The Gazette 1974

tion of the defendants—and they so informed the plain- tiffs—that conditions would later be attached to the licence. The licence became effective as from the end of December, 1971, and about January 6, 1972, the Secretary of the Central Bank obtained some informa- tion which caused the defendants to be concerned about the status of the plaintiff company. Inquiries were made with the result that it was thought wise to communicate with the chairman of the plaintiff com- pany and to discuss privately with him the suitability of Mr. Bates as a director of the plaintiff company. Ultimately the defendants notified the plaintiffs under Section 10 of the Central Bank Act, 1971, of their intention to impose conditions on the licence. Section 10 provided that a licence should be subject to such conditions, if any, as the Bank might impose and specified at the granting thereof. There were conditions which in the Bank's opinion were calculated to promote the orderly and proper regulation of banking and they might be amended, revoked or added to, and condi- tions might be imposed in relation to a licence from time to time by the Bank, if, in their opinion, the amendments were calculated to promote the orderly and proper regulation of banking. The President said that it was under this provision that the Central Bank decided to impose conditions on the licence granted to the plaintiffs. Sub-section 3 of the section provided that whenever the Bank proposed to impose conditions in relation to a licence or to amend or add to the conditions (a), it shall notify in writing the person holding the licence or to whom the licence is intended to be granted, that it intends to impose the conditions in relation to the licence or to amend or add to the conditions and show its reasons for so doing; and that the person may within 21 days after the date of giving of the notification, make representa- tions in writing to the Bank; (b), the person may make such representations within the time, and (c) the Bank shall, before deciding to impose the conditions, or amendments to the conditions, consider any represen- tations duly made to them under the sub-section. Mr. Justice O'Keeffe said that the Bank, having decided to impose conditions, notified the plaintiff company by letter of January 31, 1972, of its intention to impose the conditions. Their reason for this course of action was that arising out of an inquiry which it had made it was not willing to accept Mr. Bates as a director of I.T.B. or as a shareholder in that company. The plaintiff bank had made representations which were being considered by the board of the Central Bank and it was decided that the conditions outlined in the letter of January 31 should be imposed unless there were substantial grounds for doubting the validity of such conditions. The matter was not dealt with by imposing these conditions, perhaps because the Central Bank, when the Governor, secretary and other officials dealing with the matter came to implement the board's decision found that the letter of January 31 had not in fact complied with the requirements of sub-section 3, section 10, inas- 19 Central Bank not willing to accept a Director of plain- tiff Bank

Irish Trust Bank wins its case togainst Central Bank— conditions judged to be "not validly imposed" In a reserved judgment, the President of the High Court (Mr. Justice O'Keeffe) held that conditions imposed by the Central Bank in relation to a banking licence granted to Irish Trust Bank, of Dawson Street, Dublin, were not validly imposed and that the I.T.B. could hold their licence without any such conditions. Pleadings Irish Trust Bank had sued the Central Bank claiming that the conditions were improperly imposed. They claimed that on January 31, 1972, the Central hank intimated that under Section 10 of the Central hank Act, 1971, they proposed to make it a condition the licence issued on December 23, 1971, that Mr. Kenneth W. Bates should cease to be a director of the company on or before April 6, 1972, and that as from fhat date the shareholders of the company should not mclude Mr. Bates or any nominee of his. The condition also stipulated that, as from the same date, shareholders of the company should not include t ° r an interest exceeding 10% any company in which Mr. Bates had an interest of 10% or more. The company sought a declaration that the condi- tions were outside the powers of the Central Bank to lr npose and that they were unjust and invalid. They also sought a declaration that they were entitled to hold their licence freed and discharged from these condi- tions. They further sought damages and costs. Complies with Act In its defence, the Central Bank pleaded that they had granted the licence expressedly subject to such conditions as might be imposed in accordance with Section 10 of the Act. They pleaded that, at the time me licence was issued, they had been furnished by the c °mpany with particulars of Mr. Bates' career and early activities but that these had failed to disclose matters relevant to and necessary for a proper consideration of me application. They further pleaded that they did not infringe the constitutional rights of I.T.B. and denied mat they had failed to act judicially or failed to ormulate any precise or specific charge against Mr. bates. Delivering his judgment, the President said that rrish Trust Bank was formed in 1971 and had applied ° r and obtained a licence before the Central Bank Act came into force. At that time, a licence was available 0 anybody who paid the appropriate fee to the Reve- n u e Commissioners and made the required deposit Un der the Central Bank Act 1971. Conditions to licence only subsequently imposed The President said that anybody engaging in the Us mess of banking as defined in the Act was required t o hold a licence and the relevant conditions came into d e r a t i on as from the end of 1971. The plaintiffs had applied for a licence under the provisions of the Act. Y first the Bank decided to refuse a licence, but later bered its view and decided to grant a licence which ^as in due course granted. There were at the time no c °oditions attached to the licence but it was the inten-