About this case:

• Citation:
  [2023] IECC 1
• Judgment:
  External link
• Court:
  Circuit Court
• Judge:
  Judge John O'Connor

The defendants brought the application claiming that the preliminary references would clarify the law and that a stay would prevent unnecessary costs being incurred.

Delivering judgment in the case, His Honour Judge John O’Connor held that the court had a duty of sincere cooperation with other courts pursuant to the Treaty on the Functioning of the European Union and that the defendants would be prejudiced if the proceedings were not stayed. Accordingly, the court placed a stay on the proceedings pending the determination of the preliminary references.

Background

In February 2021, the defendants (trading as Fastway Couriers Ireland) suffered a data breach in which the personal data of 450,000 people was compromised. This resulted in a number of claims for damages being taken against the defendant pursuant to Article 82 of the GDPR. Article 82 provided that a person is entitled to receive compensation from a data controller or processor for material or non-material damage arising from a breach of their data rights.

The plaintiff alleged that his damage included interference with his peace and privacy and an apprehension about the use to which his data had been put. It was also alleged that the plaintiff had been contacted by unknown third parties and that he had lost control over his personal data, resulting in an inability to exercise rights of erasure or rectification. As such, the plaintiff was alleging non-material damage in the case.

Although the plaintiff had provided replies to particulars in the case, the defendants had not delivered a defence to the claim. Instead, the defendants brought an application to stay the proceedings until the determination of certain preliminary references to the CJEU.

The references included questions relating to the meaning of material and non-material damage and the conditions for the imposition of liability under Article 82. In particular, the references dealt with whether a degree of fault was required to impose liability on a defendant.

Notably, an Opinion was provided by Advocate General Campos Sánchez-Bordona in Case C-300/21, UI v Österreichische Post AG, where it was held, inter alia, that compensation for non-material damage did not cover mere upset.

In light of this Opinion, the defendants argued that it was possible that the CJEU would accept that the plaintiff was not liable for any damages in the case. Further, it was said that the value of the claim was low and if the claim proceeded until it was ready for hearing, unnecessary costs would be incurred that exceeded the value of the claim.

Finally, it was said that the defendants could not make a lodgement to court until the preliminary references were determined because it was not possible to quantify the sum that ought to be lodged.

In response, the plaintiff accepted that the court had a duty of sincere cooperation with the CJEU and that the proceedings could not be heard in advance of the CJEU’s decision. However, it was said that the proceedings should continue through the pre-trial process and be made ready for hearing. Essentially, it was said that the stay application was premature.

It was also argued that the defendants would obtain a litigation advantage from a stay because it would make the plaintiff more amenable to a potential settlement.

Circuit Court

Judge O’Connor began by noting that the Circuit Court Rules did not expressly provide for a stay of proceedings and that Order 67 Rule 16 provided that the practice and procedure of the High Court may be followed in those circumstances. The court referred to case law which identified that the High Court held an inherent jurisdiction to control its own procedures (see Kalix Fund v. HSBC Institutional Trust Services (Ireland) Limited [2010] 2 IR 581).

Further, the court outlined that duty of sincere cooperation contained in Article 4(3) TFEU and the need to avoid irreconcilable judgments between Member States. The court held that where a dispute depended on the validity of a Commission decision, the duty of sincere cooperation required a national court to stay proceedings pending final judgment in the Community Courts (see Case C-344/98, Masterfoods v. HB).

The court held that there were three guiding criteria for a court to consider when exercising a discretion to stay proceedings. First, the external circumstances must have a clear impact on the current court proceedings. Second, proceedings should be assessed with due regard to the principles of fairness and due process, which included a consideration of prejudice. Third, a stay should not unduly affect procedural efficiency.

Applying the law to the case, it was clear that the court was required to stay the proceedings pending the determination of the preliminary references. It was held that the plaintiff had not proffered any prejudice that he would suffer from an immediate stay, which the defendant outlined substantial prejudice.

The court also noted that unnecessary legal costs could arise if the case was not stayed immediately, particularly in light of damages which were likely to be small.

Conclusion

The court granted an order staying the proceedings pending a determination of the CJEU in the preliminary references.

Cunniam v. Parcel Connect Limited and Ors. [2023] IECC 1