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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> Mulcahy v. Avoca Capital Holdings Ltd. [2005] IEHC 70 (26 January 2005)
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Cite as: [2005] IEHC 70
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Neutral Citation No: [2005] IEHC 70
THE HIGH COURT
DUBLIN
Case No. 2004/19810P
KIERAN MULCAHY
PLAINTIFF
and
AVOCA CAPITAL HOLDINGS LTD
DEFENDANT
ACTION HEARD BEFORE MR. JUSTICE FRANK CLARKE ON WEDNESDAY, 26TH JANUARY 2005
THE JUDGMENT COMMENCED AS FOLLOWS ON WEDNESDAY 26TH JANUARY 2005
MR. JUSTICE CLARKE:
This matter comes before the court on foot of a second motion seeking interlocutory relief. The matter had previously been before the court on 21st December 2004 when, after a full hearing, I determined that I was not persuaded to make any of the orders sought by the plaintiff which would have the effect of removing the suspension currently applicable to him in respect of his employment with the defendant. I did, however, indicate that it would be appropriate, without making an order in that regard, that the defendants should afford, at the earliest practicable opportunity, a facility to the plaintiff and his expert advisers to inspect the computer equipment which the plaintiff had utilised in the course of his employment, the use of which had given rise to the issues which had led in turn to his suspension and the possibility of more serious disciplinary action being taken against him. I also gave some other minor indications, again without making any orders, as to how matters between the parties might progress. In the light of having given such indications, the matter was adjourned, no order having been made, until a date early in this term for mention.
When the matter came back before the court on that occasion counsel for the plaintiff indicated that the plaintiff was concerned that matters had not progressed in an appropriate manner and, indeed, in certain respects had worsened. In those circumstances it was my view, and I so directed, that if the plaintiff wished to invite the court to make either any of the orders that had previously been declined on 21st December, or indeed any other orders, it would be more appropriate that same should be moved on a formal motion specifying the relief sought, grounded upon whatever evidence the plaintiff might wish to put before the court. On the basis of that direction, the plaintiff has brought the motion now before the court in which he seeks a variety of reliefs, principally directed towards the removal of his suspension but also dealing with certain aspects of the investigation and inquiry into allegations or possible allegations of misconduct.
Firstly, I should state that it would not of course be appropriate at this stage to allow a simple re-arguing of issues which, even though determined at an interlocutory stage, have been determined by my decision of 21st December. In those circumstances it is obviously necessary for the plaintiff to establish that there has been a significant and sufficient change in circumstances to lead legitimately to a different view being taken in respect of any of the issues which were the subject of that decision. In saying that, it nonetheless is appropriate that in respect of certain aspects of the case I can take into account factors that were before the court in December in that an argument can legitimately be made in respect of the accumulation of factors. Applying that general rule, it is necessary therefore to consider the principal contentions which the plaintiff makes in relation to change of circumstances. In what way does he allege that things have changed since 21st December so that the court's order should now be different?
Three real points are raised, and I will set them out initially and then deal with them in turn. Firstly, the plaintiff complains that the inquiry, during which he stands suspended, has taken significantly longer than it should have. Secondly, he complains that there is no longer any real basis for his suspension in the light of the state of the inquiry to date. Thirdly, he makes certain complaints about an upcoming hearing or meeting, scheduled for the 4th February next.
Returning to the question of the allegation of delay, it seems clear from the judgment of Macken J in Martin v The Nationwide Building Society [1999] ELR 241 that the court does have a jurisdiction to grant interlocutory relief which has the effect of removing a suspension in circumstances where the court is satisfied that the delay in dealing with the complaint against the employee concerned is inordinate and unjust. The reasoning of Macken J is based on an implied term in the contract of employment, to the effect that the imposition of a suspension should not occur in circumstances which were unfair or improper, and that those circumstances include the period of time within which the necessary inquiries and, if appropriate, full disciplinary procedures should be completed. I fully agree with the general principle adopted by Macken J in that case, and I am therefore satisfied that as a matter of law it is open to a court to make an appropriate order, all else being equal, bringing to an end a suspension in circumstances where the court is satisfied that there is no reasonable justification for the delay in processing or otherwise dealing with the complaint which has given rise to the suspension in the first place. I should also say that here I am speaking of suspensions which are of the type which have been described as non-disciplinary, i.e. suspensions which are for a period pending the completion of investigations and disciplinary hearings. Obviously different criteria and different considerations apply in cases where a suspension has been imposed as a form of disciplinary action in itself.
Against that legal background it is necessary to consider whether on the facts of this case the plaintiff has established that the process has taken so much longer than that which might reasonably be expected so as to render it, in the words of Macken J, inordinate and unjust. In that context it is necessary to have regard to the nature of the inquiries involved.
Before embarking upon that it is important to note that there are, in one sense, two almost separate disciplinary processes involved between the parties at this stage. The one which has given rise to the plaintiff's suspension concerns allegations of improper dealing with the e-mail inboxes of senior members of staff and other related contentions concerning improper dealing with the company's IT systems. There is in parallel a series of contentions which are separately made by the defendant which came in the course of the hearing to be referred to as the "performance issues", in relation to which the defendant contends that the plaintiff's performance under a variety of headings, which it is not necessary to set out here, has fallen short of what could reasonably be required. Suffice it to say that it has at all times been made clear on behalf of the defendant in these proceedings that the so-called performance issues do not form part of the basis justifying the suspension of the plaintiff. In those circumstances, it seems to me that there is no reason why any issues arising out of the performance issues cannot fall to be determined in their own time and in their own way. They do not influence the current status of the plaintiff, and unless and until something were to occur in relation to the manner in which the defendant dealt with those issues, which would justify the unusual step of the court intervening in the course of a disciplinary process, then it does not seem to me that it is appropriate for the court to have any regard to the fact that those matters are running in parallel.
In saying that, I am mindful of the fact that the plaintiff contends, in essence, that the raising of the performance issues is really the subterfuge for what he contends is a plot on the part of the joint managing directors of the defendant company to remove him. That is an issue which he is entitled at an appropriate stage to agitate before the court; and clearly if he were to persuade the court that that was factually so, then he might well be entitled to appropriate relief. But, in all the circumstances, it would seem highly inappropriate for me to express any view on that contention at this stage.
What I am concerned with in respect of the plaintiff's suspension is therefore whether the process of investigating what, for shorthand, I will refer to as -- the "IT issues" has taken sufficiently longer than might be reasonable so as to render it, or render the inquiry arising from it, unjust and inordinate, or the delay in respect of it unjust and inordinate.
There is no doubt, indeed it was fairly conceded by counsel for the defendants, that it has taken longer than would have been anticipated both at the time when the plaintiff was initially suspended and, I suspect, indeed, at the time when the matter was first before the court on 21st December. I also have to have regard to the fact that the plaintiff has put before the court expert evidence which suggests that the forensic examination of the relevant computer, which is required in order that the inquiry be completed and a decision be taken as to whether formal disciplinary proceedings should be commenced, could in his view have been completed within one week. As against that, there is evidence put forward by the defendants that the extent of the computer materials required to be investigated on the advice of the defendant's experts has extended beyond that which was originally envisaged, so that the volume of materials requiring to be analysed is now significantly larger, thus lengthening the period that would be required to complete the investigation.
I also have to take into account the fact that on instructions, counsel for the defendant was in a position to inform me that it was anticipated that the inquiry and the resulting report from the defendant's experts would be available now in very early course, and would be able to be considered by the defendant, certainly prior to the anticipated meeting of 4th February of next week. I should also note that the indication which I gave on the last occasion when the matter was substantively before the court on 21st December in relation to facilitating access to an expert appointed by the plaintiff, was given in the context of the obligation on the defendant to ensure that there is no unreasonable delay. It seemed clear to me that it was highly likely that if this matter did go to a substantive disciplinary hearing that the plaintiff would reasonably require that he be in a position to present to any such hearing his own expert evidence in relation to these matters, given that there would necessarily be a lead time between such an expert being given access to the materials and the expert being in a position to produce a report and, if necessary, give evidence at any disciplinary hearing, then it was clearly necessary in order to achieve the maximum possible expedition in the disciplinary process that that access be given at as early a time as was practical.
I am happy to note that there seems at last to have been some progress in relation to this matter, in that I am told at the hearing this afternoon that access can be given to the plaintiff's expert at the premises of the defendant's expert at any reasonable hours, so that at least that aspect of the matter should not take too much longer. I am also informed that direct contact between the experts either has
been made or is in the course of being made to make the practical arrangements.
There clearly has been an element of cross purposes between the parties in relation to making those arrangements. The defendant has stated on affidavit that some certain of its senior officials attempted to make direct contact with the plaintiff's expert for the purposes of setting up an appointment. The plaintiff's solicitor has deposed to the fact, which I have to says seems entirely sensible, that he advised the expert that having regard to the difficulties in the case it would not be appropriate for the expert to deal directly with the defendants and that therefore contact should either be on a lawyer to lawyer basis, or direct between the experts. It does also seem that there was delay on the part of the defendants in responding to correspondence in relation to attempting to set these matters up from the plaintiff's solicitors. However, notwithstanding all of those factors, I am not persuaded at the moment that they display either a malevolent attempt on the part of the defendants to avoid an early resolution of the matter, or that it has been established that the delay is, as yet, inordinate or unjust, in the words of Macken J in Martin v the Nationwide Building Society. That being said, it seems clear to me that in the light of the fact that there has been a greater degree of delay than would have been anticipated, and where at least some of the responsibility for that must rest upon the defendants, I would have to give an indication that if there were any significant further delay in bringing this matter to a conclusion, and if the defendants were to any extent either solely or significantly responsible for any such delay, the point would fairly soon be reached when I might well come to a different view as to whether the delay had become inordinate and unjust.
Finally, before leaving this topic I think it is important to make two points. They are factors that are relevant in considering what period of time might be considered to be inordinate and unjust. They would tend in the one case to favour a shorter period and in the other case to favour a longer period on the facts of this case; therefore their cumulative effect may not be very significant, but it is nonetheless important to note them. On the one hand the question of whether someone has been suspended with or without pay seems to me to be a significant factor. Obviously, someone who has been suspended without pay is entitled to an even greater degree of expedition in the completion of a disciplinary process than someone who has been suspended without pay. Obviously the plaintiff in this case has been suspended on pay and therefore that factor does not lead to perhaps an even greater level of expedition being required. On the other hand, there can be no doubt that the absence from work for a prolonged period, particularly someone who is in a significant position, is the kind of thing which can be noticed to an extent that it can affect that person's reputation in the relevant economic community in which the employment is situated. While some element of that may be an inevitable consequence of the necessity to suspend in the first place, the nature of the job involved, and the likelihood of an absence from that job being in practice something which will mitigate against an employee, is also a factor that needs to be taken into account, and is a factor which, I think, would favour additional expedition in this case, having regard to the position which the plaintiff holds, and the fact that any significantly longer period not actively engaged in the carrying out of his duties could have a significant effect on him. I merely mention that to indicate that it is a further factor that might need to be taken into account if there were any significant additional delay. But for all of those reasons I am not satisfied that the delay has yet reached a stage where it would be appropriate for the court to intervene.
The second matter relied upon by the plaintiff is that, in essence, the matters which have given rise to his suspension no longer have any real basis in the light of the investigation to date. In this regard it seems to me that it is appropriate, at least initially, to refer to Deegan v Minister For Finance [2000] ELR 190 in which the Supreme Court had to consider the position of persons who had been suspended under the provisions of the Civil Service Regulations Act. It is important to note that the specific reasoning of the court in that case was concerned with an interpretation of the statutory provisions applicable to the employees in question and, therefore, it was not really concerned so much with the interpretation of implied terms in their contract of employment. But nonetheless it seems to me that the regime identified as being implicit in the statutory regime in that case, nonetheless forms a reasonable basis for implying terms into an ordinary contract of employment in the absence of any express terms to the contrary.
As was pointed out in the judgment of Keane CJ in that case, which was the judgment of the court, the appropriate distinction needs to be made between disciplinary suspensions on the one hand and what one might call inquiry suspensions on the other hand. It is clear from that judgment that amongst the entitlements of persons who are subjected to an inquiry suspension, is that they be informed of the reasons for their suspension so as to enable them to make representations to have the suspension terminated.
It seems to me implicit in that that the entitlements of an employee in the ordinary way and in the absence of any binding express term to the contrary, would be that where an employee is to be suspended pending an inquiry, the employee is, as a matter of contract, entitled to be told the reasons and is entitled to be heard as to why that suspension should not continue. It seems to derive from that the employee is also entitled, within certain parameters, to which I will return, to be kept informed of the state of the investigation so that if it takes a turn, which might allow him me to make representations that his suspension should be lifted, he is in a position to
do so.
That last point must I think, however, be subject to one important qualification and that is that it is inherent in many forms of investigations that it may not be appropriate to tell those who are the subject of the investigations as to the precise state which the investigation has reached for all sorts of reasons which will be obvious. It is not necessarily of any relevance to this case, but there may well be cases involving allegations of dishonesty where it may not be appropriate to tell the person under inquiry what the evidence is at any particular point of the investigation because, to do so, might impair the effectiveness of the investigation itself. Therefore, I wish to make it clear that I am not stating that a plaintiff employee is entitled to be kept immediately up-to-date with the precise state of the investigation, but simply that there is a general and ongoing right to be heard as to why the suspension should be lifted and, where it is reasonable so to do, to be given information that might allow a case to be made in that regard.
In that context the plaintiff's argument under this heading is that in the light the current state of the investigation, it is no longer appropriate that he stand suspended, in that it is contended that the accusations are, to a large extent, faded away or watered down on the basis of the expert reports to date.
It does seem to me, however, that that argument is necessarily premature, with particular reference to the fact that what would seem to be the definitive expert report is anticipated within the next number of days. It may be that after that report is received there is no longer any credible basis for maintaining disciplinary proceedings, or at least disciplinary proceedings which are of sufficient seriousness that they would warrant suspension, but then again it may not be. It would in my view be wrong at this stage to anticipate what may be in that report and the views which the defendant may take from it.
It does seem to me that there was sufficient evidence available to the defendants at the beginning of the process to justify a suspension. It seems to me that in those circumstances, and having regard to the high level of expertise that would be required to assess the matters giving rise to concern, it was appropriate to employ suitable expert. While I have expressed some misgivings as to how long it has taken to receive the report from those experts, given in particular that that report is now anticipated in very early course, it would not seem to me to be appropriate for the court to firstly second guess the experts, and secondly second guess the defendant as to whether it wished to pursue disciplinary proceedings in the light of what the experts may say. It does not of course necessarily follow that even though it may be appropriate to pursue disciplinary proceedings that a suspension may be necessary, but given that the defendant is not currently aware, because it has not received the report, as to the gravity of the matters for which there may be some evidence, and given that it was entitled to entertain concerns which would justify suspension on the basis of the initial reports which it received, it would seem to me to be excessive to require the defendant to remove the suspension at least until such time as it has received that report. If in the light of that report the defendant considers that disciplinary proceedings are necessary, and it should always be remembered that what has been happening up to now has been an investigation which may or may not lead to formal disciplinary proceedings under this heading, but if such formal disciplinary proceedings go ahead it would, it seems to me, be necessary for the defendant also to at least to consider whether in the light of the issues which are now going to form a disciplinary hearing and the evidence available in respect of them, whether a suspension continues to be justified. Provided it came to a reasonable conclusion that a suspension continued to be justified in the light of those matters it would not appear to me that the court should intervene, but clearly the plaintiff will be entitled to argue, if he so wishes and if he is so advised, that in the light of any matters remaining on the table, as it were, after the receipt of the final expert report, he would be entitled to argue that a suspension will no longer be justified. In those circumstances again it does not appear to me that it would be appropriate to vary the view which I took on 21st December and I would not propose, in effect, truncating or ending the disciplinary process, because to do so would be premature. I would propose granting the plaintiff liberty to apply if he wishes to take the view in the light of what is contained in the expert report that there is no longer any continuing inquiries sufficient to justify a suspension. Clearly it was implicit in what I said earlier that the plaintiff should have liberty to apply if the matter is subject to any further delay which he considers brings it within the rubric of being inordinate and unjust.
The final matter which it seems to me I need to address is the question of the proposed meeting of the board of directors of the defendant company scheduled for the 4th February. It is important to note that that is a meeting of the statutory board of the defendant company and that the plaintiff remains, as of now, a member of that board and is entitled to attend and participate in the business of that board. It is submitted by counsel on behalf of the defendants, and it seems to me to accord with the documentation that I have seen, that the purpose of that board meeting is to consider, in the light of the results of the investigation and the information available up to that time, whether the company wishes to progress to formal disciplinary proceedings against the plaintiff. It would, in my view, be only in wholly exceptional circumstances that it would be appropriate for a court to prevent an employer from entering into disciplinary processes. On the basis that that is the only matter which the board is to consider in relation to these issues at its meeting on the 4th February, I can see no basis why that meeting can not go ahead in the ordinary way. If the board decides in its wisdom to proceed with disciplinary proceedings, then those proceedings will take their own course, though I should note that what I said earlier about further delay I think applies equally to that disciplinary process in that what an employee is entitled to as part of their contract of employment is that the entire process is conducted in the earliest possible time, and given that the investigative part of the process has taken longer than anticipated there is perhaps an even greater onus on the employer to ensure that there is no delay whatsoever in the conduct of formal disciplinary proceedings should they be commenced.
Equally, if the board in its wisdom takes the view that so far as the IT issues are concerned there is no sufficient matter to require disciplinary proceedings, then clearly it would seem that the suspension would necessarily have to be lifted, and whether the board wished to go ahead with the so-called performance issues would be a matter for itself, but given that it is not contended that they give rise to justification for a suspension, clearly no suspension could continue in those circumstances.
But it does not seem to me that it is appropriate for the court to anticipate that the decision of the board will be wrongly taken or will be in any other way unlawful. Equally and in particular, given that the final report from the experts is not available, it does not seem to me that it would be appropriate for the court to give any indication as to what kind of decisions might be reasonable. In those circumstances, it does not seem to me that I should in any way interfere with the meeting of the 4th February. Clearly if it does something that it should not do that is matter that can be addressed in the light of the actions actually taken.
For all of those reasons it will be clear that I am not persuaded to vary the position which I indicated as of 21st December and I would propose granting either party liberty to apply because obviously this is an ongoing process and different considerations may emerge as time goes on. In that regard, I might just say two things. Firstly, I have arranged for this judgment to be transcribed, as soon as I have had a chance to look at the typed-up version and make any appropriate corrections, I will let the parties have a copy of it. Secondly, the parties might like to note that I will not be sitting in Dublin during the next two weeks, that is to say the two weeks starting next Monday, it is a matter for the party themselves if there is need for anyone to rely on the liberty to apply whether they want to wait for me to be around or to make the application to any judge. But certainly the liberty to apply should be interpreted as entitling either party and, I suppose, most particularly the plaintiff to apply to another judge if the urgency of the matter, or indeed any other factors seemed to the plaintiff to make it appropriate, so that if an issue arises which requires ventilation in my absence, Mr. Horan, you can be free to tell any other judge that I indicated that I have no difficulty with the matter being taken by another judge.
Approved: Clarke J.