The Gazette 1993

GAZETTE thus leaving intact the provisions in s.10(6) of the 1990 Act, with a further minor dele- tion from s.!0(6). In re Haughey [1971] IR 217 and Maher v Attorney General [1973] IR 140 applied; (3) the inspector was enti- tled to question Mr Desmond concerning companies which were incorporated out- side the State and thus were not 'related' to Chestvale and Hoddle within s.9 of the 1990 Act, since otherwise the powers of investigation under s.14 of the 1990 Act would be largely inoperable, and thus s.9 of the Act was irrelevant to the instant case. Lyons and Ors v Curran (High Court, 27 May 1992) (below) approved; (4) the High Court had correctly interpreted s.14 of the Central Bank Act 1989 in relation to the use by the inspector of the exchange control information obtained from the Central Bank. Probets and Freezone Investments Ltd v Glackin, Minister for Industry and Com- merce and Ors High Court 26 February 1992; Supreme Court 30 July 1992 COMPANY LAW - INSPECTOR - EXTENT OF POWERS - WHETHER ENTITLED TO INVESTIGATE ACTIVITIES OF COMPANY INCORPORATED OUTSIDE STATE - STATUTORY DECLARATION - WHETHER INSPECTOR ENTITLED TO SEEK TO EXAMINE DEPONENT UNDER OATH AND TO SEEK CORROBORATIVE EVIDENCE - Companies Ac! 1990, s.14 The first respondent (the inspector) had been appointed by the second respondent as an inspector pursuant to s. 14 of the 1990 Act to investigate the purchase of a site in Dublin for over 4m and its sale less than one year later to Bord Telecom Eireann for over 9m. The precise circumstances are described in Desmond and Dedeir v Glackin, Minister for Industry and Commerce and Ors (No. 2) (High Court, 25 February 1992; Supreme Court, 30 July 1992) (supra). The applicants provided the finance for aspects of the Telecom transaction. The first applicant was a resident of Jersey. The applicants insti- tuted judicial review proceedings challeng- ing the validity of the inspector's appoint- ment and also various aspects of the inves- tigation. Many ofthe grounds were identical to those in the Desmond (No.2) case, supra, and were dismissed for the same reasons. The applicants also argued that the inspec- tor had acted ultra vires in seeking to exam- ine the first applicant under oath after he had sworn a statutory declaration denying that, apart from providing certain finance, he or any company of which he had control had a financial interest in the Telecom trans- action. HELD by O'Hanlon J and affirmed by the SupremeCourt (Finlay CJ, Hederman, McCarthy, O'Flaherty and Egan JJ) in dis- missing the application for judicial review: the statutory declaration was proof that the first applicant was a resident of Jersey, that the second-named company was registered in the Isle of Man and that the first applicant had volunteered certain information to the inspector; but it was not proof of all the averments in the declaration, and the in- spector was not required to accept the aver- ments as prima facie evidence of their truth for the purposes of his investigation under s.14 of the 1990 Act; and in light of the information available to the inspector he was entitled to investigate whether the prof- its made on the financing of the transaction had passed from the applicants in the instant case to any other party, including the appli-

MAY 1993

cants in the Desmond (No.2) case (supra). Chestvale Properties Ltd and Hoddle In- vestments Ltd v Glackin High Court 7 Feb- ruary 1992 and 10 March 1992 COMPANY LAW - INSPECTOR - EXTENT OF POWERS - WHETHER ENTITLED TO INVESTIGATE ACTIVITIES OF COMPANY INCORPORATED OUTSIDE STATE - CONSTITUTION - PROHIBITION AGAINST RETRO- SPECTIVE CRIMINAL LAW - INVESTIGATION OF CON- " TRACT ARRANGEMENTS MADE BEFORE COMMENCE- MENT OF LEGISLATION-WHETHER UNJUST ATTACK ON PROPERTY RIGHTS - Companies Act 1990, s.14 - Constitution, Articles 15.5, 40.3, 43 The respondent (the inspector), a solicitor, had been appointed by the Minister for Industry and Commerce as an inspector pursuant to s. 14 of the 1990 Act to investi- gate the purchase of a site in Dublin for over 4m and its sale less than one year later to Bord Telecom Eireann for over 9m. The precise circumstances are described in Desmond and Dedeir v Glackin, Minister for Industry and Commerce and Ors (No.2) (High Court, 25 February 1992; Supreme Court, 30 July 1992) (supra). The applicants sought judicial review of the investigation and the appointment of the respondent on a number of grounds. These related to the investigation into bank accounts held or controlled by the applicants and also into the activities of foreign companies involved in the Telecom transaction. HELD by Murphy J dismissing the claim for judicial review: (1) having regard to the fact that the 1990 Act substantially expanded on inspection pow- ers contained in previous legislation and that these powers had been repealed by the 1990 Act, the correct inference was that the 1990 Act was retrospective in effect in that pre-1990 transactions are exposed to the investigative powers contained in the 1990 Act; (2) the 1990 Act did not infringe Article 15.5 of the Constitution, since it did not declare any act to be an infringement ofthe law which was not so at the date of its commission; (3) the 1990 Act did not consti- tute an unjust attack on the applicants' property rights under Articles 40.3 or 43 of the Constitution since the extension of pre- vious powers of inspectors by the 1990 Act was a marginal intrusion on their property rights in relation to any bank transactions effected before the 1990 Act came into effect, and although in that sense the 1990 Act was retrospective its operation was fully justifiable under Article 43; (4) since the director of one oftheapplicants, Mr Doherty, had received and continued to receive legal advice from the firm of solicitors of which the inspector was a partner, there might be the appearance of bias if the inspector was acting in a quasi-judicial capacity under the 1990 Act; however, in the instant case it did not appear, on the evidence to date, that the inspector would be required to make any findings of a judicial nature, so that any claim relating to bias was premature, and this brought into doubt the locus standi of the applicants to raise bias. O'Neill v Beaumont Hospital Board [ 1990] ILRM 419 and In re Pergamon Press Ltd \ 19711 Ch 388 discussed; (5) whatever problems might arise in the future because of the connection between Mr Doherty and the inspector's firm could not call into question the validity of the inspector's appointment under the 1990 Act; (6) the request by the inspector to the applicants' banks to provide informa- 2

tion concerning Delion Investments Ltd as a 'related'company within s.9 ofthe 1990 Act was not authorised, since the inspector had not made the necessary request to the Min- ister for Industry and Commerce to inquire into Delion; but this did not affect the enti- tlement ofthe inspector to investigate Delion under s.14 of the 1990 Act since although it was a foreign registered company it was connected with the Telecom transaction, and accordingly the banks were required to comply with the request for information. Glackin v Trustee Savings Bank and Anor High Court 10 April 1992 COMPANY LAW - INSPECTOR - EXTENT OF POWERS - WHETHER FINANCIAL INSTITUTION EMPOWERED TO CONSULT CLIENT BEFORE COMPLYING WITH REQUEST FOR INFORMATION FROM STATUTORY INSPECTOR - Companies Act 1990, ss.10, 14 The plaintiff (the inspector) had been ap- pointed by the Minister for Industry and Commerce as an inspector pursuant to s.14 of the 1990 Act to investigate the purchase of a site in Dublin for over 4m and its sale less than one year later to Bord Telecom Eireann for over 9m. The precise circum- stances are described in Desmond and Dedeir v Glackin, Minister for Industry and Commerce and Ors (No.2) (High Court, 25 February 1992; Supreme Court, 30 July 1992) (supra). The plaintiff sought information from the defendant bank in relation to money which had been placed with the bank by or under the control of a company concerned in the Telecom transaction. Although the bank was willing to co-operate with the inspector, it declined to reply to all queries from the inspector on the ground that it should consult its client prior to providing confidential information to him. On the plaintiff's application to the Court under s. 10 of the Act requiring the Court to inquire into the hank's failure to comply with his request HELD by Costello J: the bank was required to comply fully with the request of the inspector in the instant case, and it must be taken that the 1990 Act overrode any questions of confidentiality or any require- ment to consult with a client prior to com- plying with the request of an inspector ap- pointed under statute. Per Costello J: the Court was entitled to exercise its powers under s.10(6) of the 1990 Act, taking into account the constitutional infirmity in s.10(5) found in Desmond and Dedeir v Glackin, Minister for Industry and Commerce and Ors (No.2) (High Court, 25 February 1992) supra. Lyons and Ors v Curran High Court 27 May 1992 COMPANY LAW - INSPECTOR - EXTENT OF POWERS - WHETHER ENTITLED TO INVESTIGATE ACTIVITIES OF COMPANY INCORPORATED OUTSIDE STATE - Companies Act 1990, ss.9, 14 The respondent (the inspector) had been appointed by the Minister for Industry and Commerce as an inspector pursuant to s.14 of the 1990 Act to investigate the purchase in December 1988 of 49% ofthe shares in Sugar Distributors Ltd, through a company called Gladebrook Co Ltd, and their resale to Siuicre Eireann CPT in February 1990 at a very substantial profit. 22% of the pro- ceeds of the sale went to a company called Talmino Ltd, a Jersey registered company.