Smith v Cavan and Monaghan County Councils

• Jurisdiction: Ireland
• Judgment Date: 23 June 1949
• Date: 23 June 1949
• Court: Supreme Court

Smith v. Cavan and Monaghan Co. Councils.

PETER SMITH

Applicant

and

THE COUNTY COUNCILS OF THE COUNTIES OF CAVANand MONAGHAN, Respondents (1)

Supreme Court.

Criminal injury - Claim for compensation - Malicious burning and destruction of flax mill and machinery - Consequential loss - Loss of profits - Grand Jury (Ireland) Act, 1836 (6 & 7 Wm. 4, c. 116), s. 135 - Local Government (Ireland) Act, 1898 (61 & 62 Vict., c. 37), s. 5 - Malicious Damage Act,1861 (24 & 25 Vict., c. 97), s. 51.

The applicant instituted proceedings in the Circuit Court against both respondents, under the Local Government (Ireland) Act, 1898, to recover compensation for damage resulting from tho malicious burning and destruction of his flax mill and machinery. The Circuit Court Judge gave judgment in favour of the applicant against both respondents for a sum of £1,150, compensation, of which tho sum of £850 represented the cost of restoration and replacement of the mill and machinery and the remaining £300 represented compensation for loss of profits suffered as a result of the destruction of tho mill and machinery. The respondents appealed to the High Court on Circuit, Davitt J., who stated a case for the determination of the Supreme Court.

Held by the Supreme Court (Maguire C.J., Murnaghan, Geoghegan, and O'Byrne JJ.; Black J. dissenting), that the applicant was not entitled to recover compensation for consequential loss of profits due to the malicious act.

Noblett v. Leitrim, Co. Council [1920] 2 I. R. 143. not followed.

Case Stated.

Case Stated by Davitt J., sitting as a Judge of the High Court on Circuit at Monaghan on the 22nd March, 1947, for the hearing of appeals from the Circuit Court, pursuant to s. 38, sub-s. 3, of the Courts of Justice Act, 1936.

The applicant, Peter Smith, claimed compensation under the Grand Jury (Ireland) Act, 1836, ss. 135 and 140, and the Local Government (Ireland) Act, 1898, s. 5, for the malicious burning and destruction of his flax mill and machinery and a quantity of flax on the 10th February, 1946. In addition to the cost of restoration and replacement of the mill and machinery the applicant claimed compensation for the loss of profits sustained by him through being deprived of the use of his mill and machinery in consequence of the malicious acts complained of, and on the 22nd November, 1948, he was awarded by the Circuit Court Judge £850 in respect of the cost of the said restoration and replacement, and £300 in respect of consequential loss of profits. The order of the Circuit Court Judge directed that the total amount awarded, viz., £1,150, should he raised, as to one-half each, off the relevant electoral divisions within the area of jurisdiction of the two respondent County Councils. From the said award each of the respondent County Councils appealed

against that part of the order of the Circuit Court Judge which granted the applicant the sum of £300 by way of consequential damages. Upon the hearing of the appeal Davitt J., after amending a clerical error in the said order, adjourned the further hearing of the appeal to Dublin when, at the request of counsel for each of the respondents, he stated a Case for the determination of the Supreme Court.

The Case Stated was as follows:—

"1. This matter came before me on appeal by the County Council of the County of Monaghan and the County Council of the County of Cavan against an order of the Circuit Court Judge for the County of Monaghan, dated the 22nd November, 1946, awarding the applicant the sum of £1,150, compensation under the malicious injury code.

2. On the hearing of the appeal at Monaghan on the 22nd March, 1947, I amended a clerical error in the decree as to the amount of compensation from £1,100 to £1,150 and, as the parties agreed that the only point involved in the appeal was one of law, I adjourned the appeal to Dublin for further hearing.

3. On the hearing of the appeal in Dublin and at the request of Mr. McGonigal, Senior Counsel, for the Monaghan County Council and of Mr. W. D. Finlay for the Cavan County Council, I agreed to state this Case pursuant to s. 38, sub-s. 3, of the Courts of Justice Act, 1936 (No. 48 of 1936), and I have postponed judgment pending the determination of the Supreme Court on this Case Stated.

4. Mr. McGonigal, Senior Counsel, for the appellants, the Monaghan County Council, and Mr. W. D. Finlay, for the appellants, the Cavan County Council, agreed that their respective clients would bear the applicant's costs of this Case Stated in equal shares in any event, such costs to be taxed as between party and party.

5. I incorporate in this Case Stated the Circuit Court Judge's decree of the 22nd November, 1946, the two notices, dated the 14th February, 1946, and the 18th February, 1946, upon which the claim was brought, the two notices of appeal, dated, respectively, the 27th November, 1946, and the 28th November, 1946, the notice, dated the 22nd February, 1947, by the Monaghan County Council and the notice, dated the 24th February, 1947, by the Cavan County Council.

6. The proceedings were brought by the applicant under the Local Government (Ireland) Act, 1898, to recover compensation for the malicious burning and destruction of a flax mill and machinery, his property, at Raferagh, in the Parish of Magheross, in the County of Monaghan, on the morning of the 10th February, 1946.

7. The Circuit Court Judge gave a decree for £1,150, compensation, against both County Councils. At the adjourned hearing in Dublin it was agreed by all parties that of the said sum of £1,150, awarded to the applicant, the sum of £850 represented compensation for the actual damage to the said property (that is to say, the cost of restoration and replacement of the said mill and machinery) and that the remaining £300 represented compensation for loss of profits suffered by the applicant by reason of his inability to carry on his business in the said premises owing to their destruction by fire as aforesaid.

8. The only question argued before me on which I was asked to state a Case was whether or not as a matter of law the applicant was entitled to recover any compensation under s. 135 of the Grand Jury (Ireland) Act, 1836, or under any other section comprised in the malicious injuries code, in respect of the said consequential loss of profits sustained by him.

9. As the matter is one of some importance to local authorities I acceded to the request of counsel for both the County Councils to state this Case, on the terms above stated as to costs.

10. The question for the opinion of the Supreme Court is as follows:—Is the applicant entitled to recover compensation for the said consequential loss of profits sustained by him by reason of the malicious burning and destruction of his said property?"

The Case Stated was dated the 2nd February, 1948, and was signed by Davitt J.

Cur. adv. vult.

Maguire C.J.:—

I have read the judgment which Mr. Justice Murnaghan is about to deliver and I agree with it.

Murnaghan J.:—

The Case Stated submitted to the Court by Davitt J. raises for final decision a point upon which there has been in the past a great diversity of legal opinion. The appellant, Peter Smith, sought in the Circuit Court compensation under the malicious injury code for the burning of a flax mill and machinery, his property, situate at Raferagh, in the Parish of Magheross and County of Monaghan, on the morning of the 10th February, 1947. The Circuit Court Judge was satisfied that he was entitled to compensation to the amount of £850 for the actual damage to the property, that is to say, the cost of restoration and replacement of the said mill and machinery, but the applicant also proved that, if compensation can be awarded for loss of profits suffered by him by reason of his inability to carry on his business, he is entitled to a further sum of £300. If the plaintiff had sought to recover damages by action against the actual wrongdoer the Court, in measuring the damages, would include this consequential loss, and the question to be determined is whether under the relevant statutory provisions dealing with compensation for criminal injuries this sum should be included.

Sect. 135 of the Grand Jury (Ireland) Act, 1836, empowered the Grand Jury of the County to make a presentment for payment of compensation to a person whose property covered by the section had been maliciously destroyed. The material words were:—" . . . in all cases of maliciously or wantonly setting fire to, burning, or destroying any . . . building, . . . any person or persons injured by any such offence, and intending to apply for compensation for any loss or damage sustained thereby, shall serve notice in writing . . . and shall lodge . . . an application setting forth the loss or damage occasioned by such offence . . . and the said Grand Jury shall . . . examine into the matter of such application upon the oath of the party injured, or such other evidence as can be produced touching the said offence; and the said Grand Jury shall on the consideration of the said matter either disallow such application altogether, or present such sum or sums of money as the person or persons so injured ought to receive for such injury or damage, to be levied off the county at large, or . . . as the Grand Jury shall direct."

Sect. 5 of the Local Government (Ireland) Act, 1898, enacted:—"(1) There shall be transferred to the County Court the business of any presentment sessions and Grand Jury in relation to compensation for criminal injuries, that is to say, compensation under the enactments mentioned in Part One of the First Schedule to this Act . . ." Part 1 of the First Schedule includes the Grand Jury (Ireland) Act, 1836, ss. 135 to 140, so far as unrepealed. Sub-sect. 2 of s. 5 reads:—"Upon an application for such compensation, the County Court may either refuse the application, or make a decree against the County Council . . ."

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