Supreme Court: Remittal from Supreme Court to High Court appropriate where full re-hearing of Circuit Court action has taken place

About this case:

• Citation:
  [2024] IESC 19
• Judgment:
  External link
• Court:
  Supreme Court
• Judge:
  Ms Justice Elizabeth Dunne

Delivering judgment for the Supreme Court, Ms Justice Elizabeth Dunne concluded: “The basis of the High Court’s jurisdiction was the order of the Circuit Court which had been appealed against. The High Court dismissed that appeal on a basis this Court has now determined to be incorrect. It follows that the order of the High Court must be set aside. This is not a case where the decision on appeal means substituting a decision and order for that of the High Court. The order of the High Court being set aside, the matter should now return to the point where the jurisdiction of the High Court was invoked.”

Background

The parties had previously come before the Supreme Court on appeal concerning whether a creditor who had failed to prove his debt pursuant to the Personal Insolvency Act 2012 had locus standi to object to a Personal Insolvency Arrangement (PIA).

The Supreme Court, having determined that there was nothing to preclude a creditor who had not proved his debt from lodging a notice of objection or from proving his debt at a later stage, decided that the appellant could lodge his objection.

At the conclusion of the hearing of the appeal, the Supreme Court remitted the matter for a further consideration as to the entitlement of the appellant to prove his debt, and to lodge a notice of objection.

On 15 January 2024 High Court made an order for proof of debt. The parties were not in agreement as to the questions of remittal and costs, and so the Supreme Court heard the parties on those issues.

The respondent Personal Insolvency Practitioner (PIP) contended that the matter should be remitted to the High Court, which last had seisin of the matter.

The appellant believed that the matter should be remitted to the Circuit Court, on the basis inter alia that the Circuit Court had not determined the question of the appellant’s objections, and if the matter were to be heard in the High Court, he would lose the ability to appeal that decision given that the High Court had been dealing with the matter on appeal from the Circuit Court.

The Supreme Court

Ms Justice Dunne considered that: “As a general proposition, it can be said that, following an appeal, if issues remain in the proceedings, those issues will, as a matter of course, be determined in the court from which the appeal arose. Put simply, if a plaintiff brought proceedings in the High Court, and that court struck out the proceedings on the basis that the proceedings were statute barred — an issue tried as a preliminary issue — the matter would be returned to the High Court following a successful appeal for a full hearing on the merits.”

The judge explained that the “traditional process” had changed following the 33rd Amendment of the Constitution, and the Supreme Court now has jurisdiction to grant leave to appeal from a decision of the High Court on appeal from the Circuit Court provided that the constitutional criteria of “general public importance” and “the interests of justice” are satisfied, notwithstanding s.39 of the Courts of Justice Act 1936 which provides that a decision of the High Court on appeal from the Circuit Court shall be final and conclusive.

Ms Justice Dunne noted that “in circumstances such as those which have arisen in this case where there has been a hearing before the Circuit Court, followed by an appeal to the High Court, and where there is a subsequent appeal to this Court, in the circumstances permitted under the terms of Article 34.5.4°, there will be a second appeal”.

The court also emphasised that the nature of a rehearing on a Circuit Court appeal “is little different to the first instance hearing before the Circuit Court”.

Ms Justice Dunne considered the appellant’s contention that the Circuit Court was the “appropriate court” pursuant to s.5 of the 2012 Act, defined as “(a) where the application is made under Chapter 3 or 4 of Part 3, and the total liabilities of a debtor determined on the basis of the Prescribed Financial Statement completed by the debtor concerned in respect of the application concerned are in excess of €2,500,000, the High Court, and (b) in any other case, the Circuit Court.”

Finding his argument to be “misplaced”, the judge pointed out: “This is a standard provision, similar to many such provisions which can be found in many statutes, which sets out the basis of the jurisdiction as to which court shall deal with particular matters. The allocation of jurisdiction as to which court has jurisdiction to deal with proceedings at the outset cannot be of assistance in deciding to which court a matter should be remitted following an appeal to this Court.”

The court found assistance in Bank of Ireland Mortgage Bank v. Cody [2021] IESC 26, [2021] 2 I.R. 381 in which the Supreme Court stated: “Where an action has concluded in the Circuit Court, a High Court judge hearing a statutory appeal is the sole court then vested with the right to determine the appeal… it would in my view potentially lead to an injustice, and a failure to recognise the finality for which s. 39 of the Courts of Justice Act, 1936 provides, were the High Court judge hearing the appeal to remit an action to the Circuit Court for rehearing, when in turn the decision from that remitted hearing would be open to a further appeal. The aim of finality would suggest an alternative interpretation.”

Highlighting that the appeal to the High Court was an appeal from the whole of the Circuit Court’s decision, Ms Justice Dunne determined that “it was open to the High Court, as I have said, to deal with the question of the objections of the appellant to the making of the PIA. Therefore, it follows that the High Court, to paraphrase the words of Baker J. in Cody, continues to have seisin of the evidential and legal matters raised in the appeal, and has sole jurisdiction by virtue of the fact that the Circuit Court action has concluded.”

The court continued, “It might be observed that had the High Court reached a different conclusion on the issue of locus standi, it could have proceeded to consider the appellant’s objections and ruled on them. Neither party could have taken issue with that approach had the outcome of the appeal before the High Court accepted that the appellant had locus standi. Therefore, I am satisfied that this matter should be remitted to the High Court.”

Turning to the issue of costs, Ms Justice Dunne considered that while it was accepted that the costs orders made against the appellant in the Circuit and High Courts should be set aside, “as a general rule, it is not appropriate to make a costs order against a PIP… There is, of course, a jurisdiction to award costs against a PIP, but as has been said, it is truly an exception to the rule that this will occur.”

Concluding, inter alia, that both sides conducted the litigation in a “confrontational manner”, the Supreme Court was satisfied that each party should bear their own costs in respect of the hearing before it.

Conclusion

Accordingly, the Supreme Court remitted the matter to the High Court and ordered that each side would bear their own costs.