Primor Plc v Stokes Kennedy Crowley

• Jurisdiction: Ireland
• Judgment Date: 01 January 1996
• Date: 01 January 1996
• Docket Number: [Nos. 83 and 91 of 1994]
• Court: Supreme Court

Primor plc v. Stokes Kennedy Crowley

Primor plc (formerly P.M.P.A. Insurance plc) (under administration)

Plaintiff

and

Stokes Kennedy Crowley, Defendants

Primor plc v. Stokes Kennedy Crowley

Primor plc (formerly P.M.P.A. Insurance plc) (under administration)

Plaintiff

and

Oliver Freaney and Company, Defendants

[Nos. 83 and 91 of 1994]

[S.C. No. 110 of 1995]

Supreme Court

Practice and procedure - Dismissal of action for want of prosecution - Principles to be applied - Inordinate and inexcusable delay by plaintiff - Defendants seeking cross-order for discovery after such delay - Plaintiff incurring considerable expense in complying with cross-order for discovery - Defendants seeking to dismiss for want of prosecution after plaintiff's compliance with cross-order for discovery - Whether defendants' application for cross-order constituting acquiescence in plaintiff's previous inordinate and inexcusable delay - Whether defendants barred from seeking dismissal of action after plaintiff had complied with cross-order - Whether defendants' conduct merely a factor to be taken into account in exercise of discretion - Whether trial judge erred in failing to consider prejudice to defendants.

The defendants in the first proceedings, S.K.C., acted as auditors for the plaintiff for the financial year ending the 31st December, 1978. Freaneys, the defendants in the second proceedings, acted as auditors for the plaintiff for the financial years from the 31st December, 1967, to the 31st December, 1982, inclusive. The plaintiff issued separate proceedings against both sets of defendants on the 21st December, 1984, claiming, inter alia that they had failed to carry out their obligations as auditors in a careful and prudent manner. The summonses were not served for a year, and statements of claim were not delivered until the 8th January, 1986.

In the first proceedings, S.K.C. delivered their defence on the 8th January, 1991. The plaintiff sought an order for discovery and subsequently S.K.C. sought a cross-order. On the 25th January, 1991, the order and cross-order for discovery were made on consent. In February, 1994, the High Court (O'Hanlon J.) refused S.K.C.'s application to dismiss the claim for want of prosecution. The trial judge found that whilst the plaintiff had been guilty of inordinate and inexcusable delay, the fact that S.K.C. had sought a cross-order for discovery on the 25th January, 1991, and the fact that the plaintiff had incurred considerable expense in complying with the order constituted an estoppel and a bar to the application to dismiss the proceedings for want of prosecution. In so finding the trial judge had relied on County & District Properties Ltd. v. Lyell[1991] 1 W.L.R. 683 which subsequently had been overruled by Roebuck v. Mungovin[1994] 2 A.C. 224.

In the second proceedings, Freaneys delivered a defence and a notice for particulars on the 28th February, 1990. The plaintiff sought an order for discovery and Freaneys sought a cross-order. On the 17th July, 1990, the order and cross-order were made on consent. In February, 1995, the High Court (Johnson J.) refused Freaneys application to dismiss the claim for want of prosecution. The trial judge found that whilst the plaintiff had been guilty of inordinate and inexcusable delay, by delivering the defence and notice for particulars on the 28th February, 1990, Freaneys had acquiesced in the delay that had taken place until that date and that the seeking of further particulars thereafter, particularly together with the acquiescence of Freaneys in the motion for discovery and cross-order copper-fastened the acquiescence. In so finding the trial judge relied on the decision of the High Court (O'Hanlon J.) in the first proceedings.

Both S.K.C. and Freaneys appealed to the Supreme Court and the appeals were heard together.

Held by the Supreme Court (Hamilton C.J., O'Flaherty and Denham JJ.), in allowing the appeals and dismissing the actions for want of prosecution, 1, that the principles of law relevant to an application to dismiss an action for want of prosecution were:—

• (1) that the courts had an inherent jurisdiction to control their own procedure and to dismiss a claim when the interests of justice so required;

• (2) that the party who sought the dismissal on the ground of delay in the prosecution of the action must establish that the delay had been inordinate and inexcusable;

• (3) that even where the delay had been both inordinate and inexcusable the court must exercise a judgment on whether, in its discretion, on the facts the balance of justice was in favour of or against the case proceeding;

• (4) that when considering this obligation the court was entitled to take into consideration and have regard to —

  • (a) the implied constitutional principles of basic fairness of procedures,

  • (b) whether the delay and consequent prejudice in the special facts of the case were such that made it unfair to the defendant to allow the action to proceed and made it just to strike out the action,

  • (c) any delay on the part of the defendant, because litigation was a two party operation and the conduct of both parties should be looked at,

  • (d) whether any delay or conduct of the defendant amounted to acquiescence on the part of the defendant in the plaintiff's delay,

  • (e) the fact that conduct by the defendant which induced the plaintiff to incur further expense in pursuing the action did not, in law, constitute an absolute bar preventing the defendant from obtaining a dismissal but was a relevant factor to be taken into account by the court in exercising its discretion whether or not to dismiss, the weight to be attached to such conduct depending on all the circumstances of the particular case,

  • (f) whether the delay had given rise to a substantial risk that it was not possible to have a fair trial or it was likely to cause or had caused serious prejudice to the defendant,

  • (g) the fact that the prejudice to the defendant referred to in (f) might arise in many ways and be other than that merely caused by the delay, including damage to a defendant's reputation and business.

Biss v. Lambeth Health Authority [1978] 1 W.L.R. 382; Birkett v. James[1978] A.C. 297; Celtic Ceramics Ltd. v. I.D.A. [1993] I.L.R.M. 248; Department of Transport v. Chris Smaller (Transport) Ltd.[1989] A.C. 1197; Dowd v. Kerry County Council[1970] I.R. 27; Eagil Trust Co. Ltd v. Pigott-Brown [1985] 3 All E.R. 119; Ó Dómhnaill ó dómhnaill v. Merrick[1984] I.R. 151; Rainsford v. Limerick Corporation[1995] 2 I.L.R.M. 561; Roebuck v. Mungovin[1994] 2 A.C. 224 andThorpe v. Alexander Fork Lift Trucks Ltd.[1975] 1 W.L.R. 1459 approved;County and District Properties v. Lyell[1991] 1 W.L.R. 683 not followed.

Per O'Flaherty J.: That since the courts did not exist for the sake of discipline but rather to deal with the essential justice of the case, it was proper that regard should always be had to the rules of court but it must be remembered that the rules are there to help in the administration of justice and, accordingly, the fact that a party availed of his rights under the rules could not in itself be advanced so as to evoke some form of estoppel which prevented him from making his essential argument about the justice of the case, or a particular aspect of the case.

Roebuck v. Mungovin [1994] 2 A.C. 224 approved.

2. That in the first proceedings, the trial judge had erred in law in the exercise of his discretion in holding that the fact that S.K.C. had sought a cross-order for discovery and the fact that the plaintiff had incurred considerable expense in complying with such order constituted an estoppel and a bar to the application for an order that the proceedings be dismissed for want of prosecution. The trial judge would, however, have been entitled to regard these matters as relevant factors to be taken into account by him in the exercise of his discretion.

Roebuck v. Mungovin [1994] 2 A.C. 224 approved; County and District Properties v. Lyell[1991] 1 W.L.R. 683 not followed.

3. That in the second proceedings, the trial judge, having found that the delay on the part of the plaintiff was inordinate and inexcusable, was obliged, in the exercise of his discretion, to exercise a judgment as to whether on the facts, the balance of justice was in favour of or against the proceeding of the case.

4. That in exercising such discretion the delay on the part of the defendant or the acquiescence by the defendant in the plaintiff's delay might be ingredients but they were not the only ingredients. The trial judge had erred in failing to consider whether in the special facts of the case the delay and consequent prejudice, including damage to reputation, to Freaneys was such as to make it unfair to Freaneys to allow the action to proceed and to make it just to strike out the plaintiffs action.

5. That whilst the Court had inherent jurisdiction to dismiss a claim in the interests of justice where the delay in the proceedings was in all the circumstances so great that it would be unjust to call upon a particular defendant to defend himself, it was a jurisdiction which should not be frequently or lightly assumed.

6. That in both proceedings there had been inordinate and inexcusable delay on the part of the plaintiff.

7. That since the plaintiff had initiated the discovery process, the defendants could not be criticised for seeking cross-orders.

8. That both sets of defendants had been prejudiced by the plaintiff's delay in that:—

• (a) their reputations had been damaged;

• (b) they had been subject to the continuing possibility of having to pay enormous damages;

• (c) many years had elapsed since the alleged negligence;

• (d) their ability to mount a successful defence had been hindered in that:—

  • (i) most of the relevant staff had left, many going outside the jurisdiction, with the consequence that they could not be compelled to attend and the costs of...