Re National Irish Bank Ltd (No 6)
| Jurisdiction | Ireland |
| Judge | Mr. Justice Kelly |
| Judgment Date | 10 February 2006 |
| Neutral Citation | [2006] IEHC 35 |
| Court | High Court |
| Docket Number | [1998 Nos. 89 & 132 COS] |
| Date | 10 February 2006 |
[2006] IEHC 35
THE HIGH COURT
AND
AND
COMPANY LAW ENFORCEMENT ACT 2001 S14
RSC O.31 r29
COMPANIES ACT 1990 S160
COMPANIES ACT 1990 S12(1)
ANSBACHER (CAYMAN) LTD, IN RE 2004 3 IR 193
COMPANIES ACT 1990 S12(1)(b)
MAXWELL v DEPARTMENT OF TRADE 1974 1 QB 523
PERGAMON PRESS, IN RE 1971 CH D 388
HOLLOWAY v BELENOS PUBLICATIONS LTD 1988 IR 494
FUSCO v O'DEA 1994 2 IR 93
DELANY & MCGRATH CIVIL PROCEDURE IN THE SUPERIOR COURTS 2001
CHAMBERS v TIMES NEWSPAPERS LTD & WITHEROW 1999 2 IR 424 1999 1 ILRM 504
ALLIED IRISH BANK PLC v ERNST & WHINNEY 1993 1 IR 375
COMPANY LAW
Investigation
Final report - Documents - Disclosure - Access to documents - Whether inspectors under obligation to provide access or to make discovery of documents after delivery of final report - Whether order sought related to matters arising out of report prepared pursuant to s 11 - Whether the court should exercise its discretion under s 12(1) to make the order sought - Whether order sought would require inspectors to act outside lawful authority - Whether order sought would be consistent with scope and scheme of legislation - Re Ansbacher (Cayman) Ltd [2004] IEHC 222, [2004] 3 IR 193 approved - Companies Act 1990 (No 33), ss 11, 12 and 22 - Application refused (1998 89 & 132Cos - Kelly J 10/2/2006) [2006] IEHC 35 Re NIB Ltd
This was an application brought by the Director of Corporate Enforcement. He sought access to documents held by the inspectors appointed to investigate the affairs of National Irish Bank. The application was made pursuant to s. 12 of the Companies Act 1990 as amended by s. 14 of the Company Law Enforcement Act 2001.
Held by Kelly J. in refusing the application for access that inspectors are appointed as evidence gatherers and when they produce a final report they ought not to be asked to conduct further work for others who may wish to challenge or to stand over the report prepared by them. It was not the intention of the legislature that an order of the type sought in this application ought to be granted.
Reporter: R.W.
JUDGMENT of Mr. Justice Kelly delivered the 10th day of February, 2006
This is an application brought by the Director of Corporate Enforcement (the director). He seeks access to documents held by the Inspectors (the inspectors) appointed to investigate the affairs of National Irish Bank Limited and National Irish Bank Financial Services Limited (the companies). The application is made pursuant to s. 12 of the Companies Act, 1990, (the Act) as amended by s. 14 of the Company Law Enforcement Act, 2001.
In the alternative the director seeks non-party discovery against the inspectors pursuant to O. 31, r. 29 of the Rules of the Superior Courts (RSC).
In 1998 the inspectors were appointed to investigate and report on the affairs of the companies. Following the delivery of a number of interim reports the inspectors delivered their final report in July, 2004. Upon delivery of that report I heard an application with a view to giving directions and making orders as envisaged under ss. 11, 12 and 13 of the Act. I inter alia directed that the inspectors report be published in its entirety on 30th July, 2004.
The inspectors report made serious findings in relation to improper practices at the companies. Those improper practices inter alia had the effect of facilitating tax evasion and the levying of unwarranted fees and interest charges. The inspectors analysed the knowledge and responsibility of senior officers within the companies and concluded that certain of them bore responsibility for the improprieties identified.
On foot of the report the director issued nine separate notices of motion against persons named and criticized in the report. Each motion sought a disqualification order against the named respondent pursuant to the provisions of s. 160 the Act.
One of the respondents, Mr. Nigel D'Arcy, did not contest the director's application and in a reserved judgment which I delivered on 26th October, 2005, I made a disqualification order against him with a duration of ten years from that date. The remaining eight respondents against whom similar orders are sought are contesting the director's application.
At the outset I made it clear, and it is accepted by all parties to the litigation, that all eight respondents to the s. 160 applications brought by the director are entitled to have their applications considered individually and on their own merits. For the sake of convenience and with a view to minimising costs, the present applications have been brought on a single notice of motion.
The application under s. 12 of the Act is brought within the investigation proceedings which commenced in 1998. It is agreed that the alternative application for discovery (although brought on the same motion paper) is to be treated as a separate and distinct application for non-party discovery brought individually in each of the eight applications which seek the s. 160 orders. Such applications are governed by the provisions of O. 31, r. 29 RSC and the jurisprudence which has developed on foot of that rule.
In the originating notices of motion which seek orders under s. 160 of the Act the director makes it clear that on the hearing of those applications he will be relying on the report of the inspectors. He will be basing his case upon the facts found and opinions expressed by the inspectors. He is clearly entitled to do so pursuant to s. 22 of the Act.
That section provides as follows:-
"A document purporting to be a copy of a report of an inspector appointed under the provisions of this Part shall be admissible in any civil proceedings as evidence û"
(a) of the facts set out therein without further proof unless the contrary is shown, and
(b) of the opinion of the inspector in relation to any matter contained in the report."
The director contends that he needs access to the documents specified in the notice of motion grounding this application because of the nature of the defences which have either been delivered or intimated will be delivered by each of the eight respondents. In respect of some of the respondents, the time for delivering their affidavits in response has not yet expired. Nonetheless the director contends that there are certain common themes to the defences which have been intimated.
Each respondent seeks to challenge certain of the inspectors" findings of fact and/or the conclusions which they reached as a result of those findings.
A number of the respondents sought (and indeed have been granted) access to documents held by the companies in order to enable them to prepare their defences.
The respondents are seeking such documents in order to enable them to adduce evidence to rebut the findings of the inspectors.
The director contends that the approach of the respondents amounts to an attack on the findings of the inspectors. In order to be able to deal with such attack he must, he says, have access to the documents upon which the inspectors based their findings. He makes it clear that this is not an attempt by him to expand upon or go beyond the grounds set forth in the originating notices of motion seeking the s. 160 orders. Neither does he wish to pursue a separate or fresh investigation using the material to which he now seeks access. He contends that this application arises only because the respondents have sought to present what he describes as a collateral attack upon the findings of the inspectors. He contends that if he cannot have access to these documents he will be seriously disadvantaged in pursuing his claim against each of the eight respondents.
I have little doubt but that the director is quite entitled to adduce whatever relevant evidence he wishes in support of his s. 160 application and is not confined merely to the inspectors report. He cannot of course adduce evidence outside the grounds notified to the respondents as the basis for his application. Subject to that obvious limitation, he may adduce whatever relevant evidence he wishes. This application is an attempt by him to obtain documents which he may wish to put in evidence at the trial of the s. 160 applications.
The director seeks either access to (pursuant to s. 12 of the Act) or discovery of (pursuant to O. 31, r. 29 RSC) the documents categorised below.
a "A. Copies of all documents relevant to the inspectors" adverse findings against:
(i) Mr. Dermott Boner
(ii) Mr. Frank Brennan
(iii) Mr. Patrick Byrne
(iv) Mr. Kevin Curran
(v) Mr. Michael Keane
(vi) Mr. Jim Lacey
(vii) Mr. Tom McMenamin
(viii) Mr. Barry Seymour
comprising all branch and other audit reports, all documents made available by or on behalf of the inspectors to each respondent and/or his advisers requesting his comments or observations on the provisional findings of the inspectors and any replies thereto and any further correspondence or submissions passing between the inspectors and each respondent and/or their respective advisers.
b B. Copies of the transcripts of evidence of:
(i) Mr. Dermott Boner
(ii) Mr. Frank Brennan
(iii) Mr. Patrick Byrne
(iv) Mr. Kevin Curran
(v) Mr. Michael Keane
(vi) Mr. Jim Lacey
(vii) Mr. Tom McMenamin
...
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Mark Beatty v The Military Judge and The Director of Military Prosecutions
...tended to interpret facility extended by Order 31 Rule 29 for such discovery in ‘ a rather restrictive fashion’ ( Re National Irish Bank [2006] IEHC 35, [2006] 2 ILRM 266 at pp. 276–277), and ‘ much stricter requirements’ fall to be observed before a litigant can obtain discovery from a non......