to remain a member of the Association the Council may expel such member."

2 The plaintiff has been engaged in the business of road haulage since 1964. His business has expanded over the years and he now has operations in Dublin and in Counties Clare and Westmeath, as well as at Ellesmere Port in England. He became a member of the defendant in or about 1974 or 1975. In June 2006 the plaintiff was the Chairman of the Dublin County Branch and he was a representative of his County Branch on the Council.

3 The events which gave rise to these proceedings occurred at a Council meeting of the defendant which was held in Portlaoise on 28^th June, 2006. It is clear on the evidence that there was a history of tension between the plaintiff and the then President of the defendant, Vincent Caulfield, arising out of the election of the President in 2005, which the plaintiff had also contested. Although the plaintiff, in evidence, stated that he held no animosity towards Mr. Caulfield, he maintained that the election of Mr. Caulfield as President had been improper, and, indeed, the first letter from the plaintiff's solicitor to the defendant arising out of the events of 28^th June, 2006 stated the plaintiff's position that Mr. Caulfield had not been properly elected. However, that point was not pursued by the plaintiff in these proceedings.

4 There was also evidence of tension at branch level between the plaintiff and other members of the Dublin County Branch, in particular, Mr. Liam Brewer.

5 The controversy which provoked the events at the Council meeting in Portlaoise was a letter written on 21^st June, 2006 by the plaintiff to the Director of Services & County Engineer of Clare County Council (the County Engineer) complaining that roadworks in the Ennis area were being carried out in a manner which was dangerous to the public. The letter was written on letter heading which referred to "Dublin Branch I.R.H.A." and named the officers of the Dublin Branch. The letter purported to be written on behalf of the Dublin Branch and stated that the Dublin branch would hold the addressee "responsible for all damage or injury that may happen to the public". On 26^th June, 2006, the County Engineer wrote to the Chief Executive of the defendant complaining about the conduct of the plaintiff and the content of his letter and references contained in it to identified employees of Clare County Council. The County Engineer sought clarification whether the plaintiff was representing the defendant in writing the letter.

6 The meeting of the Council in Portlaoise on 28^th June, 2006 was attended by about 35 members of the Council. The plaintiff attended. At the meeting, Mr. Caulfield read out the plaintiff's letter to Clare County Council. Mr. Eugene Drennan, who has been a member of the defendant for 30 years, and who was at the meeting and who gave evidence on behalf of the plaintiff, testified that the members present felt that the letter had brought the defendant into disrepute. Mr. Brewer, who also testified, proposed a motion to expel the plaintiff from the defendant. His evidence was that he thought the plaintiff was out of control and was damaging the defendant. The motion was seconded. There was then a discussion on the motion. The plaintiff's evidence was that he was not allowed to speak to the motion. I am satisfied that that was not what happened. Mr. Drennan's evidence was that the plaintiff was allowed to speak, that he got up a number of times but he was slow on delivery and he did not get out what he wanted to say. The motion was put to a vote and was carried. Following a query from a member of the Council, it was put to a vote a second time and carried a second time.

7 By letter dated 26^th October, 2006, the plaintiff's solicitor wrote to Mr. Caulfield, as president of the defendant, alleging that the removal of the plaintiff from membership of the defendant on 28^th June, 2006 was unlawful and alleging that he had suffered stress, trauma, humiliation, anxiety and loss in both his personal and professional life. It was suggested that the plaintiff be invited to attend the meeting of the Council the following month on a "without prejudice" basis as to any action the plaintiff might wish to take against the defendant. There was no response to that letter. Following a reminder dated 6^th December, 2006 from the plaintiff's solicitor, Mr. Caulfield wrote on behalf of the defendant that there was no substance in the complaints in the letter of 26^th October, and that the defendant did not propose to engage in further correspondence with the plaintiff or his solicitor.

8 These proceedings were initiated by a plenary summons which issued on 30^th March, 2007.

9 The case as pleaded in the plaintiff's statement of claim delivered on 30^th March, 2007, on its face, has two separate elements. The first is the assertion that the purported removal of the plaintiff as a member of the defendant on 28^th June, 2006 was invalid and of no effect, in that it was a breach of the plaintiff's right to fair procedures as guaranteed by Article 40.3 of the Constitution. The second element, which is expressed to be without prejudice and in addition to that assertion, is the plea that it was an express or an implied term of the contract whereby the plaintiff was accepted as a member of the defendant that his membership would not be terminated save on the plaintiff being given due notice of the reason for his termination and an opportunity to present his case and to advance reasons as to why his membership should not be terminated. Accordingly, his purported removal was a breach of the terms of his contract. The plaintiff claims a declaration that his purported removal was invalid and contrary to his entitlement to basic fairness of procedures pursuant to Article 40.3. He claims injunctive relief, which is no longer relevant. He also claims damages "for the purported removal of the plaintiff as a member" of the defendant.

10 In its defence delivered on 23^rd August, 2007, the defendant admitted the plaintiff's claim and stated that a lodgement had been made to meet the plaintiff's claim for damages.

11 Almost a year after the delivery of the defence, the defendant sent a letter of apology to the plaintiff, which was dated 12^th June, 2008. Referring to the motion passed on 28^th June, 2006, the letter stated as follows:

"The Association and Council acknowledge that your expulsion was wrongful and wish to unequivocally apologise to you for the offence that may have been caused to you personally and professionally as a result. For the record, it is acknowledged and confirmed that you have at all times been and remain a full member of the Association and that your membership has not lapsed at any time."

12 It was stated that a notice to that effect would be published in the July edition of the defendant's trade magazine, "Knights of the Road". That publication is circulated as an insert in a magazine known as "Fleet". In the July/August edition of the publication, the apology was included in a page headed "Head...