THE COURT OF APPEAL
2014, No. 973
[Article 64 Transfer]
Dunne J.
Hogan J.
Murphy J.
BETWEEN/TOM KELLEHER
JUDGMENT of Mr. Justice Gerard Hogan delivered on the 28th day of June 2016
1. On Tuesday 28th June 2011 a dreadful kidnapping incident took place which has had life changing implications for the appellant and his family. The appellant, Mr. Tom Kelleher Snr., was at the time the postmaster at Newcastle West, Co. Limerick. On that particular day he was on annual leave and he had just gone on holiday to Spain with his wife when an adult son of his, Tom Jnr., was kidnapped at gunpoint and taken hostage. On that morning Tom Jnr. had just arrived at the rear of the post office in his father’s car when he was abducted. The appellant’s holiday was obviously interrupted and he had to return to Ireland immediately.
2. The appellant had left another son, Ronan, and two other employees in charge of the post office. In the appellant’s absence, however, the staff at the Post Office at Newcastle West - who obviously feared for Tom Jnr.’s life - agreed to hand over €105,000 at a specified location to the kidnappers by way of payment of a ransom demand. It was fortunate that Tom was released without physical harm from what must have been a terrifying incident.
3. These were obviously deeply traumatic events for the appellant and his family, although the fact that Tom was not physically harmed must be regarded as very positive news indeed. The appellant’s ordeal was not, however, over because these events set in train a disciplinary process which ultimately resulted in the termination of his contract qua postmaster, together with a finding that he was contractually liable to pay An Post 50% of the missing moneys.
4. These events must have come as a terrible blow to the appellant. He had served as postmaster for 19 years and he had also built the premises (which he owns) from which the post office at Newcastle West operates. His wife and one of his sons are employed there. Following his suspension from his position on the previous day, the appellant’s salary was stopped on 30th June 2011 and he says that he has been dependent on social security payments since that date.
5. It is these events which have given rise to these proceedings. The appellant has claimed, in essence, that the procedure which resulted in the termination of the appointment was unfair and that he has no contractual liability to An Post in respect of the missing moneys. In the High Court, Peart J. dismissed these claims in a reserved judgment delivered on 16th May 2013: see Kelleher v. An Post [2013] IEHC 328. The appellant now appeals against that decision.
The suspension of the appellant and the four issues raised by An Post
6. Before examining any of these issues in detail, it is necessary first to recount the events which led to the termination of the contract in the first place. Following the release of Tom Jnr. by the kidnappers, a follow-up check of accounts at the Newcastle West Post Office took place on 29th June 2011 which was carried out by An Post’s Waterford audit team. A number of issues were then identified and the appellant was interviewed. Following this, the appellant was handed a notice at about 8.30 pm on the evening of 29th June suspending him from his contract.
7. On 19th July 2011 Mr. J.J. Ryan, the relevant manager from An Post, wrote to the appellant. While the letter very properly expressed sympathy with the family’s plight and ordeal, Mr. Ryan nevertheless outlined the issues of concern to the company and indicated that the question of whether the appellant could continue to hold a contract as postmaster was now under consideration. Mr. Ryan outlined four issues for consideration.
Issue 1: Failure to follow company security procedures in the course of the kidnap incident on 28th June 2011.
8. Mr. Ryan stated that the staff at the Post Office did not contact a dedicated telephone help line in accordance with An Post security policy during the course of the kidnap incident. The sum of €105,000 was, moreover, handed over to the kidnappers without any contact having been made with An Garda Síochána, An Post or, indeed, with the appellant himself. An Post contended that there would have been time to do this, because a member of staff left with the money at 11.15am on the 28th June, but contact was made with An Garda Síochána only at 3pm that afternoon.
9. The staff at the Post Office had, however, informed the audit team that they were unaware of the special security telephone helpline and they also stated that they had never attended any security seminars. Mr. Ryan stated that An Post took the view that even though Mr. Kelleher was on holidays at the time of the kidnap, it was incumbent upon him to ensure that the staff who were left in charge were fully aware of the security procedures.
10. Mr. Ryan noted that the appellant had stated during his interview that he had not advised his staff of the relevant security telephone number to contact in the event of a hostage taking because he believed that this was for postmasters only. Mr. Ryan stated that the company could not accept this, particularly since the appellant had attended a particular security seminar in September 2009 where it had been made clear to all those attending that the number should be made available to all staff.
11. Mr. Ryan then explained that An Post considered that the failure to follow the security policy had facilitated the theft of the €105,000, increased the risk to the hostage and also significantly increased the risk “to other offices which may be seen as a soft target.”
12. Mr. Ryan also stated that it was the company policy that where losses from a robbery or kidnap of this kind are contributed to by the negligence of the postmaster then he or she would be required to make good the appropriate loss in accordance with the conditions of the contract. In this regard Mr. Ryan stated that the company wished to give Mr. Kelleher an opportunity to put forward any reasons why his contract should not be reviewed and why he should not be asked to make good some or all of the loss suffered.
Issue 2: Misuse of company funds
13. The second issue of concern to An Post was that when the investigation started on 29th June 2011 Mr. Kelleher informed the Information Manager that he had taken the sum of €12,000 in cash from the company funds on 27th June 2011 before his departure on holidays. As it happens, the audit team had discovered that some €129,074 was missing from the post office. €12,000 of that figure represented the sum which the appellant had admittedly taken on holiday. €105,000 was attributable to the sum which had been paid to the kidnappers and a further €12,000 had been hidden from the kidnappers by staff and which sum was later found by the appellant on his return.
14. In his letter Mr. Ryan referred to s. 2.33(C) of the Postmasters’ Manual which contained an express provision prohibiting the postmaster from making personal use of any balance for any purpose other than the public service.
Issue 3: Failure to process business deposits on day of receipt
15. Mr. Ryan stated that it had been discovered that three business deposits from a major supermarket company had not been processed since the day they had been presented on 24th June 2011. It was pointed out that all deposits of this kind were required to be brought to account on the day that they are presented.
16. Mr. Ryan observed that these delays presented their own difficulties, including the risk of theft, breach of contract with corporate depositors, missing funds and the misuse of the money in question. There was also the risk that the company would lose business with one of its strongest business deposit clients. He also stated that these delays had been brought to the appellant’s attention on a number of earlier occasions.
Issue 4: Unauthorised access to the Post Office and counter information system
17. Mr. Ryan stated that Mr. Kelleher had instructed his son to put through his monthly payment through the An Post’s counter automation system. Mr. Ryan noted that in order to comply with this instruction Mr. Kelleher’s son would have had to have accessed the Post Office Area and Computer Automation System. As Mr. Kelleher’s son was not a registered assistant and was not even connected to the running of the business, this was unauthorised and it was, indeed, strictly prohibited even to disclose one’s own password to the system to any unauthorised person.
The Appendix IV procedure
18. Mr. Ryan stated that the particular stipulated procedure known as the Appendix IV procedure would be followed in relation to this disciplinary investigation.
19. The Appendix IV procedure governs the process for handling cases involving “a potential breach of contract”. The essential features of the procedure are as follows:
(a) First, a letter is sent to the postmaster detailing all matters in issue. The postmaster is then provided a period of time to respond. Following this response the case is then reviewed by a Contractors Manager (in this case, Mr. Ryan) and a recommendation is then made to the Head of Contractors in respect of the case.
(b) The recommendation may range from no action to a warning to a recommendation to terminate the contract.
(c) If the postmaster is dissatisfied with the result, he may appeal that decision. Following a hearing, recommendation is than sent. A decision is then taken by the Head of Contactors (in this case, Mr. John Dunleavy) which is then communicated to the postmaster in question.
The appellant’s response of 29th July 2011 and subsequent correspondence
20. The appellant responded in a lengthy and detailed letter of 29th July 2011. Adopting the graphic words of Peart J., one may say that this reply constituted “an indignant denial and traverse” of these charges and which also contained “extensive explanations and justifications in relation to the issues raised.” This letter gave rise to a lengthy exchange of correspondence over the following months.
21. In a letter dated 12th September 2011 the appellant complained that the investigation procedure was being conducted by An Post in an unfair way, specifically in the way in which - he maintained - that so many matters had been pre-determined. The appellant sought assurances that this would not re-occur and that the company would act only on the basis of the evidence which had been properly gathered. The appellant also requested that the procedures would follow principles of due process and sought details of witnesses.
22. Mr. Ryan responded by saying:
“The company remains of the view that you were seriously negligent in not having trained your staff in correct procedures. This is compounded by the fact that you absented yourself for a week, leaving an assistant in charge who, through your negligence, was not familiar with or properly instructed in the procedures to be followed in dealing with events which transpired.”
23. Mr. Ryan also stated that the procedure would be inquisitorial. This meant that while the company did not intend to have witnesses present, the appellant could request the presence of other relevant witnesses. Mr. Ryan stated that at the conclusion of the hearing the appellant would be supplied with a written summary record of the oral hearing. He would then be given an opportunity to review it and raise any matter that he felt was not adequately dealt with in that summary. Later correspondence confirmed 14th October 2011 as the date for the oral hearing.
24. In advance of that date the appellant then wrote a further letter to Mr. Ryan on 12th October 2011. Before setting out the terms of the letter, it seems to be accepted that just before that date a Mr. McGann (who was a representative of the Irish Postmasters’ Union and of which the appellant was then a prominent member) had a discussion with Mr. Dunleavy in which the present case was discussed. At all events the appellant was advised by his union representatives that he should withdraw an earlier letter which he had written to Mr. Ryan. The appellant then contacted Mr. Ryan who agreed to return the original letter.
25. In the letter of 12th October 2011 which he then sent to Mr. Ryan - and which then replaced the original letter which Mr. Ryan had returned - the appellant struck a rather more conciliatory tone: he accepted that his understanding in relation to the hostage helpline had been incorrect. He also gave an assurance that if he were to be re-instated that in future all staff would be fully conversant with the specialised anti-hostage safety procedures.
26. The appellant also accepted that he should not have drawn down the €12,000 in advance of the holiday, saying it was the first time he had done anything like that. He assured An Post that he was scrupulously honest and that he would never do anything like this again. He further accepted that the password log-in procedures had not always been strictly adhered to, but again assured the company that this breach of security procedure would not be repeated.
27. So far as the business deposits were concerned, the appellant explained that it was not always possible to arrange to have the deposits lodged on the same day. But the appellant insisted that in future he would make every effort to ensure that these deposits were processed in a timely fashion without any further delay.
28. The appellant concluded this letter thus:
“…the experience that myself and my family have endured since June has been traumatic and devastating and one which will haunt all of us for a very long time to come. At this stage I simply want to get back to work and try, as best I can, to restore some normality for myself and my family. In this context, I would regard this as my final reply (unless you have any further queries) and I am now not seeking an oral hearing.”
29. The obvious inference from this sequence of events is that the appellant had been advised that that a more conciliatory approach was more likely to yield positive results and he decided to accept this advice. Indeed, in his judgment, Peart J. observed that the letter was “apparently drafted for [the appellant] by Mr. McGann.”
30. Yet, as Peart J. elegantly put the matter in his judgment, this new letter “did not achieve the appellant’s presumed intention”. Mr. Ryan prepared a report (the conclusions of which are summarised below) which he transmitted to Mr. Dunleavy, the Head of Contractors on 25th October 2011. In that report Mr. Ryan recommended the termination of the contract. This recommendation was accepted by Mr. Dunleavy on 27th October 2011.
31. Mr. Ryan then responded to the appellant on 27th October 2011 stating that while he regretted the necessity for the decision, the company had no alternative but to terminate the contract having lost confidence in the appellant. The appellant had seven days to appeal that decision.
32. Mr. Ryan further stated the company believed that the appellant had been negligent in not having trained his staff properly in the correct procedures and that this had contributed to the success of the robbery. The company concluded that he was 50% responsible and it accordingly required him to pay €52,500 in accordance with the terms of the contract. The appellant’s solicitors wrote to An Post on 1st November 2011 stating that he wished to appeal. They also indicated that it was inappropriate to require the appellant to pay the money demanded.
33. This may be a convenient point to note a development which took place after the High Court had delivered judgment. It would seem that some €41,950 of the missing moneys were subsequently recovered by An Garda Siochána and returned to An Post under the Police Property Act. In correspondence dated 3rd November 2014 An Post confirmed receipt of these moneys, so that the sum which it was now seeking and it which it said it was contractually entitled to 50% of the remaining missing moneys, namely, €31,525.
The appeals process
34. The appellant was then informed that a Mr. Rory Delany, the Human Resources Manager, had been appointed to hear the appeal. Mr. Delany wrote on 11th November 2011 outlining the procedure he intended to follow. He invited the appellant to write to him setting out the grounds of appeal, together with any ground of mitigation on which he proposed to rely. Mr. Delany also stated that, if necessary, an oral hearing could be arranged.
35. By letter dated 26th January 2012 the solicitors for An Post forwarded a copy of Mr. Ryan’s report and recommendations to Mr. Dunleavy. In his report Mr. Ryan had summarised the various arguments advanced by the appellant, along with the response of An Post, in a very fair and comprehensive fashion. His conclusions were as follows:
“Conclusion and recommendation”
Mr. Kelleher has been reluctant to accept that there was any wrongdoing on his behalf. For over three months he repeatedly sought to abdicate his responsibility in relation to training his staff on the relevant security procedures and argued that this was the Company’s responsibility. His attempt to construe this failure as a misunderstanding is unconvincing and unsubstantiated. The fact is that he left his deputy in charge of the office in circumstances where she or any of the other assistants had not been properly briefed in relation to security procedures.
He attempted to portray his ‘alleged’ misuse of company funds as factually incorrect despite the fact that there was absolutely no doubt that he did misuse company funds and that he clearly admitted saying this in his signed document. He took €12,000 of the company’s funds, unknown to his deputy, on the basis that he would have his son conduct an unauthorised transaction to collect his remuneration, again without knowledge of his deputy.
Regarding his failure to process business deposits in accordance with procedures, there may be some ambiguity surrounding the previous correspondence. However, he has failed to put forward an explanation for the two day delay in processing these items. I believe that this is indicative of his poor attitude to compliance with company procedures. Likewise, I believe his failure to follow procedures in respect of the use of counteraction passwords is indicative of his poor attitude to compliance.
He also sought to discredit the company’s investigations and the breach of contract process rather than accept any responsibility for his actions. He sought to rely on his impeccable record, when his record is not impeccable. In the circumstances outlined above, I don’t believe the company have confidence in Mr. Kelleher continuing to hold the contract to provide Post Office services at Newcastle West. Accordingly, I recommend that Mr. Kelleher’s contract as Post Master at Newcastle West Post Office is terminated with immediate effect.”
36. It follows, therefore, that the appellant was possessed of Mr. Ryan’s report in advance of the appeal hearing.
37. There then followed further correspondence which culminated in a hearing which was scheduled for 4th April 2012. It was agreed that the appellant’s solicitor, Mr. Casey, would make an oral presentation on the substantive hearing and make written submissions on the procedural issues. This duly occurred and on 9th May 2012 his solicitor was sent a summary report of the appeal hearing which had taken place a month earlier. The appellant then responded with some suggested alterations.
38. Following further inquiry by the appellant’s solicitors, Mr. Delany confirmed that a report had been sent by him to the Director of Retail Operations at An Post. On 20th August 2012 An Post wrote to the appellant stating that following receipt of the report from the Director of Retail Operations, no reason had been found to alter the initial decision. His appeal was accordingly rejected and his contract was terminated with immediate effect.
The appellant’s case
39. The appellant essentially raises five points of objection. First, he says that the trial judge was in error in holding that procedures afforded to the appellant by Appendix IV were entirely appropriate. Second, he contends that he ought to have been supplied with a copy of Mr. Ryan’s proposed recommendations to Mr. Delany. In addition, he also submits that there was pre-judgment on the part of Mr. Ryan. Third, he says that he was equally entitled to see Mr. Delany’s report to the Director of Retail Operations. Fourth, he submits that there was improper contact between Mr. Dunleavy and a third party, Mr. McGann. Finally, he says that An Post are not entitled to recover the sum of €31, 525 in the course of this procedure.
40. I propose to consider each of these arguments in turn.
Ground 1: Whether An Post correctly applied the Appendix IV procedure
41. The first ground of appeal is that An Post applied the wrong procedure and that it was Clause 2.39 of the Postmasters’ Manual which was the operative provision. Clause 2.39 provides:
“Any appeal against a disciplinary decision should be made without delay. The decision, or relevant form, should at once be noted “subject to appeal” and the appeal should be forwarded if not later than ten days thereafter, otherwise the right of appeal will lapse. If the punishment be not of a serious nature only one appeal is permitted. In “serious” cases up to three appeals are allows: The first should invariably be made by the officer himself / herself and if he/ she is dissatisfied with the result he / she has the option of making a third appeal to the Regional Manager either on his / her own behalf or through his / her association. Where an appeal is being made by an association, the officer must produce a communication from the association not later than thirteen days after the rejection of his / her own appeal, signifying that an appeal is being lodged on his / her behalf. The association must then forward its appeal within a further period of seven days. If this proves unsuccessful, a final appeal may then be made within a further seven days.”
42. An Post disputes the applicability of this particular provision, saying that it really applies only to disciplinary matters of a minor nature.
43. In the High Court Peart J. agreed with this latter submission, saying that the Clause 2.39 procedure could not have been intended:
“to cover matters of the complexity of the present case and which required such a detailed investigation process, followed by the requirement to afford the plaintiff every opportunity to respond to the issues identified as being of concern to An Post. Clause 2.39 provides for a procedure of much more summary kind…even though it speaks of three appeals. For example, there seems to be no opportunity provided for in Clause 2.39 for an oral hearing and an oral appeal.”
44. Peart J. then went on to note that this issue was raised first raised by the appellant after the disciplinary hearing had concluded:
“It seems to me that the procedure afforded to the [appellant] under Appendix IV procedures were entirely appropriate given the issues involved in this case. In my view, the plaintiff himself considered that [Appendix IV] procedure to be appropriate and participated in same, even though in his letter of 12th October 2011 he stated clearly that he no longer required an oral hearing.”
45. In my view, it is probably unnecessary to express any view as to whether Appendix IV or Clause 2.39 governed this particular disciplinary appeal. It is sufficient to state that the appellant fully participated at all stages in the Appendix IV procedure without objection until the final decision proved adverse to his interests. The entire procedure had been carefully explained to him at the outset by Mr. Ryan and at a later stage by Mr. Delany.
46. There is abundant authority for the proposition that knowing participation in a procedure of this kind operates to create an estoppel against the party who elected to avail of that procedure: see, e.g., the decisions of the Supreme Court in Corrigan v. Irish Land Commission [1977] I.R. 317 (where Henchy J. held that a person who elected to proceed with an administrative hearing knowing of the composition of the adjudicatory panel could not later complain that the panel was irregularly composed) and The State (Byrne) v. Frawley [1978] I.R. 326 (knowing election to proceed with unconstitutional jury).
47. This principle was, in any event, applied in the context of disciplinary hearings by Laffoy J. in Delaney. In that case the plaintiff, with the benefit of independent legal advice, agreed to participate in a psychiatric assessment organised by his employer. In view of this election Laffoy J. held that the plaintiff was then debarred from contending that the referral to the psychiatrist was invalid.
Conclusions in respect of ground 1
48. In my view, the appellant is accordingly debarred by his own conduct in knowingly participating in the process from challenging the validity or appropriateness of the Appendix IV procedure as it was applied to the present case. It follows, therefore, that this ground of objection must fail.
Grounds 2 and 3: Whether the appellant was entitled to Mr. Ryan’s report to Mr. Delany and Mr. Delany’s report to Mr. Dunleavy
49. The appellant submits that he was entitled as a matter of fair procedures to a copy of the respective reports prepared by Mr. Ryan for Mr. Dunleavy and in turn by Mr. Delany to Mr. Dunleavy. In essence, the appellant’s argument is that he was entitled to see the nature of the comments and recommendations made by the party who gathered the evidence prior to any decision being made by the party to whom the report was transmitted. In the High Court Peart J. rejected this argument, saying that:
“That could not be the case in my view. The plaintiff had his appeal hearing. That was where his fair procedure rights are to be afforded to him. That is where he makes his points and arguments. Thereafter the appeal is closed and a decision falls to be made. There is no obligation to be inferred that the appeal officer must once again revert to the appellant.”
50. There is no doubt but that this is correct as a general statement of principle. That, however, is not quite what happened here as the person who gathered the evidence or who prepared the report was not the ultimate decision maker. It is clear from the authorities that in such circumstances the decision maker is not entitled to act on the basis of information concerning issues of fact which was not disclosed to the party affected by the ultimate decision.
51. Perhaps the case which has the closest analogy with the present one is Traynor v. Ryan [2003] IESC 36, [2003] 2 IR 564. This case concerned the operation of the common Consultants’ Contract which envisaged a two stage procedure in respect of certain types of disciplinary complaints. The first stage required the relevant Hospital Manager to assess whether there was something in the nature of a prima facie case against the consultant in question. The second stage provided that in the event that the Manager concluded that there was such a case to answer, the matter was then to be referred to a committee which was appointed by the Minister for Health. The final decision on the substantive merits of the complaints rested with the committee.
52. In Traynor the manager had not only found that there was a case to answer in respect of the majority of the complaints, but had proceeded to make adverse findings on the merits of the dispute. The Supreme Court accepted that the manager had erred by purporting to determine the merits of the dispute when his task was simply to determine whether there was a case to answer. The appellant argued that this meant that there was clear pre-judgment which infected the capacity of the committee to arrive at an objective result. This argument was, however, rejected by Fennelly J. ([2003] 2 IR 564, 577-578 )
“Next, it has to be considered whether the conclusions of the [manager] so infect the entire procedure that it is no longer possible for the appellant to have a fair hearing before the committee. The Minister has been restrained by order of the High Court from acting on foot of the decision of the respondent [manager] referring the matter to him. Accordingly, there is no committee in existence before which the decision of 6th December could have been placed. Counsel for the respondent has emphasised that there is no requirement that the report be placed before the committee. The committee can perform its task without ever seeing the decision. At this point, it seems to me that the Court should presume, in the absence of any indication to the contrary, that the Minister will ensure that all aspects of the procedure before the committee will be conducted fairly. However, I have already stated that it was not any function of the respondent to pronounce conclusions on the merits of the matters in issue. Therefore, such findings would be wholly immaterial to any subsequent step taken in relation to them. All that could be material is the decision simpliciter to refer the matter to the Minister. The possibility of its influencing the deliberations of the committee does not, for these reasons warrant quashing the decision.”
53. It is clear, therefore, that the ultimate decision in Traynor turned on the fact that the adjudicatory committee would not even see the adverse findings of the manager. The clear implication, therefore, is that the disposition of the case would - or, at least, might - have been different had the committee been obliged to consider those findings. It is also important to note that at issue in that case were allegations of professional misconduct which the consultant in question had strenuously denied.
54. As I have already observed, the modern jurisprudence clearly states that a decision-maker is not entitled to act on the basis of material gleaned from outside the hearing and which has not been disclosed to the party affected, albeit that this principle is subject to the important proviso that it only applies to disputed facts. This is illustrated by Georgopoulus v. Beaumont Hospital Board [1998] 3 I.R. 132, 154, Hamilton C.J., giving the judgment of the Supreme Court held as follows:-
55. The application of this principle is also illustrated by a variety of contemporary case-law, of which the following authorities may be taken as representative. In Aziz v. Midland Health Board, Supreme Court, 29th October 1999 the Supreme Court quashed a decision of the hospital to terminate a registrar’s contract where it was said that the latter had failed to attend on a particular day without leave. The hospital’s case was that a particular consultant, a Dr. Taaffe, had given the applicant a written direction to attend on the day in question which the latter had then disobeyed. The applicant maintained that Dr. Taaffe had accepted that his attendance was not required on that day pending a review by the hospital of the necessity for cover on the day in question. It transpired, however, that the hospital’s chief executive officer had subsequently spoken to Dr. Taaffe on this very issue in the absence of the applicant. This was held by the Supreme Court to be a breach of fair procedures.
56. As Keane J. explained:
“The issue which the defendants, acting in a quasi-judicial capacity, had to resolve was whether the plaintiff was entitled to conclude that Dr. Taaffe was accepting his non-attendance on the Saturday morning because of the absence of SHO cover, pending a review of the matter by the hospital administration. That case, however tenuous it might be, was one which the plaintiff was entitled to have considered by the defendants in accordance with accepted norms of natural justice and those norms were unfortunately not met when the Chief Executive Officer elected to have a private discussion with Mr. Bane and Dr. Taaffe in the absence of the plaintiff before arriving at his decision. Given the clear conflict between the plaintiff and Dr. Taaffe as to what happened at the crucial meeting between them on the Friday, this failure to observe proper procedures could not, in my view, be disregarded.
As I must again emphasise, the fact that there was ample evidence to justify the conclusion by the CEO that not merely had the misconduct been established but that it was of sufficient seriousness to warrant the plaintiffs dismissal did not absolve the defendants in a matter of this gravity from adhering scrupulously to fair procedures.”
57. This point also emerges from two other recent High Court decisions. In Delaney v. Central Bank of Ireland [2011] IEHC 212 the applicant had previously made complaints of bullying by some fellow employees. Although these complaints were not upheld, certain findings were made against other employees and there was no question that these complaints had been made on some frivolous basis. Some concerns had been expressed by senior management in the Bank about his mental health and he was ultimately required by his employer to attend a particular psychiatrist, a Dr. Mohan. Dr. Mohan ultimately concluded that the plaintiff was suffering from a particular disorder and this led to his suspension from work.
58. The plaintiff contended that the procedures which led to the report of Dr. Mohan suspension were unfair. Specifically, he objected to the fact that he had been denied access to the material which accompanied the letter from the Bank’s solicitor to Dr. Mohan requesting a review of the plaintiff. There had moreover been a private meeting - which the Bank asserted was covered by legal professional privilege - between Dr. Mohan and the Bank’s representatives. Moreover, one of the persons against whom allegations of bullying had been made, a Mr. Kelly, had himself made contact with Dr. Mohan and had been allowed to put his position in writing which, in the words of Laffoy J., “was designed to, and obviously did, influence Dr. Mohan.”
59. It was for these reasons that Laffoy J. concluded that the process which led to Dr. Mohan’s report had not been conducted in accordance with fair procedures:
“It was entirely inappropriate that Dr. Mohan should be put in a position of having to base his opinion on the view of Mr. Kelly….as to the personal traits, the work performance and the conduct of the plaintiff in the workplace, which he did to a large extent. Whether the views of Mr. Kelly of the plaintiff were correct or not, unfortunately, the appendices to Dr. Mohan’s report give rise to the perception that Mr. Kelly was allowed to be a judge in his own cause.
The decision of the Bank that the plaintiff should not return to work, which was communicated to his solicitors in the Bank’s solicitors’ letter of 7th July, 2008, as that letter indicates, was based entirely on Dr. Mohan’s report and “his views in relation to the seriousness of [the plaintiff’s] condition”. For the reasons I have outlined, the process which led to Dr. Mohan’s report was not conducted in accordance with the plaintiff’s right to fair procedures and, accordingly, that decision cannot stand.”
60. The final authority on this point is that of Herbert J. in Somers v. Minister for Defence [2012] IEHC 447. This was a case where a member of the Defence Forces had (apparently) tested positive following a random drugs test in circumstances where the member concerned maintained that a drink of his must have been tampered with. There were also some differences between the “A and “B” samples. Following a first instance adverse disciplinary decision, the applicant duly appealed to an Appeals Officers. Unbeknownst to the applicant, however, the Appeals Officer sought advice from a specialist drugs testing unit within the Defence Forces upon which advice the Appeals Officer subsequently acted.
61. Herbert J. concluded that this amounted to a breach of fair procedures which entitled the applicant to a quashing order:
“It is not necessary for me to decide and, I do not decide, whether it is a breach of fair procedures for a decision-maker to seek “technical advice”, as distinct from legal advice in relation to the conduct of the inquiry. I am satisfied and I find that the advice sought and obtained by the Appeals Officer in the present case from the Officer in Command Defence Forces Drugs Testing Team and, upon which he acted, was advice relating to facts relevant to the matters at issue before him and in respect of which he was obliged to make a decision. As the Appeals Officer did not inform the applicant that he intended to seek such advice from the Officer in Command Defence Forces Drugs Testing Team and did not furnish the applicant with a copy of each of his letters seeking that advice and did not furnish the applicant with a copy of each of the letters received by him from the Officer in Command Defence Forces Drugs Testing Team in reply, there was a clear breach of fair procedures.”
62. How, then, should these principles be applied to the present case? For my part, if the facts were in controversy, then it seems incontestable in the light of these authorities that the appellant would have been entitled to have seen the report which had been prepared by the person who gathered the evidence for onward transmission to the ultimate decision-maker. It is the separation of the evidence-gatherer from the decision-maker which gives rise to this entitlement: if these were one and the same person than, of course, the principles enunciated by Peart J. would fully apply.
63. It must, however, be observed that the facts are not, however, in controversy. By reason of his letter of October 12th, 2011 the appellant has accepted the substance of the case alleged against him by An Post. He cannot dispute but that the staff at Newcastle West were not properly instructed as to basic security precautions or that he had improperly accessed €12,000 or that he had given his security passwords to an unauthorised person or that he had failed to lodge certain business deposits on a same day basis.
64. In that regard, the present case is very different from cases such as Traynor or Delaney or Somers, as in all of those cases the employees in question had stoutly denied any wrongdoing and the facts of these controversies were hotly in dispute. It may be recalled that in Georgopoulus the Supreme Court confirmed that this entitlement is triggered only where the facts are in controversy. By contrast, the present case has really reduced itself to the question of whether An Post ought to terminate the contract in view of these freely admitted facts. At a human level, one is bound to feel immense sympathy for the tragic outcome for the appellant as a result of terrible misfortune. But that cannot take from the contractual right of An Post to terminate the contract for stated cause provided that fair procedures have been followed.
65. For the reasons I have endeavoured to state, I do not think in the particular circumstances of this case that the appellant was entitled to have access either to Mr. Ryan’s report to Mr. Delaney or, for that matter, the report of Mr. Delaney to Mr. Dunleavy. To that extent, I agree with the ultimate conclusions of Peart J. on this issue, even if I do so for slightly different reasons.
Ground 4: The contact between Mr. McGann and Mr. Dunleavy
66. In his judgment Peart J. noted that the appellant had meet with Mr. McGann (and another IPU representative) at the IPU’s request following a meeting between Mr. McGann and Mr. Dunleavy. I have no doubt at all but that this intervention of Mr. McGann was well-intentioned and prompted by understandable sympathy for the unfortunate plight of the appellant. Reading between the lines, it is hard to avoid the impression that the IPU and its representatives considered that - possibly in the wake of that conversation - it would be best if the appellant were now to take a conciliatory approach in the hope that An Post would in turn exercise some clemency, as it was really pointless simply to deny the substance of the charges in the teeth of all the available evidence.
67. I agree that as counsel of prudence it might have well been better if the conversation in question had not taken place. Conversations of that kind have always the potential for potential confusion and misunderstandings, not least in fraught and difficult cases of this kind.
68. I nevertheless cannot conclude that this conversation was of such a nature such as exhibited pre-judgment or bias on the part of Mr. Dunleavy. In his affidavit (in respect of which he was not cross-examined) Mr. Dunleavy explained that he dealt with the IPU:
“In a situation where a member of the Union is suspended and potentially facing termination it would be very unusual not to have contact from the Union on the case. This is particularly so where the member concerned is a member of the IPU’s National Executive… Mr. Brian McGann, the General Secretary of the IPU, spoke to me in relation to the case. I don’t recall the specifics of any conversation I had, but I believe it was an enquiry of the General Secretary seeking to ensure that he had all relevant information so that he was as well informed as he could be when advising the member concerned. I can categorically state that I would not have sought to influence the type of advice the IPU might wish to give to the [appellant]. This is a matter for the IPU … I can think of no reason why I might have sought to do so… [A]t no time was I or [An Post] seeking to take any action to entrap the [appellant] [An Post] simply wanted to ensure that the [appellant] had a full and fair opportunity to respond to the issues which had been put to him. … [T]his is validated by the fact that when the [appellant] asked that we returned to him unopened the letter he had submitted, we did so.”
69. The present case is accordingly very different from cases such as Aziz where it was clear that the decision-maker had a substantive conversation with one of the protagonists in respect of a disputed issue of fact which was central to the disciplinary proceedings and in respect of which conversation the decision-maker acted.
Conclusions in respect of issue No. 4
70. While it might have been better had the conversation in question not taken place, the evidence does not establish any impropriety on the part of any of the parties. The conversation was well-intentioned and it does not appear that, contrary to cases such as Aziz, the decision maker ever acted on the basis of this conversation or treated it as an opportunity to gather evidence which might be applied to the appellant’s case.
71. In these circumstances, the objection on the grounds of apparent bias or pre-judgment must accordingly fail.
Issue No. 5: The claim by An Post for €31,250 representing 50% of the missing moneys
72. The remaining question is whether the appellant is liable to pay An Post the sum of €31,250. This sum represents 50% of the missing moneys and represents An Post’s evaluation of the extent to which the appellant’s negligence contributed to its loss. It is true that under the terms of the Postmasters’ Manual - which is, in effect, a contract between the parties - a postmaster is contractually liable to repay missing moneys if this is caused by the negligence of the postmaster in question.
73. A claim of this kind cannot, however, be unilaterally determined by An Post as if this were some form of liquidated demand, to be ascertained in the same manner as if the claim was made pursuant to a demand for payment at an agreed rate for contractual services. This claim is not an action for debt (such as might be brought by a credit institution against a defaulting borrower) or even a liquidated demand for money (such as might be brought by a professional person seeking payment for services rendered). It may well be that An Post is contractually entitled to this sum. But where, as here, the sum is disputed then the remedy for An Post is to sue the appellant for this sum as an unliquidated claim for damages for breach of contract.
Conclusions in respect of Issue No. 5
74. It follows, therefore, that An Post had no entitlement unilaterally to specify the sums which it contends were due from the appellant for breach of contract. If An Post claims to be entitled to this sum, then where (as here) such is disputed, it must sue the appellant in substantive proceedings for unliquidated damages for breach of contract
75. I would accordingly allow the appeal against this part of the order of the High Court and grant a declaration to this effect. I would, however, otherwise dismiss the appeal brought by the appellant against the decision of the High Court.
