Statutory Duty
Cases
Atlantic Marine Supplies Ltd v Minister for Transport
[2010] IEHC 104JUDGMENT of Mr. Justice Clarke delivered on the 26th March, 2010
1. Introduction
1.1 The second named plaintiff (“Mr. Rogers”) is the principal behind the first named plaintiff company (“Atlantic”). Mr. Rogers and Atlantic have been in the business of providing safety equipment for fishing boats for some considerable period of time. It is fully accepted by all involved in these proceedings that Mr. Rogers and Atlantic carry out their duties in that regard to the highest standards.
1.2 At the core of the complaint made by Atlantic in these proceedings is a contention that the first named defendant (“the Minister”) has failed to enforce legally binding measures in respect of the equipment which fishing boats are required to carry for safety purposes (specifically life rafts). As a consequence it is said that a great number of fishing boats have life rafts which are not appropriate. As a consequence, in turn, it is argued that significant financial loss has been caused to Atlantic by reason of the alleged lack of enforcement to which I have referred.
1.3 It should also be noted that Atlantic is, by virtue of the services which it provides, itself the subject of a requirement to be certified to provide such services. It should immediately be noted that there has never been any suggestion that Atlantic has failed to carry out its role in full compliance with its obligations. It is, however, said that Atlantic is constrained, by virtue of the consequences of that certification, to provide and service particular types of equipment only. In circumstances where it is said that the alleged lack of enforcement, to which I have referred, permits many fishing boats to operate with a lower standard of equipment, Atlantic claims that it is deprived of the opportunity to seek to exploit the market in the supply and service of the higher standard equipment which, on Atlantic’s case, many fishing boats should carry.
1.4 In any event, it is also important, at this early stage, to note that there are a series of separate legal bases on which Atlantic claims to be entitled to damages arising out of the alleged failure of regulation on the part of the Minister. Each of the relevant headings brings with it its own difficult legal questions. However, for present purposes, I should simply note that the four bases on which Atlantic claims to be entitled to damages are as follows:-
A. Breach of duty;
B. Breach of statutory duty;
C. Breach of constitutional rights; and
D. Legitimate expectation.
1.5 As there was no significant dispute as to primary facts, only a limited dispute as to inferences that might properly be drawn from those facts with, perhaps, a more significant dispute as to the proper characterisation of the situation which might be said to flow from that undisputed evidence, it is perhaps most convenient to start by setting out those facts which are not in dispute and the allegations that underlie Atlantic’s case.
2. The Undisputed Facts and the Allegations
2.1 Mr. Rogers started fishing out of Killybegs in County Donegal in 1971. In 1982 he decided to start his own business in relation to life saving equipment. It would appear that, at the relevant time, there was no service station on the West Coast dealing with the sale and service of marine life saving equipment. In that context, Mr. Rogers spoke to the then Chief Surveyor of the Minister together with a number of manufacturers of life rafts.
2.2 It is clear from the evidence that the suppliers of relevant equipment maintain a rigorous certification process whereby those operating service stations in this field are required, in order to obtain an initial certification, to attend for significant training, and, as the price of maintaining certification, have further regular training requirements imposed on them, and are subjected to regular inspections. The evidence makes clear that Mr. Rogers and Atlantic have, at all material times, been in good standing with the suppliers for whom they hold certification.
2.3 In order to establish the relevant service station, Atlantic initially obtained a site from the then Department of the Marine and built an appropriate structure designed to allow for the servicing of the type of life rafts then in use.
2.4 Subsequently, larger life rafts (as required for larger vessels) came on stream which required an expanded premises capable of servicing those larger life rafts. On that basis, Atlantic bought different lands on which a larger service station was built.
2.5 In the early days it would appear that the relevant form of certification from the relevant department (the department has gone through a variety of names over the years) was in the form of a letter from the Chief Surveyor. However, from in or around 1990, it would appear that a formal certificate was issued. Atlantic has, at all relevant times, held the appropriate certification.
2.6 It, therefore, follows that Atlantic has at all times satisfied both the suppliers of its equipment and the relevant department that it is up to standard for the provision of the important services with which it is charged.
2.7 It will be necessary in due course to refer in some more detail to the relevant regulatory regimes applicable to the use by fishing boats of life rafts. However, for the purposes of this narrative it should be noted that there is a clear and unambiguous statutory obligation on all fishing vessels in excess of 12 metres to carry a specified type of life raft and other safety equipment (in fact the regime differs somewhat depending on whether the boat concerned is over or under 15 metres but nothing turns on that fact for the purposes of this case). The position in respect of fishing vessels of less than 12 metres is less clear. The statutory regime applying to larger vessels, to which I have referred, does not apply to vessels under 12 metres. However, such vessels (along with all vessels which are involved in fishing) require a licence. For reasons which it will be necessary to explore in more detail, there is a statutory pre-condition to the award of such a sea-fishing boat licence which is to the effect that the vessel is appropriately certified as complying with a Code of Practice published by the Minister. The interpretation of that Code of Practice is itself a matter of some debate to which it will be necessary to turn in due course. However, on the case made by Atlantic and Mr. Rogers, it is suggested that the true construction of the Code of Practice requires that any fishing vessel (including those under 12 metres) which carries a life raft is required to ensure that the relevant life raft conforms with certain international specifications.
2.8 It is the assertion by Atlantic to the effect that there is widespread non-observance of that requirement which is at the heart of these proceedings. It will be necessary to refer in more detail to SOLAS standards for life rafts which is the recognised maritime international safety standard. On Atlantic’s case all fishing vessels are required, if they carry a life raft at all, to carry a SOLAS standard life raft or a life raft which meets analogous standards. It is clear that Atlantic became concerned about what it felt was a failure on the part of the Minister to enforce what Atlantic believed to be the appropriate statutory regime. Atlantic came to the view that many fishing boats were carrying life rafts which did not meet the relevant standard. There was significant correspondence and meetings between Atlantic and representatives of the relevant department (including meetings with senior officials and the then Minister for Marine and Natural Resources, Frank Fahey), in the early years of the 2000s.
2.9 Atlantic maintains that there are a very significant number indeed of fishing vessels which carry life rafts which do not meet the necessary standard. It is said that, in all or, at a minimum, a significant number of such cases, the failure to carry an approved life raft is in breach of the code of conduct to which I have referred. It is further said that this situation is, at least in significant part, due to a lack of adequate enforcement on the part of the Minister.
2.10 It is also alleged that one of the consequences of that state of affairs is that the number of relevant higher standard life rafts in the market place is significantly reduced with a consequent and significant loss of profit to Atlantic by reason of not having the opportunity to make the relevant sales and, it would appear, more significantly, not having the opportunity to earn further revenues by servicing the life rafts in question on a regular basis (it being typically a term of compliance with relevant standards that life rafts are regularly serviced in accordance with appropriate recommendations). It should be noted that any question of the quantification of damages to which Atlantic might be entitled has, by agreement between the parties and the court, been left over for further consideration so that this judgment is concerned solely with the question of the entitlement, if any, at the level of principle, of Atlantic to damages.
2.11 In the course of evidence it was established that, during a number of spot checks carried out by Joseph O’Sullivan (an engineer called to give evidence on behalf of Atlantic), a significant majority of fishing vessels of less than 12 metres which were found in the ports visited by the engineer concerned on a random basis, had life rafts which did not appear to be of the standard which Atlantic asserts are required by the Code of Practice. The expert evidence tendered on behalf of Atlantic established that a significant difference exists between life rafts primarily designed for use on sporting yachts on the one hand and life rafts designed for fishing vessels and other commercial boats on the other hand. Amongst the distinctions which can properly be drawn between the two is the fact that servicing of such life rafts is required on a more regular basis in the context of fishing and commercial ships. The reason for this appears to stem from the fact that fishing and commercial boats are in almost continuous use, while pleasure or yachting vessels are less regularly at sea. Mr. O’Sullivan’s evidence established that a very high number indeed of smaller Irish fishing vessels appear to carry life rafts designed for the yachting sector. The inferences to be drawn from that evidence and, perhaps more importantly, the way in which any such inferences should be characterised, was the subject of some dispute between the parties. However, the primary evidence given on behalf of Atlantic was not disputed. I should in passing note that while there was very limited evidence from which it might, on one view, be suggested that there were breaches of the undoubted formal statutory regime which exists in respect of vessels of 12 metres or more, it did not seem to me that any such evidence could give rise to an inference of lack of enforcement in respect of such boats.
2.12 In the context of the fact that there is a difference in the regulatory regime in respect of fishing vessels dependent on the size of those vessels, it is relevant to note that it was established that the number of vessels in relevant categories currently on the register of licensed fishing vessels is as follows:-
Vessels of less than 12 metres 1,777 84.821%
Vessels of less than 15 metres 1,854 88.496%
Vessels between 15 and 24 metres 132 6.301%
Vessels of 24 metres and above 109 5.203%
It will be seen that by far the preponderance of vessels in the Irish fishing fleet are those of less than 12 metres. It follows that, as a matter of fact, it is the regulatory regime in respect of such vessels which has the greatest potential, in practice, to influence the commercial business of safety equipment suppliers and servicers such as Atlantic.
2.13 Against that brief factual background it is appropriate to turn next to the regulatory regime.
3. The Regulatory Regime
3.1 As indicated earlier there was, in the end, no real dispute between counsel as to the applicable statutory regime in respect of fishing vessels of greater than 12 metres length. It was accepted that the regime technically differed as and between vessels of, on the one hand, more than 15 metres in length and, on the other hand, vessels between 12 and 15 metres in length. However, the net and combined effect of various measures including the Merchant Shipping (Life Saving Appliances) Rules 1967 and the Merchant Shipping (Life Saving Appliances) Rules 1993, is accepted as being that such that all such vessels are required to carry a SOLAS standard life raft including a so called SOLAS “B” pack. SOLAS stands for the International Convention for the Safety of Life at Sea. That Convention was adopted on the 1st November, 1974, by the International Conference of Safety of Life at Sea which was convened by the International Maritime Organisation. SOLAS entered into force on the 25th May, 1980, but has been amended subsequently by means of protocols. It would appear that many of the measures adopted in this jurisdiction are designed to ensure that Ireland complies with its obligations under that Convention, to which Ireland is a party. Of particular relevance to the issues which I have to decide is that SOLAS contains, amongst many other things, provisions in respect of life rafts. SOLAS life rafts are an approved type of life raft for six persons or more which comply with the relevant requirements. The life raft comes packed in a glass reinforced plastic container and should contain an emergency pack which is either an “A” pack or, in respect of smaller vessels, a “B” pack. A “B” pack is essentially a scaled down version of an “A” pack. In either case, SOLAS provides for a significant list of items which are required to be in the pack concerned providing for such matters as a hand pump, paddles, a sea anchor, a first-aid kit, various devices designed to attract attention and thermal protective aids.
3.2 It should also be noted that the certification of Atlantic as a relevant service provider is in accordance with the provisions of SOLAS. There was no dispute between the parties but that the proper interpretation of the use of SOLAS related terms such as, for example, a SOLAS “B” pack, in Irish regulations and in Marine Notices incorporated into the Code of Practice to which I will refer in due course, should be interpreted by reference to SOLAS itself. It was not suggested (nor could it have been) that SOLAS is directly applicable in this jurisdiction. The way in which Ireland has chosen to give effect to its obligations under SOLAS is by means of the various regulatory measures in the maritime field, some of which are referred to in the course of this judgment. It follows, of course, that an Irish Court in construing those Irish measures should attempt to do so in a manner that ensures that Ireland complies with its obligations under SOLAS. Thus, it is appropriate to refer to SOLAS for the purposes of determining the meaning of SOLAS related terminology. No greater application of SOLAS as a matter of domestic law was urged on behalf of Atlantic. I did not understand counsel for the Minister to contest but that SOLAS references in the relevant Irish regulatory documentation must be taken to mean references to relevant items in the way in which those items are defined or explained in SOLAS.
3.3 However, the real issue of contention between the parties, so far as the statutory regime is concerned, centres on the Code of Practice promulgated by the Minister. The Code of Practice was introduced by the Minister in 2004. I will refer, in due course, to certain material terms of the Code. However, it is important to note that, when first introduced, the Code had no statutory basis. It is clear that, in parts, the Code specifies requirements which arise under specific statutory regimes and, thus, draws attention to what are undoubtedly statutory obligations arising from relevant statutory instruments. In 2006, s. 97 of the Sea Fisheries and Maritime Jurisdiction Act 2006, inserted a new s. 4 into the Fisheries (Amendment) Act 2003 (“the 2003 Act”). Section 4(2) of the 2003 Act specifies that a sea-fishing boat is not to be used for sea-fishing, nor are persons on board such boats to fish for sea fish, except in accordance with a sea-fishing boat licence. A breach of that requirement constitutes an offence.
3.4 Subsections (a) and (b) of s. 4(9) of the 2003 Act apply to larger boats. It is s. 4(9)(c) which applies to smaller boats and is in the following terms:-
“Where a code of practice published by the Minister for Transport relating to the safety and sea-worthiness of sea-fishing boats of a class to which paragraph (b) does not apply requires a survey to be carried out of a sea-fishing boat of such class for the purpose of establishing whether or not such boat complies with the requirements specified in the code of practice, the licensing authority shall not grant or renew a sea-fishing boat licence in respect of the boat unless a declaration of compliance with the code of practice has been provided to the licensing authority.”
3.5 It is clear, therefore, that there is a statutory pre-condition to the grant of a sea-fishing boat licence to the effect that a declaration of compliance with the Code of Practice must be supplied.
3.6 As pointed out earlier, the Code of Practice itself was, in fact, in existence since 2004. However, the Code received a statutory status, in the form of s. 4(9)(c) of the 2003 Act in 2006. From that time on there was a statutory prohibition on the giving of a sea-fishing boat licence, save where a Certificate of Compliance with the Code was made available.
3.7 There was a significant debate between the parties as to how it was appropriate to characterise s. 4(9)(c) of the 2003 Act. It seems to me clear that the section does not impose, as such, an obligation on anyone to comply with the Code of Conduct. It should, of course, be noted, as pointed out, that the Code of Conduct itself often draws attention to the fact that certain legal requirements lie on the owners and operators of sea-fishing boats under a variety of legislative provisions. Obviously those legislative provisions have direct statutory effect on and bind parties governed by them. However, to the extent that the Code of Conduct goes further and specifies either mandatory requirements or recommendations, which are not of themselves obligations contained within enforceable statutory instruments, then the Code does not, of itself, give rise to any statutory obligation. A person who is in breach of the Code does not commit an offence. Neither is such a person guilty of a civil wrong, save to the extent that the relevant obligation recorded in the Code is otherwise of statutory effect from a source outside of the Code.
3.8 On the other hand, it seems equally clear to me that the Code has, from 2006, a statutory status. There is a clear requirement that an applicant for a sea-fishing boat licence is required to produce a Certificate of Compliance with the Code. That requirement is a direct statutory requirement. It would be unlawful for the licensing authority to grant a sea-fishing boat licence in circumstances where a Certificate of Compliance with the Code was not available for s. 4(9)(c) of the 2003 Act expressly prohibits the grant of a licence in such circumstances. The Certificate of Compliance is a Certificate of Compliance with the Code for the time being. It follows that the Code has a quasi statutory status in that it is a document by reference to which statutory rights and obligations arise.
3.9 The entitlement of an applicant to obtain a sea-fishing boat licence for which the relevant applicant might otherwise qualify, may be lost because the relevant fishing boat does not comply with the Code of Practice and thus, cannot be the subject of a valid Certificate of Compliance. It follows that compliance or otherwise with the Code of Practice can legitimately lead to the grant or refusal of a licence and, thus, the entitlement of the person concerned to engage in sea-fishing.
3.10 It seems to me that codes of practice, in general terms, can have a range of standing so far as statute is concerned. At one extreme is a code of practice which is issued merely for the purposes of guidance to persons in a particular industry or sector. As such it may provide a useful benchmark by which to consider appropriate standards but would have no added legal status. Even in an action for negligence, such a code of practice would have no formal status although reference could, undoubtedly, be made to such a code as supporting a contention that a particular practice (or the lack of it) was in accordance with appropriate standards of care.
3.11 At the other extreme might lie a code of practice which was expressly authorised by statute, where failure to comply with the provisions of the code concerned amounted to an offence or was otherwise rendered unlawful. In such circumstances breach of the code, per se, would be unlawful.
3.12 It seems to me that the Code of Practice in this case lies somewhere between those two extremes. It is not enforceable per se. It goes, however, beyond mere guidance for it has an indirect statutory effect such as can preclude persons from obtaining a sea-fishing boat licence if they fail to comply with its terms. It will be necessary to turn to how such status should properly be characterised in due course.
3.13 However, before going on to consider the legal issues which arise concerning the potential liability of the Minister and the other defendants in these proceedings, it is next appropriate to turn to the provisions of the Code insofar as they are relevant to the case made by Atlantic.
4. The Code of Practice
4.1 Any review of the Code of Practice must note that the Code, in its terms, distinguishes between provisions which contain mandatory language such as “shall”, on the one hand, and language which connotes a recommendation by the use of words such as “may”, on the other hand. The Code is, therefore, clear and states in terms that some of its provisions are mandatory while some of its provisions amount to recommendations alone. So far as mandatory recommendations are concerned, some of same involve a repetition of matters which are independently governed by express statutory provisions and, thus, would be mandatory even if they were not referred to in the Code. Others may well amount to matters which, so far as the Code itself is concerned, are mandatory even though they may not be directly enforceable as being in breach of an express statutory provision. These latter matters are mandatory in the sense that they must be complied with in order for a boat to be properly said to comply with the Code of Practice and thus be validly the subject of a Certificate of Compliance and thus, in turn, suitable for the grant of sea-fishing boat licence.
4.2 The relevant provisions of the Code of Practice concerning inflatable life rafts are to be found in s. 7.4 which provides as follows:-
“7.4 Inflatable Life rafts
Where carried, inflatable life rafts must be of a capacity to accommodate all persons on board. The life raft must be stowed in a GRP container and be fitted in a position to enable it to float free if the vessel sinks, and be fitted with an approved HRU. If this is not practicable, for example, in an open vessel, it is recommended that the life raft should be stowed in an accessible place; it may be contained within a valise. While it may not be capable of floating free it must be readily accessible to throw overboard. If it goes down with the vessel it will not operate. Life rafts must be equipped with “SOLAS ‘B’ Pack”.
7.4.1 The requirements for the carriage of life rafts are as follows:-
i) All vessels with 4 or more persons on board must carry one or more life rafts, regardless of their area of operation.
ii) All vessels operating beyond 5 miles from a safe haven must carry a life raft.
iii) All vessels operating less than 5 miles from a safe haven with fewer than 4 persons on board are recommended to carry a life raft.
7.4.2 Vessels of Loa greater than 12 metres and vessels carrying more than 4 persons must carry an approved MED/SOLAS life raft.
Vessels of Loa 12 metres or less or carrying 4 persons or less may carry non-SOLAS/non-MED life rafts. Guidance on the carriage of non-SOLAS type inflatable life rafts is given in Marine Notice No. 2 of 2003.”
4.3 A number of comments need to made about the text which I have cited. First, it seems clear that s. 7.4 does not require any life raft to be carried in at least some circumstances. The section commences with the words “where carried”. The text also makes clear in s. 7.4.1(iii) that vessels operating less than five miles from a safe haven with fewer than four persons on board are recommended to carry a life raft.
4.4 Furthermore, it is clear from s. 7.4.2 that vessels of greater than 12 metres must carry an approved MED/SOLAS life raft while vessels of 12 metres of less or carrying four persons or less may carry non-SOLAS/non-MED life rafts but that guidance on the carriage of such non-SOLAS type life rafts is to be found in what is described as Maritime Notice No. 2 of 2003.
4.5 It would appear that Maritime Notices are issued from time to time for the purposes of bringing important information to the attention of those with an involvement in maritime affairs. Some such notices involve bringing regulatory or quasi regulatory matters to the attention of interested parties. One such notice was Marine Notice No. 2 of 2003. The relevant portion of the text of that notice reads as follows:-
“The Department of Communications, Marine and Natural Resources wishes to remind skippers and those working onboard registered fishing vessels that inflatable life rafts should be approved and comply with the Marine Equipment Directive and SOLAS Convention. However, the Department recognises that for small fishing vessels, less than 40 feet, that such vessels are not required by statute to carry inflatable life rafts. The Department also recognises that the smallest approved MED/SOLAS inflatable life rafts are for six persons, this may discourage the voluntary carriage of inflatable life rafts on such small fishing vessels. In this regard the Department wishes to encourage the voluntary carriage of inflatable life rafts on small fishing vessels and it has accepted the following non-Solas/non-MED inflatable life rafts for such vessels.
• DSB 4 Person Inflatable Life raft, SOLAS type, B Pack
• RFD 4 Person Inflatable Life raft, SOLAS type, B Pack
• Viking 4 Person Inflatable Life raft, SOLAS type, B Pack
• Zodiac 4 Person Inflatable Life raft, SOLAS type, B Pack”
4.6 It will be recalled that the minimum size of a SOLAS approved life raft is one suitable for six persons. It was pointed out in the relevant Marine Notice that, for smaller boats i.e. those less than 12 metres (or 40 feet), and which are not, as such, required by statute to carry inflatable life rafts, it was acknowledged that smaller life rafts would be appropriate. It will, however, be noted that in each of the four approved cases, a SOLAS “B” pack is specified.
4.7 In addition, it is necessary to make reference to Marine Notice No. 8 of 2005 which is stated to supersede Marine Notice No. 2 of 2003. The relevant provisions of that Notice read as follows:-
“The Department recognises that small fishing vessels of length overall less than 40 feet are not required by statute to carry inflatable life rafts and that the smallest approved MED/SOLAS inflatable life rafts are for six persons. To facilitate compliance with the Code of Practice and to encourage the voluntary carriage of inflatable life rafts the Department has accepted the following non-SOLAS / non-MED inflatable life rafts. Only these life rafts listed will be accepted on fishing vessels, which are either:
(a) not required to carry a SOLAS / MED approved life raft or
(b) recommended to carry a life raft.
The life raft is to be fitted with a Hydrostatic Release Unit and stowed, if practicable, in such a position that it can be easily and quickly launched on either side of the vessel. The life raft is to be serviced at an approved life raft servicing station at intervals not exceeding 12 months.
Accepted non-SOLAS / non-MED inflatable life rafts
• DSB 4 Person Inflatable Life raft with SOLAS B Pack
• RFD Surviva 4 Person Inflatable Life raft with SOLAS B Pack
• RFD SEASAVA PRO ISO 9650 4 Person Inflatable Life raft with SOLAS B Pack
• Viking DK 4 Person Inflatable Life raft with SOLAS B Pack
• Zodiac 4 Person Inflatable Life raft with SOLAS B Pack
• EUROVINIL ISO/DIS 9650 4 Person Inflatable Life raft with SOLAS B Pack”
4.8 It seems to me to follow that the Code of Practice must now be construed as making reference to Marine Notice No. 8 of 2005, given that that Notice is specified as replacing Marine Notice No. 2 of 2003. It will be noted that, as with the 2003 Notice, each of the so called non-SOLAS/non-MED life rafts approved are specified as requiring a SOLAS “B” pack. It is also important to note that it is made clear that only such life rafts are to be accepted on fishing vessels which are either “not required to carry a SOLAS/MED approved life raft” or are “recommended to carry a life raft”.
4.9 The net affect of each of those measures seems to me to create a situation where it is possible to take two views concerning the proper intent of the Code of Practice incorporating the relevant Marine Notices.
4.10 First, so far as the Code of Practice is concerned, any boat operating with four or more persons or five miles beyond a safe haven is required to carry a life raft. In the case of vessels of more than 12 metres the requirement is that the life raft be an approved MED/SOLAS life raft. In the case of vessels less than 12 metres, the life raft must, by virtue of the Marine Notices, be of one of the types authorised by those Notices. The fact that the Code of Practice makes reference to the 2003 Notice (and by necessary implication any amendment of it), incorporates at least the relevant portions of those Notices in to the Code of Practice. Each of the life rafts mentioned in either of the Notices requires a SOLAS “B” pack. It follows that all vessels (even those of 12 metres or less), which operate outside the four persons/five miles parameter, are required to carry a life raft which is one of those specified in the Marine Notices (currently Marine Notice No. 8 of 2005). The status of vessels which are less than 12 metres and which operate within the five mile and four person limit is less clear. The Code of Practice speaks of a recommendation while Marine Notice No. 8 speaks of only those life rafts specified in that Notice as being permitted. The Code itself, as opposed to the Marine Notices, is not clear on whether there is or is not an obligation on a boat of less than 12 metres operating within the four person/five mile limits to carry an approved life raft.
4.11 That analysis seems to me to stem from the natural wording of the Code of Practice. It does, perhaps on one view, produce a somewhat paradoxical result. There can be little doubt that a vessel of 12 metres of less operating within the five miles/four person limit is not required, under the Code of Practice, to carry any life raft. It also appears that such a vessel, operating within those limits, if it chooses to carry a life raft must, if it is to comply with the Marine Notices and, perhaps, the Code of Practice, carry a life raft of the type specified in the relevant Marine Notices. The question arises as to the sense of such a provision. On one view it might be said that carrying some life raft is at least better than carrying no life raft. On the other hand, it might be argued that it is better that vessels not put to sea with a form of life raft which is considered to be underspecified thus, perhaps, leading those on board into a false sense of security.
4.12 I fully understand that, as is apparent from the terms of the Marine Notices, the intention of the Minister was at all times to seek to encourage an upgrading in the quality of lifesaving equipment on fishing vessels. It is clear that by far the preponderant number of fishing vessels in the Irish fleet are of less than 12 metres. Those vessels are not, therefore, caught by the mandatory statutory requirements to which I have referred. A decision was clearly taken not to extend those mandatory statutory requirements to such smaller vessels. However, it is apparent from the Marine Notices that the intention was to seek to encourage the use of life rafts in all cases. In such circumstances, it may well be that there was a case for some degree of what might be called “constructive fudge” concerning the precise parameters of the obligations in relation to smaller fishing vessels in respect of life rafts. If the Code of Practice had continued to operate with its original status as being simply a recommendation with no statutory consequence at all, then there might well have been a justification for retaining some degree of constructive fudge as a means of encouraging compliance in circumstances where the mandatory imposition of compliance was not regarded as beneficial. However, it seems to me that that situation changed when the Oireachtas chose to confer a statutory status on the Code of Practice. Given that the Code of Practice creates a mandatory obligation on those seeking licences, it seems to me that it needs to be clear in its terms. It is, to say the least, unfortunate that the provisions of the Code of Practice concerning the obligations of those with smaller vessels operating within the five mile/four person limit lack clarity. If nothing else came out of this case, then it seems to me to be of vital importance that the Minister takes an early opportunity to make absolutely clear in unambiguous terms as to the requirements of the Code of Practice. If it is the Minister’s intention that the Code of Practice requires (as Marine Notice No. 8 seems to suggest) that it is preferred that a vessel have no life raft rather than have a non-complying life raft, then that should be said in clear terms. If that is not the intention, then equally the Code of Practice needs to make clear what precisely are its requirements concerning life rafts in respect of the smaller vessels within the five miles/four persons limitation.
4.13 In the absence of any such amendment to the Code of Practice to date, then I must do the best I can with the existing text. For the reasons which I have sought to analyse, I am satisfied that, on a proper construction of the current Code of Practice by reference to Marine Notice No. 2 of 2003, which is expressly incorporated into it, and Marine Notice No. 8 of 2005, which is expressed to be an amendment of Marine Notice No. 2 of 2003, the Code of Practice is currently not complied with by any vessel carrying an unapproved life raft. It will be recalled that the evidence established that a significant number of fishing vessels observed by Mr. O’Sullivan, the engineer, had life rafts which were designed for the yachting sector. It is clear on the evidence that none of the relevant life rafts so described by Mr. O’Sullivan were of the type specified in either Marine Notice No. 2 of 2003 or Marine Notice No. 8 of 2005. It follows that there are a significant number of Irish fishing vessels which carry unapproved life rafts contrary to the Code of Practice as I have interpreted it.
4.14 Against that background it seems next appropriate to turn to the legal issues which arise in relation to the potential liability argued as applying to the Minister under the various headings which I have previously identified.
5. The Legal Bases for Atlantic’s Claim
5.1 As indicated earlier, four legal bases were, in the alternative, put forward for Atlantic’s claim. In fairness it should be noted that counsel for Atlantic accepted, in the course of argument, that the contention that Atlantic’s claim could be based on breach of constitutional rights could not be said to put Atlantic’s claim any further than might arise under the other headings. While Atlantic does enjoy property rights and Mr. Rogers does enjoy a right to earn a living, any claim for breach of those rights could only arise in circumstances where it could be said that a relevant defendant was guilty of some wrongdoing which interfered with the right in question. The right to damages for breach of a constitutional entitlement is, at the level of principle, clear (see for example Meskell v. CIE [1971] I.R. 121). However, it is also clear that, where an entitlement to pursue damages in respect of the same set of circumstances arises under a traditional head of claim, such as damages for tort or damages for breach of contract, the courts will only permit the invocation of a claim for damages for breach of constitutional rights in circumstances where the existing law (in the instances cited, the Law of Tort or the Law of Contract) can be said to fail to adequately protect any constitutional rights involved.
5.2 In those circumstances, it was accepted by counsel for Atlantic that, in the event that I was not persuaded that the Law of Tort (including where appropriate claims for breach of statutory duties), or the Law of Legitimate Expectation, provided Atlantic with a remedy, then the Constitution would not avail Atlantic.
5.3 In substance, therefore, two areas arose for consideration. The first was as to whether Atlantic might be able, at least in principle, to pursue a claim for damages for negligence or breach of statutory duty. For reasons which I will explore these areas raise issues which are not necessarily the same, but nonetheless there is a close connection between both and I propose dealing with them together.
5.4 A second and separate area involves Atlantic’s contention that it is entitled to damages for breach of legitimate expectation. I propose dealing with that question in due course, but will turn first to the question of breach of duty including breach of statutory duty.
6. A Breach of Duty or Statutory Duty?
6.1 The starting point under this heading has to be note that, while there may be a significant overlap between the area of breach of duty and breach of statutory duty in a context such as that with which I am concerned in these proceedings, it was not argued on behalf of either party (correctly in my view) that the two potential areas of claim are identical. The House of Lords in Stovin v. Wise [1996] AC 923, came to the view that, ordinarily, a common law duty of care would not arise in circumstances where any relevant statutory provision could not be said to have imposed a statutory duty on the person concerned. In the course of his speech in Stovin, Lord Hoffman said, at pp. 952/953 that if a statutory duty:-
“[D]oes not give rise to a private right to sue for breach, it would be unusual if it nevertheless gave rise to a duty of care at common law which made the public authority liable to pay compensation for foreseeable lost caused by the duty not being performed. It will often be foreseeable that loss will result if, for example, a benefit of service is not provided. If the policy of the Act is not to create a statutory liability to pay compensation, the same policy should ordinarily exclude the existence of a common law duty of care.”
6.2 It is, however, important to note the Lord Hoffman used the words “ordinarily” to imply that there may be circumstances where that ordinary position will not apply. In that context, it is important to note that in Glencar Exploration Plc v. Mayo County Council (No.2) [2002] I I.R. 84, Fennelly J. noted the following at p. 159:-
“As a matter of principle, it would not be wise to rule out the possibility that a case may in the future present itself where the relationship between a person liable to be affected by a ministerial or other public law decision is entitled to expect that care will be exercised in and about the decision to take legal advice and the manner of its taking. At the least, I think it would have to be shown that the statutory power in question was of the type which is designed to protect particular interests and that the plaintiff comes within its scope. In addition, it would probably be necessary for the claim to arise from the context of the type of individual transaction which was the subject-matter of Ward v. McMaster [1988] I.R. 337 or perhaps from the sort of reliance on the expertise of another which formed the background to Hedley Byrne v. Heller and Panners Ltd [1964] AC 465. …They were not engaged in any direct legal relationship with the respondent. Their prospecting licences had been granted by the State. They had not made any application for planning permission, not that that would necessarily alter the position. In short, I do not believe that the respondent owed a duty of care to the applicants either to take legal advice or to take further steps to follow it up.”
6.3 In relation to statutory duty per se it is clear from cases such as Moyne v. The Londonderry Port and Harbour Commissioners [1986] I.R. 299 and Sweeney v. Duggan [1991] 2 I.R. 274, that the question of whether a plaintiff is entitled to claim damages for breach of statutory duty must start with the consideration of whether, taking the relevant statutory regime as a whole, it can be said that it was “intended by the legislature that an aggrieved plaintiff would be entitled to damages”.
6.4 Having regard to those general principles, it seems to me that the following three questions arise:-
A. Is a statutory duty placed on the Minister in respect of the licensing of sea-fishing boats with particular reference to the Code of Practice?
B. If so, is the scheme of the relevant legislation such as it can be said that it was intended that entities or persons such as Atlantic and/or Mr. Rogers could maintain a claim in damages?
C. If not, is there nonetheless a sufficient proximity or relationship between the parties such as to meet the test identified in Glencar Exploration.
6.5 In approaching the first of those questions it is important to have regard to what the statutory provision itself requires. For the reasons which I have analysed earlier in the course of this judgment, at para. 3.5, it is clear that the only statutory requirement present is in the form of a prohibition on the grant of a relevant sea-fishing boat licence unless the appropriate certification of compliance with the Code of Practice is in place. It might be said that there is a statutory duty not to grant a licence in circumstances where the necessary certification was not in place. However, it is not suggested on the facts of this case that the licences have been granted in the absence of relevant certification. Rather it is said that, on the basis of the interpretation of the Code of Practice urged on behalf of Atlantic, sea-fishing boats are licensed (presumably on the basis of an appropriate certification) in circumstances where those boats do not, in fact, comply with the Code of Practice and further that such boats operate other than in accordance with the Code.
6.6 It seems to me to follow that what, in truth, Atlantic urges is that there is a statutory duty on the Minister to ensure a high level of compliance with the Code of Practice through the licensing system. However, it seems to me that to impose such a duty, as a matter of statute, on the Minister, would require that the statute concerned contained wording which imposed a clear statutory obligation on the Minister to ensure enforcement of the licensing regime, not merely to the extent of the express statutory obligation not to permit the licensing of boats which did not have a Certificate of Compliance, but also to the extent of ensuring that such boats did actually and continue to comply with the obligations contained in the Code of Practice during the lifetime of any relevant licence. I am prepared to accept, for the purposes of argument, that there may be circumstances in which a failure of regulation can give rise to a breach of statutory duty. However, for such to be the case, it seems to me that the relevant legislation would need to provide in express or necessarily implied terms for a specific duty of a particular type on the relevant regulator, from which the court might conclude that the proper construction of the relevant statute was such as imposed a statutory duty on the regulator concerned to act in a particular way or to refrain from acting in a particular way.
6.7 I am not satisfied that the statutory regime in this case can be so construed. The only statutory obligation is such as precludes the licensing of a boat which does not have a Certificate of Compliance. The regime does not require that the licensing authority be satisfied, either at the time of licensing or thereafter, that the boat continues to be compliant. It may very well (indeed one could go so far as to say it must) be the case that it would be prudent for the Minister to take reasonable steps to ensure that the Certificate of Compliance system is not abused, either by fishing vessels being certified as being compliant with the Code of Practice when they are not or, by the operators of fishing vessels who have the benefit of a legitimate and correct Certificate of Compliance altering the boat or the mode of its operation in a way which brings the vessel concerned outside the Code of Practice. However, to read the Act as imposing a statutory obligation on the Minister to act in such a way would seem to me to be to read too much into the Act. It might well be said that a failure on the Minister to ensure that the Certificate of Compliance system is not abused could lead to legitimate criticism of the Minister. It is, however, in my view a “bridge too far” to say that any such failure amounts, if it be established, to a breach of statutory duty. For those reasons I am not satisfied that, properly construed, the relevant legislation imposes an obligation on the Minister, as a matter of statutory duty, to ensure continuing compliance with the Code of Practice.
6.8 As pointed out earlier, the Code of Practice has not direct statutory effect. Rather, it has statutory relevance in that it is a document by reference to which a statute operates. However, that aspect of the statute only operates as part of the licensing system and then only to the extent that a Certificate of Compliance with the Code of Practice needs to be produced. In those circumstances, there is just too much of a gap between the Code of Practice and the statute to suggest that there is an implied statutory obligation on the Minister to ensure compliance with the Code of Practice rather than the undoubted obligation to ensure that licences are not granted to those who do not have a Certificate of Compliance with the Code of Practice.
6.9 If I be wrong in that view, then it would follow that it would next be necessary to consider whether the policy of the statute is such that it can be said, considering the Act as a whole, that it was intended by the legislature that an aggrieved plaintiff would be entitled to damages for breach of statutory duty.
6.10 The first element of that question is to identify who the relevant aggrieved plaintiff might be. It is clear that the purpose of the relevant provision in the statute is to procure safety at sea by requiring that only licensed fishing vessels can fish and by stipulating that, in order to be so licensed, such boats are certified as complying with the standards specified in the Code of Practice. The persons who are in the direct contemplation as beneficiaries of the legislation are, therefore, fishermen.
6.11 There may be legislation whose primary focus is to regulate a particular industry, business or sector to ensure, for example, fair conditions as and between operators within the relevant area. It does not seem to me that the 2003 Act (as amended) is such legislation. The legislation is not designed to regulate the businesses of those who operate fishing boats as and between themselves for the purposes of ensuring fair competition between such businesses. Still less is the legislation designed for the purposes of conferring benefits on or otherwise regulating the business operations of those, such as Atlantic, who might provide services to fishing boats. Even if, therefore, the relevant legislation in this case could be said to impose a statutory duty of any type on the Minister, it does not seem to me that, taking the legislation as a whole, it could be said that the Act intended that a plaintiff, such as Atlantic, operating in the field of supplying services to fishing boats, should be entitled to obtain damages for any breach of that statutory duty.
6.12 A more difficult question might arise in circumstances where the relevant claimant was a fisherman who sought to suggest that he had suffered as a result of a failure by the Minister to comply with any statutory obligations on the Minister under the Act. A more detailed analysis of the Act as a whole might be necessary in such circumstances to determine whether it could be said that such a fisherman claimant might be a person whom the legislator intended would be entitled to damages. However, no such question arises on the facts of this case.
6.13 Even if, therefore, I had been satisfied that the 2003 Act (as amended) imposed a statutory duty on the Minister of the type alleged to have been breached in these proceedings, I would not have been of the view that it would have been open to Atlantic to maintain a claim for breach of such statutory duty, for it does not seem to me that the legislation, taken as a whole, can be said to imply an intention on the part of the legislature that commercial operators in a position such as Atlantic would be entitled to damages for any such breach of duty.
6.14 Under this heading it is finally necessary to turn to the question of whether there might be circumstances in which an entity such as Atlantic might be able to claim damages for a common law breach of duty, notwithstanding the fact that it will only be in rare cases that such a common law duty will be found where the relevant statute does not give rise to a legitimate claim for damages for breach of statutory duty.
6.15 In that regard it is important to analyse the criteria identified by Fennelly J. in Glencar Exploration. First, Fennelly J. noted that it would have to be shown that the statutory power in question “was of the type which is designed to protect particular interests and that the plaintiff comes within its scope”. It seems to me that, for reasons similar to those which I have already analysed in relation to the claim for breach of statutory duty, it can not be said that a service provider to the fishing industry, such as Atlantic, comes within the scope of those whom the statute is designed to protect. It is clear that the statute is designed to enhance safety for the benefit of fishermen, rather than to protect the commercial interests of service providers to the fishing industry.
6.16 Fennelly J. further noted that it would probably be necessary, in order that it should succeed, that any relevant claim would arise from an individual transaction or special circumstances which would bring the potential claimant inside the proximity test. The basis put forward on behalf of Atlantic for suggesting that this limb of the test was met is the fact that Atlantic is itself certified to provide safety related services to the fishing fleet. There is no doubt but that that is so. It is also true that, by being so certified, Atlantic subjects itself to significant limitations on the way in which it can carry out its business. However, that fact, of itself, does not, it seems to me, create a sufficient degree of proximity between Atlantic and the Minister such as would give rise to a duty of care on the part of the Minister to operate an entirely separate licensing regime (i.e. that which operates in relation to sea-fishing boats by reference to the Code of Practice) which was designed for an entirely separate purpose, in such a manner so as to have regard to a duty of care to Atlantic.
6.17 In those circumstances, I am not satisfied that it can be said that the Minister owed any duty of care to a company, such as Atlantic, which operates as a fishing boat service provider in relation to the operation of the licensing system in relation to the operation of fishing boats themselves.
6.18 For all of those reasons I am not satisfied that there is any legitimate legal basis for the claim made on behalf of Atlantic in respect of either breach of duty or breach of statutory duty. It follows that it is next necessary to turn to the claim made in respect of legitimate expectation.
7. Legitimate Expectation
7.1 Atlantic claims that is has a legitimate expectation, which can give rise to a claim in damages, which is to the effect that the Minister will, in substance, rigorously enforce the licensing regime so that fishing vessels will not be permitted to carry life rafts which do not conform with the Code of Practice and the Marine Notices referred to in it.
7.2 Whether a legitimate expectation of that type can arise was the subject of dispute at the hearing before me. I should, firstly, note that complaint was made that a claim under this heading was not properly before the court having regard to the pleadings. However, counsel for the Minister, in my view quite correctly, did not vigorously pursue that point given that the factual basis for the claim under this heading was the same as the basis for the claim under the various other headings pursued, and the question of a legitimate expectation arising had been explored in the written submissions. I propose, therefore, dealing with this aspect of the claim.
7.3 In Lett & Company Ltd v. Wexford Borough Corporation & Ors [2007] IEHC 195, I had occasion to analyse the criteria, on the then current state of the jurisprudence, for the determination of the existence or otherwise of a legitimate expectation. I summarised my views in para. 4.7 of the judgment in that case in the following terms:-
“4.7 In the light of those authorities it seems to me that, on the current state of the development of the doctrine of legitimate expectation, it is reasonable to state that there are both positive and negative factors which must be found to be present or absent, as the case may be, in order that a party can rely upon the doctrine. The positive elements are to be found in the three tests set out by Fennelly J. in the passage from Glencar Exploration to which I have referred. The negative factors are issues which may either prevent those three tests from being met (for example the fact that, as in Wiley, it may not be legitimate to entertain an expectation that a past error will be continued in the future) or may exclude the existence of a legitimate expectation by virtue of the need to preserve the entitlement of a decision maker to exercise a statutory discretion within the parameters provided for in the statute concerned or, alternatively, may be necessary to enable, as in Hempenstall, legitimate changes in executive policy to take place. I therefore propose to approach the contentions of the parties as to the existence of a legitimate expectation in this case by first considering the positive elements of the test.”
7.4 As is also clear from my judgment in Lett, an issue arose in that case as to whether, at the level of principle, it is open to a party to claim damages per se for breach of a legitimate expectation. There is no doubt that the possibility of such a claim was noted by McCracken J. in Abrahamson v. The Law Society of Ireland [1996] 1 I.R. 403. However, for the reasons set out at para. 4.15 of my judgment in Lett, I came to the view that that issue did not, truly, arise in the case under consideration. The expectation which I found arose on the facts of Lett was, in itself, to the effect that the relevant plaintiff company would be entitled to compensation. The plaintiff in Lett did not, therefore, strictly speaking obtain damages for a breach of legitimate expectation but rather obtained compensation calculated by the court on the basis that it had a legitimate expectation to that compensation.
7.5 In addition to the question of damages, the issue also arises on the facts of this case as to whether a legitimate expectation can give rise to substantive rights rather than purely procedural entitlements. That debate was noted by Keane J. in the course of his judgment in Glencar Exploration but, for the reasons which he addressed, it was found unnecessary to resolve same. In this regard a useful starting point is, in fact, the comprehensive review of the authorities both in this jurisdiction and in other common law jurisdictions to be found in the 2nd Edition of Delaney on “Judicial Review of Administrative Action” between pp. 175 and 201. To that discussion might be added the fact that Lett itself is, at least in one sense, a case in which a substantive benefit (i.e. compensation) was provided. No claim was pursued which sought to establish an entitlement to a particular procedure being followed. Likewise, given that, as I pointed out in Lett, the genesis of the doctrine of legitimate expectation in Ireland is frequently traced back to Webb v. Ireland [1988] IR 353, it could also be said that that genesis derives from a case in which the relevant plaintiffs obtained a substantive benefit (again compensation) rather than a procedural benefit.
7.6 I have come to the view that there is no reason in principle why the doctrine of legitimate expectation cannot be invoked to obtain a substantive rather than a purely procedural benefit. However, it does seem to me that the negative factors which I identified in Lett as being likely to prevent a legitimate expectation arising are much more likely to apply, in practice, to cases where a substantive rather than a procedural benefit is asserted. There are likely to be very few cases where a legitimate expectation concerning compliance with a particular procedure could infringe the principles frequently invoked against recognising a legitimate expectation on the facts of a particular case. It is highly improbable that imposing an agreed procedure could, for example, lead to a party obtaining a right which they did not have, such as led the Supreme Court to reject the claim in Wiley v. Revenue Commissioners [1994] 2 I.R. 160. Likewise, the preservation of an entitlement of a decision maker to exercise a statutory discretion within the parameters provided for in the statute concerned, is most unlikely to be interfered with by requiring the relevant decision maker to comply with expectations legitimately arising in respect of the procedures to be followed. Other examples could be given.
7.7 The limitations on the doctrine of legitimate expectation which I summarised in the paragraph from Lett referred to above (and there may well, in time, come to be other such limitations) are much more likely to have application in cases where a substantive rather than a procedural expectation is sought to be relied on. It follows that those limitations will necessarily impact to a significant extent in cases where substantive expectations are sought to be advanced. It does not, however, in my view follow that there can be no circumstances where a substantive legitimate expectation can be enforced by the courts.
7.8 It will, therefore, fall to the court to determine whether the undoubted limitations which arise on the doctrine of legitimate expectation are such, in relation to an individual case and having regard to the policy considerations applicable to a case of that type, as outweigh the undoubted public interest in ensuring that decisions are properly made within the statutory or administrative framework applicable to them. To take but a simple example, one might consider two separate licensing regimes. In one case there might, for good policy reasons, be a limited number of licences capable of being offered (for example because of some physical limitation such as the availability of wavelengths). In the other, any person who met appropriate criteria might be entitled to a licence. In the first case the grant of a licence to any one individual would necessarily involve a potential adverse consequence for other contenders. In the second case, no such consequences would arise. It would be difficult to envisage circumstances where it would be possible to afford a plaintiff or applicant a substantive legitimate expectation which would have the effect of giving rise to an impermissible interference with the entitlements of third parties. A substantive legitimate expectation would be most unlikely, therefore, if at all, to be capable of being found in respect of a licensing regime of the first aforementioned type of case. However, a greater degree of latitude would undoubtedly arise in the second type. No third party rights or interests would be involved. Clearly a substantive legitimate expectation could not arise such as would cause someone who was not properly entitled (by reference to relevant criteria) to the licence concerned, for reasons such as those identified in Wiley. The purpose of the regime would, presumably, be to ensure that only those who met certain criteria could hold a licence. If a person clearly did not meet the necessary criteria, then it is difficult to envisage circumstances when a court could, in effect, force the grant of a licence to such person irrespective of what expectations might have been created in the mind of the claimant by the actions of those involved in the licensing process. In a case where, however, it was not established that the relevant claimant failed to meet the statutory criteria concerned, then the policy reasons for declining to enforce a legitimate expectation might be significantly less weighty.
7.9 I have, therefore, come to the view that it is possible for a legitimate expectation to exist in relation to a substantive rather than a purely procedural matter. However, significant care needs to be exercised in the case of a claim to a legitimate expectation for a substantive benefit, for the public policy requirements which need to be given significant weight are much more likely to be present and are much more likely to weigh heavily in the case of a substantive rather than a procedural legitimate expectation.
7.10 In addition, I see no reason in principle to depart from the view expressed by McCracken J. in Abrahamson to the effect that a claim in damages can, in an appropriate case, lie in respect of a breach of legitimate expectation. Indeed, there may well be cases where an award of damages, rather than a substantive interference with the statutory or administrative system under review, may be more appropriate. It is possible that there may be circumstances (particularly where a claimant has significantly changed his position as a result of a legitimate expectation) where it would be unjust not to provide the claimant concerned with some remedy. There may well, in those circumstances, be cases where it would not be appropriate to afford a substantive remedy as such in the sense of a remedy which interfered with the statutory or administrative process under review. In at least some of those cases it may well be that damages would be the appropriate remedy.
7.11 Against that general background it is next necessary to turn to the facts of this case.
7.12 The first issue that needs to addressed, applying the first test identified by Fennelly J. in Glencar Exploration, is to determine whether the relevant public authority has made a statement or adopted a position amounting to a promise or representation, express or implied, as to how it will act in respect of an identifiable area of its activity.
7.13 In assessing whether that aspect of the test is met, a number of facts need to be identified. First, Atlantic is itself certified in accordance with the SOLAS regime to provide safety equipment services to those who have to comply, under the sea-fishing boat licensing regime, with the Code of Practice and is, on the evidence, required to go to a significant effort and expense in maintaining that certification. Second, the Minister has promulgated the Code of Practice. Third, the Oireachtas has determined both that all sea-fishing boats need a sea-fishing boat licence and that a Certificate of Compliance with the Code of Practice is a mandatory requirement for the grant of any such licence. It seems to me that it can properly be said, therefore, that the Minister has “adopted a position” which amounts, at a minimum, to an implied representation, that only sea-fishing boats which comply with the Code of Practice, at least in general terms, will be allowed to operate under licence. I use the phrase “at least in general terms” because it would, of course, be important to note that the Minister could only refuse or terminate a licence where it was proportionate so to do in the light of any failure of compliance established. It must be noted that the primary purpose of the licensing regime is to ensure compliance rather than to punish non-compliance. The appropriate response to a minor non-compliance is to require that it be remedied in early course rather than to prevent the sea-fishing boat concerned operating thus depriving those involved in the relevant sea-fishing boat of their living. However, subject to that caveat, I am satisfied that it is appropriate to characterise the actions of the Minister as being such as amount to an implied representation that the Code of Practice will be applied albeit through the licensing regime.
7.14 The second requirement identified in Glencar Exploration is that the relevant representation must be addressed or conveyed either directly or indirectly to an identifiable group of persons, affected actually or potentially in such a way that it forms part of a transaction definitively entered into or a relationship between that person or group and the public authority, or that the person or group has acted on the faith of the representation. There can be little doubt that the primary group of persons to whom such representation might be held to have been made are fishermen whose safety on board sea-fishing boats is the focus of the legislation as a whole and the Code of Practice in particular. However, given that Atlantic is also certified by the same Minister to provide services which are intimately connected with that aspect of the Code of Practice with which I am concerned, I am also satisfied that such certified service providers, such as Atlantic, come within the scope of an identifiable group of persons affected by the representation and who are likely to place reliance on it in determining whether it is appropriate to incur the significant outlay of time, money and effort necessary to obtain and maintain their own licensed status.
7.15 As I pointed out in Lett, one of the principal reasons for the evolution of the doctrine of legitimate expectation stems from the fact that there may be cases where it is unjust to allow a public authority to stand on its technical legal rights. It follows that there may be circumstances where the parties who are within the group to whom an express duty of statutory care may be more confined than the group to whom a legitimate expectation obligation may be owed. It seems to me that this is such a case. Even if a statutory duty arose in this case, it could not extend beyond fishermen. However, a somewhat wider group, including closely connected entities such as Atlantic, can be said to be within the class of those to whom a representation may, by implication, be said to have been made, by virtue of the other elements which I have identified at para. 7.14.
7.16 The third test requires that the relevant representation must be such as to create a reasonable expectation in the group of persons concerned to the effect that the relevant public authority will abide by the representation to the extent that it would be unjust to permit the public authority to resile from it. I am also satisfied that this test is met on the facts of this case. Atlantic has incurred significant expenditure and put in significant effort in maintaining its own certified position. In deciding whether it wishes to do so (and to continue to do so), Atlantic is, in my view, entitled to place reliance on the implied representation of the Minister that the Code of Practice will be reasonably enforced. It would, in my view, in those circumstances be unjust to permit the Minister to resile from the representation as to reasonable enforcement such as exists in this case. Atlantic is not, however, entitled to expect that the Code will remain unchanged. The risk that relevant regulatory regimes may change over time is one of the risks that any party contemplating an involvement in a connected business venture will have to have regard to.
7.17 In those circumstances it seems to me that the three positive criteria identified by Fennelly J. in Glencar Exploration are met on the facts of this case. It is next necessary to turn to the question of whether there are any reasons, deriving from the negative criteria which I identified in Lett & Company or otherwise, which might prevent an enforceable legitimate expectation arising.
7.18 First, there does not seem to me to be any factor of the type identified in Wiley. To require the Minister to reasonably enforce, through the licensing system, the Code of Practice, as for the time being promulgated, could not lead to any person getting something that they were not entitled to or to any person not getting something which they were entitled to. Second, it does not seem to me that the imposition of an obligation on the Minister to reasonably enforce the Code of Practice through the licensing system in any way fetters the Minister’s discretion. If, on due consideration, the Minister does not think that the Code of Practice as currently promulgated is appropriate, then there is nothing to prevent the Minister from changing it. All that is being asked of the Minister is that he be consistent in enforcing, in a reasonable way, his current version of the Code of Practice. Such a requirement does not, in any way, fetter the Minister’s discretion either under statute or otherwise. If the Minister chooses to change the Code of Practice, then any subsequent certification for the purposes of the 2003 Act will be in accordance with the Code as so amended. The Minister retains a full entitlement to alter the Code of Practice in any way which he may consider appropriate.
7.19 There does not, therefore, seem to be any overriding policy objection to recognising a legitimate expectation to the effect that the Minister will reasonably enforce the Code of Practice to the extent that that may be possible under the licensing regime. That licensing regime confers a licensing power. The regime operates by express reference to certification of compliance with the Code of Practice. Those factors create a legitimate expectation that the code will be enforced in that way. Atlantic is within the contemplation of those who might be affected by a lack of enforcement, by reason of the fact that it too is certified to provide some of the services expressly mentioned in the code, being the safety requirements in relation to life rafts and the like, to which I have referred. I am, therefore, satisfied that, at least in general terms, a legitimate expectation arises that the Minister will enforce or cause to be enforced the code of conduct through the licensing system to a reasonable extent.
7.20 However, it does not seem to me that any such expectation could extend to an obligation on the Minister to ensure that the code is enforced in all circumstances. The Minister clearly retains a discretion as to how to deal with any failure of compliance with the Code of Practice (save that it is not permitted to grant a license, by reason of the clear wording of the 2003 Act, as amended, in cases where a Certificate of Compliance is not made available). Likewise, no regulator or enforcement agency will ever achieve complete compliance with a relevant regulatory regime. It does not seem to me that any person could entertain a legitimate expectation that complete compliance would arise. Any representation which the Minister might impliedly be said to have made (so as to meet the first test identified by Fennelly J. in Glencar Exploration), could only extend to reasonable enforcement having regard to the resources reasonably available for enforcement and having regard to the need to act proportionately so far as the rights of individual fishing vessel operators are concerned, when cases of non-compliance are identified. Against the background of that finding, two further questions arise. The first is as to whether it can be said, on the evidence, that the Minister has failed to meet the legitimate expectation of enforcement identified. The second is as to whether damages lie in that eventuality. I turn to the first of those questions.
8. Has There Been a Failure on the Part of the Minister?
8.1 While it is true to say that concerns of the type now advanced were expressed on behalf of Atlantic some time ago, it seems clear on the evidence that almost all of those concerns were expressed in the early years of the last decade. In that context it is important to identify the time when any legitimate expectation, on which Atlantic might rely, first arose. Up to the passage of the 2006 Act, there was no statutory basis for the Code of Practice at all. While the code was there, the Minister had no means of enforcing it. It does not seem to me, therefore, that any legitimate expectation of enforcement could be said to have arisen prior to the Code of Practice achieving what I have described as a quasi statutory status on the enactment of the 2006 Act. It was only when that Act came into force that the Minister had a means, through the licensing system, of procuring its enforcement of the obligatory passages of the Code of Practice. A legitimate expectation as to enforcement necessarily implies the means of enforcement.
8.2 In those circumstances, it seems to me that many of the complaints made by Atlantic occurred at a time when no legitimate expectation existed. It does not appear that, other than in the context of this case through the giving of oral evidence in the witness box, the attention of the Minister was drawn to what seems to be a significant scale of non-compliance with the life raft provisions of the Code of Practice (on the basis of the manner in which I have interpreted those provisions earlier in the course of this judgment). It does appear, on the facts as they emerged in the course of evidence, that there are a significant number of fishing vessels which, by inference, operate outside of the 5 mile/4 person parameter, but which carry life rafts of a type which are not designated in Marine Notice 8 of 2005. For the reasons which I have already sought to analysis, I am satisfied that such boats do not comply with the Code of Practice in those circumstances.
8.3 I should also have regard to the fact there was evidence that some level of enforcement has been engaged in by Minister such that licenses have been suspended for failure to comply with some of the standards specified in the Code of Practice. In the circumstances, it does not seem to me to have been established that there has, to date, been a sufficient failure of enforcement on the part of the Minister so as to give rise to a breach of the legitimate expectation which I have found arises in favour of Atlantic on the facts of this case. I am satisfied on the evidence that there is a material level of non compliance. The evidence of Mr. O’Sullivan bears no other inference. However, there is no evidence as to those breaches identified by Mr. O’Sullivan, or the like, having been brought to the attention of the Minister. There was evidence that there had been spot checks in the past which were designed to ensure that Certificates of Compliance with the Code of Conduct accurately reflected actual compliance. IT would, in my view, require evidence directed towards the failure of the Minister to take reasonable steps as to enforcement (having regard especially to the fact that the Minister could, legitimately, take some comfort from the presence of Certificates of Compliance) before a finding of breach of legitimate expectation could be made. However, it seems to me that evidence now having been placed before the Minister, in the form of the evidence given in this action, there is now a pressing obligation on the Minister to do one of two things.
8.4 The Minister must first review the terms of the Code of Practice and consider whether it should continue in its present form. If the Minister wishes, in the light of the issues which were addressed in the course of these proceedings, to amend the Code of Practice then it is, of course, open to him so to do. If any such amendment alters the position so that the apparent breaches of the Code of Practice identified in the evidence in this case would no longer be a breach of the Code of Practice, then no issue of continuing enforcement would arise.
8.5 Second, however, should the Minister decide to continue with the Code of Practice in something substantially like its present form insofar as life rafts are concerned, then it seems to me that there is a pressing obligation on the Minister to now act so as to procure a much higher level of enforcement than has been identified in the past. It is next necessary to turn to the question of damages.
9. Damages
9.1 In the light of those findings it does not seem to me that it would be appropriate to make an award of damages in favour of Atlantic. Any issues concerning compliance with the Code of Practice up to the coming into force of the 2006 Act could not, for the reasons which I sought to analyse, give rise to a legitimate expectation and thus no claim for damages in respect of any such period could, in any event, arise.
9.2 In relation to the period since then, it does not seem to me that there was sufficient evidence to satisfy me that the Minister was guilty of a culpable failure to enforce. I have come to this view not least because the detailed evidence of non-compliance put before the court had not been notified to the Minister prior to the hearing. However, in the light of the evidence given in this case, it would seem to me that, in the absence of any material alteration in the Code of Practice, a failure on the part of the Minister to take significant action to now ensure compliance might well amount to such a culpable failure.
10. Conclusions
10.1 It seems to me that it would not, for those reasons, be appropriate to make any award of damages to Atlantic. However, it does seem to me that Atlantic has established an obligation on the part of the Minister to either alter the Code of Practice or enforce it as it now is. In the circumstances, it seems to me that the appropriate course of action to adopt is to adjourn these proceedings for a period of time to allow the Minister to consider the findings contained in this judgment and to formulate the action which the Minister intends to take.
10.2 In those circumstances, I propose adjourning the proceedings for mention until the last day of Easter term. In the meantime, I would invite the Minister to consider the matters determined in this judgment and to indicate to Atlantic, in advance of that hearing, what position the Minister intends to adopt.
Freeman v Bank of Scotland (Ireland) Ltd
[2013] IEHC 371Judgment of Mr. Justice Gilligan delivered on 31st day of May, 2013
1. By notice of motion issued on 17th January, 2013, the defendants seek “an Order pursuant to O. 19, r. 28 of the Rules of the Superior Courts dismissing the claim of the plaintiffs herein on the grounds that the claim as pleaded is frivolous and/or vexatious and the pleadings disclose no reasonable cause of action”. Further, or in the alternative, an Order is sought “pursuant to the inherent jurisdiction of this Honourable Court dismissing the plaintiffs’ claim herein on the grounds that the claim as pleaded is bound to fail”. This application is grounded upon an affidavit sworn by Mr. Gary Collins on 16th January, 2013. The plaintiffs in these proceedings are litigants in person.
Background
2. The plaintiffs are husband and wife and were customers of Bank of Scotland Limited (BOSI) which, in 2010, was the subject of a cross-border merger with Bank of Scotland plc. In 2006 the plaintiffs applied for and were granted loan facilities on security of six properties, namely, 52 Huntstown Drive, Blanchardstown; 55 Huntstown Wood, Blanchardstown; 27 Willowood Lawn, Blanchardstown; 1 Drumcliffe Drive, Cabra; 15 Ventry Drive, Cabra 23 Dunsink Green, Finglas. The plaintiffs set out in their statement of claim that the loans were for the refurbishment and upkeep of the properties. Unfortunately, the plaintiffs encountered financial difficulty and became unable to pay instalment repayments due and on 23rd August, 2011, the mortgage accounts were in arrears amounting to approximately €51,000. The Bank made a demand for payment and following a failure to pay the sums due, in February 2012 the first named defendant appointed the second named defendant as receiver over the properties. The receiver instructed the third defendant who sold a number of the properties and the net proceeds of sale were remitted to the Bank. The affidavit of Mr Gary Collins sets out the details of the mortgage accounts and the amounts currently outstanding after the sale of the properties.
3. The plaintiffs instituted proceedings by plenary summons dated 28th August, 2012. The procedural history of the proceedings is summarised in the grounding affidavit of Mr Gary Collins. By notice of motion filed on 7th September, 2012, the plaintiffs sought injunctive relief to restrain the first and second defendants from selling three of the named properties. On 29th November the proceedings were before Laffoy J. and counsel for the defendants indicated that they would be agreeable to undertaking not to dispose of the remaining two properties until the trial of the action. This was not accepted by the plaintiffs. The matter was again before this Court on 13th December, 2012, where Murphy J. confirmed that the defendant’s motion to dismiss, together with the plaintiff’s injunction, should issue returnable for 26th February, 2013.
4. The plaintiffs make a number of allegations against the defendants which can be summarised as follows – that the Bank was insolvent at the time of the cross-border merger and as a result, the appointment of the second named defendant as receiver was ultra vires; the first named defendant relied on repealed legislation in appointing the second named defendant as receiver and the appointment is therefore null and void; because some of the loans were securitised the Bank is not entitled to maintain against the plaintiffs any claim in relation to the loans or the security; the Bank acted in breach of two Central Bank codes of practice in completing the securitisation scheme; senior members of the Bank conspired to fraudulently obtain a cross-border merger; the Bank did not advance the plaintiffs a loan of money but instead misled and deceived the plaintiffs by ‘creating currency’; the first named defendants have committed offences under the Criminal Justice (Theft and Fraud Offences) Act, 2001. It is further pleaded that the plaintiffs suffered defamation of character and damage to reputation. A number of allegations are also made against the second and third named defendants.
5. All of these allegations are denied by the defendants. Counsel for the defendants submits that none of the matters pleaded, even if true, disclose a reasonable cause of action and that the plaintiffs’ claim is therefore frivolous, vexatious and bound to fail. The plaintiffs contend that they have established a number of reasonable causes of action which would be better tried at a substantive hearing. I will now consider each of the plaintiff’s claims in turn.
Securitisation and the codes of practice
6. Paragraph 11 of the plaintiffs’ statement of claim submits that the “loans have been settled by a third party (Special Purpose Vehicle)” under a securitisation scheme. In the plaintiffs’ supplemental affidavit dated 5th March 2013 it is alleged that “the first named Defendant sold the Plaintiff’s loans for at least three, if not all of the mortgaged properties and the attached security to Wolfhound Funding 2008-1 Limited on 20th November 2008”. According to the affidavit of Mr. Collins, the loans subject to securitisation were those in connection with the three properties at 15 Ventry Drive, 23 Dunsik Green, and 1 Drumcliffe Drive. It is submitted by the plaintiffs that at all relevant times the power, custody and control of the loans was actionable only by Wolfhound. As a result, it is contended that the appointment of the receiver was invalid and the Bank is not entitled to maintain against the plaintiffs any claim in relation to the loans or the security. The plaintiffs also submit in relation to the securitisation scheme that the Bank acted in breach of two Central Bank codes of practice. The documents relied on are entitled ‘Central Bank Code of Practice on Transfer of Mortgages’ and ‘Central Bank of Ireland Asset Securitisation’.
7. Paragraph 1 of the Central Bank Code of Practice on Transfer of Mortgages states that: –
“A loan secured by the mortgage of residential property may not be transferred without the written consent of the borrower. When seeking consent from either an existing or a new borrower the lender must provide a statement containing sufficient information to enable the borrower to make an informed decision. This statement must be cleared in advance with the Central Bank of Ireland, must include a clear explanation of the implications of a transfer (including the borrower’s future membership status where the lender is a building society) and how the transfer might affect the borrower. The borrower must be approached on an individual basis and given reasonable time to give or to decline to give his consent.”
The plaintiffs submit that they have “never knowingly given written consent to the transfer of the mortgage, and were not provided with a statement containing sufficient information to enable the Plaintiff’s to make an informed decision.”
Paragraph 2 of the Code is as follows: –
“When seeking a consent and where there is to be or where there may be an arrangement under which the original lender will service the mortgage as an agent of any transferee, the lender will confirm that the transferee’s policy on the handling of arrears and in the setting of the mortgage interest rates will be the same as that of the original lender and that the original lender will handle arrears as its agent.”
The plaintiffs say that in respect of Paragraph 2 “the first named defendant has never given confirmation, either in writing or verbally, of the Transferee’s policy on the handling of arrears, interest rates or that the original lender would handle arrears as its agent”.
8. The Central Bank of Ireland Asset Securitisation document sets out the conditions to be satisfied for transferred assets to be exempted from the calculation of a credit institution’s capital adequacy position. Paragraph (i) requires that “the transfer does not contravene the terms and conditions of the underlying loan agreement and all the necessary consents have been obtained.” The plaintiffs submit that the necessary consents were never requested by the Bank or provided by themselves.
9. The defendants contend that the securitisation of the loans does not alter the plaintiffs’ obligations under the mortgage agreement and that their claim in this regard is bound to fail. The Court is referred to the case of Wellstead v. Judge Michael White where Peart J. held: –
“…there is nothing unusual or mysterious about a securitisation scheme. It happens all the time so that a bank can give itself added liquidity. It is typical of such securitisation schemes that the original lender will retain under the scheme, by agreement with the transferee, the obligation to enforce security and account to the transferee in due course upon recovery from the mortgagors.”
10. The defendants submit that the plaintiffs provided consent to securitisation of the loans on a number of occasions. The affidavit of Mr. Gary Collins on behalf of the defendants states as follows: –
“At all material times, the plaintiffs, in accepting the Offers of Mortgage Loans and in executing the Mortgage, consented to the securitisation of the loans. Clause 8 of the Terms and Conditions Leaflet incorporated into the Offers of Mortgage Loan, Clause 5.3 of the Mortgage, and Clause 18 of the Home Loan Mortgage Conditions provide for the express consent of the plaintiffs to transfer of the Mortgage, including transfer by way of securitisation.”
11. Clause 5.3 of the Mortgage Agreement reads as follows –
“The Borrower hereby irrevocably and unconditionally consents to the Bank at any time or time hereafter transferring, assigning, disposing or sub-mortgaging or sub-charging the benefit of this Mortgage and Charge…to any third person or body…as part of any loan, transfer and securitisation scheme on such terms as the Bank may think fit…without any further consent from or notice to the Borrower…”
C1 8 of the Terms and Conditions leaflet contains an almost identical provision and also states “Your Home Is At Risk If You Do Not Keep Up Payments On A Mortgage Or Any Other Loan Secured On It”. [sic]
12. In relation to the Central Bank documents, the supplemental affidavit of Ms. Kathryn Harris dated 4th March, 2013, states that neither of the documents relied on by the plaintiffs is a statutory code of practice under the relevant legislation, being section 117 of the Central Bank Act, 1989. It is submitted that currently four such codes are issued under s. 117, namely, the Consumer Protection Code 2012; Code of Conduct for Business Lending to Small and Medium Enterprises 2012; Code of Conduct for Business Lending to Small and Medium Enterprises 2009; and Code of Conduct on Mortgage Arrears.
13. In relation to the Central Bank of Ireland Asset Securitisation document, it is contended that this is of no relevance to the plaintiffs’ case and “is only relevant to the manner in which a bank treats securitised loans for regulatory capital adequacy purposes.” In any event, it is submitted that even if it were applicable, which it is contended it is not, this is a voluntary, non-statutory code.
14. In relation to the Code of Practice on Transfer of Mortgages Ms. Harris states that: –
“The voluntary (non-statutory) nature of the Code of Practice on Transfer of Mortgages was confirmed by the Central Bank to Bank of Scotland (Ireland) Limited in correspondence in 2008 in advance of the securitisation program whereby three of the six loans at issue in the proceedings were securitised”.
15. A letter dated 14th May, 2008, from a Mr. Carl Rainey, then ‘Director – Group Risk Division’ with Bank of Scotland, to a Ms. Elaine Sheerin, Senior Regulator in the Central Bank’s Banking Supervision Department, states that “As part of the preparation work for the residential mortgage securitisation, we now set out below the steps we have taken to ensure that we are compliant with the requirements of the Central Bank Code of Practice on Transfer of Mortgages” and goes on to state that –
“every home loan originated by BOSI and BOS since 1999 has involved the obtaining of consent to securitisation in at least three documents: (1) a declaration contained in the application form which is signed by the borrower, (2) the terms and conditions which accompany the offer letter which is signed by the borrower, and (3) in the terms and conditions which accompany the mortgage itself which, again, is signed by the borrower.”
The response from Ms. Sheerin dated 27th May, 2008, says that “the Code of Practice (the Code) is a Voluntary Code and that it is the responsibility of banks to adhere to their commitments under the Code”. Following this, on 29th May, 2008, Mr. Rainey sent an email to a number of BOSI employees states that “it is our responsibility to ensure compliance with all aspects of the Code…On the basis that we have assured ourselves that we are in compliance with Code, I feel we are in good shape to proceed”.
16. The legal status of the Central Bank codes has been considered in a number of recent cases and has led to what Hogan J. described in Irish Life and Permanent Plc v. Duff & Anor. [2013] IEHC 43 as “cross-currents of judicial opinion”. In Friends First Finance Ltd v. Cronin [2013] IEHC 59 the defendant argued that the plaintiff had failed to comply with the Consumer Protection Code and that the loan agreements between the parties were unenforceable as a result. It was held that the defendant had no arguable case on this ground as he was not a “licence holder” or “person supervised” under the Code. Herbert J. went on to state that even where a breach did occur-
“There is nothing in any of these statutes which expressly or impliedly would render the loan agreements illegal, invalid or unenforceable because of a breach by the plaintiff of any of these statutory provisions or of the Consumer Protection Code 2006.”
17. In Zurich Bank v. McConnon [2011] IEHC 75 the defendant also relied on the Central Bank Consumer Protection Code. In considering the consequences of breaching the Code, Birmingham J. said that sanctions might include cautions, reprimands, fines, and disqualification, but stated –
“Entirely lacking is any suggestion that a breach of the Code renders the contract null and void or otherwise exempts a borrower from the liability to repay… there is no suggestion that the lender is prohibited from seeking repayment from its borrower.”
The defendant in that case submitted that the Code forms an implied term of the contract. Birmingham J. held that there were a number of fundamental difficulties with this argument and ultimately concluded that: –
“I can see no basis for suggesting that any alleged breach of the Code exempts the borrower from repaying his loan.”
18. In Stepstone Mortgage Funding Limited v. Fitzell [2012] IEHC 142 the defendants went into arrears and were informed by the lender that it was not prepared to offer them an alternative repayment arrangement. They were told that they were not entitled to appeal that decision as provided for by the Code of Conduct on Mortgage Arrears as it did not apply to their case. The Master of the High Court determined that this contention was incorrect and so on appeal Laffoy J. in this Court considered the proper application of the Code of Conduct on Mortgage Arrears. Laffoy J. referred to a passage from Breslin on Banking Law (2nd Ed.) as an accurate statement of the jurisprudence of the Superior Courts on the status of the Code. The relevant passage is as follows: –
“The Central Bank has promulgated Codes of Practice for credit institutions pursuant to its powers under s. 117 of the Central Bank Act 1989. Breach of the code is not a criminal offence and the Act does not spell out any particular consequences in civil law arising from a breach. Breach of a direction by the Central Bank to comply with particular provisions of the Code is a criminal offence. A key question is whether or not these provisions are merely ‘soft law’, i.e. devoid of legal effect such that a breach of a provision in the Code of Practice will not sound a remedy in civil law for damages. In the unlikely event that the Codes of Practice have been incorporated into the bank customer bargain then they apply. Whether a particular requirement is deemed to be an implied term in that contract depends on the particular term sought to be implied, and the circumstances of the case – but the test is not an easy one to meet. It is submitted that the Codes of Practice appear more likely primarily to arise in the context of the analysis of the bank’s duty of care and whether the bank has in a particular case met reasonable standards.”
Laffoy J. held that in proceedings for possession of a primary residence which came before the Court after the Code came into force, the lender must demonstrate compliance with the Code. Laffoy J. found that the Code had not been complied with and the lender was not entitled to possession because the borrowers had not been advised of their right to appeal in the manner required by the Code.
19. In the recent case of Irish Life and Permanent Plc v. Duff & Anor. [2013] IEHC 43, the Circuit Court had made an order for possession in favour of the plaintiff which was appealed by the defendants. It was claimed that ILP had not complied with the Code of Conduct on Mortgage Arrears. Hogan J. on appeal in this Court said it was “necessary to consider the somewhat troublesome issue of the precise legal status of the Code of Conduct.” He noted that the Code was promulgated under s.117 of the Central Bank Act 1989 and that the Central Bank could invoke administrative sanctions in relation to the Code. Hogan J. reiterated the comments of Birmingham J. in Zurich Bank as set out above, and added that “s.117 of the 1989 Act contains no mandatory sanction of voidness”. However, he did observe that the remarks of Birmingham J. were “in all strictness merely obiter dicta.” Hogan J. followed the reasoning of Laffoy J. in Fitzell and found that the Code of Conduct was applicable to the facts of the case. It was held that the lender had not complied with Clause 6 of the Code and accordingly “it would not be appropriate for me to exercise a judicial discretion in favour of granting an order for possession.”
20. It is apparent from the case law that the status of the Central Bank codes issued under s. 117 and those relied on by the plaintiffs is not absolutely clear and may be dependent on the circumstances of each particular case. I am satisfied that the issues relating to the relevant Codes, their role, and the consequences of any alleged breach are interlinked with the issue of securitisation. It is not for this Court at this point in time to express any view as to the plaintiffs’ prospects of succeeding on this ground. What must be decided at this stage is whether or not the plaintiffs’ claims are of sufficient substance that it is appropriate to allow them to proceed with the action. In Aer Rianta v Ryanair [2004] IESC 23 Denham J made it clear that the jurisdiction to strike out proceedings under O19, r 28 is one that the Court should be slow to exercise. In relation to the Court’s inherent jurisdiction, it was established by Costello J in Barry v. Buckley [1981] 1 I.R. 306 that where the court is satisfied that a claim is bound to fail “it would be a proper exercise of its discretion to strike out proceedings whose continued existence cannot be justified and is manifestly causing irrevocable damage to the defendant”. That jurisdiction can only be exercised upon the closest scrutiny and in clear cases and the Court will only exercise this jurisdiction where it is satisfied that there is nothing meritorious in the plaintiffs’ claim. In essence, the defendants have to satisfy the court on the balance of probabilities that the plaintiffs’ case has no foundation in law. The view of this Court is that the securitisation issue and that of the relevant Codes are inextricably intertwined and, having carefully considered the submissions of both parties, the Court could not therefore come to a conclusion based on the present state of the law as outlined above that the plaintiffs’ claim is bound to fail or has no foundation in law. Right of access to the Courts must be preserved if at all possible and for that reason the plaintiffs’ must be allowed to proceed on this ground.
The cross-border merger – insolvency and fraudulent misrepresentation
21. It is submitted by the plaintiffs that the Bank was insolvent, in breach of liquidity laws and in breach of its license when the cross-border merger was effected in December, 2010 and as a result the Bank’s appointment of the second named defendant as receiver was ultra vires. Paragraph 9 of the statement of claim also alleges that senior personnel in the Bank conspired with others to fraudulently obtain the cross-border merger between Bank of Scotland Ireland and Bank of Scotland plc. It is alleged that such persons misled the High Court and the Scottish Court of Sessions as to the Bank’s solvency and eligibility for a merger. It is contended that a consolidated balance sheet for Bank of Scotland (Ireland) for the period ending December 31st, 2009 was used in support of the cross-border merger in order to convince the Courts that the Bank was solvent and satisfied the necessary legal requirements at the time, rendering the action of appointing the receiver null and void.
22. Counsel for the defence contends that this is not a reasonable cause of action for a number of reasons. Firstly, it is submitted that there is no solvency requirement in relation to cross-border mergers and that the relevant UK legislation makes express provision for disapplication of the Insolvency Act where the company is the subject of a cross-border merger. S.73(2)(d) of the Insolvency Act 1986, says the protections afforded to creditors by the Act do not apply to a proposal for a cross-border merger, while s.74(6) says that an order may not be made in relation to an administrators conduct “if it would impede or prevent the implementation of…a cross-border merger”. Article 4 of Directive 2005/56/EC sets out the conditions relating to cross-border mergers and there is no reference to a solvency requirement. Secondly, the defendants assert that a cross-border merger can not be challenged once the Order approving the merger is made. In the present case, orders approving the merger were made in the High Court by Kelly J on 22nd October, 2010, and by the Scottish Court of Session on 10th December, 2010. The grounding affidavit of Mr Gary Collins states that “the cross-border merger occurred under the supervision of the High Court in Ireland and the Court of Session in Scotland, which said courts were satisfied that the relevant requirements were satisfied” and that as a result the plaintiffs cannot seek to contend that the cross-border merger was somehow deficient or invalid. It is submitted that the contracts entered into by the plaintiffs remain enforceable by the Bank as a result. Under Directive 2005/56/EC, as transposed into Irish law by the European Communities (Cross-Border Mergers) Regulations 2008, the effect of the order approving the cross-border merger is that all of the assets and liabilities of the transferor company shall be transferred to the acquiring company and that “every contract, agreement or instrument to which a transferor company is party shall…be construed and have effect as if the successor party had been a party thereto instead of the transferor company”. Article 17 of the Directive further states that “A cross-border merger which has taken effect as provided for in Article 12 may not be declared null and void”. Counsel for the defendant also relies on Regulation 16(3) of the UK Companies (Cross-Border Mergers) Regulations 2007 which states –
“After the consequences of the cross-border merger have taken effect (see regulation 17), an order made under this regulation is conclusive evidence that –
(a) the conditions set out in paragraph (1) have been satisfied
(b) the requirements of regulations 7 to 10 and 12 to 15 (pre-merger requirements) have been complied with.”
In the case of RE C L Nye [1971] Ch 442 (CA), where an issue arose as to the date of creation of a charge, it was held that the date of creation in the register was conclusive evidence and the court can not go behind that. Counsel for the defendant submits that this case is authority for the proposition that the order approving the merger cannot be challenged even if it is incorrect, which, it should be noted, this Court does not accept that it is.
23. In relation to the alleged fraudulent misrepresentation, counsel for the defendants asserts that this is an “unfounded allegation of a most grave nature that is not grounded in fact and…ought to be dismissed”. Again, the Court is referred to the order of Kelly J. approving the merger which states –
“The Court doth certify pursuant to Regulation 13 of the European Communities (Cross-Border Mergers) regulations 2008 that the applicant has completed properly each of the pre-merger requirements in respect of a cross-border merger with Bank of Scotland plc.”
24. The Court accepts the submissions of the defendant that there was no solvency requirement in this case in relation to the cross-border merger. In addition to this, the merger occurred under the supervision of the Commercial Court and the Scottish Court of Sessions and this Court will not interfere with the orders made approving the merger. The cross-border merger has been declared valid and such validity cannot be challenged. The appointment of the receiver was therefore not ultra vires as a result of any solvency issues. The Court is of the view that the particularisation of the alleged fraud and misrepresentation is wholly inadequate and deficient to establish a reasonable cause of action. For that reason, the claims in relation to insolvency at the time of the merger and the alleged fraudulent misrepresentation are struck out as being frivolous, vexatious and bound to fail.
Repeal of legislation
25. The plaintiffs submit that the appointment of the receiver is null and void as the Bank relied on repealed legislation and was therefore not entitled to make the appointment. Counsel for the defendants submits that this allegation is misconceived and that the Bank’s entitlement to appoint a receiver is a contractual one arising from the mortgage agreement.
26. In Kavanagh v. Lynch [2011] IEHC 348 the validity of the appointment of a receiver was at issue. In that case, the deed of mortgage had incorporated certain provisions of the Conveyancing Act, 1881 which were subsequently repealed by the Land and Conveyancing Law Reform Act 2009. Laffoy J. held that the power to appoint the receiver was conferred on the Bank by the construction of the deed of mortgage and that this had not been altered by the commencement of the Land and Conveyancing Law Reform Act 2009. For that reason, the arguments in relation to repealed legislation did “not have the impact contended for by counsel for the Defendants”. Laffoy J went on to state as follows –
“Accordingly, in my view, the considerations which arose in Start Mortgages Ltd. v. Gunn and others [2011] IEHC 275 in consequences of the repeal of s. 62(7) of the Registration of Title Act 1964 (the Act of 1964) by s. 8 of the Act of 2009 do not arise in relation to the power of Permanent to appoint Mr Lowe as receiver.”
27. Clause 8.1 of the Home Loan Mortgage Conditions states that-
“At any time after the Bank has demanded repayment of the Debt or following a request by the Borrower and insofar as the law allows, the Bank may:
(a) appoint a receiver over all or part of the property”
28. The Court accepts the submission that the entitlement of the bank to appoint a receiver was a contractual matter conferred on the Bank by the deed of mortgage and is unaltered by the repeal of legislation. The plaintiffs’ challenge to the validity of the appointment of the receiver on this ground is therefore struck out. However, the appointment of the receiver is also challenged by the plaintiffs in relation to the securitisation and Central Bank Codes issues. As set out above, these claims remain to be determined and so the appointment of the receiver remains at issue on those grounds.
The ‘creation of currency’
29. At para. 10 of the statement of claim, the plaintiffs allege that the “first named defendants misled and deceived the plaintiffs by offering what the plaintiffs understood to be a ‘loan of money’, when in fact the first named defendants did not ‘lend’ the funds, they instead created the funds with the Plaintiff’s signatures on a loan application” [Emphasis in original]. In support of this argument the plaintiffs seek to rely on the affidavit of a Mr. Walker F. Todd which discusses what he calls “a common misconception about the nature of money” and states –
“In a fractional reserve banking system like the United States banking system, most of the funds advanced to borrowers (assets of the banks) are created by the banks themselves and are not merely transferred from one set of depositors to another set of borrowers.” [Emphasis in original]
30. This affidavit was sworn in unrelated proceedings in the United States. This Court has no knowledge of those proceedings, the facts and issues of the particular case, and the context in which the affidavit was made and accordingly the Court attaches no weight to it. The Court accepts the submission by counsel for the defendants that this ‘creation of currency’ argument resembles the so-called ‘money for nothing schemes’ discussed in Meads v. Meads 2012 ABQB 571. Such arguments are coming before the Courts in numerous jurisdictions with increasing frequency since the economic and property market collapse. In Meads, Associate Chief Justice Rooke stated that such arguments are often advanced by a particular type of vexatious litigant which he termed ‘Organised Pseudolegal Commercial Argument (OPCA) litigants’. He described these arguments as ‘fanciful’ and ‘completely devoid of merit’ and said they are often made by distressed litigants, particularly those who find themselves in financial difficulty, acting under pressure and on the instruction of organised groups or individuals who have a vested interest in disrupting court operations and frustrating the legal rights of governments, corporations and individuals.
31. It is also important to note that the funds in question, regardless of how they were allegedly ‘created’, were drawn down by the plaintiffs and, as stated in the statement of claim, were spent on the refurbishment and upkeep of the properties or however else the plaintiffs saw fit. The nature of the loan agreement between the parties was clear and unambiguous and was willingly signed for by the plaintiffs who were aware of their obligations and responsibilities. For that reason, I am of the view that the plaintiffs’ claim in relation to the ‘creation of currency’ argument is frivolous, vexations and bound to fail and is therefore struck out.
Alleged offences under the Criminal Justice (Theft and Fraud Offences) Act 2001
32. The plaintiff’s make a number of allegations of criminality against the defendants. Paragraph 14 of the statement of claim alleges that the first named defendant “due to an internal systems error on their part, has taken monies lawfully belonging to the plaintiffs, in direct contravention of the Theft and Fraud Act 2001”. The plaintiffs fail to identify how this allegation gives rise to a reasonable cause of action in the present proceedings. Criminal allegations under the 2001 Act are a serious matter and are to be dealt with by An Garda Síochána and the Director of Public Prosecutions. This Court will not interfere with or circumvent the role of these authorities by entertaining any discussion or making any determination in relation to these claims. For that reason, the only proper course of action for the Court to take is to strike out this claim.
Allegations against the second and third defendant and alleged defamation
33. As already stated, the plaintiffs’ challenge to the validity of the receiver’s appointment remains at issue in relation to the securitisation and codes of conduct issues. As the allegations against the third named defendant are linked to the validity of the appointment of the receiver, it follows that the plaintiffs’ claims against the third named defendant in relation to its duty of care and role in selling the property at 55 Huntstown Wood should be allowed to proceed.
34. Having already dismissed the plaintiffs’ claims in relation to alleged offences under the Criminal Justice (Theft and Fraud Offences) Act 2001, the claims at paragraph 14 of the statement of claim against the second named defendant in relation to such alleged criminality must also be struck out.
Conclusion
35. I must stress that the jurisdiction to strike out proceedings is not one that the Court exercises lightly. Right of access to the courts should be preserved if at all possible and in arriving at my decision the benefit of any doubt always lay with the plaintiffs, who, like many property-owners throughout the country, find themselves in a very unfortunate situation. However, I have carefully considered the pleadings, affidavits and submissions made by both parties and have come to the conclusion that only the issues as raised by the plaintiffs’ in relation to securitisation and alleged non-compliance with Central Bank Codes meet the low threshold required in allowing these issues to proceed to be litigated. The remaining heads of claim as advanced by plaintiffs must be struck out pursuant to the inherent jurisdiction of the court on the basis that they are frivolous and vexatious and have no prospect of succeeding.
36. In these circumstances and in the interest of justice it appears appropriate that the plaintiff should deliver an amended statement of claim setting out the appropriate pleas in respect of their allegations in relation to the securitisation and Central Bank codes issues, as well as the remaining claim in relation to the third named defendant. It is appropriate that this claim should be advanced and in the circumstances, the court is disposed to making any appropriate order to assist in the management of the matter.
Collins v FBD Insurance Plc
[2013] IEHC 137
Judgment of Mr. Justice Feeney delivered on 14th day of March, 2013.
1.1 This is an appeal from a Circuit Court order of the 9th March, 2012 where the Court determined that Michael Collins, the plaintiff in the Circuit Court, was entitled to the sum of €15,000 damages and that he should recover that sum together with costs from the defendant. The defendant has appealed that order by notice of appeal dated the 15th March, 2012.
1.2 In the Circuit Court proceedings Michael Collins claimed a number of reliefs including damages for discrimination and harassment in breach of the Equal Status Acts 2000/2008, damages for negligence and breach of duty including statutory duty and damages for breach of contract. He also claimed damages pursuant to s. 7 of the Data Protection Acts 1988 and 2003 (“the Data Protection Acts”). The order of the Circuit Court did not identify the claim in respect of which the damages were awarded. However, both parties to the appeal proceeded on the basis that the only issues to be considered by the High Court was whether or not the plaintiff was entitled to damages pursuant to s. 7 of the Data Protection Acts and if so, the quantum of such damages. Both parties proceeded on the basis that the Circuit Court had determined that the defendant had breached the provisions of the Data Protection Acts and that the plaintiff in the Circuit Court action had been held entitled to general damages in the sum of €15,000 pursuant to the provisions of s. 7 of the Data Protection Acts and that no special damages or loss had been proved.
1.3 The case initially commenced before the High Court on the basis that the sole issue to be determined was whether as a matter of law the plaintiff respondent is entitled to compensation pursuant to s. 7 of the Data Protection Acts in the absence of evidence of actual loss or damage. When the case commenced it was envisaged by both parties that oral evidence would not be required and that the parties would seek the Court to rule on the issues of the entitlement to general damages under s. 7 of the Data Protection Acts and, if the plaintiff was so entitled, then to determine the quantum of damages. Following further consideration of the matter, the parties agreed and proceeded on the basis that oral evidence should be heard by the Court.
2.1 The factual matters which give rise to this claim commenced with the plaintiff insuring his van bearing registration number 08D 1065 with the defendant insurance company. The van which the plaintiff insured was for use by him in his business of painting and decorating. The insurance cover obtained extended to the loss of the vehicle or damage to it but the policy did not cover any other financial loss due to matters such as the temporary loss of the vehicle. The period of insurance provided for in the policy was for the twelve month period beginning the 31st May, 2008.
2.2 On the 27th September, 2008 the plaintiff’s van was stolen from outside of his home in Finglas following a break-in to his house and the theft and break-in were investigated by An Garda Síochána. Following the theft of his van, the plaintiff made a claim under his policy of insurance on the 2nd October, 2008. The claim was investigated on behalf of the defendant by a claims management company who concluded in a report from its investigator that there was clear evidence that the insurer’s house had been broken into whilst it was unoccupied and that a number of items had been stolen along with the insured’s van and that the claims management company had no reason to suspect that there was anything untoward. The report expressed the view that it was a case for settlement. Following receipt of that report, the defendant insurance company determined to have the plaintiff investigated by a private investigator. The private investigator reported to the insurance company. In the report the investigator stated that his inquiries at the local Garda station had indicated that the Gardaí considered the claim to be a genuine incident but the report went on to state that from other inquiries and information, the private investigator had established that the plaintiff was involved in an incident in Blanchardstown Shopping Centre where a van had been broken into and a strongbox in the rear of the vehicle had been forced open and items stolen and that the investigator had established from court records that it appeared that at Swords District Court on the 26th June, 2004, the plaintiff had been convicted under the Theft Act and had been sentenced to two months in prison. It should be noted that the factually correct position is that the plaintiff pleaded guilty to receiving the stolen goods which were removed from the vehicle that was broken into and that on a plea of guilty, the plaintiff received a three month sentence.
2.3 On the 10th November, 2008 the defendant insurance company wrote to the plaintiff and stated:
“We understand that you may have been convicted of a criminal offence. Please let us have full details of same in writing, together with an explanation as to why this material fact was not disclosed to us. If we do not hear from you within ten days from the date of this letter, we will proceed to cancel the above policy and treat the same as null and void.”
That letter of the 10th November, 2008 was written at a time when the insurance company did not have available to it the plaintiff’s proposal form. On the 19th November, 2008 the plaintiff wrote to the defendant seeking the plaintiff’s proposal form. The proposal form was unavailable to the defendant insurance company as of that date. On the 27th November, 2008, solicitors acting for the plaintiff wrote to the defendant requesting the urgent attention of the insurance company and pointing out that the plaintiff was currently out of work due to the loss of his vehicle. No response was received to the plaintiff’s solicitors’ letter and further reminders were sent on the 11th December, 2008 and the 16th December, 2008.
2.4 In early January 2009, the plaintiff’s van was recovered and returned to him. As of the date that the van was returned, the defendant insurance company had neither paid out under the policy of insurance nor responded to the correspondence from the plaintiff’s solicitors nor had it provided the plaintiff with a copy of his proposal form. That form had been signed and completed at the inception of the policy. On the 12th January, 2008 the plaintiff’s solicitors wrote to the defendant pursuant to the Data Protection Acts formally calling upon the defendant pursuant to s. 4 to furnish a copy of the plaintiff’s file, including a copy of the original proposal form. The cheque enclosed with the request was for a sum greater than the required amount and correspondence was exchanged to achieve the payment of the actual required amount. A cheque for the correct sum was forwarded by the plaintiff’s solicitors to the defendant by letter dated the 19th February, 2009. On the 25th March, 2009, the defendant forwarded to the plaintiff’s solicitors a letter enclosing the documentation that the defendant held on its file in respect of Michael Collins. By that date, the plaintiff’s solicitors had already been in contact with the Data Protection Commissioner and had, by letter of the 9th March, 2009, requested the Commissioner to inquire into the insurance company’s delay in dealing with the request from the plaintiff. Following receipt of the insurance company’s letter of the 25th March, 2009, enclosing certain documentation, the solicitors for the plaintiff again wrote to the Data Protection Commissioner by letter of the 30th March, 2009 raising concerns as to how the insurance company had come upon certain information and whether or not, in obtaining such information, there had been a breach of the Data Protection Acts. Following further correspondence between the Data Protection Commissioner, the plaintiff’s solicitors and the defendant insurance company, the solicitors for the plaintiff, by letter of the 16th September, 2009 to the Data Protection Commissioner, formally requested a decision from the Commissioner under s. 10 of the Data Protection Acts in relation to the complaint brought on behalf of Michael Collins against FBD Insurance Company. That request was ultimately responded to by a decision of the Data Protection Commissioner dated the 1st August, 2010 concluding that the defendant insurance company had been in breach of s. 4(1)(a) of the Data Protection Acts “by not providing all the relevant personal data within the forty day time limit specified”, and, secondly, had been in breach of s. 4(7) “by not notifying Lawlor Partners Solicitors [the plaintiff’s solicitors] when it released certain personal data on the 25th March, 2010 of its reasons for refusal to supply other personal data in its possession and of the data’s subject right to complain to the Data Protection Commissioner about that refusal”.
2.5 As part of the correspondence which was exchanged prior to the first decision of the Data Protection Commissioner, the Data Protection Commissioner wrote to the plaintiff’s solicitors by letter of the 11th August, 2009 indicating that the Commissioner had been informed in a recent letter that the insurance company’s actions arose because “the reasons the claims handlers became suspicious on this case came down to the occupation of the insured. The claims handler in the case of Mr. Michael Collins asked the question on previous convictions because the client’s occupation is stated to be a painter and decorator”. During the hearing in this Court, it was accepted and acknowledged on behalf of the insurance company that that was a false explanation, based upon incorrect information and that by the date that the insurance company had written to the plaintiff on the 10th November, 2008 stating that they understood that Mr. Collins may have been convicted of a criminal offence, the insurance company were in fact of a possession of the claims management company’s report dated the 13th October, 2008 and the private investigator’s report which referred to a criminal conviction. The explanation provided by the defendant for raising the possibility of a criminal conviction was, on the face of it, concocted.
2.6 Following receipt of the first decision of the Data Protection Commissioner dated the 1st August, 2010, further correspondence was exchanged between the plaintiff’s solicitor and the office of the Data Protection Commissioner. On the 9th September, 2010 the plaintiff’s solicitors made a complaint against FBD Insurance Company on behalf of the plaintiff. Eventually, that complaint resulted in the second decision of the Data Protection Commissioner which was dated the 14th April, 2011 wherein it was identified that on the 9th September, 2010 a request had been made to investigate alleged breaches of the Data Protection Acts relating to the use by FBD of a private investigator and the production by him of a report on Mr. Collins which included information on an unrelated incident involving Mr. Collins which had resulted in a criminal conviction. The decision of the Data Protection Commissioner set out details of the investigation and an analysis of the data protection issues and concluded on the final page with the decision. The Commissioner was of the opinion that FBD Insurance had contravened the Acts and, in particular, s. 2(c)(3):
“. . . by failing to ensure that all the processing of your client’s [Mr. Collins’] personal data was carried out in pursuance of a contract in writing or in another equivalent form between the data protection controller (FBD) and the data processor (private investigator), that the contract provide that the data processor carry out the processing only on and subject to the instructions of the data controller and that the data processor comply with obligations equivalent to those imposed on the data controller by s. 2(1)(d) of the Act”.
The Commissioner also gave the opinion that the insurance company failed “to ensure that the data processor provide sufficient guarantees in respect of the technical security measures, and organisational measures governing the processing” and also failed to “take reasonable steps to ensure compliance with those measures”. The decision also found that FBD Insurance failed to comply with 2(c)(3) and s. 2(1):
“by (i) securing access to court records through the agency of the private investigator which recorded sensitive data – a criminal conviction – related to your client [Mr. Collins], other than in a manner prescribed by the District Court rules and (ii) in failing to take reasonable steps to ensure that the private investigator did not thus unfairly obtain personal data related to your client [Mr. Collins]”.
2.7 The second decision of the Data Protection Commissioner of the 14th April, 2011 concluded by stating in relation to damages that data controllers are liable under s. 7 of the Data Protection Acts to an individual for damages if they fail to observe the duty of care they owe in relation to personal data in their possession and that it was a matter for any individual who feels that he might have suffered damage from a contravention by a data controller of its data protection responsibilities to take legal advices appropriate but that the office of the Data Protection Commissioner has no function in relation to the taking of proceedings under s. 7 or in giving any such legal advice.
2.8 The decisions of the Data Protection Commissioner were not appealed.
2.9 By civil bill dated the 12th May, 2011, Michael Collins commenced Circuit Court proceedings against FBD Insurance Company Plc including claims for a number of reliefs including a claim for damages under s. 7 of the Data Protection Acts arising from the contraventions by FBD of its data protection responsibilities as detailed in the two decisions of the Data Protection Commissioner. The claim pursuant to s. 7 was the only clam proceeded with in the Circuit Court and it was in respect of that claim under s. 7 of the Data Protection Acts that damages were awarded to the plaintiff by the Circuit Court.
2.10 The second decision of the Data Protection Commissioner identified that the defendant insurance company in its disclosure of documents made on the 25th March, 2009 to the plaintiff’s solicitors had omitted therein to identify or reveal the existence of a report from the private investigator and the decision of the Data Protection Commissioner had identified that there was no written contract in place between the insurance company and the investigator as required by the Acts.
2.11 The proceedings before the High Court were a re-hearing of the case considered by the Circuit Court and during the course of the hearing counsel for the defendant acknowledged that the FBD Insurance Company had breached the Data Protection Acts and accepted the findings of the Commissioner in relation to such breaches and confirmed that no appeal had been taken against the findings made by the Commissioner. Whilst the civil bill had identified particulars of special damage in the form of loss of earnings and alternative transport, no figure was identified in respect of such special damage nor was any loss proved in Court. At the commencement of the hearing before the High Court, it was acknowledged on behalf of the plaintiff that there had been no out of pocket expenses or special damages incurred by the plaintiff arising from the breaches of the Acts. It was on that basis that the issue which was before the Court was whether or not the plaintiff was entitled under s. 7 of the Act to an award of general damages in the absence of any damage including special damage. During the course of the evidence certain limited evidence was led in relation to loss of earnings arising from the plaintiff being without his van for a number of months. That evidence was so imprecise and indefinite that I was unable to conclude that the plaintiff suffered any provable damage or to relate any claimed damage to the breaches of the Data Protection Acts committed by the defendant.
3.1 The plaintiff claims that he is entitled to damages pursuant to s. 7 of the Data Protection Acts for the breaches of the Acts committed by the defendant. In the two decisions of the Data Protection Commissioner, four breaches were identified. Those breaches were:
(a) the failure by the insurance company to furnish data within forty days;
(b) the failure by the insurance company to disclose that documentation; in its possession had been released;
(c) the failure by the insurance company to have the necessary and required contract in place with a private investigator before using such investigator; and
(d) the failure by the insurance company to access District Court conviction orders in the proper manner.
3.2 Section 7 of the Data Protection Act deals with the duty of care owed by data controllers and data processors. Section 7 provides:
“For the purposes of the law of torts and to the extent that that law does not so provide, a person, being a data controller or a data processor, shall, so far as regards the collection by him of personal data or information intended for inclusion in such data or his dealing with such data, owe a duty of care to the data subject concerned.”
It is the extent of the civil liability for breach of statutory duty as identified in s. 7 which is central to the matters which I must consider. The plaintiff contends that he is entitled to damages pursuant to s. 7 of the Act as there has been a breach of the Act by the defendant. The plaintiff contends that s. 7 establishes a statutory duty of care and allows for a remedy for a breach under the law of torts. The plaintiff also contends that to recover damages under s. 7 of the Act, a data subject does not have to show a loss and damages may be awarded by a Circuit Court Judge, or on appeal by a High Court Judge, so as to allow the data subject enforce his data protection rights. The defendant contends that a plaintiff is not entitled to any award of damages pursuant to s. 7 unless the plaintiff proves actual loss or damage. I must therefore determine what is the extent of damage recoverable under s. 7 of the Data Protection Acts. Section 7 of the Data Protection Acts establishes a statutory duty of care and allows for a remedy for a breach under the law of torts. Section 7 is a statutory provision which expressly provides that a civil action may be taken. Section 7 imposes a statutory duty of care on data controllers and data processors to the extent that the law of torts does not already provide, as regards the collection of personal data and their dealing with the data; the duty is owed to the data subject concerned. The question comes down to whether or not the damages provided for by s. 7 requires that there be proof of damage suffered by a plaintiff as a necessary pre-condition to an award of damages.
3.3 The long title to the Data Protection Act 1988 reads in part as follows:
“An Act to give effect to the convention for the protection of individuals with regard to automatic processing of personal data done at Strasbourg on the 28th day of January, 1981, and for that purpose to regulate in accordance with its provisions the collection, processing, keeping, use and disclosure of certain information relating to individuals that is processed automatically.”
The convention referred to is the Strasbourg Convention. Section 7 of the Data Protection Acts seeks to provide for remedies as envisaged under Directive 95/46/EC of the 24th October, 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data. Article 23 of the Directive reads under the heading “Liability”;
“Member States shall provide that any person who has suffered damage as a result of an unlawful processing operation or of any act incompatible with the national provisions adopted pursuant to this Directive is entitled to receive compensation from the controller for the damage suffered.”
What is envisaged by Article 23 is that a person who has suffered damage is entitled to be compensated. Paragraph (55) of the preamble to the same Directive reads:
“Whereas, if the controller fails to respect the rights of data subjects, national legislation must provide for a judicial remedy; whereas any damage which a person may suffer as a result of unlawful processing must be compensated for by the controller, who may be exempted from liability if he proves that he is not responsible for the damage, in particular in cases where he establishes fault on the part of the data subject or in case of force majeure; whereas sanctions must be imposed on any person, whether governed by private of public law, who fails to comply with the national measures taken under this Directive.”
The Directive mandates that in the event of a breach that sanction shall apply and Article 24 of the Directive states in relation to sanctions:
“The Member States shall adopt suitable measures to ensure the full implementation of the provisions of this Directive and shall in particular lay down the sanctions to be imposed in case of infringement of the provisions adopted pursuant to this Directive.”
3.4 What is obligated under the Directive is that a Member State is obliged to have in place a provision which provides that a person who has suffered damage as a result of an unlawful processing operation or an act incompatible with national provisions is entitled to receive compensation from the controller for the damage suffered. The obligation does not extend to an automatic payment of compensation. It is open to the Member State to provide that the compensation permissible in a Member country’s legislation extends beyond the Directive. That is a matter for each individual Member State. Article 23 provides that a wronged individual may be entitled to payment of compensation but subject to proof of the damage that they have suffered.
3.5 Section 7 of the Data Protection Acts transposes the Directive into Irish law. Section 7 imposes a statutory duty of care on data controllers to the data subject. It is stated in the legal submissions on behalf of the plaintiff that:
“The drafting of the section (s. 7) is perhaps not inspired and academic commentary is sparse. Almost all Irish authority on statutory duty relate to the existence of statutory duty existing in parallel to a common law duty and generally in the context of occupational injury”.
I accept that the drafting of s. 7 is imperfect and, to some extent imprecise. However, what is clear is that s. 7 does not provide, within its terms, for strict liability or for the automatic payment of compensation. It limits compensation by a provision providing for the existence of a duty of care within the law of torts. The section does not in its express terms seek to go beyond the obligation for compensation contained in the Directive.
3.6 Insofar as it may be said that the terms of s. 7 are ambiguous or unclear, s. 7 must be interpreted in the light of Article 23 of the Directive. The interpretation of Directives requires not only the construction of the Community Directive or text but also of the national implementing legislation. It is accepted that national legislation ought to be interpreted so as to give effect to the intention identifiable from the text of the Directive itself. Directives are commands addressed to each Member State and each State has a duty to give effect to its obligations under the Directive. That duty does not extend to going beyond the obligation required in the Directive even though the possibility of doing so is permitted, provided the Member State does so clearly within the legislation implementing the Directive. It is submitted by the defendant that the Directive limits the obligation to provide for an entitlement to compensation for the data controller to damage suffered by a person who can prove that they have, in fact, suffered damage arising from a breach of their rights pursuant to the legislation. I accept that submission. It is also the case that s. 7 in the Irish legislation does not, on the face of it, provide for compensation for strict liability or for the automatic payment of compensation but limits compensation to the existence of a duty of care within the law of torts. It is consistent with the general principles of the Irish law of torts that a person seeking compensation arising from a breach of statutory duty must establish that the loss or damage which they have sustained flowed from that breach unless the statutory duty involved is one of strict liability. The Directive does not provide for strict liability or the automatic payment of compensation nor does s. 7 of the Irish legislation so provide, either by its express terms or by reference to a duty of care within the law of torts.
3.7 Consideration of the legislation by which a number of Member States have incorporated the Directive into their national law demonstrates that those countries have proceeded on the basis that there is no need or requirement to go beyond providing for compensation on proof of damage (see the provisions of s. 69 of the Danish legislation on processing of personal data of 2000 and s.8 of the Federal Data Protection Act 2001 of Germany dealing with compensation by a private body which is limited to the harm caused and also s. 15 of the Italian Personal Data Protection Code of 2003 which deals with compensation for damage to another).
3.8 Insofar as it can be claimed that there is an ambiguity within the words of s. 7, that section is required to be interpreted in the light of Article 23 of the Directive and on that basis, and by reference to the terms of s. 7 itself, I am satisfied that s. 7 does not provide for either strict liability or the automatic payment of compensation but limits itself to providing for the existence of a duty of care within the law of torts. For that duty of care, in circumstances where it is a breach of statutory duty to extend to the payment of damages without proof of damage or loss, it would mean that strict liability applied. For that to arise, the section itself would have to have so provided.
4.1 As recognised by the plaintiff in the legal submissions submitted on his behalf, almost all Irish authority on statutory duty relates to the existence of statutory duty existing in parallel to a common law duty and generally in the context of occupational injury. Occupational injury claims are often brought on the basis that there has been a breach of the Safety, Health and Welfare at Work Act of 2005 and the regulations made thereunder. That Act, like the Data Protection Acts, has its origin in obligations placed upon Ireland pursuant to a European Directive which provided for significant rights and protections to individual citizens. An individual claimant seeking to rely on a breach of the extensive statutory obligations pursuant to the Safety, Health and Welfare at Work Act 2005 and seeking compensation must establish that he or she has suffered damage flowing from the particular breach in respect of which complaint is made. In other words, the person seeking compensation arising from a breach of statutory duty under the Safety, Health and Welfare at Work Act 2005 must prove damage flowing from a breach and unless that is established, there is no entitlement to damages as the Act does not provide for a strict liability.
4.2 The provisions of s. 7 of the Data Protection Acts provides for an obligation on a data controller or a data processor to exercise a duty of care. A breach of that duty of care can result in the award of damages. However, the section does not provide for automatic damages for a breach of the Act and there is no reference or identification of any strict liability. The Act does deal with and expressly provides for sanctions or penalties for criminal liability (see s. 31). In addressing the requirement to implement the Directive and a need for liability under the Act, the legislature was addressing the requirement to provide for “any person who has suffered damage” and to provide for compensation “for the damage suffered”. The implementation by Ireland, in its legislation, could have gone further and Ireland as a Member State could have provided for greater protection than required under Directive 95/46 (see the case of Re Criminal Proceedings against Lindqvist [2004] QB at para. 49, which identifies that nothing prevents a Member State from extending the scope of the national legislation implementing Directives). In Ireland the legislature determined to implement the Directive into Irish law by reference to a statutory duty of care obligation and not by reference to strict liability.
4.3 As a matter of construction, the statutory obligation which provides for a private remedy for breach of statutory duty under the Data Protection Acts was imposed, not as a strict liability, but as a duty of care obligation. If the statute provides a express means of enforcing a duty, that normally indicates that the statutory right was intended to be enforceable by that means. The entitlement to damages and the scope of such damages is dependent upon a true interpretation of the relevant statutory provision. In this case, where it is clear that there is no strict liability and that liability and the entitlement to compensation is predicated upon and dependent upon a claimant establishing a breach of a statutory duty of care, it necessarily follows that a claimant must establish that the breach has caused the claimant damage if that claimant is to be entitled to damages. In this instance, the entitlement is not to damages for breach of duty, but compensation for breach of duty. Compensation is intended to place an individual in the position which that individual would have been apart from the wrong done. In general, an entitlement to damages for distress, damage to reputation or upset, are not recoverable save where extreme distress results in actual damage, such as a recognisable psychiatric injury.
4.4 Section 7 is limited and goes no further than providing for a duty of care that is a duty of care within the law of torts. To obtain a compensation for a breach of duty of care, it is necessary for a claimant to establish that there has been a breach, that there has been damage and that the breach caused such damage. The tort of negligence, unlike the tort of trespass to person, requires proof of damage. Such requirement is demonstrated in the judgment of Clark J. in Larkin v. Dublin City Council [2008] 1 IR 391 where Clark J. held, in dismissing the plaintiff’s claim, that the defendant had breached its duty to ensure that the results of assessments for appointment to a post were not presented to the candidates until their accuracy had been checked, but that despite that breach by the defendant, the plaintiff had not established that he had suffered from any recognisable psychiatric illness and was therefore excluded from the recovery of damages for public policy reasons. A person seeking compensation arising from a breach of statutory duty under an Act must establish that the loss or damage that such person has suffered flowed from the breach, unless the statutory duty involved is one of strict liability. Here, the statute does not provide for strict liability and for me to interpret s. 7 of the Data Protection Acts as enabling a claimant to benefit from an award of damages for non-pecuniary loss, would be for me to expand the scope of s. 7 beyond that provided for in the Act or required by the Directive. The Directive in issue in this case requires for there to be compensation for damage suffered and s. 7 does not extend beyond that obligation. Section 7 provides an obligation of duty of care and allows for a remedy under the law of torts and the law of torts generally provides for compensation to be based upon certain criteria which includes the proof of damage.
5.1 The defendant sought to rely on various English decisions concerning the U.K.’s legislation implementing the Directive, namely, the Data Protection Act 1998. However, consideration of the provisions of that Act and, in particular, s. 13(2) dealing with compensation which allows for compensation to an individual “. . . who suffers distress by reason of any contravention”. The U.K. Act goes beyond the requirements in the Directive and expressly provides for compensation for distress. The Irish legislation does not. In those circumstances, I have decided this case without regard to the English authorities as the statutory approach to damages is different.
6.1 In this case the plaintiff has failed to prove any damage resulting from the breach of the duty of care owed by the defendant. While certain limited evidence was led by the plaintiff in relation to the consequences of delay, no evidence was led to prove such damage or to establish that any damage flowed from the admitted breach of statutory duty on the part of the defendant. In those circumstances, the plaintiff in this case is not entitled to any damages as he has failed to establish that he has suffered any loss or damage within the scope of s. 7 of the Data Protection Acts. The statutory position in Ireland is that no matter how blatant the breach that the person the subject of the breach can only receive damages on proof of loss or damage caused by the breach.
7.1 Whilst I am satisfied that the plaintiff is not entitled to an award of damages, and that therefore the Circuit Court order should be vacated, the Court will have regard to both the manner in which the defendant company conducted itself in relation to the investigations carried out by the Data Protection Commissioner, and also to the fact that the issue as to the limitation of the nature of damages under s. 7, which has resulted in the defendant succeeding in this appeal, was not argued in the Circuit Court when addressing the question of costs.
Flynn v. Waterford County Council
[2004] IEHC 335
Judgment of Finnegan P. delivered on the 20th day of October 2004.
The Defendant is sued as the Road Authority responsible for a road leading from Portlaw to the main Kilmeaden to Carrig-on-Suir Road designated in the Defendant’s records as the A16. The section of the A16 is known locally as Priests Lane and is approximately one half mile long. It is some thirteen to fourteen feet wide but is splayed and slightly wider at its junction with the Kilmeaden to Carrig-on-Suir Road. On the date of the accident giving rise to this claim a Stop sign was located at some nine feet from the junction. The Plaintiff’s Engineer gave evidence that there was also a stop line with the word “stop” painted on the roadway: however Garda Maurice Clifford who investigated the accident gave evidence and introduced a sketch map of the scene which did not show any stop line nor the word “stop” but merely a centre line on Priests Lane. He had taken photographs of the scene but these had been mislaid and had not been located. On the balance of probability I am satisfied that the sketch map represents the road markings at the date of the accident. In addition to the Stop sign there was an advance warning sign provided at a distance of seventy five yards from the junction. John Whelan who was then the Road Overseer for the Defendant for the area gave evidence that he gave an instruction on the 28th July 1999 for a new advance warning sign to be erected to replace another sign which had been vandalised. The instruction went to Paul Kelly. The vegetation on the ditch had been cut in July. Paul Kelly a general worker with the Defendant gave evidence that he received the instruction at 7.55 a.m. on the 28th July. On that day he saw a vandalised advance warning sign on Priests Lane. He filled a dumper with the necessary equipment and replaced the sign. There was a concrete pole on which the vandalised sign had been placed but this was broken. He got a new sign from the Depot and erected the same on a new metal pole some ten yards closer to the junction. He used a strimmer to clear vegetation on the ditch to clear the view to the sign. If this evidence is correct the new sign had been erected prior to the accident and the vegetation trimmed.
The Plaintiff’s father gave evidence of having inspected the locus of the accident some two weeks after the accident. He saw the warning sign in the ditch all bent and faded. It was some distance from the present location, there was vegetation around it and you could hardly see it if driving. The sign was not on a pole and he believed it was on a tree.
On the balance of probabilities I am satisfied that an instruction was given to replace the sign on the 28th July 1999 but that Mr. Paul Kelly, the Defendant’s General Worker is incorrect in his recollection that he carried out the work on that day but rather that the work was not carried out until after the date of the accident.
The legal issue to arise in this action is whether there is an obligation upon the Road Authority, the Defendant, to erect signs and to maintain them.
Dr. Denis Wood, Engineer on behalf of the Plaintiff gave evidence of best practice and in this regard relied upon Layout of Roads in Rural Areas 1968 H.M.S.O. and Junctions and Access: The Layout of Major/Minor Junctions 1984 U.K. Department of Transport. He also referred to the Traffic Signs Manual produced by the Department of the Environment in 1996. I accept these as setting out best practice both in relation to road signs and road markings and the clearing of vegetation. However I am satisfied that none of these publications impose a duty on a highway authority if one does not otherwise exist at law.
The Plaintiff relied upon the Roads Act 1993. Section 2. of the Act defines “road” as follows –
(a) any street, lane, footpath, square, court, alley or passage,
(b) any bridge, viaduct, underpass, subway, tunnel, overpass, overbridge, flyover, carriageway (whether single or multiple), pavement or footway,
(c) any weighbridge or other facility for the weighing or inspection of vehicles, toll plaza or other facility for the collection of tolls, service area, emergency telephone, first aid post, culvert, arch, gulley, railing, fence, wall, barrier, guard-rail, margin, kerb, lay-by, hard shoulder, island, pedestrian refuge, median, central reserve, channelliser, roundabout, gantry, pole, ramp, bollard, pipe, wire, cable, sign, signal or lighting forming part of the road, and
(d) any other structure or thing forming part of the road and –
(i) necessary for the safety, convenience or amenity of road users or for the construction, maintenance, operation or management of the road or for the protection of the environment, or
(ii) prescribed by the Minister.
Thus “road” includes both poles and signs forming part of the road. Section 2(3) of the Act provides as follows –
“Nothing in this Act affects any existing rule of law in relation to the liability of a Road Authority for failure to maintain a public road.”
Section 2(4) provides as follows –
“The maintenance of a public road includes the provision and maintenance of public lighting.”
The Road Traffic Act 1961 section 95(3) as amended provides as follows –
“(3)a The Road Authority may provide for public roads in their charge such information signs and warning signs as they consider desirable.”
Section 95(5)a provides as follows –
“A road authority shall provide for public roads in their charge such regulatory signs (other than special category signs) as may be requested by the Commissioner.”
I cite the last provision in which the word “shall” is used as opposed to “may” in section 95(3)a. On this basis I find that section 95(3)(a) confers a discretionary power on a Road Authority and not an obligation. Applying the principles enunciated by the Supreme Court in Glencar v Mayo County Council and Another 2002(1 I.R. 112) to section 95(3)a I am satisfied that it was not the intention of the Legislature in enacting that provision to confer on an individual an entitlement to claim for damages. Where a statutory provision does not give a private right to sue it would be most unusual that it should nevertheless give rise to a duty of care at common law: Gorringe v Calderdale Metropolitan Borough Council (2004) 2 All ER 326. Lord Hoffmann at p. 336
said –
“In the absence of a right to sue for breach of the statutory duty itself it would in my opinion have been absurd to hold that the Council was nevertheless under a common law duty to take reasonable care to provide accommodation for homeless persons whom we could reasonably foresee would otherwise be reduced to sleeping rough. And the argument would in my opinion have been even weaker if the Council, instead of being under a duty to provide accommodation merely had a power to do so.”
In the present case the Defendant merely has a power to erect signs. I am satisfied that that power does not give rise to a cause of action in a person who suffers injury because of their failure to do so as a breach of statutory duty. Neither can the failure to do so give rise to an action for negligence at common law.
The Roads Act 1993 I am satisfied does not alter the common law save and except that it includes within the duty to maintain a road a duty to provide and maintain public lighting. The failure of a Road Authority to maintain a public road does not confer upon an individual a right to civil redress for damages: Brady v Cavan County Council (2000) 1 ILRM 81 and Harbinson v Armagh County Council (1902) 2 IR 538
Accordingly if the Plaintiff is to sustain his claim he must do so at common law. Taking it that the sign was in disrepair and that it was largely obscured by vegetation and that the result of this was that the sign was not visible to a motorist going along Priests Lane until he was almost upon the sign can this give rise to a claim in negligence? The Plaintiff relies upon the following proposition in Pratt and McKenzie Law of Highways 20th Edition 1962 at page 142 –
“Where a highway authority places something in the highway under statutory powers and not for the purposes of maintaining the highway … they are bound to keep and repair the statutory work so placed and are liable to an action for injury arising out of their failure to do so.”
The authority cited for this proposition is Skilton v Epsom and Ewell UDC (1936) 2 All ER 50. In that case the highway authority had inserted studs into the highway for the purposes of directing traffic. One of the studs came loose and injured the Plaintiff. At first instance it was held that the stud was not part of the highway and that therefore the exemption for non feasance did not apply to the Defendant. On appeal the Court of Appeal was unable to express a view as to whether the stud was or was not part of the highway but determined that this was not in the circumstances of the case material and the case was decided by asking the question whether the Highway Authority had caused a nuisance in the highway and this question being answered in the affirmative the Plaintiff succeeded. I am satisfied that the Plaintiff cannot bring himself within the principle upon which that case was decided – that a common law liability might arise from acts done on or around the highway that have created a source of danger to users of the highway. In the circumstances giving rise to this claim the existence of the obscured sign does not constitute a nuisance.
If no sign had been erected this could not give rise to a claim by an individual for damages for breach of statutory duty: Glencar v Mayo County Council and Another 2002 1 IR 112. If the failure to erect a sign cannot give rise to liability can the Road Authority be liable if having erected a sign they fail to maintain the same by ensuring that it remains visible? In Gorringe v Calderdale MBC 2004 2 All ER at 334 Lord Hoffmann said –
“If the Highway Authority at common law with no duty other than to keep the road in repair and even that duty was not actionable in private law, it is impossible to contend that it owes a common law duty to erect warning signs on the road. It is not sufficient that it might reasonably have foreseen that in the absence of such warnings, some road users might injure themselves or others. Reasonable foreseeability of physical injury is the standard criterion for determining the duty of care owed by people who undertake an activity which carries a risk of injury to others. But it is insufficient to justify the imposition of liability upon someone who simply does nothing: who neither creates the risk nor undertakes to do anything to avert it.”
In the present case had the Defendant done nothing it would not have attracted a common law duty of care. Having given a warning the circumstances which prevailed on the day of the accident were such that the warning was less than that which was desirable but even then the Defendant had done more than it was at common law obliged to do. In these circumstances it seems to me that no liability at common law arises.
The Plaintiff also relied on Bird v Pearse 1979 RTR 369. In that case the highway authority carried out resurfacing which obliterated white lining on the road which had established a system of priorities at a junction. It was held foreseeable that there was a risk of drivers misunderstanding their priorities at the junction in that the Highway Authority had created a pattern of traffic flow which did not exist before they placed the white lines on the road, a pattern which drivers could be expected to rely upon. In these circumstances there was a duty of care to the Plaintiff to prevent accidents occurring as a result of the removal of the white lines. The decision in that case was based upon the highway authority encouraging a pattern of behaviour among road users and altering the same without warning. No such conduct on the part of the Defendant arises in the present case.
The Plaintiff has failed to satisfy me that the Defendant in this case was in breach of statutory duty or indeed if a breach of statutory duty should arise having regard to the statutory provisions that the same confers upon him a right of action. Further he has failed to establish the existence of a duty on the Defendant at common law to maintain the sign which it had erected so that it would be clearly visible. Accordingly I dismiss the Plaintiff’s claim.
Approved by Finnegan P.
Carey v. Mould & Anor
[2004] IEHC 66 (20 April 2004)
Judgment of Mr Justice Michael Peart delivered the 20th April 2004:
On the day of this accident the plaintiff was aged 62 years. By trade he is a builder who has worked at that trade since he left school in his teenage years.
The accident giving rise to these proceedings took place at a junction at Slavery, near Buncrana, Co. Donegal where the plaintiff resides. He was driving to his home on the date in question at about 1pm. He knows the road intimately and has driven that way regularly for a great number of years.
As one drives along this main road from the direction of Buncrana, the road veers to the right. Another road, the minor road from the direction of Cleggan, meets this road at the point at which the main road veers to the right. The 1st defendant was travelling along this minor road, towards the junction with that main road, in other words travelling towards the plaintiff.
The 2nd defendant, Donegal County Council, (“the Council”) had erected a Stop sign on the minor road close to the point at which that road meets the main road, in order to alert drivers on the minor road to stop, in order to let traffic on the main road continue along that main road, as the plaintiff was so doing on this day. However it appears that in some way, that Stop sign had been interfered with, as a result of which it was not facing in the intended direction on this date, but instead was turned 180 degrees so that it was in fact facing the direction from which the plaintiff was travelling.
Therefore on the date of this accident the plaintiff was travelling along the main road, and turned or veered around to the right as he was perfectly entitled to do, as he had right of way. But the 1st defendant was travelling towards the plaintiff on what he thought was a straight road on which he could continue, as if he had a right to proceed past the junction to his left, in the safe knowledge that any traffic coming onto that road from the left would yield, and that any oncoming traffic, such as the plaintiff, would halt before making a turn to their right, or would simply continue in a straight direction past him in the Cleggan direction..
On this occasion the plaintiff proceeded to veer around to his right in the knowledge that any oncoming traffic would stop at the stop sign referred to. However, because the Stop sign was facing the wrong way, the 1st defendant continued straight ahead through the junction. A factor also is that the plaintiff had, as was his entitlement, no indicator flashing in order to indicate his intention to veer to his right because he had the right of way. Therefore the 1st defendant was not even aware that the plaintiff was intending to travel across his path in order to continue on his way along the main road. A collision was therefore inevitable, and so it happened.
The evidence has been that the Stop sign at the junction, which ought to have told the 1st defendant that he was required to stop, had been interfered with, so that he was not aware of its existence. Because of this interference the evidence has been that the 1st defendant assumed that he in fact was on the main road and could with impunity and in safety continue along what he thought was a straight main road. However there is also evidence that some 100 metres back from the junction there was in place on that date a yellow sign on the left with words in black informing a driver such as the 1st defendant that there was a stop sign ahead at 100 metres. There was also a white stop line at the junction. These signs and markings had been placed at this point by the Council in order to alert drivers such as the 1st defendant that they were required to stop in order to allow drivers such as the plaintiff to pass along the main road in front of them.
I am not required to decide whether the plaintiff has proven to the necessary degree that either the 1st defendant or the Council breached the duty of care which they owed in their respective capacities to the plaintiff.. The defendants have agreed a quantum of damages in respect of the plaintiff’s injuries and have let the plaintiff out so to speak, in the sense that the only issue for decision by me is the question as to which of the defendants is liable to the plaintiff, or if both are liable, then to what degree each is so liable as between them.
The 1st defendant has accepted that the plaintiff was entitled to proceed along the main road, and to cross in front of him in so doing. In other words, he accepts that the road on which the plaintiff was travelling is the main road, and that the obligation was on him (the 1st defendant) to stop before proceeding past the junction. However he says that the Council is liable because the sign was not facing in the correct direction, for whatever reason, and there was no other sufficient warning to him that he was obliged to stop at the junction to allow the plaintiff to pass along the main road across his path. He accepts that the yellow sign placed 100 metres before the junction was in place on this date, but he very fairly accepted that he did not see it.
The Council submits that if he had been keeping a proper lookout he would have seen that sign, and that even if the Stop sign was facing the wrong way he would and should have realised that he had an obligation to yield to the plaintiff and stop at the junction. The Council also submits that on the evidence the 1st defendant was travelling at 25mph as he came down the incline towards this junction and there is no evidence that he slowed in any way as he came to the junction itself, and that he is therefore liable for the accident which occurred.
The 1st defendant on the other hand, who lives in Northern Ireland and was on holidays in the area at the time, and was not therefore familiar with this junction, as the plaintiff was, says that he did nothing wrong since the sign was facing the wrong way, and he submits that the yellow sign was not sufficient to alert him to the necessity to stop at this junction.
There has also been evidence from Garda Wallace that she was called to the scene of this accident a short time after it happened. She confirmed that the Stop sign was turned around the wrong way, but she also gave evidence that the white stop line on the 1st defendant’s side of the junction was partially faded to the extent that immediately after the accident she contacted somebody by telephone at the Council to tell them about this. She also stated that she had also personally typed a letter to the Council informing them of the problem at this junction. The Council have denied ever receiving such a letter, and Garda Wallace has not produced a copy of the letter to the Court, but she was sure that she had sent such a letter. Whether the letter was sent or not, I am satisfied that she was of the opinion on that date that the road marking was somewhat faded through age.
As I have said what I have to decide is which defendant is liable to the plaintiff, or if both are partially liable, in what proportions.
The Council has submitted that by placing the Stop sign at the junction, it has fulfilled its statutory obligation to alert the public to the necessity to stop. It submits that there is no statutory obligation to place white lines on the road, and that in addition it placed a yellow warning sign which I have already referred to at a position about 100 metres back from this junction, and maintains that even if some person by whatever means had turned that Stop sign around the other way, that yellow sign ought to have been sufficient to alert the 1st defendant to the necessity to stop at the junction. It is also submitted that the 1st defendant in any event should have slowed as he approached this junction even if he did not appreciate that he needed to halt or stop at the junction.
Mr Donal Kelleher, an engineer in the employment of the Council gave evidence that there was no history of accidents at this junction, and that the priority of the roads at this junction had remained unchanged for many years. In other words, it has been the case for years that traffic coming from the direction from which the plaintiff was travelling could proceed to their right along what is the main road, and that traffic coming from the direction of the 1st defendant must halt and yield to same. He also said that the manner in which this Stop sign was placed on the pole in question was in accordance with the method recommended in the Traffic Signs Manual. It had been suggested to him by Mr Ralston S.C. on behalf of the 1st defendant, that a better method of fixing would be to place a bolt through the sign and the pole in order to ensure that it could not be turned round in the other direction as this one had been. However, Mr Walker was of the view that placing a bolt through the sign and the pole as suggested would in fact result over time in weather damage through corrosion and that this could affect adversely the clarity and efficiency of the sign in the future.
Mr Colm Smith S.C on behalf of the 2nd defendant has submitted that the Council had done everything in its power to ensure that the public received adequate warning in respect of this junction. He accepted that it was potentially a dangerous junction in the total absence of any signage, but submitted that the Council had placed signage at the junction, and also 100 metres back from the junction, as well as placing white line markings on the road itself, and that it could not be expected to anticipate that some person would turn the sign around so that it faced the wrong way, and ceased to serve its intended purpose.
Mr Gavin Ralston S.C. on the other hand, on behalf of the 1st defendant, submitted that his client had, in the circumstances, done nothing wrong, since the sign which was intended to warn him of the junction ahead at which he was to stop, was facing the other way, and that given the nature of this road, which reasonably appeared to his client to be a straight main road, he did not fail in any duty of care upon him to the plaintiff in the circumstances. He submitted that his client’s speed at the time was reasonable and not excessive, and that it was not reasonable to find the 1st named defendant culpable for not adverting to the yellow warning sign 100 metres back from the junction given its size and position.
What is not in doubt in this case is that the plaintiff is completely blameless for this accident. That is accepted by the defendants. What is also clear from the way in which the case developed is that the defendants accept that there has been negligence on the part of one or other defendant, or a combination of both, since the quantum of damages has been agreed, and the plaintiff was not required by the defendants to take any part in the issue arising as between the defendants. Had that not been the situation as the case developed, this Court would have had to decide whether the plaintiff was able to make out a sufficient case of negligence against either defendant. That interesting question, however, does not arise for determination by me.
As far as the 1st defendant is concerned, I am satisfied that he was not travelling at an excessive speed as he proceeded towards this junction. However I am satisfied that the yellow sign placed 100 metres back from the junction was placed there for a purpose, which was to give an early warning to a driver, such as him, that he was approaching a junction at which he was required to stop. The 1st defendant very fairly accepted that he did not remember seeing that sign. If he had seen it, I am satisfied that he would at least have been aware of the junction and the need to stop, and would at the least have become puzzled that there was no Stop sign visible. He would undoubtedly have been alerted to the fact that there was no question of just proceeding along this otherwise straight road, as if it was one continuous main road. He would have been put on some sort of lookout if he had seen the yellow sign. Why he did not see the sign is of no concern to me. The fact is that he did not, and this transformed the mishap to the Stop sign itself into a far greater misfortune than it would have been had the yellow sign been observed.
However the fact that the 1st defendant failed to observe the yellow sign does not absolve the County Council from blame. It has the statutory obligation to main a safe road system. While it cannot be expected to be aware automatically of every occasion on which a sign is turned around the wrong way, perhaps by mischief, it retains an overall responsibility to ensure that roads are safe and that all traffic users are aware of potential dangers, including persons such as the 1st defendant, a tourists, who would not be familiar with a potentially dangerous junction, such as that involved in this accident. I am satisfied that this junction is, and was on this date, even ignoring the fact that the Stop sign was facing the wrong way, an inherently hazardous junction, and one requiring that very clear warnings be apparent to any road user, particularly one such as the 1st defendant who was a visitor to the area. It is an unfortunate fact of everyday life that signs such as this Stop sign can become turned in the wrong direction for whatever reason. No doubt this is why the Council felt it was desirable to give road users an early warning of the junction by placing the yellow sign 100 metres back from the junction. However it is also clear to me that the Council would not have regarded that yellow sign alone as an adequate warning to a road-user such as the 1st defendant, to stop at the junction, hence the fact that it placed the Stop sign, and also the white Stop line at the junction itself. That white line marking was partially faded on this date, according to the evidence of Garda Wallace, which I accept in that regard.
Mr John Mooney, Consulting Engineer on behalf of the 1st defendant, has suggested a number of ways in which a junction, such as the present one, could be improved as far as safety is concerned. He is of the view that without the Stop sign this is a hazardous junction, and that for instance, some sort of island design could be placed at the junction which would mandate traffic such as the first defendant to stop and wait till traffic such as the plaintiff had passed. He also suggested that at the Stop sign there could also be white lettering on the road itself saying “STOP”, as often happens. He also suggested that the Council could have placed a larger type of yellow warning signing indication the need to stop at the junction which would not be subject to the possible hazard of being turned the wrong way by accident or otherwise.
I am satisfied that while the Council had fulfilled the letter of their statutory obligation by erecting the Stop sign at this junction, that is not the full extent of its obligations to the public. Firstly, this is an inherently dangerous junction requiring special steps to be taken in order to ensure as far as possible that an accident such as the present one did not happen. In recognition of this it went further than its statutory obligation by providing a white Stop line at the junction, and a yellow warning 100 metres back from the junction. However the white line was partially faded, and the yellow sign, it has to be said, from the photographs, is not a large, unmissable type of sign. Nevertheless, I believe that the 1st defendant ought to have seen it, and if he had, he might possibly have realised that he was at a junction at which he was required to stop and give way to the plaintiff.
I am satisfied that, as between the defendants, while the 1st defendant was at fault in that regard, he is at fault to a much lesser extent than the Council, whose duty it is to ensure the safety of the roads. I am particularly mindful of the fact that the 1st defendant was a tourist and was therefore completely unfamiliar with this junction. The Council was in a position to ensure the safety of this junction to a much greater degree than was the case, such as in the manner suggested by Mr Mooney, to which I have referred. Having said that, I have a degree of sympathy for the Council which cannot reasonably and fairly be expected to be aware of the fact that some person has turned a sign around so that it ceases to serve the purpose for which it was intended.
In all the circumstances, I find the 1st defendant liable to the extent of 15%, as he ought to have at least seen the yellow sign. It was there and he ought to have at least noted it and been on the look-out. The Council is liable to the extent of 85% for the plaintiff’s damages, since I am of the view that they are primarily liable as between the defendants for the fact that this junction presented a greater hazard than it ought to have on the day in question.
I give judgment accordingly.
Flynn v. Waterford County Council
[2004] IEHC 335
Judgment of Finnegan P. delivered on the 20th day of October 2004.
The Defendant is sued as the Road Authority responsible for a road leading from Portlaw to the main Kilmeaden to Carrig-on-Suir Road designated in the Defendant’s records as the A16. The section of the A16 is known locally as Priests Lane and is approximately one half mile long. It is some thirteen to fourteen feet wide but is splayed and slightly wider at its junction with the Kilmeaden to Carrig-on-Suir Road. On the date of the accident giving rise to this claim a Stop sign was located at some nine feet from the junction. The Plaintiff’s Engineer gave evidence that there was also a stop line with the word “stop” painted on the roadway: however Garda Maurice Clifford who investigated the accident gave evidence and introduced a sketch map of the scene which did not show any stop line nor the word “stop” but merely a centre line on Priests Lane. He had taken photographs of the scene but these had been mislaid and had not been located. On the balance of probability I am satisfied that the sketch map represents the road markings at the date of the accident. In addition to the Stop sign there was an advance warning sign provided at a distance of seventy five yards from the junction. John Whelan who was then the Road Overseer for the Defendant for the area gave evidence that he gave an instruction on the 28th July 1999 for a new advance warning sign to be erected to replace another sign which had been vandalised. The instruction went to Paul Kelly. The vegetation on the ditch had been cut in July. Paul Kelly a general worker with the Defendant gave evidence that he received the instruction at 7.55 a.m. on the 28th July. On that day he saw a vandalised advance warning sign on Priests Lane. He filled a dumper with the necessary equipment and replaced the sign. There was a concrete pole on which the vandalised sign had been placed but this was broken. He got a new sign from the Depot and erected the same on a new metal pole some ten yards closer to the junction. He used a strimmer to clear vegetation on the ditch to clear the view to the sign. If this evidence is correct the new sign had been erected prior to the accident and the vegetation trimmed.
The Plaintiff’s father gave evidence of having inspected the locus of the accident some two weeks after the accident. He saw the warning sign in the ditch all bent and faded. It was some distance from the present location, there was vegetation around it and you could hardly see it if driving. The sign was not on a pole and he believed it was on a tree.
On the balance of probabilities I am satisfied that an instruction was given to replace the sign on the 28th July 1999 but that Mr. Paul Kelly, the Defendant’s General Worker is incorrect in his recollection that he carried out the work on that day but rather that the work was not carried out until after the date of the accident.
The legal issue to arise in this action is whether there is an obligation upon the Road Authority, the Defendant, to erect signs and to maintain them.
Dr. Denis Wood, Engineer on behalf of the Plaintiff gave evidence of best practice and in this regard relied upon Layout of Roads in Rural Areas 1968 H.M.S.O. and Junctions and Access: The Layout of Major/Minor Junctions 1984 U.K. Department of Transport. He also referred to the Traffic Signs Manual produced by the Department of the Environment in 1996. I accept these as setting out best practice both in relation to road signs and road markings and the clearing of vegetation. However I am satisfied that none of these publications impose a duty on a highway authority if one does not otherwise exist at law.
The Plaintiff relied upon the Roads Act 1993. Section 2. of the Act defines “road” as follows –
(a) any street, lane, footpath, square, court, alley or passage,
(b) any bridge, viaduct, underpass, subway, tunnel, overpass, overbridge, flyover, carriageway (whether single or multiple), pavement or footway,
(c) any weighbridge or other facility for the weighing or inspection of vehicles, toll plaza or other facility for the collection of tolls, service area, emergency telephone, first aid post, culvert, arch, gulley, railing, fence, wall, barrier, guard-rail, margin, kerb, lay-by, hard shoulder, island, pedestrian refuge, median, central reserve, channelliser, roundabout, gantry, pole, ramp, bollard, pipe, wire, cable, sign, signal or lighting forming part of the road, and
(d) any other structure or thing forming part of the road and –
(i) necessary for the safety, convenience or amenity of road users or for the construction, maintenance, operation or management of the road or for the protection of the environment, or
(ii) prescribed by the Minister.
Thus “road” includes both poles and signs forming part of the road. Section 2(3) of the Act provides as follows –
“Nothing in this Act affects any existing rule of law in relation to the liability of a Road Authority for failure to maintain a public road.”
Section 2(4) provides as follows –
“The maintenance of a public road includes the provision and maintenance of public lighting.”
The Road Traffic Act 1961 section 95(3) as amended provides as follows –
“(3)a The Road Authority may provide for public roads in their charge such information signs and warning signs as they consider desirable.”
Section 95(5)a provides as follows –
“A road authority shall provide for public roads in their charge such regulatory signs (other than special category signs) as may be requested by the Commissioner.”
I cite the last provision in which the word “shall” is used as opposed to “may” in section 95(3)a. On this basis I find that section 95(3)(a) confers a discretionary power on a Road Authority and not an obligation. Applying the principles enunciated by the Supreme Court in Glencar v Mayo County Council and Another 2002(1 I.R. 112) to section 95(3)a I am satisfied that it was not the intention of the Legislature in enacting that provision to confer on an individual an entitlement to claim for damages. Where a statutory provision does not give a private right to sue it would be most unusual that it should nevertheless give rise to a duty of care at common law: Gorringe v Calderdale Metropolitan Borough Council (2004) 2 All ER 326. Lord Hoffmann at p. 336
said –
“In the absence of a right to sue for breach of the statutory duty itself it would in my opinion have been absurd to hold that the Council was nevertheless under a common law duty to take reasonable care to provide accommodation for homeless persons whom we could reasonably foresee would otherwise be reduced to sleeping rough. And the argument would in my opinion have been even weaker if the Council, instead of being under a duty to provide accommodation merely had a power to do so.”
In the present case the Defendant merely has a power to erect signs. I am satisfied that that power does not give rise to a cause of action in a person who suffers injury because of their failure to do so as a breach of statutory duty. Neither can the failure to do so give rise to an action for negligence at common law.
The Roads Act 1993 I am satisfied does not alter the common law save and except that it includes within the duty to maintain a road a duty to provide and maintain public lighting. The failure of a Road Authority to maintain a public road does not confer upon an individual a right to civil redress for damages: Brady v Cavan County Council (2000) 1 ILRM 81 and Harbinson v Armagh County Council (1902) 2 IR 538
Accordingly if the Plaintiff is to sustain his claim he must do so at common law. Taking it that the sign was in disrepair and that it was largely obscured by vegetation and that the result of this was that the sign was not visible to a motorist going along Priests Lane until he was almost upon the sign can this give rise to a claim in negligence? The Plaintiff relies upon the following proposition in Pratt and McKenzie Law of Highways 20th Edition 1962 at page 142 –
“Where a highway authority places something in the highway under statutory powers and not for the purposes of maintaining the highway … they are bound to keep and repair the statutory work so placed and are liable to an action for injury arising out of their failure to do so.”
The authority cited for this proposition is Skilton v Epsom and Ewell UDC (1936) 2 All ER 50. In that case the highway authority had inserted studs into the highway for the purposes of directing traffic. One of the studs came loose and injured the Plaintiff. At first instance it was held that the stud was not part of the highway and that therefore the exemption for non feasance did not apply to the Defendant. On appeal the Court of Appeal was unable to express a view as to whether the stud was or was not part of the highway but determined that this was not in the circumstances of the case material and the case was decided by asking the question whether the Highway Authority had caused a nuisance in the highway and this question being answered in the affirmative the Plaintiff succeeded. I am satisfied that the Plaintiff cannot bring himself within the principle upon which that case was decided – that a common law liability might arise from acts done on or around the highway that have created a source of danger to users of the highway. In the circumstances giving rise to this claim the existence of the obscured sign does not constitute a nuisance.
If no sign had been erected this could not give rise to a claim by an individual for damages for breach of statutory duty: Glencar v Mayo County Council and Another 2002 1 IR 112. If the failure to erect a sign cannot give rise to liability can the Road Authority be liable if having erected a sign they fail to maintain the same by ensuring that it remains visible? In Gorringe v Calderdale MBC 2004 2 All ER at 334 Lord Hoffmann said –
“If the Highway Authority at common law with no duty other than to keep the road in repair and even that duty was not actionable in private law, it is impossible to contend that it owes a common law duty to erect warning signs on the road. It is not sufficient that it might reasonably have foreseen that in the absence of such warnings, some road users might injure themselves or others. Reasonable foreseeability of physical injury is the standard criterion for determining the duty of care owed by people who undertake an activity which carries a risk of injury to others. But it is insufficient to justify the imposition of liability upon someone who simply does nothing: who neither creates the risk nor undertakes to do anything to avert it.”
In the present case had the Defendant done nothing it would not have attracted a common law duty of care. Having given a warning the circumstances which prevailed on the day of the accident were such that the warning was less than that which was desirable but even then the Defendant had done more than it was at common law obliged to do. In these circumstances it seems to me that no liability at common law arises.
The Plaintiff also relied on Bird v Pearse 1979 RTR 369. In that case the highway authority carried out resurfacing which obliterated white lining on the road which had established a system of priorities at a junction. It was held foreseeable that there was a risk of drivers misunderstanding their priorities at the junction in that the Highway Authority had created a pattern of traffic flow which did not exist before they placed the white lines on the road, a pattern which drivers could be expected to rely upon. In these circumstances there was a duty of care to the Plaintiff to prevent accidents occurring as a result of the removal of the white lines. The decision in that case was based upon the highway authority encouraging a pattern of behaviour among road users and altering the same without warning. No such conduct on the part of the Defendant arises in the present case.
The Plaintiff has failed to satisfy me that the Defendant in this case was in breach of statutory duty or indeed if a breach of statutory duty should arise having regard to the statutory provisions that the same confers upon him a right of action. Further he has failed to establish the existence of a duty on the Defendant at common law to maintain the sign which it had erected so that it would be clearly visible. Accordingly I dismiss the Plaintiff’s claim.
Approved by Finnegan P.
Carey v. Mould & Anor
[2004] IEHC 66 (20 April 2004)
Judgment of Mr Justice Michael Peart delivered the 20th April 2004:
On the day of this accident the plaintiff was aged 62 years. By trade he is a builder who has worked at that trade since he left school in his teenage years.
The accident giving rise to these proceedings took place at a junction at Slavery, near Buncrana, Co. Donegal where the plaintiff resides. He was driving to his home on the date in question at about 1pm. He knows the road intimately and has driven that way regularly for a great number of years.
As one drives along this main road from the direction of Buncrana, the road veers to the right. Another road, the minor road from the direction of Cleggan, meets this road at the point at which the main road veers to the right. The 1st defendant was travelling along this minor road, towards the junction with that main road, in other words travelling towards the plaintiff.
The 2nd defendant, Donegal County Council, (“the Council”) had erected a Stop sign on the minor road close to the point at which that road meets the main road, in order to alert drivers on the minor road to stop, in order to let traffic on the main road continue along that main road, as the plaintiff was so doing on this day. However it appears that in some way, that Stop sign had been interfered with, as a result of which it was not facing in the intended direction on this date, but instead was turned 180 degrees so that it was in fact facing the direction from which the plaintiff was travelling.
Therefore on the date of this accident the plaintiff was travelling along the main road, and turned or veered around to the right as he was perfectly entitled to do, as he had right of way. But the 1st defendant was travelling towards the plaintiff on what he thought was a straight road on which he could continue, as if he had a right to proceed past the junction to his left, in the safe knowledge that any traffic coming onto that road from the left would yield, and that any oncoming traffic, such as the plaintiff, would halt before making a turn to their right, or would simply continue in a straight direction past him in the Cleggan direction..
On this occasion the plaintiff proceeded to veer around to his right in the knowledge that any oncoming traffic would stop at the stop sign referred to. However, because the Stop sign was facing the wrong way, the 1st defendant continued straight ahead through the junction. A factor also is that the plaintiff had, as was his entitlement, no indicator flashing in order to indicate his intention to veer to his right because he had the right of way. Therefore the 1st defendant was not even aware that the plaintiff was intending to travel across his path in order to continue on his way along the main road. A collision was therefore inevitable, and so it happened.
The evidence has been that the Stop sign at the junction, which ought to have told the 1st defendant that he was required to stop, had been interfered with, so that he was not aware of its existence. Because of this interference the evidence has been that the 1st defendant assumed that he in fact was on the main road and could with impunity and in safety continue along what he thought was a straight main road. However there is also evidence that some 100 metres back from the junction there was in place on that date a yellow sign on the left with words in black informing a driver such as the 1st defendant that there was a stop sign ahead at 100 metres. There was also a white stop line at the junction. These signs and markings had been placed at this point by the Council in order to alert drivers such as the 1st defendant that they were required to stop in order to allow drivers such as the plaintiff to pass along the main road in front of them.
I am not required to decide whether the plaintiff has proven to the necessary degree that either the 1st defendant or the Council breached the duty of care which they owed in their respective capacities to the plaintiff.. The defendants have agreed a quantum of damages in respect of the plaintiff’s injuries and have let the plaintiff out so to speak, in the sense that the only issue for decision by me is the question as to which of the defendants is liable to the plaintiff, or if both are liable, then to what degree each is so liable as between them.
The 1st defendant has accepted that the plaintiff was entitled to proceed along the main road, and to cross in front of him in so doing. In other words, he accepts that the road on which the plaintiff was travelling is the main road, and that the obligation was on him (the 1st defendant) to stop before proceeding past the junction. However he says that the Council is liable because the sign was not facing in the correct direction, for whatever reason, and there was no other sufficient warning to him that he was obliged to stop at the junction to allow the plaintiff to pass along the main road across his path. He accepts that the yellow sign placed 100 metres before the junction was in place on this date, but he very fairly accepted that he did not see it.
The Council submits that if he had been keeping a proper lookout he would have seen that sign, and that even if the Stop sign was facing the wrong way he would and should have realised that he had an obligation to yield to the plaintiff and stop at the junction. The Council also submits that on the evidence the 1st defendant was travelling at 25mph as he came down the incline towards this junction and there is no evidence that he slowed in any way as he came to the junction itself, and that he is therefore liable for the accident which occurred.
The 1st defendant on the other hand, who lives in Northern Ireland and was on holidays in the area at the time, and was not therefore familiar with this junction, as the plaintiff was, says that he did nothing wrong since the sign was facing the wrong way, and he submits that the yellow sign was not sufficient to alert him to the necessity to stop at this junction.
There has also been evidence from Garda Wallace that she was called to the scene of this accident a short time after it happened. She confirmed that the Stop sign was turned around the wrong way, but she also gave evidence that the white stop line on the 1st defendant’s side of the junction was partially faded to the extent that immediately after the accident she contacted somebody by telephone at the Council to tell them about this. She also stated that she had also personally typed a letter to the Council informing them of the problem at this junction. The Council have denied ever receiving such a letter, and Garda Wallace has not produced a copy of the letter to the Court, but she was sure that she had sent such a letter. Whether the letter was sent or not, I am satisfied that she was of the opinion on that date that the road marking was somewhat faded through age.
As I have said what I have to decide is which defendant is liable to the plaintiff, or if both are partially liable, in what proportions.
The Council has submitted that by placing the Stop sign at the junction, it has fulfilled its statutory obligation to alert the public to the necessity to stop. It submits that there is no statutory obligation to place white lines on the road, and that in addition it placed a yellow warning sign which I have already referred to at a position about 100 metres back from this junction, and maintains that even if some person by whatever means had turned that Stop sign around the other way, that yellow sign ought to have been sufficient to alert the 1st defendant to the necessity to stop at the junction. It is also submitted that the 1st defendant in any event should have slowed as he approached this junction even if he did not appreciate that he needed to halt or stop at the junction.
Mr Donal Kelleher, an engineer in the employment of the Council gave evidence that there was no history of accidents at this junction, and that the priority of the roads at this junction had remained unchanged for many years. In other words, it has been the case for years that traffic coming from the direction from which the plaintiff was travelling could proceed to their right along what is the main road, and that traffic coming from the direction of the 1st defendant must halt and yield to same. He also said that the manner in which this Stop sign was placed on the pole in question was in accordance with the method recommended in the Traffic Signs Manual. It had been suggested to him by Mr Ralston S.C. on behalf of the 1st defendant, that a better method of fixing would be to place a bolt through the sign and the pole in order to ensure that it could not be turned round in the other direction as this one had been. However, Mr Walker was of the view that placing a bolt through the sign and the pole as suggested would in fact result over time in weather damage through corrosion and that this could affect adversely the clarity and efficiency of the sign in the future.
Mr Colm Smith S.C on behalf of the 2nd defendant has submitted that the Council had done everything in its power to ensure that the public received adequate warning in respect of this junction. He accepted that it was potentially a dangerous junction in the total absence of any signage, but submitted that the Council had placed signage at the junction, and also 100 metres back from the junction, as well as placing white line markings on the road itself, and that it could not be expected to anticipate that some person would turn the sign around so that it faced the wrong way, and ceased to serve its intended purpose.
Mr Gavin Ralston S.C. on the other hand, on behalf of the 1st defendant, submitted that his client had, in the circumstances, done nothing wrong, since the sign which was intended to warn him of the junction ahead at which he was to stop, was facing the other way, and that given the nature of this road, which reasonably appeared to his client to be a straight main road, he did not fail in any duty of care upon him to the plaintiff in the circumstances. He submitted that his client’s speed at the time was reasonable and not excessive, and that it was not reasonable to find the 1st named defendant culpable for not adverting to the yellow warning sign 100 metres back from the junction given its size and position.
What is not in doubt in this case is that the plaintiff is completely blameless for this accident. That is accepted by the defendants. What is also clear from the way in which the case developed is that the defendants accept that there has been negligence on the part of one or other defendant, or a combination of both, since the quantum of damages has been agreed, and the plaintiff was not required by the defendants to take any part in the issue arising as between the defendants. Had that not been the situation as the case developed, this Court would have had to decide whether the plaintiff was able to make out a sufficient case of negligence against either defendant. That interesting question, however, does not arise for determination by me.
As far as the 1st defendant is concerned, I am satisfied that he was not travelling at an excessive speed as he proceeded towards this junction. However I am satisfied that the yellow sign placed 100 metres back from the junction was placed there for a purpose, which was to give an early warning to a driver, such as him, that he was approaching a junction at which he was required to stop. The 1st defendant very fairly accepted that he did not remember seeing that sign. If he had seen it, I am satisfied that he would at least have been aware of the junction and the need to stop, and would at the least have become puzzled that there was no Stop sign visible. He would undoubtedly have been alerted to the fact that there was no question of just proceeding along this otherwise straight road, as if it was one continuous main road. He would have been put on some sort of lookout if he had seen the yellow sign. Why he did not see the sign is of no concern to me. The fact is that he did not, and this transformed the mishap to the Stop sign itself into a far greater misfortune than it would have been had the yellow sign been observed.
However the fact that the 1st defendant failed to observe the yellow sign does not absolve the County Council from blame. It has the statutory obligation to main a safe road system. While it cannot be expected to be aware automatically of every occasion on which a sign is turned around the wrong way, perhaps by mischief, it retains an overall responsibility to ensure that roads are safe and that all traffic users are aware of potential dangers, including persons such as the 1st defendant, a tourists, who would not be familiar with a potentially dangerous junction, such as that involved in this accident. I am satisfied that this junction is, and was on this date, even ignoring the fact that the Stop sign was facing the wrong way, an inherently hazardous junction, and one requiring that very clear warnings be apparent to any road user, particularly one such as the 1st defendant who was a visitor to the area. It is an unfortunate fact of everyday life that signs such as this Stop sign can become turned in the wrong direction for whatever reason. No doubt this is why the Council felt it was desirable to give road users an early warning of the junction by placing the yellow sign 100 metres back from the junction. However it is also clear to me that the Council would not have regarded that yellow sign alone as an adequate warning to a road-user such as the 1st defendant, to stop at the junction, hence the fact that it placed the Stop sign, and also the white Stop line at the junction itself. That white line marking was partially faded on this date, according to the evidence of Garda Wallace, which I accept in that regard.
Mr John Mooney, Consulting Engineer on behalf of the 1st defendant, has suggested a number of ways in which a junction, such as the present one, could be improved as far as safety is concerned. He is of the view that without the Stop sign this is a hazardous junction, and that for instance, some sort of island design could be placed at the junction which would mandate traffic such as the first defendant to stop and wait till traffic such as the plaintiff had passed. He also suggested that at the Stop sign there could also be white lettering on the road itself saying “STOP”, as often happens. He also suggested that the Council could have placed a larger type of yellow warning signing indication the need to stop at the junction which would not be subject to the possible hazard of being turned the wrong way by accident or otherwise.
I am satisfied that while the Council had fulfilled the letter of their statutory obligation by erecting the Stop sign at this junction, that is not the full extent of its obligations to the public. Firstly, this is an inherently dangerous junction requiring special steps to be taken in order to ensure as far as possible that an accident such as the present one did not happen. In recognition of this it went further than its statutory obligation by providing a white Stop line at the junction, and a yellow warning 100 metres back from the junction. However the white line was partially faded, and the yellow sign, it has to be said, from the photographs, is not a large, unmissable type of sign. Nevertheless, I believe that the 1st defendant ought to have seen it, and if he had, he might possibly have realised that he was at a junction at which he was required to stop and give way to the plaintiff.
I am satisfied that, as between the defendants, while the 1st defendant was at fault in that regard, he is at fault to a much lesser extent than the Council, whose duty it is to ensure the safety of the roads. I am particularly mindful of the fact that the 1st defendant was a tourist and was therefore completely unfamiliar with this junction. The Council was in a position to ensure the safety of this junction to a much greater degree than was the case, such as in the manner suggested by Mr Mooney, to which I have referred. Having said that, I have a degree of sympathy for the Council which cannot reasonably and fairly be expected to be aware of the fact that some person has turned a sign around so that it ceases to serve the purpose for which it was intended.
In all the circumstances, I find the 1st defendant liable to the extent of 15%, as he ought to have at least seen the yellow sign. It was there and he ought to have at least noted it and been on the look-out. The Council is liable to the extent of 85% for the plaintiff’s damages, since I am of the view that they are primarily liable as between the defendants for the fact that this junction presented a greater hazard than it ought to have on the day in question.
I give judgment accordingly.