Meagher v Dublin City Council & Health Service Executive

• Jurisdiction: Ireland
• Judge: Mr. Justice Hogan
• Judgment Date: 01 November 2013
• Neutral Citation: [2013] IEHC 474
• Court: High Court
• Docket Number: [2005 No. 336 P]
• Date: 01 November 2013

[2013] IEHC 474

THE HIGH COURT

[2005 No. 336 P]

BETWEEN

JOHN MEAGHER

PLAINTIFF

AND

DUBLIN CITY COUNCIL AND HEALTH SERVICE EXECUTIVE

DEFENDANTS

Damages - Breach of contract - Refugee influx - Accommodation - Delay - Doctrine of laches - Mutual mistake

Facts: In the late 90s, the number of refugees seeking asylum in the state increased rapidly. The plaintiff, John Meagher, a business man, was involved in the hotel and hostel accommodation business. As a result of this refugee influx, Mr. Meagher was approached to determine whether he would be willing to use his hostels as accommodation for the refugees. He agreed to do so, and entered into contract arrangements, both formal and informal, with the Dublin City Council (DCC) and the statutory predecessors to the Health Service Executive (HSE). It was not disputed that Mr. Meagher provided accommodation and other ancillary services to refugees from late 1997 onward. The key premises where these services were provided were the Sancta Maria Hostel and adjoining premises in Charlemont Street and other premises in Parnell Square and Dorset Street. At this stage, responsibility for the refugees was held by the HSE until 2001 when the DCC took over responsibility.

This case concerned an action for damages for breach of contract against the defendants. Mr. Meagher contended that he had not been paid the entirety of the sums promised under the contractual arrangements. The plaintiff claimed €390,699 together with a payment of interest. That sum contained three elements: €147,227 for unpaid invoices between 1998 and 2002; €203,158 for the unpaid balance on an October 1999 contract for capitation payments for the Charlemont premises; and €40,314 for the unpaid rent against the DCC from the 8 ^th of September 2002 until 19 ^th of October 2002.

The first determination to be made by the court was whether the action was statute-barred. On this point, it was held that as this action was commenced in March 2005, that the plaintiff was entitled to claim in respect of the 6 years prior, and that claims prior to this were statute-barred. The second determination to be made was whether the doctrine of laches could be used to dismiss the action. On this issue, it was pointed out that the equitable doctrine of laches was not applicable to a common law action for damages as even though equity and common law ‘work ever more closely together’, that they were not yet ‘fused’. Hogan J. went on to discuss the merits of the case.

Firstly, the court held that as a result of mutual mistake, a settlement agreement of October 2000 was void, as neither party was ad idem regarding the invoices discussed therein. Any claims arising out of this agreement were therefore estopped. Regarding the claims made against HSE, four elements were to be considered: invoices from claims prior to March 1999; invoices after March 1999; payments relating to the special increased rate for Roma refugees; and payments relating to overstaying asylum seekers. In this respect, it was held that the claims prior to March 1999 were statute-barred; that Mr. Meagher would be able to claim 20% of those invoices post March 1999; that Mr. Meagher was entitled to be reimbursed for ‘Roma rate’ for non-statute-barred invoices; and that Mr. Meagher”s claim for invoices was allowed in respect of overstaying asylum seekers. Regarding the claim for €40,314, it was held that no sum was due to Mr. Meagher, as the DCC were entitled to terminate the agreement as a result of the poor conditions of the premises.

The court therefore held that Mr. Meagher”s claim was well founded to a ‘limited extent’, and invited counsel to determine the quantification of the claim in respect of the successful grounds.

Mr. Justice Hogan

JUDGMENT of Mr. Justice Hogan delivered on the 1st November, 2013

1 PART I: INTRODUCTION

2 1. The dramatic rise in the number of refugees seeking asylum in the State in the latter part of the 1990s was a remarkable social phenomenon. While there was less than 100 such applications annually in early 1990s, by the latter part of the decade the figures had risen dramatically and, indeed, exponentially. This sudden surge began to manifest itself especially in the years from 1997 onwards. It is, I think, fair to say that this was a phenomenon for which the authorities found themselves somewhat unprepared.

3 2. This litigation arises directly out of these events. The plaintiff is a business man who has been involved in a variety of different businesses, but he also has considerable experience of the hotel and hostel accommodation business.

4 3. Shortly after the first major influx of refugees arrived in 1997, Mr. Meagher was approached to see whether he would be prepared to make arrangement to enable his hostels to be used as accommodation centres for the new refugees. This he agreed to do, and for that purpose entered into several different formal and informal contractual arrangements with both Dublin City Council and the statutory predecessors to the Health Service Executive. It is not in dispute but that Mr. Meagher entered into an arrangement with the HSE at some stage in late 1997 (or, perhaps, at the latest, early 1998) whereby he would provide accommodation and other ancillary services (such as the provision of basic meals) in respect of refugees and other homeless persons. At this time the responsibility for the accommodation of asylum seekers rested with the HSE, albeit that the Council paid for this. This continued until October 2001 when the Council took over the control of the hostel service and dealt with and paid service providers such as Mr. Meagher directly.

5 4. The principal premises where these services were provided was at the Sancta Maria Hostel and adjoining premises at 2-8 Charlemont St., Dublin 2, but the services were also supplied at other premises in Dublin, including at Parnell Square, Dublin 1 and Dorset Street, Dublin 2.

6 5. This action is, in essence, a breach of contract action against the defendants whereby the plaintiff contends that he has not been paid the full sum of the amounts that had been promised to him by the defendants under these contractual arrangements.

7 6. I should pause at this juncture to indicate that at various different stages in this narrative the second named defendant (or, more strictly its statutory predecessors), was described by different names. At one stage the functions were discharged by the Eastern Health Board and that Board was later subsumed into the Eastern Regional Health Authority. These functions were then later again taken over the Health Service Executive following the passage of the Health Act 2004. Purely for reasons of convenience I propose to refer to the second defendant as the HSE even though, in strictness, that body only existed after 2004, but since at least for the purposes of this litigation, this is only a matter of nomenclature and nothing turns on this. The same applies to Dublin City Council which was formerly known as Dublin Corporation. Again, purely for reasons of convenience, I propose to described it as the Council.

8 7. The plaintiff”s claim in these proceedings is for the sum of €390,699, together with a payment of interest under the Prompt Payment of Accounts Act 1997. That sum is made up of three separate elements as follows:

i. €147,227 in respect of unpaid invoices supplied between 25th May 1998 and May 2002,

ii. €203,158 being what is claimed to be the unpaid balance owing on foot of a one year contract dated 20th October 1999 in respect of capitation payments in respect of the Charlemont St. premises,

iii. €40,314 representing the unpaid balance of the annual rollover capitation contract for the period from 8th September, 2002, and 19th October, 2002.

9 PART II: IS THE CLAIM STATUTE-BARRED OR OTHERWISE BARRED BY THE DOCTRINE OF LACHES?

10 The course of the proceedings

11 8. The proceedings were commenced on the 9th March, 2005. Rather remarkably, the proceedings were not served on the two separate defendants until sometime in April, 2008 and then pursuant to a court order (Peart J.) which renewed the summons for six months from the 1st April, 2008. The Council entered an appearance on 24th April, 2008, and the HSE filed an appearance on 18th June, 2008.

12 9. The plaintiff then subsequently brought a motion for summary judgment in July, 2009. Following an exchange of affidavits, this culminated in an order of the Master of the High Court remitting the matter to plenary hearing. There then followed a statement of claim, particulars and then, finally, two separate defences filed which were filed on 14th November, 2011 (by the Council) and on 23rd December, 2011, (by the HSE) respectively. It may be observed that the HSE”s defence pleaded that the plaintiff”s claim was barred by the doctrine of laches and undue delay and was also statute-barred for the purposes of the Statute of Limitations.

13 10. Before considering these latter pleas, it is necessary to bear in mind that a significant element of the plaintiff”s claim relates to a settlement in respect of outstanding invoices and arrears of rent which was entered into between the parties on 11th October, 2000. As the plaintiff maintains that the defendants dishonoured their part of the bargain, he is now re-presenting these invoices for payment. Many (but not all) of the invoices pre-date 2000. It is against this background that the contention that the action is statute-barred or barred by the doctrine of laches can be evaluated.

14 Is the claim statute-barred?

15 11. While it is true that the plea of the Statute of Limitations has been raised by the HSE only and not by the Council, the essential point is that the plaintiff has at all times has been on notice of the plea. This is especially so where the defences of the two defendants are intertwined...