Further to yesterday’s post on the award of 75% of costs to losing party Angela Kerins in her case against the Public Accounts Committee, Broadsheet commenter Harry Molloy asked me to come back to readers when the full written judgment had been published. It is now available here.
The justification for the award of costs is set out by the Court at paragraphs 26-33 and appears to be as follows:-
(i) The PAC has an important function. Questions concerning the proper discharge of its function and the conduct of its members and the legal safeguards (if any) available to witness who appear before it are matters of public importance, involving questions of freedom of speech in Parliament, the separation of powers and the extent to which the court may intervene in the affairs of the Legislature.
(ii) Ms Kerins attended before the PAC in a voluntary capacity and much of what was put to her and said about her was damaging to her reputation personally and professionally. By bringing her action, Ms Kerins cast a light on the position of persons who volunteer to appear before the PAC. The institution of proceedings on her part was a proportionate reaction on her part to what had occurred and as such and the fact that she had a personal interest in the outcome of the application should not preclude her obtaining her costs.
The implication from the ruling was that Ms Kerins had not been well treated by the PAC and therefore it was justifiable for her to seek to clarify the law in relation to the position of witnesses appearing before it.
There is also an implication that she performed a public service in alerting potential witnesses to the risks of appearing before the PAC.
Although within the (very wide) parameters of the discretion laid down by previous case law, the ruling does break new ground in that it sanctions an award of costs to an unsuccessful litigant with a personal interest in proceedings on a matter of public interest where that litigant acted proportionately in bringing the proceedings.
It will be interesting to see what implications this ruling will have for Denis O’Brien’s costs in his recent unsuccessful application for parliamentary privilege. Will the richest man in Ireland be entitled to his costs on a losing case on the basis that he acted ‘proportionately’?
And, more pressingly, what does proportionately even mean?
Angela Kerins before the Public Accounts Committee in 2014
The Public Accounts Committee will have to pay two thirds of former Rehab boss Angela Kerins’ legal costs after her failed High Court action.
Ms Kerins lost her personal injury claim against PAC [concerning two days of grilling about payments to the charity] after the court said it could not make any judgment on utterances made inside the oireachtas (see REDACTED for details).
So…why are ‘we’ lumbered with the bill?
Legal Coffee Drinker writes:
Order 99 Rule 1(1) of the Rules of the Superior Courts provides that the
“costs of and incidental to every proceeding in the Superior Courts shall be in the discretion of those courts respectively…”.
Order 99 Rule 1(4), further provides:
“…the costs of every issue of fact or law raised upon a claim or counterclaim, shall, unless otherwise ordered, follow the event…”.
This gives the courts a wide discretion in relation to costs which has been limited by rules laid down in case law.
The leading case is the decision of the Supreme Court in Dunne v Minister for the Environment  2 IR 775. The issue under appeal was whether or not an individual who had brought an unsuccessful legal challenge to the construction of a motorway near a site of archaeological interest should be entitled to their costs.
The Supreme Court held that that the normal rule was that the costs of every proceeding followed the event but that the courts always retained discretion in relation thereto.
There was no fixed rule or principle determining the ambit of that discretion and, in particular, no overriding principle which determined that it had to be exercised in favour of an unsuccessful plaintiff in specified circumstances or in a particular class of case.
The fact that a plaintiff was not seeking a private personal advantage and that the issues raised were of special and general public importance were factors which could be taken into account along with all other circumstances of the case in deciding whether there was sufficient reason to exercise a discretion to depart from the general rule that costs followed the event.
However, the two principles, in themselves, were not the determining factors in any category of cases which could be described as public interest litigation.
In that case the Supreme Court overturned an order awarding the unsuccessful applicant his costs, saying that:
“undoubtedly the fact that a plaintiff is not seeking a private personal advantage and that the issues raised are of special and general public importance are factors which may be taken into account, along with all other circumstances of the case, in deciding whether there is sufficient reason to exercise a discretion to depart from the general rule that costs follow the event.
However, insofar as the learned High Court Judge may have considered that the two principles to which she referred are in themselves the determining factors in a category of cases which may be described as public interest litigation, I do not find that the authorities cited support such an approach…”.
Recently United Left TD Joan Collins was awarded 75% of her legal costs in her unsuccessful challenge to the promissory notes issued by the Minister for Finance in favour of Anglo Irish Bank and the Educational Building Society.
The three-judge divisional High Court ruled that it was an exceptional case which merited a departure from the normal rule regarding costs. Given the exceptional nature of the litigation, it awarded her 75%.
In that case, Joan Collins had no ‘private personal advantage’ in the success of her legal claim. The Kerins case is different in this respect.
However the decision in Dunne, while acknowledging that lack of private personal advantage might be a factor to be taken into account in deciding on costs, did not absolutely rule out an award of costs in such a case.
The test which is applied in deciding on costs is ‘exceptionality’ – something which still leaves a lot of discretion to the trial judge.
In the Kerins case, the court appears to have regarded the issue involved as of sufficient public importance to override the fact that the case was of private personal advantage.
Former Rehab Chief ExecutiveAngela Kerins leaving the High Court last September
The three judge court ruled today, as a result of the absolute privilege provided by the Constitution for Oireachtas proceedings, the courts have no power to intervene in relation to how those hearings were conducted.
The President of the High Court, Mr Justice Peter Kelly, said while the claim was couched in highly jurisdictional claims, the issue of jurisdiction does not properly arise.
Ms Kerins claimed the utterances by the PAC members that she complained of amounted to some form of adjudication or determination when, in reality, those were just expressions of opinion by the PAC members which were devoid of any legal force.
Because these were no more than utterances, that ousted the court’s jurisdiction in this matter, he said.
“The Constitution guarantees freedom of speech in parliament, not to protect parliament, but the democratic process in itself,” he said.
Businessman Denis O’Brien’s action over statements made by two TDs in the Dáil about his banking affairs has concluded at the High Court with judgment reserved.
Ms Justice Una Ní Raifeartaigh reserved judgment until the new year and said she would not finalise her decision until the High Court rules on the separate case of former Rehab chief executive Angela Kerins.
From top: Denis O’Brien leaving the High Court after giving evidence last week; an excerpt of Mr O’Brien’s witness statement given to the court
Mary Carolan, in The Irish Times, reports:
Businessman Denis O’Brien’s action over statements made by two TDs in the Dáil about his banking affairs has concluded at the High Court with judgment reserved.
Ms Justice Una Ní Raifeartaigh reserved judgment until the new year and said she would not finalise her decision until the High Court rules on the separate case of former Rehab chief executive Angela Kerins. That case raises some similar issues and judgment was reserved on it last October.
Former CEO of Rehab Angela Kerins and John McGuire, Director of Fundraising at Rehab, arriving at Leinster House to appear before the Public Accounts Committee in February
The Irish Times reports:
“In her affidavit, [Angela Kerins] said she had a conversation on February 21st with the PAC clerk, Ted McEnery, almost a week before she and other senior Rehab figures appeared before the committee at a seven-hour hearing…
“Ms Kerins has also claimed she discussed the forthcoming hearing with the PAC chairman John McGuinness, Fianna Fáil TD for Kilkenny, in the offices of a public relations company the month before her appearance.”
Frank Flannery (top) and with Angela Kerins (above)
Former Rehab chief executive and ex-Fine Gael strategist Frank Flannery was on Today With Seán O’Rourke this morning, following the Public Accounts Committee being told by the Oireachtas Committee on Procedures and Privileges that PAC doesn’t have the power to compel Mr Flannery or former Rehab chief executive Angela Kerins to appear before it.
The CCP said PAC couldn’t compel Mr Flannery of Ms Kerins because Rehab is not audited by the Comptroller and Auditor General, so PAC can’t legally examine how it has used public money.
Mr Flannery received payments of more than €409,000 for consultancy work given to him by Rehab while he was a director at the charity. Some of his work involved lobbying when Mr Flannery worked as an adviser to Enda Kenny.
Sean O’Rourke: “Now I think the nub of the ruling is that as Rehab is not audited by the Comptroller and Auditor General and no report then exists of his work there, the Public Accounts Committee does not have the legal authority to examine the use of public monies by the Rehab Group so you kind of get out the door on the basis of a technicality.”
Frank Flannery: “Well it’s technically one thing. The Rehab Group is an independent, private sector, not-for-profit company. It receives no State funding of any kind whatsoever but it does a huge amount of business with the State. It tenders for contracts, it has about 28 service-level agreements with the HSE, I understand, and bear in mind, I’ve been out of there now for eight years so, I’m just depending on what information I get.”
O’Rourke: “Well you were a board member, I think up to recently, to 2011 …”
Flannery: “For a couple of years, yeah. Yes, I would have had some but as an ordinary board member, I would have some general but no detailed information on the operations of the organisation through that. But, nonetheless, the Rehab Group has a commercial relationship with the State. The State’s a customer, it bids for contracts. If it wins the contracts, it delivers those contracts under service-level agreements which stipulates exactly what has to be done for and then it sends in its invoice and it gets paid. And one of the very interesting things which came through with very little comment, from the Public Accounts Committee is, the Rehab Group does its business mainly with the HSE and with Solas, they’re the two major players.”
O’Rourke: “Formerly FÁS.”
Flannery: “Formerly FÁS, Solas, in my time it was FÁS, in my time neither of those entities existed. We had health boards and we had FÁS but now…”
O’Rourke: “You see everything you’re saying…sorry, yeah finish.”
Flannery: “Well now, let me just finish. They contract in the private sector with hundreds of deliverers, from accountants to lawyers to every other kind of supplier, people who supply cars, people who supply services, people who supply training programmes, people who supply care services. Both Rehab Care and [inaudible] are successful contractors with them and they win business, they get paid for it on sending in the invoices in a normal commercial relationship and that is their commercial income and then they tender again the next year, no contract to my knowledge lasts really beyond 12 months, it’s a very tough competitive business but it is, they’ve all commercial transactions. Nothing whatsoever to do with the State giving grants, the State never gave Rehab grants.”
O’Rourke: ‘Yes, but exactly what you’ve just said could have been said by the Central Remedial Clinic, the CRC, even though they’re designated slightly differently in the way funds are given, as between Section 38 and 39, but essentially, the point made by the Public Accounts Committee to you repeatedly was that approximately €83million of public money annually, it was actually €95million last year, are matters in respect to which the taxpayer, through the committee’s examinations is entitled to transparency and full accountability.”
Flannery: “Seán, you’re missing a very, very simple and basic point which [inaudible] you’d no difficulty picking up.The State gives its money to the HSE which is mandated to provide for the health services. Most of it is provided by itself, some of that work gets contracted out to suppliers. It also buys in all the equipment it needs to run on its hospitals and all its supplies. And it also buys in certain services and they, it does a proper tendering operation for that and whoever wins those tenders, most of them will be in the private sector, including the Rehab Group. So they pay for what they buy now the State has to ask the HSE ‘did you get value for money?’ and it’s the HSE’s job up to say ‘Yes, we did’. Now at that committee the HSE said that they were delighted with the quality of all of the services that Rehab companies provided them And with the value for money they got. Solas also said at that meeting that they were satisfied. Now Seán this has been has been bunched over with a committee which was only interested in the personal details of people’s lives but the essence of it was that the State agencies responsible confirmed that they got top value for money and that they were very satisfied with the quality of the service provided. And that I thought was a very decisive piece of evidence.”
O’Rourke: “What about your point though. I mean you argued from the beginning that this was a witch hunt and that was a phrase used in, more than once, in correspondence and a personal vendetta against you. What’s your basis for saying that?”
Flannery: “Well with regard to the witch hunt affair , I was wondering why I first of all was not invited in at all by the HS..by the PAC but I did hear several of its members yelling at me over the radio, morning, noon and night and through the newspapers. Even in their committee, excuse me I’ve a bit of a frog in my throat, saying I should be there, to the point when I finally had to write to them and say I’ve heard two people using my name, often in a very derogatory context. I said ‘do you want to speak to me? If so, this is my address, this is my email, this is my telephone number, please contact me and let me know what information you want from me that I’m in a position to deliver for you. And just also let me know how that fits with your remit.’ Now that’s information that any witness to any committee is fully entitled. I have never received a reply to that letter.”
O’Rourke: “Yes, but ultimately they decided to seek powers of compellability because they concluded from the correspondence….”
Talk over each other
O’Rourke: “That you weren’t willing to go.”
Flannery: “I never refused to go in. I just said ‘please answer my questions and I’ll be very happy to assist you in anyway I can.”
O’Rourke: “Why do you think though that there was a vendetta and a witch hunt?”
Flannery: “Well I’m retired now out of Rehab for eight years. I suspect that, and I mean this is only…thing…if you look at the seven hours of questioning, when Angela Kerins was in, you would see the nature of the questioning it had nothing at all to do with the money spent through Solas, through Solas, and through HSE, that so-called €95million, that wasn’t part of the questioning at all. It was everything to do, even with the car she had. When was it bought? When was it due to renewal? An incessant personal attack. Now…”
O’Rourke: “Is it your view that Angela Kerins’ salary was none of anybody’s business?”
Flannery: “No I think the whole question of salary has been in the public arena in Ireland generally, from the Taoiseach down – so it’s very legitimate area for discussion.”
O’Rourke: “So it’s right that the people should know what the chief executive of Rehab is paid?”
Flannery: “And indeed that was already in the public arena, as I remember it, bearing in mind now…”
O’Rourke: “Well yes but she…when this whole controversy really took was when she declined to answer that simple question from Gavin Jennings several months ago on Morning Ireland. And there was a sense that people just wanted to hide or keep things under the lid. Now you say you know you got top marks from…”
Flannery: “Can I just come back to a basic point which we have to bear very much in mind. The Committee of Procedures and Privileges, which is the relevant committee, has handed down a judgement that the PAC was ultra vires outside its power, outside its remit in the entire matter of examining the Rehab Group and that includes me. That means that everything they did in respect of that, in my simple lay man’s language, if it’s outside the law, it would also be illegal. Now they knew that, as far as I know, because it was published in The Irish Times last January, having been so informed by their legal counsel, whose name is in the public arena, and they were also reminded in a most emphatic manner by that same legal counsel in May of this year, yet they deliberately decided to go against the legal advice and to pursue their vendettas against people and organisations – even though they knew it was unlawful. Now when lawmakers become law breakers, the country is in a very dangerous situation. And the Committee on Procedures and Privileges has done, in my opinion, the parliament and the Dáil committee system a very necessary service of putting a halt to this particular gallop.”
O’Rourke: “Well, you say, you know, they went outside the law. Legal advice is just that, it is advice, it is there to be taken or acted upon, depending on the advice. They felt that there was maybe a wider public interest. I quote from one of the letters they sent that ‘the public was entitled to transparency on how taxpayers’ money was spent’.”
Flannery: “The public, whatever the public’s entitled to transparency, that’s fine. But if the PAC is not entitled to break its own law. It can particularly, if they’re doing it for their personal aggrandisement or for headline-seeking. And there’s a strong suspicion that certain members of that committee, were embarked on such a programme. For instance, the fact that I was director of elections of Fine Gael and a trustee of the party is in my opinion not at all unrelated to their decision to haul me back after eight years of retirement and try and subject me to their particular form of inquisition.”
O’Rourke: “If you were being pursued in this fashion, be it vendetta or witch hunt or whatever, as somebody who’s given a lifetime service to Fine Gael, weren’t you entitled to better than you got from the party, in terms of support through this difficulty, this ordeal?”
Flannery: “Let me say two things, Seán please, bear in mind this is the first time I’ve been speaking on this topic since it started. My…I’ve two, two, two, a number of very strong concerns and I don’t particularly feel vindicated by this decision. I am relieved but I feel pretty battered and pretty bruised, that’s how I feel. Now. The fact that the Rehab Group and organisation, I spent 33 years of my life, when I joined it we had 80 employees and we were a small organisation. When I left it we had over 3,000 employees and a very large organisation and very successful at providing services to tens of thousands of people. One of the best not-for-profit organisations…
Talk over each other
Flannery: “Let me say further, let me say further, the damage to that organisation is the greatest agony in my life now and that was done by an illegal enterprise by this committee and that is one thing I hold very seriously against them. With regard to the good old delightful Fine Gael decision, with which I’ve also been involved for most of my life, you know the amount of sweat, blood and tears I put in with them…
O’Rourke: “Yes I do.”
Flannery: “And the fact that I am now outside that as well is another very serious damage done to me.”
O’Rourke: “But yet, you know, they took away your pass, you know, from the Dáil, you access to Leinster House, you felt compelled to resign from your position I think as director of strategy with the party, it was literally weeks ahead of the European and local elections. They…but you see the thing about it is, you became, and I know this is deeply upsetting for you, Frank, but you became something of an embarrassment to the party and you say that the Public Accounts Committee have done huge damage to Rehab but had you gone in there and answered straight questions a lot of that could have been averted?”
Flannery: “But you see Seán, why would I… this committee was set upon a lawless path and they were attacking the constitutional rights of citizens under our constitution. They knew they were doing it and I believe it was widely known in the system that was going on. But nobody was shouting stop. Some citizen had to stand up and stand up for the citizen and prevent this abuse of public power. And it just fell, to my greatest misfortune, that obligation fell upon me to do it. And I’m not the kind of a person who would shy away. I did that entirely as a matter of principle. And had I gone in and allowed them to treat me the same way as they treated others, it wouldn’t have been any difference. They were determined to have a really serious go at me. They weren’t interested in the expenditure of public money. I am retired out of that business for eight years. I know in my own mind, I know what they were after, they were after publicity, they were after headlines…”
O’Rourke: “But no, they were going to ask you about…Why do you feel they had no right to ask you…”
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Flannery: “They had no right to inquire into the personal lives of citizens…They are guaranteed in the constitution.”
O’Rourke: “But you’re saying that they’d no right to ask about them as a consequence of, you’re working back logically to say they’ve no right to know how the money that Rehab is raising, through public funds as well as everything else, as we say €95.5million last year. And then there were fees, for instance, that you would have received. These were in public domain and they probably didn’t suit you that they were a matter of public knowledge – €40,000 in 2007, €68,750 in 2008, €44,044 in 2009, €60,000 in 2010, €51,000 in 2011, €66,000 in 2012 and €79,050 in 2013. Those are the figures.”
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Flannery: “You’ve made it everybody’s business now so let me answer it. When I retired from the Rehab Group in 2006, I was asked would I continue to assist principally in the matter of international affairs, I’ve had a huge involvement internationally, I was involved in the setting up and the running of the European Platform for Rehabilitation, I was one of the principal founders of Equass which is now a European-wide quality system for service providers in the social services and I chaired their management committee and their adjudicating committee and other involvements. I was asked if I would continue to provide that service for a number of, for a period of time, bear in mind, Rehab was heading into its sixth worst [inaudible] of recession. So I was very glad to do that.”
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O’Rourke: “But the idea that you got nearly €80,000 last year for these services, on top of a pension will astonish people.”
Flannery: “But Rehab got enormously valuable work. I am now a consultant. That is my livelihood, that’s how I earn my living. And I’m very happy to have good clients. Rehab was my life for 33 years, this allowed me to continue working in that arena, for a bit longer, in a limited way. Rehab got enormously good value for money. I gave them time way and above and I gave them every bit of strategic advice and any kind of help I could give them was freely and willingly given, under that contract. As soon as Rehab didn’t want me to do that, that was the end of that.”
O’Rourke: “But clearly because you declined even to accept the urgings of the Taoiseach, the leader of your party and many other people, friends and colleagues, to go in their and face that committee, you became something of an embarrassment to Rehab as well as Fine Gael and therefore it suited that you didn’t have to have any further dealings with them.”
Flannery: “That’s something I have to live with. I took my stand on a point of principle and I was proven to be 100% right. The Taoiseach, when he told me to go in before PAC, clearly did not know the kind of devil’s pact that was involved in and…”
O’Rourke: “But sure the dogs on the street could see what they were at, Frank.”
Flannery: “Could they? Well then, then, is it then, is it correct that the Dáil committee made up of elected parliamentarians, lawmakers, should set themselves up, to go outside their brief to…
Talk over each other
Flannery: “…and to attack individuals and attack organisations in doing that and to be allowed to do it and is there no sanction for it. That is what I would really like to know.”
O’Rourke: “Part, and that’s a valid question and if we can, put it to somebody from the PAC, at some future point. But , you see, again part of the problem here is and it’s worth exploring, is the crossover between yourself, in your lobby activities on behalf of Rehab and other work, other services in consultancy. And you access to politicians at senior level . You had the run of Leinster House. You had this pass and apparently invoices suggested that you were billing them for lobbying the Department of Justice, Education and Social Protection in 2011 and 2012.”
Flannery: “I did, I did.”
O’Rourke: “It was a little bit too cosy there.”
Flannery: “There was nothing cosy really, bear in mind, there are an awful lot of former civil servants [inaudible] who are now consultants, it’s a very, very common thing. There are an awful lot of former ministers who are now consultants, it’s a very common thing, it’s all over the place. Now, I was never a civil servant. I never got one penny of my own income from the State, I never worked for the State, I never wanted to work for the State. Neither was a I a politician and I never held office and you might have noticed that my beloved party never appointed me to any quangos or anything like that…because I never sought them.”
O’Rourke: “Or the Seanad.”
Flannery: “Or the Seanad, very specifically.”
O’Rourke: “Did that disappoint you, as a matter of interest?”
Flannery: “Not in the slightest. I had made it very clear to the Taoiseach not to consider me because if he’d have offered it to me, I wouldn’t have accepted it cause I knew exactly, I knew exactly what it would mean for me. I was never in that business. So, to say that I have special access, is a nonsense.”
O’Rourke: “It’s not nonsense at all. It’s a statement of the obvious.”
Flannery: “It’s not a statement of the obvious either.”
O’Rourke: “I bet you there isn’t a member of that Cabinet, certainly the one that served up to recently, whose mobile phone number, at least in Fine Gael, that you wouldn’t have.”
Flannery: “But sure the dogs on the street have the Taoiseach’s mobile phone. There’s nothing magic about that…”
O’Rourke: “But getting through to him is another matter. But let’s not go down there. But you did have the option and I think people will respect the fact that you’ve come in here today and defended your corner but you could have done exactly the same thing with that committee, accept…”
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Flannery: “But if I did that I would have been aiding and abetting …”
O’Rourke: “You could have gone in and challenged them, you didn’t have to answer the questions, you could have taken…”
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Flannery: “Some of those people have a feral attitude, they were, they were, you could see their attitude to it. They were out for destruction. I heard one of them saying that the greatest achievement they had was the first chief executive of Rehab resigned. They destroyed a very, very strong person’s career and took great pleasure in doing it. That is the kind of people that we are…why would I aid and abet and give further strength and credibility to that activity when it needed to be stopped in its tracks because it was getting seriously unlawful and seriously dangerous. I mean, if I did that, then I would feel I had abandoned any of my claims to citizenship and to my rights and I couldn’t live with myself if I did that. I didn’t want, the challenge was put to me but once it was put to me I couldn’t find it in my heart to refuse the challenge and somebody needed to stand up to them and to my sheer misfortune that it turned out to be me and I did it. And it has been determined that my stand was the correct one. And those who invited me to cooperate with them were ill advised.”
O’Rourke: “And what about the deafening silence from Fine Gael?”
Flannery: “But sure Fine Gael is fine, I mean Fine Gael is a political party, they have elections to fight, they have elections to win, they have a Government to run..”
O’Rourke: “You surely could have been treated better from them?”
Flannery: “No, I have not, I am not complaining about Fine Gael, I’m not complaining about anybody. I’m only complaining about a system which allows parliamentarians to run amok and to behave in an illegal and even on occasions in a righteous fashion, that needed to be stopped and if I made one small contribution to at least drawing people’s attention to the abuses that were going on, then I think it was probably worth it, even though it has cost me enormously.”
O’Rourke: “Frank Flannery, thank you very much indeed for coming into the studio.”
“The Public Accounts Committee has decided to seek compellability powers for the attendance of former Rehab chief executive Angela Kerins and former board member Frank Flannery in its examination of the spending of public monies. An application to the Dáil Committee on Procedures and Privileges is expected to be made within days.”