Re R Ltd

• Jurisdiction: Ireland
• Court: Supreme Court
• Judgment Date: 02 May 1989
• Docket Number: [1988 No. 8775P]
• Date: 02 May 1989

In re R. Ltd.

In re R. Limited

[1988 No. 8775P]

Supreme Court

Practice and procedure - In camera hearing - Administration of justice in public - Constitution - Requirements - Exceptions - Company - Legitimate interests - Information - Publication seriously prejudicial - In camera order - Ambit - Courts (Supplemental Provisions) Act, 1961 (No. 39), s. 45 - Companies Act, 1963 (No. 33), s. 205 - Constitution of Ireland, 1937, Article 34, s. 1.

Article 34, s. 1 of the Constitution provides:—

"Justice shall be administered in courts established by law by judges appointed in the manner provided by this Constitution, and, save in such special and limited cases as may be prescribed by law, shall be administered in public."

Section 205 of the Companies Act, 1963, provides that a member of a company may apply to the High Court for relief where the powers of the directors of a company are being exercised or its affairs conducted in a manner oppressive to him or any of the members. Sub-section 7 provides:—

"If, in the opinion of the court, the hearing of proceedings under this section would involve the disclosure of information the publication of which would be seriously prejudicial to the legitimate interests of the company, the court may order that the hearing of the proceedings or any part thereof shall be in camera."

The applicant was a substantial shareholder of the defendant company who alleged that he had been unfairly dismissed from his position as chief executive and further petitioned the High Court for relief from oppression pursuant to s. 205 of the Companies Act, 1963. His petition and grounding affidavit set out sensitive commercial information including inter alia detailed accounts of the company; its five-year business plan and the precise terms of an undisclosed and incomplete commercial transaction. The two respondents, being the company and one of its directors, obtainedex parte an order in the High Court that the proceedings be heard in camera pursuant to s. 205, sub-s. 7 of the Act. Upon the applicant's unsuccessful motion upon notice to rescind that order, the respondents obtained a further order prohibiting publication of the contents of the originating documents and affidavits. The applicant appealed to the Supreme Court and argued that the High Court, in making the orders, had been in breach of the terms of s. 205, sub-s. 7 of the Act.

Held by the Supreme Court (Walsh, Griffin and Hederman JJ.; Finlay C.J. and Hamilton P. dissenting), in allowing the appeal and directing that the proceedings be heard in public, 1, that one of the requirements essential to the administration of justice was that it be in public unless that requirement, by itself, operated to deny justice in the particular case and this principle was enshrined in Article 34, s. 1 of the Constitution.

2. That accordingly the specific exceptions to the administration of justice in public permitted by Article 34 were limited to those cases which were "prescribed by law" and where it was shown that the publicity, by itself, would deny justice as between the parties.

3. That while the respondents had satisfied the condition precedent prescribed by s. 205, sub-s. 7 of the Act, which would empower the presiding judge to exercise his discretion, viz. that"the hearing of proceedings . . . would involve the disclosure of information the publication of which would be seriously prejudicial to the legitimate interests of the company," they had failed to show that a public hearing would, by itself, so impede the doing of justice as between the parties, that the judge ought, in the exercise of that discretion, order that the proceedings be heard in camera.

Beamish & Crawford Ltd. v. Crowley [1969] I.R. 142 considered.

Per Finlay C.J., dissenting (Hamilton P. concurring): On the evidence before the Court inter alia that the petitioner had disclosed the sensitive information in issue to a stranger before service of the proceedings, the in camera order was necessary and had been properly effected by the presiding judge.

Per Finlay C.J. dissenting, (Hamilton P. concurring): An in camera order under s. 205, sub-s. 7 of the Act does not prohibit the publication of facts which are likely to be proved under s. 205 proceedings: nevertheless a court might prohibit the publication of certain facts, if they were to be published for no other reason independent of their being adduced or proved by testimony in such proceedings.

Per Walsh J.: The fundamental requirement that justice be administered in public is not satisfied merely by the pronouncement in public of a judicial decision based upon evidence taken in secret, unless precisely within the limits of the appropriate statutory exception.

In re Redbreast Preserving Co. Ltd. (1956) 91 I.L.T.R. 12 considered.

Per curiam: An in camera order duly made under s. 205, sub-s. 7 may in the appropriate case include an order prohibiting the publication of the contents of originating documents and affidavits.

Cases mentioned in this report:—

The Sunday Times v. United Kingdom (1979) 2 E.H.R.R. 245.

Cullen v. Toibín [1984] I.L.R.M. 577.

Beamish & Crawford Ltd. v. Crowley [1969] I.R. 142.

In re Redbreast Preserving Co. Ltd. (1956) 91 I.L.T.R. 12.

Petition.

The facts are summarised in the headnote and set out in the judgment of the Chief Justice, post. The appeal was heard before the Supreme Court on the 13th December, 1988.

Cur. adv. vult.

Finlay C.J.

This is an appeal against orders made in the High Court pursuant to s. 205, sub-s. 7 of the Companies Act, 1963. These orders directed (a) that these proceedings under s. 205 of the Act and every part thereof be held in camera; and (b) that none of the affidavits or exhibits referred to or facts therein recited, including the petitions and pleadings, be disclosed to anyone who is not a party to the proceedings.

The first of these orders was dated the 16th September, 1988, and was made ex parte by Johnson J., and the second was dated the 4th October, 1988, and was made upon notice of motion brought by the applicant to rescind the ex parte order made by Johnson J. The second order was made by Costello J. and in it he refused the application to rescind the order previously made, and in effect affirmed that order and added to it as matters not to be disclosed the contents of the petitions and pleadings.

Sub-section 7 of s. 205 of the Act of 1963 reads as follows:—

"If, in the opinion of the court, the hearing of proceedings under this section would involve the disclosure of information the publication of which would be seriously prejudicial to the legitimate interests of the company, the court may order that the hearing of the proceedings or any part thereof shall be in camera."

The nature of the proceedings provided for in s. 205 and the variety of reliefs which may be obtained in such proceedings is contained in sub-ss. 1 to 4 of s. 205 of the Act of 1963 which sub-sections read as follows:—

"(1) Any member of a company who complains that the affairs of the company are being conducted or that the powers of the directors of the company are being exercised in a manner oppressive to him or any of the members (including himself), or in disregard of his or their interests as members, may apply to the court for an order under this section.

• (2) In a case falling within subsection (3) of section 170, the Minister may apply for an order under this section.

• (3) If, on any application under subsection (1) or subsection (2) the court is of opinion that the company's affairs are being conducted or the directors' powers are being exercised as aforesaid, the court may, with a view to bringing to an end the matters complained of, make such order as it thinks fit, whether directing or prohibiting any act or cancelling or varying any transaction or for regulating the conduct of the company's affairs in future, or for the purchase of the shares of any members of the company by other members of the company or by the company and in the case of a purchase by the company, for the reduction accordingly of the company's capital, or otherwise.

• (4) Where an order under this section makes any alteration in or addition to any company's memorandum or articles, then, notwithstanding anything in any other provision of...