Re Thomas Finnegan (a debtor)

JudgeMr. Justice Denis McDonald
Judgment Date04 March 2019
Neutral Citation[2019] IEHC 137
Docket Number[2018 No. 410 C.A.]
CourtHigh Court
Date04 March 2019

[2019] IEHC 137



McDonald J.

[2018 No. 410 C.A.]




Insolvency – Costs – Personal Insolvency Act 2012 (As Amended) – Personal insolvency practitioner seeking an order for costs – Whether the an order for costs should be made against an objecting creditor

Facts: The personal insolvency practitioner made an application for costs relating to a hearing regarding a preliminary issue which arose in the S. 155A proceedings. The hearing was to resolve an issue raised by an objecting creditor who argued the practitioner’s S. 115A application was not made within the mandated time period. The practitioner had lodged the application with Circuit Court Office, however it had not been served on the statutory notice parties within the mandated time period. The Circuit Court found in favour of the creditor, however, on appeal, the High Court found that the applications had been made within the prescribed 14 day period. The practitioner applied for costs. The creditor argued that as this was a test case, and the practitioner was akin to a public authority, the Court should depart from the ordinary rule that costs follow the event.

Held by McDonald J that the exceptions to the general rule that costs follow the event did not apply in this case. Mc Donald J distinguished this case from Shackleton as this was not a public law issue of general importance pursued by a party with no private interest in the outcome. Furthermore, McDonald J noted that the practitioner should not be equated to a Minister in that he was not responsible for the relevant legislation, nor was the legislation particularly difficult to construe.

McDonald J made a costs order in favour of the practitioner, with the exception of the costs for written submissions as these had been filed outside the Court’s timetable.

Relief granted.

JUDGMENT of Mr. Justice Denis McDonald delivered on 4 March, 2019
Relevant facts

This is an application by the personal insolvency practitioner (‘ the practitioner’) for the costs relating to a preliminary issue which arose in these proceedings and which was the subject of a hearing which took place on 21 January, 2019. The issue (which was raised by an objecting creditor, Mars Capital Ireland No. 2 DAC (‘ Mars’)) related to whether an application under s. 115A of the Personal Insolvency Act 2012(as amended) could be said to have been ‘ made’ to the court within the 14 day period prescribed by s. 115A(2) where it had been lodged in the Circuit Court Office within that period but not served on the statutory notice parties until after that period had expired.


In the Circuit Court, the learned Circuit Court judge decided the issue in favour of Mars and dismissed the s. 115A application of the practitioner on the grounds that it was out of time. The practitioner then appealed that decision to this court.


In the meantime, a significant number of objectors to similar s 115A applications relied on the decision of the learned Circuit Court judge in this case to raise the same s. 115A(2) point and these objections were, in turn, upheld on the basis of that decision. This has resulted in a substantial number of appeals backing up the appeal in this case.


On 21 January, 2019 I heard extensive and detailed submissions from senior counsel for both Mars and the practitioner in relation to the s. 115A(2) issue and there were also detailed written submissions provided by the parties.


In a judgment delivered on 11 February, 2019 I ruled in favour of the practitioner's arguments and I concluded that the relevant application had been made within the prescribed 14 day period in circumstances where it had been lodged in the Circuit Court office within that period.

The submissions in relation to costs

On 25 February, 2019 I heard further submissions from counsel for both parties in relation to costs. Counsel for Mars urged that, in circumstances where the issue raised by Mars affected a large number of other cases, this was, in effect, a test case such that it would be appropriate to make no order as to costs. He also stressed that, in the Circuit Court, Mars had not sought costs notwithstanding that it had been successful on the issue in that court.


Counsel for the practitioner complained that the issue raised by Mars was simply yet another ‘ technical issue’ in a long line of such issues which had been raised by Mars in an attempt to defeat a meritorious case. He also argued, by reference to the decision of Clarke J (as he then was) in Cork County Council v Shackleton [2011] 1 IR 443, that, even if it could be said that this was a test case, it was one between private parties such that the ordinary principle that costs follow the event should apply. He relied on the following passage (with emphasis added) from the judgment of Clarke J at p 489:

‘Test cases can arise in very many different circumstances. Where there is doubt about the proper interpretation of the common law, the Constitution or statute law … and where the circumstances giving rise to those doubts apply in very many cases, then it is almost inevitable … that one or a small number of cases which happen to be first tried will clarify the legal issues arising. Where the proceedings involve entirely private parties then there does not seem to me to be any proper basis for departing from the ordinary rule in relation to costs, notwithstanding the fact that the case may properly be described as a test case. There is no good reason for depriving a successful private party of its ordinary entitlement to costs simply because the case …happens to be a test case’.


In response, counsel for Mars sought to rely on a further passage from the same judgment where Clarke J suggested that a different approach might be taken where one of the parties is a public authority which was responsible for the way in which a legislative provision giving rise to the test case was drafted. Clarke J also suggested that a similar approach might be taken where one of the parties was a body which was funded by the public authority concerned. Counsel for Mars suggested that there was an obvious parallel here given that the practitioner's legal costs have been met by the Legal Aid Board which is a body funded by the Minister for Justice who was also the Minister responsible for the enactment of the 2012-2015 Acts.


Counsel for the practitioner argued that the reliance by Mars...

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3 cases
  • Ford (orse Egan) v Personal Insolvency Acts 2012-2015
    • Ireland
    • High Court
    • 2 March 2020
    ...liable for the costs of the appeal. 7 Finally, counsel for the practitioner also relied on my judgment in Re. Finnegan (a debtor) (No.2) [2019] IEHC 137 in which I rejected an argument made by the unsuccessful applicant in that case that there was no basis, on public interest grounds, to de......
  • Tanager Designated Activity Company v Ryan
    • Ireland
    • High Court
    • 25 October 2019
    ...of “test case”, counsel very helpfully referred me to the judgment of the High Court (McDonald J.) in Re Finnegan (A Debtor) (No. 2) [2019] IEHC 137. DISCUSSION 7 The four arguments advanced on behalf of Tanager are addressed in sequence under separate headings below. (1). Test case 8 The o......
  • Langan v Personal Insolvency Acts 2012–2015
    • Ireland
    • High Court
    • 13 July 2023
    ...the objection that the charge in favour of Mr Casey was a preference under s.120(h) was, in the words of McDonald J in Re Finnegan [2019] IEHC 137 at para. 14 “…designed to deal a knockout blow to the application under s.115A…”. While, as McDonald J recognised in that case, it is sometimes ......

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