About this case:

• Citation:
  [2022] IEHC 670 and [2022] IEHC 674
• Court:
  High Court

On Friday, Mr Justice Anthony Barr held that there was no evidence that insurers were wrongfully withholding €20 million from the taxpayer under the Scheme and stated that this figure amounted to “triple hearsay”. Further, on Monday Mr Justice Paul Coffey outlined the proper approach for practitioners when seeking consent orders regarding liability.

Wilson v. Leonardi and Anor.

In Wilson v. Leonardi and Anor. [2022] IEHC 670, Mr Justice Barr outlined the background to the RBA Scheme and the differing judgments of Mr Justice Kevin Cross and Mr Justice Twomey on the issue (see Matthews v. Eircom [2021] IEHC 456; Fahy v. Padraig Fahy Tiling Contractors Ltd [2021] IEHC 682). It was noted that Mr Justice Twomey took the view that an apportionment of liability could only occur after a judge had heard evidence and made a ruling on liability (see Kuczak v. Treacy Tyres (Portumna) Ltd (No.1) [2022] IEHC 181).

As such, it was said that judges could not make consent orders apportioning liability based on the agreement of the parties as this did not take into account the interests of the taxpayer who was required to pay the rest of the RBA bill.

Mr Justice Barr disagreed with Mr Justice Twomey’s decision, stating that it was appropriate for a court to include consent terms in relation to either the loss of earnings claim maintained by a plaintiff, or a determination on liability, “provided there was some rational and fair basis for making those determinations”.

The court stated that it was “very far from convinced” that the €20 million shortfall relied on by Mr Justice Twomey had been established in evidence, noting that the figure was cited in journal and newspaper arguments and could not be independently verified. As such, the figure was described as “triple hearsay”.

The court also considered a letter from the Minister for Social Protection which was written to Insurance Ireland in 2017 that identified the “belief” that there was a €20 million shortfall in the recoupment of benefits. Again, the court held that the Minister could not possibly have taken this view that €20 million had been wrongfully withheld by insurers as there was simply no evidence of fraud “either on that scale, or at all”.

Finally, the court noted that if the Minister genuinely believed that the department was being wrongfully denied the full amount of recoupment of relevant benefits, then it was open to her to take steps to address this issue. This included taking judicial review proceedings to address the issue of whether consent terms in court orders were “orders” for the purposes of section 343R of the Social Welfare (Consolidation) Act 2005.

However, the court recognised the legitimacy of the concerns that an agreement to apportion liability between two private parties could negatively affect the interests of the taxpayer. Dealing with this, the court noted that consent orders in personal injuries actions depended on the trust between judges and counsel. Judges rely on counsel to tell the truth and make consent orders on the assumption that there is a rational evidential basis to make that determination.

The court went on to say that a judge should not “blindly rubberstamp” a requested order by the parties. The court used the analogy of infant rulings, which required a barrister to make submissions on liability in order to determine the adequacy of a settlement figure. In a similar way, it was appropriate for a court to “be given sufficient information to satisfy the judge that the determination sought to be included in the order, is appropriate in all the circumstances”. If this procedure was followed, the court held that personal injuries actions could still be settled with an apportionment of liability.

Jarmula v. DSG Solutions Limited

Mr Justice Coffey also considered the issues of consent orders and the RBA Scheme in Jarmula v. DSG Solutions Limited [2022] IEHC 674. In this case, counsel had informed the court that a causation issue arose from a disagreement between the medical experts regarding the extent to which the plaintiff’s injuries were related to the accident. As such, the parties sought to limit the plaintiff’s loss of earnings by 50 per cent.

In dealing with the matter, Mr Justice Coffey held that a court had jurisdiction to make a consent order for the apportionment of liability prior to the commencement of section 343R in August 2014. Previously, if parties agreed issues of negligence, causation and quantum of damages, this could form part of a consent order. In the same way, parties could always reach agreement on loss of earnings.

It was not for the court to compel parties to litigate issues which had been agreed, Mr Justice Coffey said.

Further, the court held that the jurisdiction to make consent orders on the apportionment of liability was not affected by the commencement of section 343R.

The court also held that section 343R of the 2005 Act did not alter the underlying process by which an order could be applied for and made by a court. There was nothing in the 2005 Act to suggest that the Minister had to be put on notice of an application for a consent order relating to the RBA Scheme.

It was said that the “suggestion of Twomey J in Kuczak that ‘an order of the court’ denotes a hearing “after hearing evidence under cross-examination in an adversarial hearing” is manifestly not provided for in the subsection”. The “alarming consequence” of Mr Justice Twomey’s position was that parties would have to litigate for days or weeks on issues that were agreed.

In outlining the appropriate procedure for seeking consent orders on liability, the court stated: “In this case, I was informed of the factual and legal basis on which the apportionment was agreed. Although not required by the Act of 2005, it seems to me to be desirable in the interests of transparency that legal practitioners should follow this practise when seeking such orders.”

Conclusion

Accordingly, both Mr Justice Barr and Mr Justice Coffey held that it was appropriate to make consent orders which relate either to loss of earnings or the apportionment of liability.

Wilson v. Leonardi and Anor. [2022] IEHC 670; Jarmula v. DSG Solutions Limited [2022] IEHC 674