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National Irish Bank, Re [1998] IEHC 89 (11th June, 1998)
URL: http://www.bailii.org/ie/cases/IEHC/1998/89.html
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[1998] IEHC 89
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National Irish Bank, Re [1998] IEHC 89 (11th June, 1998)
THE
HIGH COURT
1998
No. 89 COS
IN
THE MATTER OF NATIONAL IRISH BANK LIMITED
(UNDER
INVESTIGATION) AND
IN
THE MATTER OF THE COMPANIES ACT, 1990
JUDGMENT
of Mr. Justice Kelly delivered the 11th day of June 1998.
1. On
the 30th March, 1998 I appointed The Honourable John Blayney and Mr. Tom Grace
as Inspectors to National Irish Bank Limited (the Bank) pursuant to the
provisions of Section 8(1) of the Companies Act, 1990.
2. They
were directed to investigate and report to the Court on the affairs of the Bank
relating to the following matters:-
(a) the
alleged improper charging of interest to accounts of customers of the Bank
between 1988 and the 30th March, 1998;
(b) the
alleged improper charging of fees to accounts of customers of the Bank between
1988 and the 30th March, 1998;
(c) the
alleged improper removal of funds from accounts of customers of the Bank
between 1988 and the 30th March, 1998;
(d) all
steps and action taken by the Bank, its directors and officers, servants or
agents, in relation to the charging of such fees or interest or the removal of
any funds without consent of the account holders and their actions arising from
the issues when discovered;
(e) the
manner in which the books, records and accounts of the Bank reflected the
foregoing matters;
(f) the
identity of the person or persons responsible for or aware of any of the
practices referred to above, and
(g) whether
other unlawful or improper practices existed or exist in the Bank from 1988 to
the 30th March, 1998 which served to encourage the evasion of any revenue or
other obligations on the part of the Bank or third parties or otherwise.
3. I
directed the Inspectors to deliver an interim report to the Court not later
than the 22nd June, 1998 and fixed the 29th June, 1998 for the purpose of
considering that report.
4. Yesterday
the Inspectors, pursuant to Section 11(1) of the Act, reported to me of their
own motion concerning certain issues which had arisen in the course of their
investigation. They sought directions from the Court as to the resolution of
these issues.
5. Yesterday's
hearing was held in camera but I indicated that I would give my ruling on the
matter in open Court and that I now do today.
6. The
issues which have arisen before the Inspectors relate to employees and former
employees of the Bank.
7. Having
carried out extensive preparatory work, the Inspectors intended to commence
interviewing such persons on the 28th May, 1998. That did not prove possible
because of representations made by solicitors acting on behalf of such personnel.
8. Four
firms of solicitors have written to the Inspectors on behalf of employees or
former employees. One firm represents seventy-five such persons, another five,
another a single retired employee and the fourth firm also represents a single
retired employee. The issues raised in the solicitors' letters can be
summarised as follows:-
(a) They
assert that their clients in attending before the Inspectors have the right to
be legally represented.
(b) They
assert that their clients may attend before the Inspectors with their own legal
representation at any time when evidence is being given concerning their clients.
(c) They
wish to have the right to cross-examine anyone who is giving evidence
concerning their clients.
(d) They
seek copies of all documents concerning their clients.
(e) They
seek advance information on questions which the Inspectors propose to ask at
interview.
(f) They
seek confirmation that their clients may refuse to answer questions where the
answers to such questions might possibly incriminate them.
(g) They
seek to have draft copies of any interim or final report made available to
their clients prior to its submission to the Court or prior to publication and
they wish their clients to be given adequate time to review the contents of
such draft report, to obtain clarification where necessary and to make
representations to the Inspectors in respect of it.
9. These
concerns raise two substantial issues for determination. The first is whether
interviewees in the context of an investigation under Part II of the 1990 Act
have a right to refuse to answer questions put by the Inspectors on grounds of
possible self-incrimination. The second relates to procedures to be followed
so as to protect the legitimate rights and entitlements of prospective
interviewees.
10. I
am satisfied that these are serious issues and ought to be determined by this
Court as a matter or urgency. I am also satisfied that it would not be in the
interests of an expeditious and efficient conduct of the investigation or
indeed in the public interest that these matters be left to be dealt with under
the procedures prescribed in Section 10(5) of the Act. They would involve a
cumbersome, time-consuming and wholly unsatisfactory way of dealing with these
matters, particularly in the context of a large number of proposed
interviewees. The operation of that subsection would require individuals to be
called before the Inspectors and upon refusing to answer questions, the
Inspectors in each case certifying that refusal to this Court and a subsequent
hearing on the matter.
Under
Section 7(4) of
the Act the Court is entitled to give directions. That
subsection reads:-
"Where
the Court appoints an inspector under this section or Section 8, it may, from
time to time, give such directions as it thinks fit, whether to the inspector
or otherwise, with a view to ensuring that the investigation is carried out as
quickly and as inexpensively as possible".
11. I
am satisfied that this is an appropriate case in which to give directions so
that these issues may be determined fairly, efficiently and with a minimum of
costs being incurred. I therefore direct as follows:-
1.
The
Inspectors are directed to write to the firms of solicitors representing
employees and former employees today indicating the orders which I am now
making. These solicitors will be asked to agree amongst themselves on the
nomination of one named individual to represent all of their clients. They
will be asked to nominate one firm of solicitors and one team of Counsel to
appear on the hearing of these issues. This will avoid unnecessary
duplication. They should signal their agreement to this course by 5 p.m. on
Monday next.
12. I
hope that the Court can count on the co-operation of these solicitors as
officers of the Court in this regard. If it is not forthcoming, then the
Inspectors have leave to apply on Tuesday next for a representative order and
for such further directions as they think appropriate.
2.
On
the assumption that the steps that I have outlined are followed, the Inspectors
are at liberty to serve Notice of Motion in the form of the draft proffered to
the Court on the nominated solicitor. These documents should also be served on
the following:-
(a)
the
solicitors representing the Bank,
(b) the
Chief State Solicitor on behalf of the Attorney General, and
(c) the
solicitor representing the Minister applicant.
3.
The
Motion will be returnable for hearing at 11 a.m. on Thursday the 25th June,
1998 in the Chancery 2 list.
4.
The
Motion and grounding Affidavits must be served as soon as possible but not
later than 5 p.m. today on the Bank, the Attorney General and the Minister.
They are to be served on the solicitors representing the employees and former
employees as soon as may be but in any event not later than 3 p.m. on Tuesday
next.
5.
Any
replying Affidavits on the part of the Notice Parties must be sworn, served and
filed not later than 5 p.m. on Monday the 22nd June, 1998.
13. The
issues which are to be determined by the Court are principally ones of law and
so I direct an exchange of skeleton legal arguments. The Inspectors are the
moving parties in this application. They have been advised that the privilege
against self-incrimination does not apply to investigations of the type being
carried out by them. Accordingly, I direct that they file the first skeleton
legal arguments and that they furnish them to the Court and to the Notice
Parties by 5 p.m. on Thursday next, the 18th June, 1998. The replying skeleton
arguments are to be furnished to the Inspectors' solicitors and to the Court by
5 p.m. on Tuesday the 23rd June, 1998.
14. In
accordance with Section 11(3) of the Act, I direct the Registrar of the Court
to forward a copy of the Inspectors' report to the Minister. I do not consider
it necessary or desirable that the report be furnished to any other party at
this stage.
15. In
the light of these developments I absolve the Inspectors from the necessity to
prepare an interim report by the 22nd June, 1998 and the hearing date of the
29th June, 1998 is vacated.
16. There
is liberty to apply to the Judge who tries the issues which I have directed as
to the furnishing of an interim report on the part of the Inspectors.
17. The
costs of this application are reserved.
© 1998 Irish High Court