High Court of Ireland Decisions

1. This is a claim for damages of £1,938,264. It arises in the wake of the judgment of Blayney J. given in these proceedings on the 13th November, 1992. By his Order of that date that judge declared that the inclusion of what has come to be called a mining ban which was inserted in paragraph 3.6.1 of the County Mayo Development Plan on the 17th February, 1992 was ultra vires the Respondent and was null and void.

2. Having obtained that decision in their favour the Applicants now assert that they are entitled to recover damages against the Respondent. They claim the recovery of monies expended by them (agreed in the sum already set forth) on the basis that in inserting the ban the Respondent was guilty of at least one of five different wrongs. These wrongs are misfeasance in public office, breach of statutory duty, negligence, breach of legitimate expectation and wrongful interference with the Applicants' constitutional rights. Each of these claims will have to be considered in turn.

3. The Applicants are respectively a public company registered in Dublin and a public company registered in Belfast. They are both involved in prospecting and mining ores and minerals.

4. On the 30th May, 1986 the Applicants obtained from the Minister for Energy ten prospecting licences. These were obtained for the purposes of exploring for gold in townlands south of Westport in County Mayo. These licences have been renewed from time to time.

5. By the 17th February, 1992 the Applicants had spent the amount claimed in these proceedings on an exploration programme in the areas authorised by the licences. As a result of their exploration, the Applicants formed the view that gold in commercial quantities existed in the areas prospected. However, in order to bring matters a stage further substantial sums would require to be expended. To this end, they engaged in negotiations with a company called Newcrest Mining Limited which at that time was one of the largest Australian gold producers. It ranked in the top fifteen gold-mining companies in the world. Having considered and evaluated the Applicants' work on the licensed lands, that company thought that the Applicants' results warranted a considerable amount of additional work being done. Newcrest felt the potential ore size was striking and the geological evidence was regarded as spectacular.

6. As a result of this, Newcrest entered into a joint venture agreement with the Applicants. It agreed to expend at least £1.6 million on further exploration. It was to receive a 51% interest for so doing. This agreement was made in November 1991. In February 1992, however, Newcrest pulled out of the joint venture because, it is said, of the mining ban having been included in the County Development Plan.

7. When the Applicants first obtained their prospecting licences, the Respondent's 1984 Development Plan was in existence. It did not contain any mining ban.

8. In 1990, a new Development Plan was published. It was put on public display between the 2nd April, 1990 and the 31st July, 1990. Paragraph 3.6.1 of that draft plan dealt with mineral extraction. It was in the following terms:-

9. The ban was introduced as an amendment to this section of the plan. It was to be inserted between the two sub-paragraphs in the policy section. A motion adopting the ban was passed at a meeting of the Respondent held on the 11th March, 1991. The ban was inserted under the heading "Policy" in paragraph 3.6.1 of the Plan and was under the heading "Mineral Extraction" . It read as follows:-

10. The Development Plan incorporating this amendment was then put on public display from the 2nd April, 1991 to the 6th May, 1991. On the 2nd May, 1991 the Applicants wrote to the Respondent objecting strongly to the amendment being included in the Development Plan.

11. A meeting of the Respondent was held on the 11th November, 1991. The members considered the written representations received in relation to this amendment but decided nonetheless to include it in the Development Plan. The County Secretary informed the members that the County Development Plan as amended would be placed before them for their formal ratification at their December meeting. That meeting was held on the 16th December, 1991. On that day it was resolved to defer the ratification in order to give the members of the County Council an opportunity of considering a letter dated the same date which had been received from the Department of Energy. That letter made the views of the Minister for Energy known in no uncertain terms. The relevant parts of the letter stated:-

12. The letter went on:-

13. The meeting having adjourned on the 16th December, 1991 six members of the Respondent put down a motion to rescind the resolution of the 11th November, 1991 which had approved the Development Plan with the mining ban included in it. Their motion, if passed, would have removed the mining ban from paragraph 3.6.1 of the Plan.

14. At a meeting of the Respondent on the 17th February, 1992 that motion was defeated by 22 votes to 8.

15. Thus the mining ban came into force and in turn led to these proceedings. Later on in this judgment I will have to give much more detailed consideration to many aspects of the Respondent's behaviour in relation to the imposition of this ban. The foregoing is merely the general background against which this litigation can be understood.

16. The Applicants were given leave to commence these proceedings which began on the 12th May, 1992. Judgment was delivered on the 13th November, 1992. In his judgment Blayney J. made it clear that he was fully aware of the strong feelings which existed in County Mayo on the question of whether or not mining should be permitted in the Doolough area of that county. However, he pointed out that it was not the Court's function to decide between the different interests. What it had to do was to determine the legal issue without regard to the relative merits of each side.

17. Having considered the relevant statutory provisions, Blayney J. said:-

18. Blayney J. then went on to other considerations which in his view led to the same conclusion. He considered certain statutory provisions and regulations made thereunder as a result of which he came to the following conclusions (at pp. 247-248):-

19. Having decided that the mining ban was ultra vires, Blayney J. did not consider the other detailed submissions which were addressed to him. He did, however, comment on a further aspect of the case. It was by reference to the letter from the Department of Energy of the 16th December, 1991 from which I have already quoted the relevant extracts. The letter was addressed to the County Manager and asked that it be brought to the attention of the Council members, which indeed it was. Counsel for the Applicants submitted to Blayney J. that a further reason for nullifying the mining ban was the fact that the Respondent, in including it in the Development Plan, had failed to comply with the provisions of Section 7 of the Local Government Act, 1991. The relevant part of that section is as follows:-

20. Blayney J. dealt with this argument as follows (at p. 248):-

21. Having thus succeeded in having the mining ban set aside, the Applicants then continued with these proceedings claiming damages under the various headings which I have already identified.

22. Blayney J. annulled the mining ban in the Respondent's Development Plan. He did so because the Respondent acted ultra vires. The effect of his judgment was to make void ab initio the offending provision. But it does not follow automatically that because a declaration of invalidity has been given that that of itself gives rise to a cause of action in damages. There is no direct relationship between the power of the High Court to quash a decision of an inferior tribunal or body and a liability being visited on the Respondent in such a situation to pay damages. The Applicants largely accept this general proposition and they cite the decision of Finlay C.J. in Pine Valley Developments Limited v. The Minister for the Environment, Ireland and the Attorney General [1987] ILRM 747. The Chief Justice there said (at pp. 757-758):-

23. The Applicants recognise the strength of this statement but assert that they fall within one or other if not all of the categories identified in it as giving an entitlement to recover damages in respect of an ultra vires act.

24. I turn now to consider the behaviour of the Respondent in imposing the mining ban with a view to ascertaining the true factual position. I will then consider whether my findings of fact support the Applicants in their various allegations of wrongdoing against the Respondent.

25. There is no doubt but that in the early part of this decade the topic of mining in County Mayo was a heated one. This was particularly so in the Westport electoral area. I am satisfied on the evidence that there was great concern amongst the population concerning the question of mining development in the area. The area is scenic and attracts a considerable number of tourists.

26. Perhaps the single most important manifestation of mining activity which gave rise to this reaction was the work carried out by Burmin Exploration and Development PLC and Tara Mines PLC. They had a joint gold-mining prospect on the slopes of Croagh Patrick. As a result of their activities a scouring was created on the side of that mountain. The evidence of Messrs Hughes and Kenny, both of whom were members of the Respondent at the relevant time, satisfies me that once this scouring became apparent, the general public reacted against it. Mr. Kenny said it was described in the national media as "The Rape of the Reek" . He said :-

27. Later in his evidence Mr. Kenny said:-

28. There was also considerable concern and discussion about an entity called Ivernia West which, through its subsidiary Talc Technology Limited, had a talc prospect about a mile south east of the Westport Urban District area. A planning application to develop that prospect was considered and refused by the Respondent. On appeal, it was again refused by An Bord Pleanala. Amongst the reasons given for that refusal by An Board Pleanala was one that the development would be "detrimental to the interests of the tourist industry and to the long-term development potential of that industry" . Mayo County Council refused planning permission to Talc Technology Limited on the 20th February, 1990 and the appeal to An Bord Pleanala was decided on the 14th January, 1991. All of these matters were very much in the mind of the members of the Respondent when they were considering the question of the mining ban in early 1991.

29. Both members of the Respondent Council who have given evidence, namely, Mr. Hughes, who represented Fianna Fail and Mr. Kenny, who represented Fine Gael, made it clear that having regard to the concern that was being expressed about the Burmin and Talc activities and about mining activities in general, they wished to bring about a situation where in the event of planning permission being sought in respect of any mine, it would be the councillors rather than the officials of the Respondent who would deal with such an application. They were of the view that if the mining ban were included it would mean that any applicant for planning permission would have to seek a variation of that plan and that was a decision which would have to come before the elected representatives and could not be dealt with by the County Manager or his officials. This was the mind-set which was present on the part of many of the councillors and was to a considerable extent dictated by the concern about mining activities which was all too evident both from their dealings with their constituents and from newspaper coverage in the local press.

30. Two answers which were given in evidence, one from each of the two members of the Respondent who gave evidence, indicate their approach.

31. Mr. Hughes representing the Fianna Fail interest said (Question 176, 10th December, 1997):-

32. Mr. Kenny in his evidence (11th December, 1997 at Question 79) said:-

33. It was Mr. Hughes who appears to have been one of the prime movers in introducing the notion of a mining ban. He first asked Council officials to prepare a report on the possibility of making a special amenity area order to cover the area in question. However, he formed the view that if the Council were to resolve to make a special amenity area order, the Respondent would have to commit huge resources to carry out the necessary examination. He took the view, having regard to an experience which was related to him involving an attempt to make a special amenity area order for the Liffey Valley in Dublin, that there was no practical solution to be found by following that course.

34. The possibility of a special amenity area order was first discussed at a meeting of the Respondent held on the 22nd October, 1990. By the time of its meeting of the 25th February, 1991 the Respondent had decided not to make the special amenity area order. Instead, at that meeting of February 1991 Mr. Hughes first proposed the mining ban. His proposal was seconded by Mr. O'Toole. In order to make sense of the ban it was necessary that a new map of the area to be covered by it be prepared. That came to be known as Map 10A. The original Map 10 formed part of the original draft development plan and indicated areas of special scenic importance in Mayo. This new map was prepared and it is quite clear that the area covered by it was enormous. It covered approximately three hundred square miles. This was about one hundred square miles in excess of the area which was in contemplation when the special amenity area order was being considered. It is clear from the evidence of Mr. Dunleavy that Map 10A was prepared on the direction of the councillors. There was no discussion on the drawing of the map. As far as he was concerned it was drawn in the context of a lot of agitation and with emphasis on the Westport electoral area. The map was drawn without any further study being carried out. The area covered was extended to cover, for example, the area of the talc mine even though that was not an area of special scenic importance included in Map 10.

35. By the next meeting of the Respondent held on the 11th March, 1991 the map had been prepared and the mining amendment was adopted as part of the draft plan. The vote of the Respondent on this occasion was unanimous.

36. As I have already stated, the draft plan in its amended form was then put on display and the appropriate statutory notices were published. Various representations and objections were received and these in turn were circulated to the Council. They were also examined by officials of the Respondent and they in turn made recommendation to the elected members on foot of their consideration. Amongst the representations received were ones from the Confederation of Irish Industry Mining Exploration Group, the Institute of Mining and Metallurgy, Ivernia West, Burmin Plc. and the Irish Mineral Exploration Group. A letter was also received from the Applicants but outside the statutory period for the receipt of such representations. It was circulated directly by the Applicants to the elected councillors. I will return to the question of the recommendations made to the elected members by the officials of the Respondent in due course.

37. At its meeting of the 11th November, 1991 the Respondent resolved, having considered the written representations received in relation to mining in the Westport electoral area, that the mining ban be inserted in the development plan. The County Secretary informed the Council that the draft plan as amended would be placed before the December meeting of the Council for formal ratification. That indeed was done and the matter was on the agenda for the next meeting of the Respondent of the 16th December, 1991. It was on that date that the letter was received from the Department of Energy. The elected members were advised by the County Manager that they were obliged by Section 7 of the Local Government Act, 1991 to have regard to the Minister's letter. Accordingly the ratification of the draft plan was adjourned initially to a meeting in January 1992 and ultimately to a meeting of the 17th February, 1992. I have already recited in summary form what occurred on that occasion. It is now necessary to look at that in some greater detail.

38. The meeting, in so far as it dealt with the issue in suit, lasted for a number of hours. The first matter that fell for attention was the Motion of the six members of the Respondent which sought to rescind the resolution of the previous November which had approved the development plan with the mining ban included in it. The only way the matter could be reopened so as to allow the issue to be further debated and the Minister's letter to be considered was by a Motion rescinding the amendment submitted for inclusion on the Agenda. This required the consent of two-thirds of the members of the Council. This was obtained following advice given to the Council by the County Manager in the following terms as recorded in the minutes:-

39. A lengthy discussion then ensued. It is recorded in the minutes in the following terms:-

40. So much for the views expressed by councillors at that meeting. The result of the meeting is well known and has given rise to these proceedings.

41. I now turn to a consideration of the advice furnished to the councillors by senior officials of the Respondent prior to their making the decision of the

42. The evidence on this aspect of the case points in one direction only. The ban was imposed by the elected members of the Respondent against the advice of the County Manager, the Senior Executive Planner, the County Engineer and County Solicitor. It was also imposed in the teeth of the letter from the Minister for Energy.

43. The advice of the County Manager was given to the elected representatives in no uncertain terms at the fateful meeting of February 1992. It is recorded in the minutes in the following terms:-

44. This advice could not have come as news to the elected members. For almost a year beforehand, similar views were expressed by senior officials of the Planning and Engineering Departments. For example each of the written representations received from interested parties while the draft plan was on display was the subject of consideration and recommendation by Council officials. All of the mining interests who wrote in time protesting the inclusion of the mining ban were supported in their stance by Council officials. The recommendations in each case, which were communicated to the elected members, were that the prohibition on mining be not accepted and that the original policy in the draft development plan stand. In the context of the letter from the Clew Bay Tourism co-ordinating Committee of the 2nd April, 1991, which was supportive of the mining ban, the officials of the Council commented in writing to the elected members as follows:-

45. It is not necessary to refer to the other occasions upon which similar advice was furnished to the elected members of the Council. It was all one way. Existing procedures and controls and the statements in the original draft plan were sufficient to accommodate the concerns of the councillors and it was both unwise and unnecessary to adopt the mining ban.

46. Given the state of concern on the part of the County Manager and the other officials it is hardly surprising that legal advice was sought by them on the topic.

47. On the 15th May, 1991 the County Secretary, Mr. Hughes, wrote to

48. Mr. Michael Brown, Solicitor, enclosing copies of letters received from Ivernia West Plc. and Glencar Exploration following the display of the draft Development Plan. He asked

49. Mr. Brown to advise him and the Council on the status and implications of the Motion passed by the Council at its meetings on the 25th February, 1991 and the 11th March, 1991.

50. Within five days Mr. Brown responded in writing as follows:-

51. Attached to that letter was a detailed memorandum dealing with the question of validity of the resolution, whether it was inter vires the planning acts, the possible breach of Article 43 of the Constitution, the doctrine of legitimate expectation and the possibility of material contravention.

52. The Respondent was well served in the legal advice which it obtained from Mr. Brown. Unfortunately for it, it decided not to follow his advice. On the question of the validity of the resolution, he stated:-

53. Mr. Brown was furnished with additional information by the County Secretary and was authorised to instruct senior counsel to advise on the topic. He did so. He retained Mr. Philip O'Sullivan S.C. as he then was who, of course, was one of the foremost experts in the country on planning law. As a matter of urgency Mr. O'Sullivan provided a written opinion. Whatever documents he was supplied with it is clear that he never had sight of

54. Map 10A. The crucial part of his opinion reads as follows:-

55. Had Mr. O'Sullivan seen Map 10A, comprising as it does three hundred square miles or one-seventh of the total area of Co. Mayo, and had he been privy to the evidence in this case, I have little doubt but that he would have concluded, as indeed do I, that this ban was nothing more than a crude exclusionary policy. The map was not prepared with a degree of attention to detail. Care was not taken to limit the exclusionary prohibition to specified high amenity locations. Neither could the proposal be regarded as reasonable because it was not made by reference to objective criteria.

56. It is clear from the foregoing that in essence the legal advice was to the effect that there was no power to impose it. That said, I am by no means satisfied that the import of Mr. O'Sullivan's advice was understood by the Respondent. His advice as to the legal ability to include the ban was clearly conditional on the matters addressed in that part of the opinion from which I have just quoted. The conditions were not met. Yet the Respondent appears to have concluded that the advice was to the effect that there was power to proceed. This is particularly clear when one reads the minutes of the meeting of the 17th February, 1992. There, there is set forth the advice of the County Manager on the procedural aspect of that meeting. In the course of his recital of the events giving rise to the motion being proposed , he is reported to have said:-

57. This strongly suggests that Mr. O'Sullivan's advice was understood as an imprimatur for the proposal whereas, properly understood, it did not even amount to a nihil obstat.

58. In any event, I am of opinion that the Respondent believed (wrongly) that it had power to impose the ban.

59. The approach of the Respondent to the letter from the Department of Energy of the 16th December, 1991 has already been considered by Blayney J. I have reproduced the part of his judgment where he stated his conclusions. Having had the benefit of a good deal more evidence than was available to that Judge, I have come to the same conclusion as he did, namely, that the Respondent could not be said to have had regard to the policy of the Government in respect of mining when it adopted as part of its development plan a policy which was totally opposed to Government policy.

60. FROm at least as far back as July 1990 Mr. McCullough, the managing director of the first Applicant, was writing to the Respondent pointing out that the Applicants' exploration work in south Mayo was well advanced and that they hoped to develop a gold mine in the area. The elected members of the Respondent also had the Applicants' letter of the 2nd May, 1991 circulated directly to them. Much of what is contained in that letter had already been covered in documents received from the other organisations which opposed the imposition of the mining ban and to which I have already referred.

61. On the 5th December, 1991 the Applicants again wrote to the Respondent. In the course of that letter Mr. McCullough said:-

62. I have already recorded the fact that the officials of the Respondent were, without exception, opposed to the imposition of the ban. In the course of the evidence there were suggestions made by some of them that really the ban made little difference in reality. All were of the view that an applicant for planning permission for a mine under the original development plan would only have obtained permission with difficulty. They attempted to suggest that the matter was little different after the imposition of the ban because it was not truly a ban at all. This approach is perhaps exemplified by reference to the evidence of

63. Mr. Ian Douglas, the town planner with the Respondent.

64. On the 1st March, 1991 he wrote in a memorandum pertaining to the proposed ban the following:

65. Although he denied it in evidence there was, in my view, something of a change of mind on the part of this witness concerning this topic by the time of the trial. Rather than asserting that any Applicant could expect to be refused planning permission because of the existence of the ban he said that an Applicant for such a permission could "expect difficulty" (evidence 9th December, 1997) question 571. He said that an Applicant would not necessarily be refused. Rather he said there would be a fair expectation of being refused. What he had in mind was that an Applicant could seek a material contravention of the plan and if refused at first instance by the Respondent could then go to An Bord Pleanala.

66. Whilst this is undoubtedly so it does not appear to me to be borne out in reality by the views expressed by the officials of the Respondent Council themselves when advising on the inappropriateness of the ban. Indeed, the advice of the County Manager spoke about a total ban and its effect as being to "impose a complete ban on the working, development and extraction of minerals as defined by the Minerals Development Acts in an area of approximately 300 square miles or about one seventh of the total area of County Mayo, i.e. the area covered by map 10a". Neither does it appear to have been the view of the Minister for Energy as communicated in his letter of the 16th December, 1991 where he said "the statement, which implies that planning permission will be automatically refused to any mining project means that there will, in fact, be no exploration investment whatsoever".

67. Indeed this is a matter which was addressed in the final part of Mr O'Sullivan's opinion under the heading of Material Contravention. He said:-

68. There is no doubt but that Mr O'Sullivan's view as to the legal position is correct. Indeed, Mr Douglas's view as stated in the course of the trial is in full accord with it. But the reality is that everybody involved in advising the elected members of the Respondent took the view that the mining ban was in reality what it was intended to be, namely, a total ban on mining in the designated area. It was so interpreted by everyone concerned.

69. Again in the course of evidence, the elected representatives allowed for the possibility of an application for material contravention. Whilst this was technically possible, I think that any reasonable applicant could have had little hope of ever achieving such. Indeed, in view of some of the strongly stated views of a number of the elected members of the Respondent and the possible use of the Party Whip (which indeed was used on the occasion that the ban was imposed) a reasonable prospect of a fair hearing on an application for material contravention must have been in some doubt.

70. Each of the Applicants have as their objectives the exploration, prospecting for and the mining of ores and minerals. In June 1986 they acquired the ten prospecting licences from the Minister for Energy for the purposes of exploration for gold in townlands south of Westport. These licences where renewed from time to time and were in force at the time when the mining ban was imposed.

71. There is no dispute but that the Applicants carried out extensive prospecting on foot of these licences and that they achieved encouraging results.

72. They took the view that it would not be prudent to continue to fund additional exploration and analysis costs out of their own resources and so they sought out a partner who would be prepared to invest and to provide technical expertise for the enterprise. In November 1991, Newcrest entered into the joint venture with the Applicants. It agreed to invest at least £1.6 million and to provide specialist technical expertise in the further exploration of the areas in question.

73. Mr. David Jones of that firm was the principal person involved. He met with representatives of the Applicants, reviewed the geological data and visited the sites in question. He formed a very favourable impression of the results. He took the view that the potential ore size was the most striking thing demonstrated. His conclusion was that the Applicants had a very fine property which warranted a very considerable amount of additional work being done on it. He furthermore took the view that it had the potential to meet the parameters which Newcrest would regard as a minimum to meet its economic requirements for development. Newcrest agreed to invest at least £1.6 million. That would bring the project on to its next stage of development. It would involve testing along as much

74. Draft heads of agreement were prepared as of early October 1991 and this was followed by a visit to Ireland by the Chief Executive of Newcrest, Mr. Quinn and Mr. Jones

75. Not long thereafter, Mr. Jones was told by Mr. McCullough that Mayo County Council had introduced the mining ban into the Development Plan and that it included all of the area that was covered by the Applicants' licences. Mr. Jones' reaction was clear. He did not really believe that it could possibly come to pass and he found it quite shattering when it did. When asked what effect this had on him as a prospective investor he said:-

76. Mr. McCullough kept Newcrest apprised of developments. Newcrest itself also became involved by making submissions directly to the Minister for Energy. Newcrest was aware of Government policy in relation to mining in Ireland because Mr. Jones had had discussions with representatives of the Geological Survey Office. As far as he was concerned the official view on mining in Ireland was very positive and he took the view that that was already demonstrated by the fact that at that time Ireland was the largest producer of zinc in the European Community.

77. Newcrest were kept informed of the legal challenge that was mounted and of its success. But that success did not change Mr. Jones' mind. When asked why, he said:-

78. He gave evidence, which I accept, that the element of confidence is all important in making decisions to invest in a mining venture. He said that the mining ban convinced his company that it did not wish to continue with work in County Mayo. He formed the view that if the Council had been prepared to institute a ban by illegal means it would be illogical that they would then turn around when you made a planning application and not do everything in their power to prevent mining going ahead regardless of the merits of the project.

79. Following the signing of the heads of agreement in November 1991, Newcrest did in fact carry out some work on the project and invested some money in it. Such work as they carried out did not devalue the technical merit of the property.

80. By the 21st February, 1992 Newcrest was making its views clear. In a letter of that date to the Applicants it said:-

81. Notwithstanding the judgment of Blayney J., however, the attitude of Newcrest did not differ. The die was finally cast by a letter of the 22nd January, 1993. In the course of that letter Mr. Jones said:-

82. The Applicants sued Newcrest in respect of its refusal to proceed with the joint venture. Those proceedings were settled by a payment of £85,000 to the Applicant Companies inclusive of costs. It was also a term of the settlement that Newcrest would provide a witness, if required, to attend and give evidence in the current proceedings. It seems clear that this was in effect a nuisance value type settlement given what was involved in the joint venture and the amount claimed in those proceedings.

83. I am satisfied on the evidence that Newcrest lost confidence in the whole venture as a result of the imposition of the mining ban and notwithstanding the judgment of Blayney J. in favour of the Applicants, there was simply no persuading that company that it should become further involved in the project.

84. The imposition of the ban also brought the share price of the Applicants down and as Mr. McCullough put it colourfully in evidence:-

85. Mr. McCullough made further valiant efforts notwithstanding these setbacks. He wrote to four or five other companies of significant size only one of which demonstrated any interest. That was a company called LAC Minerals of Canada. That company was represented in Dublin by Mr. Christopher Bates who was the first witness in the case. In 1994 he was asked by his superiors to look at the project and did so in April and May of that year. He reviewed the data and visited the site. He took the view that the deposits were of technical merit as far as his company was concerned but a good deal more work was required to be done. He knew that the Applicants had spent between £1.6 and £1.9 million and if his company were prepared to become involved with them, he would probably have sought to match that spending in order to get a 50% interest in the working. He looked at the situation both technically and non-technically. He recommended to his superiors that the project had good technical merit but was not worth the risk because of the Council decision being anti- mining. He therefore declined any further involvement. He indicated that he probably would have recommended proceeding further with the matter were it not for the mining ban history. LAC would be prepared to do business with the Applicants but not in the circumstances. Even though the mining ban had been removed by Order of this Court, he took the view that the sentiments of the County Council had not changed, at least not of its own volition. Again, he reiterated, as did many of the other witnesses, that confidence is critical in the mining industry in order to ensure a return of investment. In cross-examination he expressed the view that he did not discern any change of heart on the part of the Respondent notwithstanding the Order of the Court. If the project were to progress, it would probably continue to run into problems with the County Council in getting planning permission. They were at that time of course years and millions of dollars away from being in a position to apply for planning permission.

86. The failure to persuade another investor to become involved effectively sounded the death knell for this project.

87. At the time of the hearing before Blayney J. ten prospecting licences were in being and held by the Applicants. By the time of this hearing they had been reduced to six. Four were surrendered by the Applicants and they have not been taken up by any other applicant. Six licences continued to be held in the areas where most of the expenditure had been made and where the principal deposits of gold had been located. Mr. McCullough said that he was holding onto these licences for two reasons, one because he believed that it was necessary to maintain a physical property presence in the area so as to sustain these proceedings and, secondly, because if there was any chance of settling the matter between Mayo County Council they might be used as part of the settlement. However, the Applicants have no further interest in carrying out any more work on the area of these licences.

88. The evidence from Mr. Pyne, an officer of the Department of Energy, satisfies me that the Department of Energy was aware of the expenditure of about £2 million on exploration activity by the Applicants. In terms of monies typically spent by Irish companies on exploration that was a large sum. The Department was completely happy with the way in which the Applicants carried out their work. They never gave the Department any cause for concern in relation to any aspect of their work, technical, environmental or otherwise. They were fully co-operative with the Department both in terms of making reports to it and co-operating in field visits. They were, to use Mr. Pynes description, " faultless". They were as he said " top drawer ". The company spent many times more money than they were obliged to spend under the terms of the licences and they were renewed without difficulty. His evidence furthermore satisfies me that whilst the holder of a prospecting licence does not have a guarantee of obtaining a mining lease in respect of the prospect, nonetheless if it is proven that there are reserves there, there is a high likelihood of the mining lease being granted to the holder of the prospecting licence.

89. Finally, I should say that I am quite satisfied that the Applicants have no intention of participating further in carrying out any work in the area the subject matter of the prospecting licences in suit notwithstanding the attempt to suggest otherwise by the Respondent.

90. Before departing from this aspect of the case there is one other matter that I ought to deal with. I am satisfied that throughout its involvement the Applicants were endeavouring to dissuade the Respondent from engaging in the activity complained of. They made representations not merely to the Minister for Energy but also to the Minister for the Environment. Whilst the Minister for Energy wrote the letter of December 1991, which I have already reproduced, it is clear that the Minister for the Environment was not prepared to use his powers to put matters right thereby forcing the Applicants to have resort to this Court.

91. In my view, this question must be answered in the affirmative. Mining is a high risk business at the best of times. Much expenditure can be made without an ultimate return. Whilst confidence is always an important ingredient in a decision on whether or not to invest in any project, that is particularly so in the world of gold mining. I am satisfied that the activities of the Respondent in imposing the mining ban gave rise to a collapse in confidence concerning the Applicants' project.

92. This collapse in confidence is evidenced by the withdrawal of Newcrest, the drop in the share price of Glencar, the failure of the Applicants to secure any other joint venture partner, the refusal of LAC to become involved even though the project was technically interesting to them and the gradual surrender by the Applicants of their licences. I do not believe that gold prices had much, if any, part to play in this.

93. I am satisfied that even the judgment of Blayney J., whilst it resulted in a quashing of the mining ban, did not restore confidence in the venture. Hence, the failure of Newcrest to reaffirm the joint venture even in circumstances where they were being sued in respect of an alleged breach of it. The refusal of LAC to become involved was a further exemplification of the collapse in confidence which had been brought about.

94. Whilst of course it can be said that as a matter of high probability even in the absence of a mining ban, planning permission was unlikely to be granted by the Respondent and that recourse would have to be had to An Bord Pleanala and furthermore that it would be that body that would ultimately decide an appeal from the Respondent in respect of a failure to grant a material contravention of the Development Plan which included a mining ban, such a view did not appeal in fact to the real world of commerce. The fact is that confidence did collapse. Indeed it was predicted by the senior officials of the Respondent themselves and in the letter from the Minister for Energy of the 16th December, 1991.

95. I regard the evidence of Mr. Jones as being of some considerable significance on this aspect of the matter. He was aware of a certain anti-mining lobby before entering into the joint venture agreement. He had noticed anti-mining slogans for example prominently displayed when he visited the area. Environmental opposition would have been part and parcel of any Mining Company's difficulties. What was unique was a regulator adopting an anti-mining policy and using statutory powers to implement it.

96. I am therefore satisfied that the decision of Newcrest to withdraw and further work to be stopped resulted from the mining ban.

97. No claim is made in these proceedings for any loss of future profits sustained by the Applicants. The Applicants simply claim recovery of the monies which they expended prior to the imposition of the ban. They say the imposition of the ban was a wrongdoing a result of which they have lost the benefit of that expenditure.

98. I turn now to consider whether as a matter of law they are entitled to recover that or any sum against the Respondent.

99. The Applicants seek to recover damages against the Respondents on the basis that the imposition of the mining ban constituted the tort of misfeasance in public office.

100. The tort of misfeasance in public office is committed where an act is performed by a public official, either maliciously, or with actual knowledge that it is committed without jurisdiction and is so done with the known consequences that it would injure the Plaintiff (see Keane J. in McDonnell -v- Ireland unreported, Supreme Court, July 23rd 1997).

101. The tort was defined by Smith J. in Farrington -v- Thompson [1959] V.R. 286 at 293 where he said:-

102. More recently, the ingredients of this tort have been considered both by the High Court of Australia in Northern Territory -v- Mengel (1995) 185 CLR 307 and the High Court in England in Three Rivers DC -v- Bank of England (No 3) [1996] 3 All ER 558.

103. I am of opinion that the following passage from the judgment of Brennan J. given in the Northern Territory's case accurately summarises the tort. He said:-

104. In the present case, the Applicants have not made out that in imposing the ban the elected members of the Respondent were actuated by malice against the Applicants or had a realisation that what they were doing amounted to an abuse of office. I do not believe that the evidence establishes that there was a deliberate and dishonest wrongful abuse of the powers given to the elected members. I am of opinion that whilst considerable criticism can be made of the elected members of the Respondent and their whole approach to the subject the Applicants have not satisfied me that there was any malicious intent on their part or that there was any realisation that by imposing the ban they were abusing their office. To adopt the approach of Brennan J. in the Australian High Court, the evidence here does not demonstrate a dishonest attempt to perform the functions of office. On the contrary, I am of the view that they were responding bona fide to the pressures put on them by their electorate. In so doing they sought to achieve a specific end. Whilst they did so unlawfully, they did so honestly. Furthermore, they believed they had legal authority to so do.

105. Accordingly, insofar as a claim is made for damages for misfeasance in public office it fails.

106. Insofar as the Respondent was guilty of a breach of statutory duty it appears to arise, if at all, under Section 19 of the Local Government (Planning and Development) Act, 1963 and Section 7(1)(e) of the Local Government Act, 1991. Section 19 of the 1963 Act deals with the obligation of the Local Authority to make a plan indicating development objectives for their area. Section 7 of the 1991 Act requires a local authority, in performing the functions conferred on it under that or any other enactment, to have regard to policies and objectives of the Government or any minister of the Government.

107. In other words, if the duty is owed to the public at large then no action for breach of duty lies.

108. Accordingly insofar as the Applicants assert an entitlement to damages for breach of statutory duty, it likewise fails.

109. Damages for common law negligence are claimed. It is no understatement to say that the topic of liability for the negligent exercise of a statutory power is one which has given rise to much controversy. This area of the law is beset with many judgments, not all of them easy to reconcile one with the other.

110. In England one has seen the topic authoritatively decided (or so one thought) by the House of Lords in Anns -v- Merton London Borough Council [1978] AC 728. There, Lord Wilberforce set out the famous "two-tier test" for liability. In order to bring home a claim for damages under the Anns doctrine one had to show as a prerequisite to liability the fact that the act complained of was ultra vires. Once that was established, the second part of the test had to be satisfied. This involved inter alia a consideration of whether the subject matter of the case involved a discretionary rather than an operational matter. Once that was established, it had to be considered in the context of the usual requirements of the tort.

111. Within a few years of that decision, the English Courts were in full blooded retreat from it and ultimately it was over-ruled by the House of Lords in Murphy -v- Brentwood District Council [1991] 1 AC 398. Happily, I can confine my consideration of this topic to decisions in this jurisdiction although it must be said that some of them are difficult to reconcile one with the other by times also.

112. The first thing to note is what I have already stated in this judgment namely that there is no direct relationship between the doing of an ultra vires act and the recovery of damages for that act. There are very good reasons why that should be so and they are touched upon by Finlay C.J. in his decision in Pine Valley Developments Limited -v- Minister for the Environment [1987] IR 23 at 38 where he said:-

113. That statement, of course, does not exclude an entitlement to recover damages in circumstances where the impugned act was carried out negligently.

114. I have come to the conclusion that the imposition of the mining ban in the present case was done negligently. Whatever may have been the motives of the elected members, they set about achieving their goal in a way which, in my view, no reasonable local authority in receipt of the advice which they obtained would have done. It is not the function of elected representatives to slavishly give effect to their constituents' demands come what may. They must exercise a degree of judgment in any particular case.

115. In this case, the evidence demonstrates that the provision of the mining ban was unnecessary. The existing planning code was sufficient to protect all legitimate planning interests. This was the advice they received from their officials. It was also the view made clear to them by the Minister for Energy. Not merely was it unnecessary from a planning point of view, but the evidence was that it was in fact contrary to the best interests of the county because it would drive away investment in exploration and the county would lose the chance of evaluating the benefits of any project put forward for planning permission. Furthermore, there was in my view no objective justification for the adoption of the ban. It was to operate in respect of all minerals, regardless of their method of extraction, value or the quantity likely to be extracted. The ban was of enormous span and it was clear, particularly from the evidence of Mr Dunleavy, that little or no thought went into the nature or the extent of the ban. It was nothing more than a crude exclusionary policy.

116. In concluding that the Council were negligent in the sense that they did something which no reasonable authority would have done, I have yet to address the question as to whether that negligent act was done in the context of a duty of care being owed to the Applicants. It is only in such context that a right to damages would arise.

117. The leading case on the topic is Ward -v- McMaster [1985] IR 29 in the High Court and [1988] IR 337 in the Supreme Court.

118. In the High Court Costello J. (as he then was) reviewed the relevant authorities and reached the following conclusions concerning the principles to be applied:-

119. The decision of Costello J. was appealed to the Supreme Court. The appeal was dismissed. In the course of his judgment, Henchy J. having found that the Local Authority were plainly in breach of their public duty went on to say:-

120. McCarthy J. in the course of his lengthy judgment indicated that whilst Costello J. had rested his conclusion on the "fair and reasonable test", he preferred to express the duty as one arising from "the proximity of the parties, the foreseeabililty of the damage and the absence of any compelling exemption based on public policy" . On the duty of care he said (at p. 351):-

121. In seeking to apply these principles to this case, there must be weighed heavily in the scales against the Applicants the fact that the statutory powers which were conferred and operated here are in my view ones which were to be operated for the benefit of the public at large. They were not directed towards a particular class or group of persons of which the Applicants are a member. That of course is not necessarily the end of the matter if it can be shown that a duty of care arose not from the statute per se but from the relationship between the parties. Whether one adopts the "fair and reasonable test" preferred by Costello J. or the "proximity of the parties, foreseeability of the damage and the absence of any compelling exemption based on public policy" test preferred by McCarthy J., in my view the answer in this case is the same.

122. It would be neither fair nor reasonable nor would the proximity of the parties suggest that there was any duty of care extant between the Respondent and the Applicants when the mining ban was imposed. The Applicants were not even then applicants for a planning permission and indeed there was no guarantee that they would ever become so. The most that can be said of them were that they were prospectors who had a hope, nay even an expectation of being applicants for planning permission at some stage in the future. It is indeed true that they had made representations to the Respondent seeking to avoid the imposition of the ban and pointing out that they would sue in respect of any loss which they might sustain as a result of it. But that of itself does not appear to me to give rise to a proximity in the legal sense which would result in an entitlement to damages for a negligent act. Accordingly, I have come to the conclusion that the purported exercise of the statutory powers in question by the Respondent was not one which gave rise to a duty of care in the law of torts at the suit of the Applicants against the Respondent.

123. The claim which is made here is that some legitimate expectation of the Applicants was frustrated by the Respondent thereby giving rise to an entitlement to damages. When asked to identify precisely what legitimate expectation the Applicants were relying on and what exactly it was alleged the Respondent did to generate that expectation, they replied as follows:-

124. Just like the topic which I discussed in the immediately preceding part of this judgment, legitimate expectation has hosted a large number of decisions in varying jurisdictions, not all of them easy to reconcile one with the other.

125. Happily, I may confine myself to an examination of the law in this jurisdiction with a view to ascertaining whether or not the Applicants have made out a case under this heading.

126. The starting point for any such examination must be the decision of the Supreme Court in Webb v. Ireland [1988] IR 353. Finlay C.J. said this (at p. 384):-

127. Later in his judgment Finlay C.J. said:-

128. There are a number of important matters to bear in mind when reading the aforesaid passages. No statutory powers of the State were involved in the case. A positive assurance had been given to Mr. Webb as to how he would be treated. The case concerned itself with substantive rather than procedural rights. Finally, its roots were firmly planted in the soil of promissory estoppel.

129. There have been many cases decided subsequent to Webb in this jurisdiction. Some seek to confine the application of the principle to the area of procedural rather than substantive rights. This is so particularly where a conflict might arise between the granting of a substantive right and the principle that the beneficiary of a statutory power may not fetter his freedom to exercise that power by estoppel.

130. Of the subsequent decisions in this Court, the one which I find to be of greatest assistance to me is that of Costello J., as he then was, in Tara Prospecting Limited and Another v. Minister for Energy, Ireland and the Attorney General [1993] ILRM 771.

131. The case is remarkable because it is dealing with the same subject as this one, namely, gold mining in County Mayo. The Minister granted prospecting licences in 1981 and 1984 to Tara in respect of areas which included Croagh Patrick. Letters from the Minister made it clear that the renewal of these licences would be conditional on certain matters such as Tara's work commitments. Tara and the second named applicant in that case, Burmin, entered into a joint venture agreement. Gold was found in the Croagh Patrick area. There was much public opposition to their mining proposals. Efforts were made to use planning legislation to block any mining in the area. There was also opposition on religious grounds as Croagh Patrick is a traditional place of pilgrimage. The problems were discussed between the prospecting companies and the Department of Energy. The Minister announced in May 1990 that he had decided to use his powers under Section 12 of the Minerals Development Act, 1940 to exclude Croagh Patrick from the prospecting licence because of the unique importance of it as a pilgrim site, a part of the national, cultural and religious heritage.

132. The Minister conveyed his decision to the applicants and excluded any further prospecting licences in respect of that mountain. He also clearly implied that no State mining lease would ever be granted in the excluded areas. A challenge was brought to the Minister's decision on the basis that it was ultra vires. It was also said that it was in breach of the principles of natural and constitutional justice and contrary to the legitimate expectations which the Minister had caused the applicants to entertain in relation to the licences sought.

133. Costello J. rejected the challenge to the Minister's decision and dismissed the claim for Judicial Review. In the course of his judgment on the topic of legitimate expectation he said the following (at p. 783):-

134. Costello J. then went on to consider authorities both in the United Kingdom and in Australia, together with a number of further Irish authorities. It is not necessary for me to rehearse what he had to say concerning those cases and I confine myself to the conclusions which he drew. He said (at p. 788):-

135. The observations which I have just quoted from these two judgments must be borne in mind when examining the assertions made by the Applicants as to legitimate expectation (which I have already reproduced in this part of the judgment) and the evidence in the case. There is neither allegation nor evidence supporting any promise, express or implied, on the part of the Respondent. It was never represented to the Applicants that they would obtain planning permission. Furthermore, the Applicants could not, in my view, have had a legitimate expectation that planning permission would be given for mining even in the absence of the mining ban. In fact, the evidence suggests that great difficulties would be encountered even in getting to the stage of making an application for planning permission never mind the actual obtaining of such permission. Just as the applicants in the Tara case, from which I have already quoted, had no legitimate expectation that their exploration licences would be renewed by the Minister, neither, in my view, can there be any legal basis for holding that the Applicants in this case had a legitimate expectation that planning permission would be granted. It is only on that basis that a claim for damages could succeed for reasons which I will explain when I come to the question of damages.

136. The only possible legitimate expectation which the Applicants might have had was that if they applied for planning permission they would get a fair hearing. Indeed, after the judgment of Blayney J. there were never even informal overtures made to the Respondent on this topic. These Applicants were nowhere near even making a decision in principle as to whether it would be commercially feasible to apply for planning permission.

137. I am of opinion that none of the ingredients required in order to mount a successful claim for the existence of a legitimate expectation have been made out in this case. It seems to me that it is an attempt to carry this doctrine to a distance never achieved before and probably not contemplated by the Supreme Court in Webb. The views of O'Hanlon J. in Association of General Practitioners Limited v. Minister for Health [1995] 1 IR 382 have much to recommend them where he said that if a plea of legitimate expectation were "allowed its head" it could "introduce an unwelcome element of uncertainty into well defined law concerning rights of property, rights of contract and other matters" .

138. Even if I am wrong in the view which I have come to as to the existence of a legitimate expectation not having been established, I am of opinion that damages would not be available for its breach in the absence of a subsisting contractual or equivalent relationship. The cases in which damages have been awarded such as Webb, or Duggan v. An Taoiseach [1989] ILRM 710 are distinguishable from this case because the applicants there were in long-term contractual or equivalent relationships with the respondents and the wrongs done were akin to a breach of contract. There is no such equivalent relationship between the parties to this litigation.

139. Reliance was placed on the decision of Blayney J. in Ahern v. Kerry County Council [1988] ILRM 392 to support the Applicants' case but I derive no help from that since Blayney J. expressly refused to express a conclusion on the point that might help the Applicants.

140. Accordingly, I reject the claim which is made here on the basis of a legitimate expectation having been defeated. I hold that there was no legitimate expectation such as is contended for and even if there was, damages would not be available as a remedy in respect of it because of the absence of a contractual or similar relationship between the parties. In fact, the relationship between the parties here was no more than one of planning authority and prospective applicant for planning permission.

141. The final claim which is advanced by the Applicants is one which alleges that their property rights under the Constitution have been unlawfully interfered with. They say that in such an event they should be entitled to damages. These rights have allegedly been unjustly attacked and their value has been damaged to a significant extent by the unlawful acts of a State authority. In the course of their written closing submissions, the Applicants elided the issue of legitimate expectation with their claim in respect of constitutional rights. They said this:-

142. This seems to me to go considerably further than what is warranted by the jurisprudence or justified in principle.

143. The property rights of the Applicants here were confined to licences from the Minister for Energy to enable them to prospect. True it is that if the Minister was satisfied as to the results of that prospecting, a mining lease might well have been expected. But even then the development of a mine would of course be subject to the obtaining of planning permission. It seems to me that the prospecting licence was the only matter which they had as of right at the time that this ban was imposed. Their enjoyment of that was not jeopardised save in a most indirect way in that their joint venture partners pulled out. This is certainly very far from a case of any form of direct interference with or expropriation of the property right such as it was.

144. The property right in respect of the licence must be seen in context. A prospecting licence is of itself of little value even though substantial sums of money may be sunk on foot of it in exploration. It becomes of substantial commercial value only when a return can be achieved from it. The evidence in the present case is that before one could get to that stage, a huge amount of additional work would have had to be done with uncertain results, a mining lease procured and a planning permission obtained. The mine would then have to be put into operation and a profit derived from it. It is only at that stage that one could speak in any realistic way of a commercial value attaching to the prospecting licence.

145. In these circumstances, I have come to the conclusion that no case for damages has been made out in respect of an alleged interference with the Applicants' constitutional property rights.

146. As is clear from the views that I have already expressed, the Applicants fail in this claim for damages. Lest, however, I am wrong in all or any of the views which I have expressed to date, I will proceed to state my conclusions on the question of damages. The claim which is made is for the full sum expended by the Applicants on prospecting in the areas affected by the ban. It comes to just short of £2 million. They seek to be recompensed in the entirety of that sum by the Respondent. They assert that in assessing damages the Court should do so as of the date upon which the ban was imposed rather than the date of trial. The importance of this submission will become clear in a moment.

147. As is clear from the evidence, prospecting for gold is a high risk enterprise. It is speculative. It is uncertain. On Mr. McCullough's own evidence, the prospects of success in mining projects on average is one out of one hundred. In the present case he said that they had established that there was gold in very significant quantities present and that figure was reduced to more like one in ten or somewhere in that region. Accordingly, at the time when the ban was imposed, there was only a one in ten prospect that the gold found was going to be what he described a commercial deposit. Even assuming that such a commercial deposit was found at the end of all of the prospecting, planning permission would then have to be sought for the mine and in my view that was never going to be easy. One then has to postulate that if planning permission were granted, the mine would then be established. One must then assume that it would trade profitably. It is only at that stage that a return of the original monies expended in prospecting would be likely to be recovered.

148. In these circumstances, it seems to me that even if the Applicants were wholly successful on the question of liability, before any damages could be awarded to them they would have to demonstrate, on the balance of probabilities, that their venture would have been successful and would at least have yielded amounts sufficient to recoup the expenditure made. No such evidence was forthcoming. Indeed, Mr. McCullough's own estimate of a one in ten chance of a commercial deposit being found speaks for itself. In the light of this, it appears to me to be a bold claim to seek to recover from the Respondent the entire sum expended. To award damages in the amount claimed would in effect constitute the Respondent as a form of insurer for expenditure incurred which on the balance of probabilities would never have be recovered.

149. I accept that the evidence of gold was promising but it only demonstrated a one in ten chance of a commercial deposit being found. That means that there was a nine in ten chance that the money expended would never have been recovered but rather would have been lost. To make an award of damages in these circumstances would seem to me to be perverse since the Applicants have not demonstrated on the balance of probabilities that these monies would ever have been recoverable by them. If I were to award them the sum claimed they would have recovered the entire expenditure made by them which, if no wrong had been done to them, they had at best a one in ten chance of recovering in any event.

150. If I am incorrect in the views which I have just expressed, it seems to me that putting the Applicants' case at its highest, the most that they could hope to recover given the probabilities set forth in evidence by Mr. McCullagh would be one-tenth of the expenditure incurred, namely, £193,826.40. That would be the sum recoverable if damages were assessed as of the date of the mining ban. If, however, the date of trial was the more appropriate date, I am satisfied that it would have to be reduced even further. I have already indicated that the prospects of obtaining planning permission were not very good but in the light of the evidence which I had concerning the European Union Habitat Directive, I am satisfied that the prospects of obtaining planning permission would have diminished even further by the time it might be applied for. At most, it appears to me that the Applicants could hope to recover only one-twentieth of the expenditure. However, in the light of the views which I have already expressed, this is not a case in which damages should be awarded and consequently this claim is dismissed.