Shields v The Central Bank of Ireland

• Jurisdiction: Ireland
• Judge: Ms. Justice Donnelly
• Judgment Date: 04 November 2022
• Neutral Citation: [2022] IECA 250
• Court: Court of Appeal (Ireland)
• Docket Number: Appeal No.: 2021/222

Lawrence Shields

Appellant

and

The Central Bank of Ireland

Respondent

and

An Garda Síochána, Ireland and The Attorney General

Notice Parties/Respondents

[2022] IECA 250

Donnelly J

Noonan J

Ní Raifeartaigh J

Appeal No.: 2021/222

THE COURT OF APPEAL

JUDGMENT of Ms. Justice Donnelly delivered on this 4 ^th day of November 2022

1 . This is an appeal against a refusal to grant leave to apply for judicial review. After a contested leave hearing, the High Court (Barr J, [2021] IEHC 444) refused to grant leave on the basis that the applicant, Lawrence Shields (hereinafter “the appellant”), had no locus standi and the application was premature. He also refused leave to join the appellant's instructing solicitors, James T Flynn & Co. Solicitors, as a second applicant in the proceedings. The High Court had ordered that the leave application be heard on notice to the respondent (“the Central Bank”) and to the Commissioner of An Garda Síochána and Ireland (“the notice parties”). The appellant was ordered to pay the costs of the respondent and the notice parties.

2 . The appellant has appealed against those findings and the order for costs. In his notice of appeal, he raised a fresh issue. He claimed that the High Court had no jurisdiction to make any determination in respect of a matter of European Union law concerning a decision of the Central Bank under the Decision of the European Central Bank on the denominations, specifications, reproduction, exchange and withdrawal of Euro bank notes of 19 April 2013 ECB/2013/10 (“the ECB Decision”). The appellant's point in raising that issue at this late stage is to claim that the Central Bank ought to have told him that the High Court had no jurisdiction to hear the matter and that the correct order for this Court on appeal is to vacate the Order of the High Court and to award costs to the appellant.

The Background

3 . The challenge by way of judicial review centres on a decision of the Central Bank taken on 15 ^th May 2020 pursuant to Article 3(3)(b) of the ECB Decision. Specifically, the first relief sought in the statement grounding the application for judicial review was an Order of Certiorari of the decision “by which the [Central Bank] refuses to exchange and/or withhold banknotes pertaining to the applicant in the amount of €4,400 provided for exchange on or around the 17 ^th April 2019”. The ECB Decision permits the Central Bank, as a National Central Bank, to exchange damaged Euro notes for undamaged notes of the same value provided certain conditions are met.

4 . In the decision of the 15 ^th May 2020, the Central Bank outlined in brief the history of the application. The decision then stated:

“The Central Bank has been informed by An Garda Síochána that they have commenced an investigation into the source of funds the subject of the firm's application. Accordingly, pursuant to Article 3(3)(b) of the ECB Decision, the Central Bank is not exchanging and is withholding the damaged banknotes. Unless otherwise decided by the competent authorities, the damaged banknotes shall at the end of the investigation qualify for exchange under the conditions laid down in Articles 3(1) and (2) of the ECB Decision.”

5 . The first point of note about the decision of the 15 ^th May 2020 is that it was taken after the Bank was informed by An Garda Síochána of an investigation into the source of the funds. In those circumstances, the Central Bank relied upon the Article 3(3)(b) of the ECB decision which is set out in para 25 of this judgment.

6 . The second point of note is that the decision is addressed for the attention of Mr. James Flynn, Principal, JT Flynn & Co. Solicitors. The decision referred to the application to the Central Bank by JT Flynn & Co. Solicitors for the exchange of damaged banknotes. The decision goes on to record the history of the submission of these banknotes to the Central Bank, originally having been made in the name of a Ms. Sandra Daly, and the subsequent application for exchange in January 2020 from JT Flynn & Co., effectively taking over the application. The decision then referred to the completed application form with the necessary declaration signed.

7 . The appellant does not take deny that the application made to the Central Bank was made by JT Flynn & Co., who were then, and continue to be, the solicitors acting on his behalf. In fact, the appellant expressly states in his affidavit grounding the application for judicial review: “I am seeking primarily to quash the decision of the Central Bank of Ireland to withhold and refuse to exchange banknotes in the amount of €4,000 which had been provided by me as payment for professional fee to my solicitors”. The appellant's solicitor, Mr. James Flynn, also swore an affidavit relating to the application. Mr. Flynn stated that his firm, JT Flynn & Co., had been furnished with these banknotes as a fee payment by the appellant who is “a long-standing client of the firm”.

8 . The relevant history of events is that, on a previous occasion, this appellant personally submitted an earlier batch of damaged banknotes (face value €4,950) to the Central Bank for exchange. These earlier banknotes became the subject matter of separate judicial review proceedings. This history is referred to briefly in the judgment of Barr J., the subject matter of this appeal, and is set out in further detail in the High Court and Court of Appeal decisions in Shields v Central Bank [2020] IEHC 518 and [2022] IECA 241 It is only necessary to give a brief synopsis of the background to those proceedings.

9 . In that earlier application to the Central Bank there had been a somewhat protracted exchange between the parties concerning how the notes were damaged. The claim had been made that the notes were damaged when an envelope containing €10,000 had been placed in a furnace by the appellant's partner but retrieved before incineration. The Central Bank initially formed a view that the notes were intentionally damaged. Further exchanges followed, and the appellant gave an explanation as to how certain chemicals might have been on the banknotes. The Central Bank indicated that they would seek further forensic testing. An application was moved ex parte for leave to seek judicial review challenging the withholding of the bank notes. Subsequently, the Central Bank wrote to the appellant informing him that in light of the further report they would in fact exchange the bank notes that he had submitted. The Central Bank defended those proceedings on the basis, inter alia, that they were moot.

10 . In the present case, the appellant says that these banknotes were damaged in the same incident as the earlier batch. In the High Court and to a large extent in this appeal, the appellant claims that, despite not making the application for exchange, he has an interest in seeking to challenge this decision because he will be “on the hook” for fees if the damaged notes are not exchanged. It cannot be gainsaid however that neither the appellant nor his solicitor ever put that claim on affidavit. On the contrary, their affidavit evidence is that the money was paid over as payment of the professional fee involved.

11 . In the oral hearing of this appeal, the appellant sought to expand the nature of his interest in the matter, in particular by reference to him being the source of the money, and that his claim for relief was a challenge to the decision to refer the matter to An Garda Siochána. He also referred to the claims he had made in respect of the orders of mandamus sought in his statement grounding the application for judicial review. It is appropriate to examine the claims he has made.

The Reliefs sought in the High Court

12 . In his statement of grounds, the appellant initially sought six substantive reliefs, which later increased to eight substantive reliefs in his amended statement of grounds. The first relief claimed was an order of certiorari of the Central Bank's decision, the wording of which has been set out above at para 4. It is important to note that in his grounding affidavit, the appellant asserts that his primary claim was in respect of the decision to withhold and refuse to exchange banknotes in the amount of €4,000 and then says that he “also sought orders of mandamus to compel the Central Bank to furnish him with materials upon which it made this decision, and certain declarations in relation to my due process rights.”

13 . In addition to the application for certiorari, the appellant included in his amended statement of grounds a claim for an order of mandamus to compel the Central Bank to make a final decision under Article 3 of the ECB decision in respect of the banknotes provided for exchange.

14 . He sought two further orders of mandamus seeking to compel the Central Bank to provide him with details of any laboratory to which the banknotes were sent for testing or to provide him with a copy of the initial report (if any) on which it based its assessment that the banknotes, or banknotes from the same source, were “ intentionally damaged and/or chemically altered.” ( Emphasis added). The underlined part appears to relate back to the earlier application for exchange of damaged banknotes (which were in fact exchanged) that are the subject matter of the aforementioned appeal to this Court in which judgment is awaited.

15 . The appellant claimed damages for breach of his rights under the Constitution and under the Charter of Fundamental Rights of the EU (“the Charter”) and under the provisions or protocols of the European Convention on Human Rights (“the ECHR”). In his amended statement of grounds, he sought a Declaration that the immunity from damages afforded to the Central Bank by s.33AJ(2) of the Central Bank Act 1942 was unconstitutional, in breach of the Charter and contrary to provisions or protocols of the ECHR, having regard to s.3 of the ...