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Ryanair Ltd v. Aer Rianta Cpt [2002] IEHC 37 (20 February 2002)

THE HIGH COURT

JUDICIAL REVIEW No. 801 OF 2000

BETWEEN

RYANAIR LIMITED

APPLICANT

AND

AER RIANTA, CPT

RESPONDENT

JUDGMENT of Mr. Justice Paul Butler delivered the 20th day of February, 2002.

1. The Applicant is a limited liability Company and operates both as an airline and “groundhandler” out of, inter alia, Dublin Airport.

2. The Respondent is a public Company limited by shares incorporated pursuant to the Provisions of the Companies Consolidation Act, 1908-1924. It’s shares are held by or on behalf of the Minister for Finance and it is vested with certain functions by the Air Navigation and Transport (Amendment) Act, 1998. It is the owner and operator of Dublin Airport. The Applicant complains of two decisions made by the Respondent, namely a determination made in December 2000 to implement certain charges and a new “code of conduct” for groundhandling at the Airport.

3. The Applicant’s objections to these decision are, in my view, fairly summarised in the Respondent’s submissions as follows:-

“In relation to the charges it is claimed:-

(i) that the Respondent does not enjoy the power to impose the same;

(ii) that any such power must depend upon the provisions of section 39 of the Air Navigation and Transport (Amendment) Act 1998, and the same requires Ministerial consent:

(iii) if such a power does exist, same are fees within the meaning of Article 14(3) of the European Communities (Access to groundhandling Market at Community Airports) Regulations 1998, and would therefore require the prior consent of the Minister;

(iv) that the charges are discriminatory, are not objective and are not transparent.

(v) that the Respondent failed to advise the Minister for Public Enterprise of the same as required by Regulation 14(1);

(vi) that there was a failure to consult with the Applicant in connection with the application, thereby breaching principles of natural and constitutional justice.

(vii) that the decision to impose the charges is unreasonable;

(viii) that no or no adequate account was taken of the representations of the Applicant in connection with the decision to implement these charges.”

In relation ot the Rules of Conduct, the claims are:

(i) “that the Respondent failed to consult the Applicant in relation to same;

(ii) that the decision to implement these rules is unreasonable;

(iii) that the Respondent did take into account the Applicant’s circumstances when making the rules;

(iv) that the Respondent failed to take account of the Applicant’s representation before making the rules;

(v) the implementation of the rules is disproportionate and discriminatory;

(vi) that in implementing the rules, the Respondent has imposed a condition or conditions upon access to airports that was not relevant, objective, transparent or non-discriminatory, as allegedly required by Regulation 14(1) of the Regulations.”

4. The charges in dispute are:-

A. A check-in desk rental of IR£12,000 per annum, together with supplemental rates for additional usage in certain circumstances.

B. “Administration charge” intended to defray the Respondent’s costs in implementing the European Communities (Access to groundhandling Market at Community Airports) Regulations, 1988.

C. Meter car charges for groundhandlers and

D. A cargo handling charge.

5. The Applicant contends that the charges proposed by the Respondent’s are ultra vires because the charges have been levied without the consent of the Minister as required by both Section 39 of the 1998 and Article 14(3) of the 1998 Regulations. It argues that, as a general proposition of administrative law, where a statutory authority purports to impose charges or exact payments in connection with its statutory functions, it must have clear statutory authority so to do.

6. The Minister for Finance is sole shareholder in the Respondent, which is a Company established pursuant to the provisions of the Companies Act. Section 14 of the Air Navigation and Transport (Amendment) Act, 1998 vests in the Respondent, inter alia, Dublin Airport and the Respondent is obliged, by virtue of Section 16(2) of the Act, to ensure that the provision of such service and facilities as are, in the opinion of the company, necessary for the operation, maintenance and development of a state airport.

7. Section 24(1) of the 1998 Act provides that:-

(1) “It shall be the general duty of the company -

(a) to conduct its affairs so as to ensure that the revenues of the company are not less than sufficient taking one year with another

(1) meet all the charges which are properly chargeable to its revenue account

(2) generate a reasonable proportion of the capital it requires, and

(3) Remunerate its capital and pay interest on and repay its borrowings,

(4) to take such steps either alone or in conjunction with other persons as are necessary for the efficient operation, safety, management and development of its airports,

(5) to conduct its business at all times in a cost-effective manner, and

(6) to regulate operations within its airports.”

8. I do not accept the proposition that the Respondent requires express statutory authority to require persons occupying parts of buildings at Dublin Airport, such as desk space, to pay. It is clear, within the confines of the Act, the Applicant is obliged to act as a commercial company and, therefore, has an obligation to charge for the use of its assets and services.

9. Section 39 of the Air Navigation and Transport (Amendment) Act 1939 provides, inter alia, that:-

(1) “The company may require payment to it of airport charges, in respect of the use of a State airport, at such rates as it may, from time to time, with the approval of the Minister determine.”

10. Airport charges are defined in Section 2 of that Act as follows:-

(a) “Charges levied in respect of the landing, parking or taking off of aircraft at an airdrome including charges for air-bridge usage but excluding charges in respect of air navigation and aeronautical communications services levied under Section 43 of the Act of 1993,

(b) Charges levied in respect of the arrival at or departure from an airport by air of passengers, or

(c) Charges levied in respect of the transportation by air of cargo to or from an airport.”

11. I accept the contention on behalf of the Respondents that the charges in dispute are not “airport charges” within the meaning of the Act. They are not charges levied in respect of the arrival at or departure from an airport of passengers.

12. Article 14 (3) of the European Communities (Access to the ground handling market at Community Airports) Regulations, 1998 provides that:-

“Where access to airport installation gives rise to the collection of a fee, the latter shall be determined by the managing body of the airport and approved by the Minister in advance in accordance with relevant, objective, transparent and non-discriminatory criteria.”

13. The Applicant contends that prior ministerial consent would, in any event, be required pursuant to the foregoing provision. The Respondent contends, inter alia, that its charges are not in respect of “access” but of “use”, that they relate not to airport “installations” but to “desks, administration and electricity” and that they are “charges” and not “fees”. While I have considerable doubts as to whether there is any real difference between “fees” and “charges” I do accept the contention that these same are not in respect of “access to airport installations”.

14. I do not accept that there is evidence upon which I could hold that the charges are discriminatory, not objective or not transparent.

15. Further, on the basis of the foregoing, I hold that the charges in question do not amount to the placing of “conditions upon such access” and that the obligation to inform the Minister in writing pursuant to Article 14 (of the regulations) does not arise.

16. I accept that the imposition of charges in this case is a commercial decision involving commercial relationships and that the principles of natural justice have no application thereto.

RULES OF CONDUCT.

17. The Applicant argues that while the Rules of Conduct are held out by the Respondent to be a mere codification of existing custom and practice at Dublin Airport, in fact the same purport to go much further and give the Respondent the right to set aside or abrogate existing commercial agreements between the Respondent and airport users. It is argued that the rules are, therefore, confiscatory in nature in that they purport to give the Respondent the power to over - ride existing contractual commitments on its part and to nullify existing contractual rights and benefits enjoyed by operators.

18. Mr. Hogan submitted that in early November the first version of the rules of conduct came into being and that these were to be “contractual” in nature. The Respondent did not proceed with these rules. A “final draft” of the rules was produced in December. This, it was argued, was a manifest breach of fair procedures.

19. Rules 4, 10, 12, 80 and 87 came in for particular criticism from the Applicant.

20. It is argued on behalf of the Respondent that airport users were given the opportunity to comment upon the new rules and were advised of the same at a presentation by the Respondent on the 18th October, 2000. Following this, the Applicant was given a copy of the new rules in their original format on the 3rd November and was invited to comment thereon and to meet the Respondent to discuss the same. These invitations were not taken up by the Applicant. The Respondents say that the effect of any duty to consult is not to require the Respondent to produce rules as directed by the Applicant; it is to advise it thereof and to afford an opportunity for comment.

21. The Respondent further argues that the attack on the rules is a pure moot. The only agreement cited by the Applicant as being open to some form of unilateral change under the new rules is the Pier A Agreement. In this connection the Respondents have indicated that they have not relied upon the Rules of Conduct in relation to this (alleged as they say) agreement.

22. While it must be accepted that the Respondent has no right to unilaterally alter any contract, I accept that this argument is a moot and I further accept, if consultation was required, the Applicant was given an opportunity to partake in such consultation.

23. By reason of all of the foregoing I refuse all of the Reliefs sought in this Application.

THE HIGH COURT

2001 No. 11259P

BETWEEN

RYANAIR LIMITED

PLAINTIFF

AND

AER RIANTA, CPT

DEFENDANT

JUDGMENT of Mr. Justice Paul Butler delivered the 20th day of February 2002.

24. These proceedings are related to Judicial Review proceedings between the same parties bearing the record no. 801 of 2000 and wherein I have delivered judgment immediately before this.

25. Although the proceedings herein were instituted by a Plenary Summons issued on the 9th July, 2001 the Motion which I am now dealing with was issued in the said Judicial Review proceedings on the 21st May, of that year. It has been agreed that that Motion be treated as a Motion in these proceedings.

26. It has been agreed that I am not concerned with paragraph 1 of the said Notice of Motion and that the substantial matter for determination is paragraph 2 thereof wherein the Plaintiff seeks :-

“An Interlocutory Injunction pursuant to Order 50 Rules 6, 7 and 12 of the Rules of the Superior Courts and/or pursuant to the inherent jurisdiction of this Honourable Court restraining the Respondent from acting in breach of an agreement dated 9th June, 1998 between the Applicant and the Respondent relating to the Applicant’s priority use of airport parking stands at Dublin Airport.”

27. Because of the change of title in proceedings one should read “Plaintiff” for “Applicant” and “Defendant” for “Respondent” above.

28. The Plaintiff argues that it has a fair case to be tried in relation to an agreement entered into in 1998. It says that the Defendant has persistently failed to honour that agreement; that is not denied that it has breached priority access and that it (the Defendant) now says that there was no such agreement.

29. The Plaintiff says that it moved its operations in return for the priority allocation for certain parking stands at (Pier A). It argues that the 1998 agreement was not a single isolated letter (that dated 28th May, 1999). The Plaintiff says that damages are not an adequate remedy as access to the contact stands at Pier A is vital to the way that Ryanair does business.

30. On the balance of convenience it is argued that the agreement has operated perfectly satisfactorily until the end of April, 2001 and that “massive” disruptions had been suffered by the Applicant.

31. While there has been extensive argument on whether there was an agreement and whether the Defendant was in breach thereof, I am satisfied that, for the purposes of obtaining an Interlocutory Injunction, the Plaintiff has established that there is a fair issue to be tried.

32. On the question of damages being an adequate remedy the Defendant suggests that any consequences of the Plaintiff being deprived of rights as alleged are entirely measurable in damages.

33. I am satisfied that the Courts frequently award damages for losses such as those being alleged by the Plaintiff herein and that, in this case, I am not satisfied that damages would be an inadequate remedy. Naturally if a case were to be made out of disruption of the Plaintiff’s business to the extent that it endangered the future of that business the case would be different.

34. On the balance of convenience the Plaintiff argues that it is suffering “massive disruptions” but has produced no evidence of any such a scale of disruption. On the contrary, it has been submitted on behalf of the Defendant and not denied on the Plaintiff’s behalf that the evidence is that only some 13 out of 3,450 flights have been affected by the alleged disruptions. The Defendant says that it has a scarce resource - some 67 stands for over 500 flights a day and that contact stands are even more scarce.

35. I am satisfied that the balance of convenience rests with the Defendant.

36. Accordingly, I refuse the Interlocutory Application.

_______________

PAUL BUTLER