harp graphic.
THE HIGH COURT
[2025] IEHC 181
[Record No. HJR 2025/184]
BETWEEN
JONATHAN COSGROVE
PRACTISING UNDER THE STYLE AND TITLE OF
AIDAN T STAPLETON SOLICITORS
APPLICANT
AND
THE MINISTER FOR JUSTICE AND THE ATTORNEY GENERAL
RESPONDENTS
JUDGMENT of Mr Justice Barr delivered on the 26th day of March 2025.
Introduction.
1. The applicant is a practising solicitor. In this application he seeks an interlocutory injunction restraining the respondent from implementing a decision made by him on 15 November 2024, that he would not deal with the applicant concerning applications lodged by his clients under a visa scheme known as the Immigrant Investor Programme (hereinafter 'IIP'), pending conclusion of an investigation being carried out into a complaint lodged against the applicant's firm with the Legal Services Regulatory Authority (hereinafter 'LSRA').
2. The applicant has challenged the legality of that decision on the grounds that he was not afforded fair procedures prior to the decision being taken, because he was not given any opportunity to make representations as to why the decision should not be made. He also challenges the decision on the basis that there were no reasons given in it for why the decision was taken. Furthermore, he alleges that the respondent does not have the power to effectively suspend him from practice, which is the effect of the decision that has been taken by the respondent.
3. In this application, the applicant seeks an interlocutory injunction restraining the respondent implementing the decision pending the hearing of his judicial review proceedings.
Background.
4. At all material times the applicant was a solicitor employed in the firm known as Aidan T Stapleton. He subsequently became a partner in the firm. In recent times he has become the sole partner in the firm.
5. It is only necessary to describe the operation of the IIP in very broad terms. In or about 2012, the Government set up the visa scheme known as the IIP. Under this scheme non-EU nationals who were of high net worth, meaning that they had personal wealth of at least €2 million, could apply for a visa to enter and reside in the State if they could establish that they had invested a sum of between €500,000 and €1m in an approved investment project in the State.
6. The scheme operated in the following way: there were four areas of investment in which projects were deemed suitable for investment. When a particular project was identified, it was put before a government committee for acceptance as an approved investment. Once approved, foreign investors who met the necessary financial thresholds, were identified. When a sufficient number of investors had been obtained for the project, the foreign nationals would apply to the respondent for a visa. When approval for the visa was obtained, a visa would issue to the foreign investor once the solicitor had certified that the required investment in the project had been made by the foreign individual.
7. The scheme operated from 2012 until approximately 14 February 2023, when the Minister announced that the scheme was closing down. However, existing projects and applications were allowed to run through the system. There were approximately 1,500 such applications in the system at that time. In addition, there were a further 400 development projects that had been accepted as being suitable for inclusion in the scheme, but in respect of which, investors had not been obtained or identified at the date of the announcement of closure of the scheme. The scheme remained open in respect of these projects as well.
8. On a date that is unclear, but was probably in or around September 2024, a Mr O'Lionscaigh, who held himself out as representing a number of Chinese investors, who had invested in a particular investment project run by a company called Trinity Homes Limited, made a complaint to the LSRA that a former partner in the applicant's firm had misrepresented the ownership of the entity which had acted as an agent in this country in relation to the particular investment project. He alleged that it had been represented by the former partner in the applicant's firm, that the agency vehicle known as McGuire Project Management was owned by a Mr Le Compte, when in fact the former partner in the applicant's firm was named as the sole director of the company.
9. Mr O'Lionscaigh also complained that this state of affairs constituted a conflict-of-interest between the former partner and his clients, the Chinese investors. He further complained that McGuire Project Management had signed an agreement in 2017 with Trinity Homes Limited, whereby that company would pay McGuire Project Management a fee for acting as agent in relation to the investment in Trinity Homes Limited. It was alleged that McGuire Project Management had been paid €1,100,000 under this agreement. It was alleged that this constituted fraud on the part of the former partner in the applicant's firm.
10. Mr O'Lionscaigh informed the LSRA that he had made a complaint in identical terms to An Garda Siochana.
11. By letter dated 13 September 2024, the LSRA informed the applicant of the lodgement of the complaint with them by Mr O'Lionscaigh. They invited him to respond to it. The applicant responded to that complaint in writing on 2 October 2024. He vehemently denied the complaints that had been made against him by Mr O'Lionscaigh. He accepted that his former partner had been named as sole director of McGuire Project Management, but denied that there had been any misrepresentation to any investors in this regard. He also informed the LSRA that there was no substance to any of the allegations of misconduct on the part of the former partner in the firm, or on his own part, or on the part of any employee in the firm.
12. On 30 October 2024, the LSRA informed the applicant by letter that they were deferring consideration of the complaint that had been lodged against him, pending the conclusion of any Garda investigation that was under way into the matter.
13. No application has been made by the LSRA or the Law Society for any restriction on the applicant's ability to practice as a solicitor.
14. The applicant states that he is unaware of any investigation being carried out by An Garda Siochána into the complaint made by Mr O'Lionscaigh. He has stated that he has not been contacted by An Garda Siochána in relation to the matter. While not expressly stated, it appears that no search warrant has been applied for by the gardaí; certainly no search warrant has been executed in respect of any books or records of the firm, or belonging to the applicant.
15. The applicant states that he has had dealings with the respondent on behalf of foreign investor clients under the IIP for over 10 years. He states that there has never been any difficulty with his work, or with his dealings with either the Department of Justice, or his clients.
16. On 15 November 2024, the respondent sent the following email to the applicant at 11.59 hours:
"I write to you in relation to the Immigrant Investor Programme (IIP).
I wish to inform you that this department has been notified that a formal complaint has been made to the LSRA, and other relevant authorities, in relation to your solicitor practice and its involvement with the IIP. While this matter is being investigated, we will be pausing the processing of all Aidan Stapleton Solicitors IIP applications.
We appreciate that pausing of applications may have practical implications for the applicants and, almost certainly, give rise to concerns on their part. For that reason, we would be grateful if you could confirm to us by 6 December that all your IIP investor applicant clients have been advised that their applications are currently paused while these matters are being examined. In the event that such confirmation is not forthcoming, we reserve our right to advise applicants of the position.
Regards,
Paddy Duffy
Immigrant Investor Unit."
17. Having requested the respondent to rescind its decision, and upon its failure to do so, the applicant made an application for leave to proceed by way of judicial review to challenge the legality of the respondent's decision. The applicant was granted leave to proceed by way of judicial review on 17 February 2025.
18. As already noted, in this application the applicant seeks an interlocutory injunction to preserve the status quo ante , which will effectively oblige the respondent to continue to deal with the applicant as a solicitor acting on behalf of his clients who are participating in the IIP, or who are desirous of so doing, until the trial of the judicial review proceedings.
Discussion and Conclusions.
19. The general principles relating to the grant of an interlocutory injunction are long established, having been set down in Campus Oil v Minister for Industry (No. 2) [1983] IR 88.
20. These principles were refined by McCracken J in B & S Ltd v Irish Auto Trader Ltd [1995] 2 IR 142. The test was further refined by the Supreme Court in Merck Sharp and Dohme Corporation v Clonmel Healthcare Ltd [2022] IR 1, where the principles were set down by O'Donnell J (as he then was) at paragraph 65 of his judgment.
21. Similar but slightly different principles come into play when considering the grant of an interlocutory injunction in judicial review proceedings; particularly where the effect of an injunction would be to prevent the implementation of a ministerial or statutory decision pending the trial of the action. In Okunade v Minister for Justice [2012] 3 IR 152, Clarke J (as he then was) summarised the principles applicable to an application for an interlocutory injunction in judicial review proceedings in the following way:
"(a) The court should first determine whether the applicant has established an arguable case; if not the application must be refused, but if so then;
(b) the court should consider where the greatest risk of injustice would lie. But in so doing the court should:
(i) give all appropriate weight to the orderly implementation of measures which are prima facie valid;
(ii) give such weight as may be appropriate (if any) to any public interest in the orderly operation of the particular scheme in which the measure under challenge was made; and
(iii) give appropriate weight (if any) to any additional factors arising on the facts of the individual case which would heighten the risk to the public interest of the specific measure under challenge not being implemented pending resolution of the proceedings; but also
(iv) give all due weight to the consequences for the applicant of being required to comply with the measure under challenge in circumstances where that measure may be found to be unlawful.
(c) in addition the court should, in those limited cases where it may be relevant, have regard to whether damages are available and would be an adequate remedy and also whether damages could be an adequate remedy arising from an undertaking as to damages;
(d) in addition, and subject to the issues arising on the judicial review not involving detailed investigation of fact or complex questions of law the court can place all due weight on the strength or weakness of the applicant's case."
22. In that case, Clarke J stated that when considering where the balance of justice lies in relation to the grant of an interlocutory injunction, one was in reality looking to see where the least risk of doing an injustice lay. In other words, which outcome would produce the lesser injustice: where an injunction was granted, but that was held to be unfounded at the trial of the action; or where an interlocutory injunction was refused, and the party who had sought it, was ultimately successful at the trial of the action. The court must ask itself where the greater injustice lies.
23. In the present case, the parties were agreed that insofar as the requirement to show a fair or serious issue to be tried was concerned, that threshold had been crossed because the applicant had succeeded in obtaining leave to bring his judicial review proceedings.
24. However, Mr Lewis SC, on behalf of the respondent argued that where an application was in effect for a mandatory injunction, the applicant for such an injunction had to establish that they had a strong case to put forward at the trial of the action: see Maha Lingham v HSE [2005] IESC 89.
25. Counsel for the respondent submitted that in effect the applicant was seeking a mandatory injunction forcing the respondent to continue to deal with the applicant until the trial of the action. Therefore, the applicant was required to show that he had a strong case. It was submitted that the applicant did not have such a case, as there was a line of authority in employment disputes, which had established that the courts are generally slow to force an employer to have legal relations with their employees when a decision had been taken to either terminate their employment, or put them on suspension.
26. Counsel further submitted that as the IIP was a scheme operated by the respondent, he had an implied power to make the necessary regulations to deal with a situation where a serious complaint had been made by a person concerning the applicant's conduct in connection with the IIP. It was submitted that it had been rational and reasonable for the respondent to have made the decision that he had done to temporarily suspend the applicant's ability to act for clients in connection with the scheme, while investigations into these serious complaints were ongoing.
27. Counsel for the respondent further submitted that insofar as the applicant had complained about a want of fair procedures prior to the making of the decision; it was submitted that the authorities established that where one was dealing with what was in effect a temporary suspension, the right to fair procedures was not engaged. It was submitted that in these circumstances, the applicant had not demonstrated that he had a strong case and therefore, as his application was one for a mandatory injunction, it should be refused.
28. In response, Mr Lyons SC submitted that the applicant was not seeking a mandatory injunction. He was merely seeking the continuance of the status quo ante , whereby he would be entitled to act as a solicitor in relation to applications by his clients under the IIP, as he had done for the previous 10/12 years. It was submitted that the applicant was seeking an interlocutory injunction of a prohibitory nature restraining the respondent from implementing his decision of 15 November 2024 until the trial of the action.
29. Without prejudice to that submission, it was submitted that the applicant had a strong case, as it was clear that where a decision was to be taken by a decision-maker which could materially affect a person's right to earn a livelihood and/or their right to their good name, that engaged the right to fair procedures, which had at its most basic level, the right to make submissions before the decision was taken: see Dellway Investments v NAMA [2011] 4 IR 1, per Hardiman J at paras. 298–301.
30. Counsel submitted that the line of authority dealing with suspension cases had to be seen in the light of more recent case law, such as the decision of the Supreme Court in O'Sullivan v HSE [2023] IESC 11, where it had been recognised that suspension of itself could have a significant adverse effect on a person's right to earn a livelihood and on his/her right to their good name. In such circumstances, the court had held that the right to fair procedures was clearly engaged: see judgment of Dunne J at para.78; see also Bank of Ireland v Riley [2015] IEHC 241.
31. Counsel for the applicant submitted that the applicant had a strong case, as it was not disputed that the applicant had not received any notice of any impending decision; much less had he been given any opportunity to make submissions thereon. He had simply received the email of 15 November 2024 out of the blue.
32. The court is satisfied that both submissions made by counsel on behalf of the applicant are correct. The court holds that the injunction sought by the applicant in this case is not a mandatory injunction. It is a prohibitory injunction restraining the respondent from implementing his decision of 15 November 2024 pending the trial of the judicial review proceedings. That being the case, the initial threshold is that the applicant must establish that there is a fair or serious issue to be tried. It is accepted that the applicant has crossed that threshold.
33. Even if I am wrong in holding that the injunction sought is prohibitory in nature, I accept the submission made by counsel on behalf of the applicant, that the applicant has demonstrated that he has a strong case to put forward at the trial of the action. It is uncontroverted that he did not get any opportunity to make representations prior to the decision being taken. I hold that on the authority of the decisions in Dellway; Bank of Ireland v Rile y and O'Sullivan v HSE , a right to fair procedures is engaged at a basic level whenever a material decision is being taken which may affect a person's right to earn a livelihood or their right to their good name.
34. As has been noted in the case law, this does not mean that the full panoply of rights involved in a criminal trial are engaged, but basic fairness requires that a person be given some opportunity to make representations prior to the decision being taken. As it has been accepted by the parties that that did not occur in this case, I hold that the applicant has a strong case to make at the trial of the action.
35. I accept the evidence of the applicant as set out in his affidavits that the inability on his part to represent his clients who are either in the IIP process, or are desirous of entering it, is having a significant adverse effect on his ability to earn a livelihood and will cause significant reputational damage to him and his firm. I am satisfied that that is sufficient to engage the right to fair procedures.
36. In addition, I accept the submission that there is considerable force in the argument that as the respondent has no role in the regulation of, or disciplining of solicitors, who are officers of the court, the respondent acted ultra vires in effectively prohibiting the applicant from acting as a solicitor in one area of work, which constitutes a significant proportion of his practice.
37. Finally, I accept the applcant's submission that there is a strong case that the decision as contained in the email of 15th November 2024, is deficient at law for failure to give reasons for the implementation of the decision. The duty to give reasons is well known in Irish law: Connelly v An Bord Pleanala 2021 2IR 752; Balz v An Bord Pleanala 2019 IESC 90; Meadows v Minister for Justice, Equality & Law Reform 2010 2IR 710; NECI v The Labour Court 2021 IESC 36.
38. Insofar as the respondent attempted to argue that the reason for his decision was the necessity to uphold the integrity of the visa scheme; it is doubtful that the respondent can rely on this as a reason for the decision, as it was not stated in the decision. It is well settled that reasons cannot be given after the decision has been made. They must be given in the decision itself, or in documents referred to in the decision.
39. In these circumstances, I find that the applicant has demonstrated that he has a strong case that he is entitled to the relief that he seeks in his judicial review proceedings. Accordingly, I find that the applicant has crossed the first threshold of the test for an interlocutory injunction.
40. Turning to the second issue, being the balance of justice, I am satisfied that the applicant has demonstrated that this comes down in favour of the grant of an injunction.
41. I accept the applicant's evidence that this area of work accounts for circa 50% of the fee income of his firm. If he is not granted an injunction and is ultimately successful at the trial of the action, he will have lost this income between now and the date of the hearing.
42. One might argue that that is entirely quantifiable and therefore can be provided for by an award of damages. However, that does not take account of two things: first, the applicant will probably lose some, or all, of his existing clients in this period. It is not just the loss of the fee income from this work on their behalf in connection with the IIP, that will be lost.
43. These clients are, by definition, individuals of high net worth. If they have a good working relationship with the applicant concerning their successful participation in the IIP, there is the potential for further fees to be earned by the firm in providing ancillary legal services to them, such as in connection with the purchase of accommodation; the purchase of rental properties; advising on legal aspects of other investment opportunities; and advising on probate and inheritance issues under Irish law. Thus, the loss of these clients, is not limited in financial terms to the loss of fees from their participation in the IIP.
44. I find as a fact that the loss of existing clients would probably result in significant, yet unquantifiable, loss of fee income for the applicant into the future. As such, damages would not be an adequate remedy.
45. In addition, if the applicant cannot act for clients in relation to future applications under the IIP, and I accept his evidence that there may be up to 400 investment projects yet to proceed through the system, of which he could expect to acquire a proportion of these; he will lose an unknown number of future clients, thereby giving rise to further unquantifiable loss of income to the firm. Under this heading too, damages would not be an adequate remedy.
46. Finally, under the heading of the adequacy of damages, one has to have regard to the fact that the applicant is operating in an extremely competitive market. If he cannot provide services to clients in connection with the IIP, his existing clients and prospective clients will be poached by his competitors. The loss of these clients will be permanent, in that they are unlikely to return to the applicant as their solicitor, even if he were to be successful at the trial of the action.
47. I am satisfied that when a solicitor loses a significant market share that he has built up over a long period of time, it would be very difficult for him to make up that ground and win back that market share from other solicitors, if he were to be successful at the trial of the action. Accordingly, I find that the applicant's losses would be irremediable in damages, if he were refused an interlocutory injunction and was ultimately successful at the trial of the action.
48. The court is also entitled to have regard to the fact that the reputational damage to the applicant caused by the decision, would be significant: see Kui v Nolan [2025] IEHC 17.
49. Looking at the matter from the other side, being the alleged loss or harm that would be suffered by the respondent if an injunction were granted, and the applicant was not ultimately successful at the trial of the action; I am not persuaded that the respondent would suffer any appreciable loss or harm by allowing the applicant to continue to act as a solicitor for his clients in the period between now and the trial of the action.
50. The respondent has argued that it is vital that the scheme be seen to be transparent and above reproach from a financial point of view. The respondent submits that he must protect the integrity of the scheme. While that may well be correct, it is important to note that the respondent does not allege that the applicant, or his previous partner in the firm, have done anything wrong in connection with the IIP scheme.
51. The respondent is entitled to carry out whatever investigations it thinks necessary if it suspects that any firm involved in the IIP has acted unlawfully or improperly. However, the respondent does not allege that the applicant, or his former partner, have done anything wrong.
52. Instead, they say that because a third party has made a complaint to the LSRA about the conduct of the applicant's former partner in representing that an investment agency was owned and operated by a Mr Le Compte, when in fact the former partner in the firm was named as sole director of that entity; and that that entity had a beneficial agency agreement with the investment vehicle, Trinity Homes Ltd; that that somehow means that the applicant and his firm have acted improperly in connection with the IIP. While the complainant has complained that the agreement between the investment agency and Trinity Homes Limited provided for the payment of a considerable sum to the agency, there is no allegation that that agreement was hidden from any of the investors.
53. It has to be remembered that anyone can make a complaint to the LSRA about a solicitor or a barrister. The making of a complaint does not of itself mean that it is a credible complaint, or that there was wrongdoing on the part of the lawyer against whom the complaint was made.
54. In relation to any investigation being carried out by An Garda Siochána, there is no evidence of any such investigation before the court. All there is, is a statement by the complainant to the LSRA that he has made a complaint to the gardaí. One must not lose sight of the fact that under criminal law, there is the presumption of innocence. The making of a complaint by a person to An Garda Siochána does not convert the person complained against into a guilty person. They are entitled to the presumption of innocence until either a guilty plea is entered, or there is a conviction following a trial.
55. The action of the respondent in refusing to deal with the applicant as a solicitor for an indefinite period until the LSRA, or the gardaí, have concluded whatever investigation they may carry out into the complaint, is effectively a decision by the respondent that the applicant cannot act as a solicitor in a defined area of work for an indefinite time. That decision has immense consequences for him, because the solicitor has sworn that this area of work accounts for 50% of the fee income of the firm.
56. The fact that such a Draconian measure is described as a "pause", does not disguise the fact that it is a decision by the respondent to effectively put a solicitor on suspension due to the making of a complaint by a third party to the LSRA, which complaint may or may not be well-founded. That is not the role of the respondent.
57. If there are any concerns about the legality of the financial dealings of the applicant, or his firm, or of his former partner; the Law Society has ample powers to take a range of measures to protect clients and the general public from the financial misdeeds of errant solicitors. An application can be made by the appropriate party to the president of the High Court for a temporary suspension of the solicitor's practising certificate. It is noteworthy that no such steps have been taken to date.
58. The court is not persuaded that any financial loss or reputational harm will be caused to the respondent, or to the IIP, by allowing the applicant to continue to act as a solicitor for clients involved with the scheme pending the trial of the action.
59. The court is satisfied that in all the circumstances and for the reasons outlined herein, the balance of justice lies in favour of the grant of an interlocutory injunction in this case.
60. Accordingly, the court hereby makes an order that the respondent is restrained from implementing his decision of 15 November 2024 until the trial of the action in the within judicial review proceedings. This order is to be of immediate effect.
61. On the issue of costs, the court's indicative view is that the costs of the application for an interlocutory injunction should be reserved to the trial of the action.
62. The court will list the matter for mention at 10.30 hours on 28 March 2025, when it will hear the parties on the issue of costs and on any ancillary matters that may arise.