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Cite as: [2005] IESC 7, [2005] 1 IR 105
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Judgment Title: In the Matter of Article 26 of The Constitution & In the Matter of the Health Composition of Court: Murray C.J., Denham J., Mc Guinness J., Hardiman J., Geoghegan J., Fennelly J., McCracken J. Judgment by: Murray C.J. Status of Judgment: Approved |
Judgments by | Result | Concurring | Dissenting | |
Murray C.J. | Other (see notes) | |||
Notes on Memo: Section 1 (b) of the Health (Amendment) (No. 2) Bill 2004 which provides for the insertion of subsections (5), (6) and (7), and subsection (11) insofar as it defines "relevant charge", in section 53 of the Health Act, 1970, are repugnant to The Constitution and in particular Articles 43 and 40.3.2 thereof
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THE SUPREME COURT
Murray C.J.
Denham J.
McGuinness J.
Hardiman J.
Geoghegan J.
Fennelly J.
McCracken J.
524/04
IN THE MATTER OF ARTICLE 26 OF THE CONSTITUTION
AND THE HEALTH (AMENDMENT) (NO. 2) BILL, 2004
AND THE HEALTH (AMENDMENT) (NO. 2) BILL, 2004
DECISION of the Court pronounced on the 16th day of February, 2005, by Murray C.J.
This is the decision of the Supreme Court on the reference to it by the President of the Health (Amendment) (No. 2) Bill, 2004, pronounced pursuant to Article 26.2.1º of the Constitution.
The Reference
By order given under her hand and seal on the 22nd December, 2004, the President, after consultation with the Council of State, referred, in pursuance of the provisions of Article 26 of the Constitution, the said Bill to the Supreme Court for a decision on the question as to whether any provision of the Bill is repugnant to the Constitution or any provision thereof.
Proceedings on the Reference
Counsel were assigned by the Court to present arguments on the question referred to the Court by the President. Prior to the oral hearing counsel assigned by the Court presented written submissions to the Court, including submissions that certain provisions of the Bill were repugnant to the Constitution. Submissions in writing by and on behalf of the Attorney General were presented to the Court submitting that none of the provisions of the Bill were repugnant to the Constitution.
The oral hearing then took place before the Court on the 24th, 25th and 26th January, 2005. During the course of the hearing the Court heard oral submissions by counsel assigned by the Court and by counsel for the Attorney General.
The Legislation
The Bill in question is a short Bill and since the entire Bill is the subject of the question referred to the Court pursuant to Article 26 of the Constitution, it is appropriate to set out its terms in full:
- “HEALTH (AMENDMENT) (NO. 2) BILL 2004
…
————————
AN ACT TO AMEND SECTION 53 OF THE HEALTH ACT 1970.
BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:
1.—Section 53 of the Health Act 1970 is amended—
(a) in subsection (2)—
- (i) by substituting ‘‘Notwithstanding anything in the Health Acts 1947 to 2004 but subject to subsections (3), (4) and (9), the Minister shall’’ for ‘‘The Minister may’’, and
(ii) in paragraph (a), by substituting ‘‘to whom the in-patient services are provided’’ for ‘‘who are not persons with full eligibility’’, and
- ‘‘(3) A charge imposed under regulations made under subsection (2) on or after the enactment of this subsection is not payable where the in-patient services concerned are provided to—
(a) a person under 18 years of age,
(b) a woman in respect of motherhood,
(c) a person detained involuntarily under the Mental Health Acts 1945 to 2001,
(d) a person who—
- (i) is in a hospital for the care and treatment of patients with acute ailments (including any psychiatric ailment), and
(ii) requires medically acute care and treatment in respect of any such ailment,
(e) a person who pursuant to section 2 of the Health (Amendment) Act 1996, in the opinion of the chief executive officer of a health board, has contracted Hepatitis C directly or indirectly from the use of Human Immunoglobulin Anti-D or the receipt within the State of another blood product or a blood transfusion.
(5) Subject to subsection (6), it is hereby declared that the imposition and payment of a relevant charge is, and always has been, lawful.
(6) Subsection (5) shall not apply in the case of a relevant charge which is the subject of civil proceedings—
- (a) instituted on or before 14 December 2004, and
(b) for the recovery of the relevant charge.
(8) For the avoidance of doubt, it is hereby declared that—
- (a) regulations made under subsection (2) and in force immediately before the enactment of this subsection—
- (i) shall continue in force on and after that commencement and may be amended or revoked, and
(ii) subject to paragraph (b), do not apply to persons with full eligibility,
(b) such regulations may be amended on or after that commencement to apply, in whole or in part, to persons with full eligibility.
- (a) a period of not less than 30 days, or
(b) periods aggregating not less than 30 days within the previous 12 months,
then—
(c) a charge imposed under regulations made under subsection (2) on or after the enactment of this subsection for the further provision of any in-patient services to that person shall be charged at a weekly rate, and
(d) such weekly rate shall not exceed 80 per cent of the maximum of the weekly rate of the old age (non-contributory) pension within the meaning of the Social Welfare Acts.
(11) Notwithstanding section 51, in this section—
- ‘in-patient services’, in relation to any regulations made under subsection (2) on or after the enactment of this subsection, means the institutional services referred to in the definition of ‘in-patient services’ in section 51 only insofar as those institutional services consist of the maintenance of a person;
- (a) imposed (or purporting to be imposed) under regulations made (or purporting to be made) under subsection (2), and
(b) paid at any time before the enactment of this subsection.’’.
(No. 2) Act 2004.
(2) The collective citation ‘‘the Health Acts 1947 to 2004’’ shall include this Act.”
As can be seen the Bill is limited to amending s. 53 of the Act of 1970. Section 53 of that Act provides as follows:
- “53.—(1) Save as provided for under subsection (2) charges shall not be made for in-patient services made available under section 52.
(2) The Minister may, with the consent of the Minister for Finance, make regulations—
(a) providing for the imposition of charges for in-patient services in specified circumstances on persons who are not persons with full eligibility or on specified classes of such persons, and
(b) specifying the amounts of the charges or the limits to the amounts of the charges to be so made.”
The terms of the provisions of the Bill, since it is confined to amending and adding to s. 53 of the Act of 1970, can be more readily appreciated if s. 53(2) and the ensuing subsections are read in an amended and consolidated form which, at the risk of some repetition, would provide as follows:
- “53.—(2) Notwithstanding anything in the Health Acts 1947 – 2004 but subject to subsections (3), (4) and (9) the Minister shall, with the consent of the Minister for Finance, make regulations –
- (a) providing for the imposition of charges for in-patient services in specified circumstances on persons to whom the in-patient services are provided or on specified classes of such persons, and
(b) specifying the amounts of the charges or the limits to the amounts of the charges to be so made.
- (a) a person under 18 years of age,
(b) a woman in respect of motherhood,
(c) a person detained involuntarily under the Mental Health Acts 1945 to 2001,
(d) a person who—
- (i) is in a hospital for the care and treatment of patients with acute ailments (including any psychiatric ailment), and
(ii) requires medically acute care and treatment in respect of any such ailment,
- (e) a person who pursuant to section 2 of the Health (Amendment) Act 1996, in the opinion of the chief executive officer of a health board, has contracted Hepatitis C directly or indirectly from the use of Human Immunoglobulin Anti-D or the receipt within the State of another blood product or a blood transfusion.
(5) Subject to subsection (6), it is hereby declared that the imposition and payment of a relevant charge is, and always has been, lawful.
(6) Subsection (5) shall not apply in the case of a relevant charge which is the subject of civil proceedings—
- (a) instituted on or before 14 December 2004, and
(b) for the recovery of the relevant charge.
(8) For the avoidance of doubt, it is hereby declared that—
- (a) regulations made under subsection (2) and in force immediately before the enactment of this subsection—
- (i) shall continue in force on and after that commencement and may be amended or revoked, and
(ii) subject to paragraph (b), do not apply to persons with full eligibility,
- (b) such regulations may be amended on or after that commencement to apply, in whole or in part, to persons with full eligibility.
- (a) a period of not less than 30 days, or
(b) periods aggregating not less than 30 days within the previous 12 months,
- (c) a charge imposed under regulations made under subsection (2) on or after the enactment of this subsection for the further provision of any in-patient services to that person shall be charged at a weekly rate, and
(d) such weekly rate shall not exceed 80 per cent of the maximum of the weekly rate of the old age (non-contributory) pension within the meaning of the Social Welfare Acts.
(11) Notwithstanding section 51, in this section—
‘in-patient services’, in relation to any regulations made under subsection (2) on or after the enactment of this subsection, means the institutional services referred to in the definition of ‘in-patient services’ in section 51 only insofar as those institutional services consist of the maintenance of a person;
‘relevant charge’ means a charge—
- (a) imposed (or purporting to be imposed) under regulations made (or purporting to be made) under subsection (2), and
(b) paid at any time before the enactment of this subsection.’’.
By way of introduction it may be said that the Bill is confined to the making of amendments to s. 53 of the Health Act, 1970. The subject matter of the Bill is in turn confined to the payment of certain charges by certain categories of persons, in most cases elderly persons of limited means, who will benefit in the future or have benefited in the past from being maintained in a hospital or home by a Health Board. In the former instance the relevant provisions operate prospectively and in the latter retrospectively.
There are two sections in the Bill. Section 1 contains the essence of the Bill and provides for an amendment to subsection 2 of s. 53 of the Health Act, 1970 and, by way of insertion, the addition to that section of nine new subsections. Section 2 of the Bill simply provides for the short title and the inclusion of the Bill in the collective citation “the Health Acts, 1947 – 2004” in respect of which no issue arises. Accordingly only the constitutionality of the amending provisions contained in s. 1 are in issue. The context and full implications of these provisions are fully examined subsequently in this judgment.
Prospective Effect
Section 1(a) of the Bill amends s. 53(2) of the Act of 1970 so as to require the Minister to make regulations for the imposition of charges in certain circumstances for in-patient services provided in the future insofar as they consist of the maintenance of a person in a home or hospital by a Health Board. Section 1(b) provides for the insertion after s. 53(2) of the Act of 1970 of certain new subsections which govern, inter alia, the category of persons on whom such charges may be imposed, the circumstances where such charges may be imposed and their maximum level, namely, 80% of the maximum of the weekly rate of the old age (non-contributory) pension.
The new power given to the Minister to impose charges and the provisions governing the use of that power concern only the imposition of a charge for the provision of the service in question in the future. In addition to these provisions there is a provision which confers on the Chief Executive Officer of a Health Board a discretion to reduce or waive a charge payable pursuant to such regulations where the full imposition of the charge would give rise to undue hardship in an individual case.
The provisions which would have prospective effect only, taking account of the amendments of the Bill, are s. 53, subsection (2) of the Act of 1970 as amended by the Bill and subsections (3), (4), (9), (10) and (11) (insofar as the latter subsection defines “in-patient services”) of that section as inserted by the Bill.
Retrospective Effect
The second object of the Bill is to declare as lawful, and as always having been lawful, certain charges for in-patient services which had been imposed, or purported to be imposed in the past on, and paid by, certain persons pursuant to regulations made (or purporting to be made) under subsection (2) of s. 53 of the Act of 1970 even though there has been admittedly no lawful authority for the imposition of such charges. This is the retrospective aspect of the Bill. It is a special feature of the retrospective provisions of the Bill that they seek to validate not only charges imposed without lawful authority but charges that were imposed for an in-patient service which the Oireachtas, in s. 53(1), had decreed should be provided free of any charge to those concerned.
The retrospective provisions of the Bill are subsections (5), (6), (7) and (11) (insofar as the last mentioned subsection defines “relevant charge”) of s. 35 of the Health Act, 1970, as inserted by s. 1(b) of the Bill.
Full consideration is given to the statutory context and effect of these retrospective provisions subsequently in this judgment where it addresses the constitutional issues to which those provisions give rise.
Since the terms of the Bill are best appreciated by reference to s. 53 of the Act of 1970 in its amended and consolidated form, for ease of reference the provisions of the Bill are generally referred to in this judgment, unless the context indicates otherwise, by reference to the particular subsection of s. 53 as amended or inserted by the Bill.
Presumption
The Court in considering this Bill applies the presumption of constitutionality in accordance with its decision under Article 26 in In Re The Criminal Law (Jurisdiction) Bill, 1975 [1977] IR 129.
Constitutionality of Provisions with Prospective Effect
The Court will first of all consider the constitutional issues which have arisen in relation to those provisions of the Bill which have prospective effect only. For this purpose the prospective provisions of the Bill are referred to in more detail.The primary prospective provision is to be found in s. 1(a) of the Bill, which amends the provisions of s. 53(2) of the Health Act, 1970. As can be more readily seen from s. 53(2) of the Act of 1970 in its consolidated form, the Bill amends that subsection so as to require the Minister, with the consent of the Minister for Finance, to make regulations “providing for the imposition of charges for in-patient services” on persons who receive such services or unspecified classes of such persons. The Bill is mandatory in this regard in that it says the Minister “shall make” regulations. The Minister is also required to specify in the regulations the amounts of such charges or the limits to such amounts.
For these purposes “in-patient services” is defined in subsection (11) of s. 53 of the Health Act, 1970, as inserted by the Bill, as meaning, “the institutional services referred to in the definition of ‘in-patient services’ in s. 51 only insofar as those institutional services consist of the maintenance of a person;”
“The institutional services” referred to in s. 51 of the Health Act, 1970 are those provided for persons while maintained in a hospital, convalescent home or home for persons suffering from physical or mental disability or in accommodation ancillary thereto. “Institutional services” are defined, for this purpose, in s. 2 of the Health Act, 1947, as including:
(a) maintenance in an institution,
(b) diagnosis, advice and treatment at an institution,
(c) appliances and medicines and other preparations,
(d) the use of special apparatus at an institution.
While the 1970 Act draws a distinction, for the purpose of enjoying such services and in particular as to their liability for the payment of any charges, between persons having respectively “full eligibility” and “limited eligibility”, no such distinction is drawn for the purpose of liability to pay any charges imposed by virtue of regulations made by the Minister under this provision of the Bill, and it is not necessary to consider the distinction between these two categories in this context. (The distinction between “full eligibility” and “limited eligibility” is particularly pertinent to the retrospective effects of the Bill and this is fully considered later in the judgment.)
The Bill does, however, exclude certain categories of persons from liability to pay charges imposed under regulations made by the Minister under subsection 2. These are set out in subsection 3 of s. 53, as inserted by s. 1(b) of the Bill, and include such categories of persons who avail of such services as a woman in respect of motherhood, a person detained involuntarily under the Mental Health Acts and persons with acute ailments or requiring acute care and treatment. Subsection 9 of s. 53 as inserted by s. 1(b) of the Bill provides for a minimum period of stay before a person becomes liable to pay maintenance charges under the regulations and then goes on to provide that the charge imposed shall be charged at a weekly rate and that it shall not exceed 80% of the maximum weekly rate of the old age (non-contributory) pension within the meaning of the Social Welfare Acts.
The final relevant prospective provision of the Bill is to be found in subsection 4 of s. 53 as inserted by s. 1(b) of the Bill whereby a Chief Executive Officer of a Health Board may reduce or waive a charge imposed under the regulations after the enactment of the Bill, if he or she “… is of the opinion that having regard to the financial circumstances of that person (including whether or not that person has dependants), it is necessary to do so in order to avoid undue financial hardship in relation to that person”. In short, the prospective provisions provide for the payment of maintenance charges by persons who are maintained in a hospital or home by a Health Board as long-stay patients, subject to the specified excepted categories. This liability may be alleviated by the discretionary power of the Chief Executive in individual cases of undue hardship.
Submissions of counsel assigned by the Court
Counsel assigned by the Court made a number of submissions impugning the compatibility with the Constitution of the foregoing provisions. The first issue concerned the imposition of any charges per se for maintenance on persons who receive such a service.
Counsel assigned by the Court firstly contended that if their arguments as to the existence of a constitutional right to care and maintenance by a Health Board of persons who are unable to look after themselves independently prevails then it would be unconstitutional to require those persons to pay any charge for the provision of that service irrespective of the means of those persons or their ability to pay for their maintenance. This argument was followed by the alternative proposition relied upon by counsel, namely, that in any event the provisions requiring the imposition of charges for such services should be considered repugnant to the Constitution in that they would unduly restrict a constitutional right of access to them by virtue of causing undue hardship to persons of limited means.
In their general argument on constitutionality counsel submitted that the provisions of the Bill which require the making of regulations to ensure the future imposition of charges on persons for in-patient services consisting of maintenance are repugnant to Article 40.3.1 and 2 of the Constitution. Although the Minister would be precluded by s. 53(3) (as inserted by s. 1 of the Bill) from imposing charges on certain categories of persons, the Bill requires him to impose charges for maintenance on all other persons receiving such services pursuant to s. 52 of the Health Act, 1970. These, it was submitted, are by definition, largely persons facing very considerable financial hardship and invariably include the elderly, and persons who suffer from physical or mental disability. It was submitted that the Constitution, and specifically the right to life and the right to bodily integrity of such persons as derived from Article 40.3.1º and 2º, imposes an obligation upon the State to provide at least a basic level of in-patient facilities to persons in need of care and maintenance who cannot provide for it themselves. It was also submitted that any charge on persons who are of such modest means as to qualify for the old age (non-contributory) pension, or to come within the definition of full eligibility pursuant to the Health Acts, would of itself be unconstitutional. In short, it was submitted, the class of persons thus affected evidently embraces the elderly, and those disabled by physical or mental conditions such as to require residential care. Any charge would be an undue financial burden on such persons and therefore would constitute a failure to vindicate their right to life and also their constitutional rights to bodily integrity on the one hand and their dignity as human persons on the other. Alternatively, it was argued that the charges actually provided for in s. 53(9) (as inserted by s. 1(b) of the Bill) would in any event cause undue hardship on the persons concerned so as to be in breach of their constitutional rights of the kind referred to.
In their submissions counsel assigned by the Court sought to derive from the right to life or the right to personal dignity as protected by Article 40.3.1 and 2 of the Constitution a constitutional right for those who are entitled to the services provided pursuant to s. 52 of the 1970 Act to maintenance in a home without the imposition of any charge or alternatively any unreasonable charge.
Article 40.3.1 states:
- “3.1 The State guarantees in its laws to respect, and, as far as practicable, by its laws to defend and vindicate the personal rights of the citizen.
2. The State shall, in particular, by its laws, protect as best it may from unjust attack and, in the case of injustice done, vindicate the life, person, good name and property rights of every citizen”
- “Every man has the right to life, to bodily integrity and to the means which are necessary and suitable for the proper development of life; these are primarily food, clothing, shelter, rest, medical care, and finally the necessary social services.”
Counsel assigned by the Court also submitted that the doctrine of the separation of powers according to which it was an exclusive function of the Oireachtas to determine the allocation of budgetary resources according to public policy priorities rather than the courts should not be considered as inhibiting the Court from finding the proposed imposition of charges as unconstitutional. It was submitted that the duty of the State to respect constitutional rights, as enforced by the courts, will often have, as a consequence, the expenditure of necessary funds to fulfil that obligation. The State cannot be spared from its duty to respect the rights in question on financial grounds alone.
Submissions of counsel for the Attorney General
Counsel for the Attorney General submitted that the extent of the State’s constitutional obligations did not go so far as to involve a constitutional obligation to maintain elderly or other long-stay patients. This was a matter to be dealt with by statute in accordance with public social policy. In support of their submissions counsel for the Attorney General also relied on judicial dicta in a range of cases including that of Keane C.J. in T.D. –v- Minister for Education [2001] 4 IR 259 where he called in question the formulation adopted by Kenny J. in Ryan –v- Attorney General [1965] IR 294] as to whether is was “an altogether satisfactory guide to the identification of such rights”. Counsel for the Attorney General also cited statements by the late Professor John Kelly to the same effect (Fundamental Rights in Irish Law and Constitution, Dublin, 1967, 44, 45). Counsel for the Attorney General also made reference to judicial dicta in T.D. –v- Minister for Education (cited above), Attorney General –v- Hamilton (No. 1) [1993] 2 IR 250 and Sinnott –v- Minister for Education [2001] 2 IR 545.
In the alternative, it was argued on behalf of the Attorney General that even if the persons concerned enjoyed the rights asserted by counsel assigned by the Court there can be no constitutional objection to a charge which is subject to an upper limit and which represents only a portion of the actual costs to the State of maintaining such patients. In addition it was submitted that the doctrine of the separation of powers, as accepted in the jurisprudence of this Court, recognised the constitutional competence of the Oireachtas to determine the allocation of resources in accordance with social and economic policies and that the exercise of its competence in this instance was not such as to infringe or subject to unjust attack any constitutional rights of those affected by these provisions of the Bill.
Conclusion on this issue
The extent to which care and maintenance is provided to persons affected by the Bill has not been put in issue. This is inevitable since the Bill does not purport to address that subject matter. What the Bill seeks to do is to lay down the terms, by way of the imposition of charges, upon which the services in question can be availed of. That is why the constitutional challenge presented by counsel assigned by the Court focuses, as they put it, on the ‘principle of charging’.
In a discrete case in particular circumstances an issue may well arise as to the extent to which the normal discretion of the Oireachtas in the distribution or spending of public monies could be constrained by a constitutional obligation to provide shelter and maintenance for those with exceptional needs. The Court does not consider it necessary to examine such an issue in the circumstances which arise from an examination of the Bill referred to it. Even assuming there is such a constitutional right to maintenance as advanced by counsel the question actually raised is whether the charges for which the Bill provides could be considered an impermissible restriction of any such right.
Subsection 9 of s. 53 of the Act of 1970, as inserted by s. 1(b) of the Bill, provides for the imposition of a charge at a weekly rate which shall not exceed 80% of the maximum of the weekly rate of the old age (non-contributory) pension within the meaning of the Social Welfare Acts.
Furthermore, subsection (4) of s. 53, as inserted by the Bill, provides that the Chief Executive Officer of a Health Board may reduce or waive a charge imposed on a person under the regulations if he or she is of the opinion that having regard to the financial circumstances of that person (including whether or not that person has dependents), it is necessary to do so in order to avoid undue financial hardship in relation to that person.
The first argument of counsel assigned by the Court was that persons entitled to in-patient services pursuant to s. 52(1) of the Act of 1970 had a constitutional right to receive such services, including any maintenance elements involved, free, irrespective of the means of such persons. In Sinnott –v- Minister for Education [2001] 2 IR 545, the Court had occasion to point out the unique feature of Article 42 in requiring the State to “provide for free primary education”. In using those terms the Constitution made free education an express characteristic of the right to primary education so that no charges can be imposed for it. It is not contended that there is any equivalent provision of the Constitution applying to the rights asserted by counsel. Persons who avail of in-patient services pursuant to s. 52 of the Act of 1970 and who have the means to pay for maintenance charges related to those services are not denied access to them. The Court does not consider that it could be an inherent characteristic of any right to such services that they be provided free regardless of the means of those receiving them.
The alternative argument of counsel assigned by the Court was that the charges actually provided for in the Bill would cause undue hardship to persons of limited means who have, for a range of reasons, a special need for maintenance by a Health Board in receiving in-patient services.
It is not in contention that the maximum proposed charge would be but a fraction of the total cost of maintenance of a person concerned. However, the real question is whether the charges as envisaged could be said to infringe or unduly restrict the constitutional rights asserted.
Although the Bill makes it mandatory for the Minister to impose charges, his discretion would appear to extend from a nominal charge to the maximum charge of 80% of the maximum old age (non-contributory) pension. It was clearly the intent of the Oireachtas that the power to impose such charges should not result generally in undue hardship to the classes of persons to whom they applied. That is reflected in the provision which grants a Chief Executive Officer the power to remit a charge in a case of individual undue hardship. Such a provision is only consistent with an intent that the charges themselves should not cause undue hardship as a general consequence for those persons who have to pay them. That is a policy aspect of the Bill.
It seems to the Court that it cannot be gainsaid, having regard to its well established jurisprudence, that it is for the Oireachtas in the first instance to determine the means and policies by which rights should be respected or vindicated. Counsel assigned by the Court are correct in submitting that the doctrine of the separation of powers, involving as it does respect for the powers of the various organs of State and specifically the power of the Oireachtas to make decisions on the allocation of resources, cannot in itself be a justification for the failure of the State to protect or vindicate a constitutional right. This of course begs the question as to whether the provisions in question involve such a failure.
In this instance the Oireachtas has been careful to insert into the Bill a cap on the maximum charge which the Minister can impose, as referred to above. In doing so it is clear that it sought to avoid causing undue hardship generally to persons who avail of the in-patient services. No doubt it could be said that the State could or should have been more generous, or less so with regard to persons of significant means, but that is the kind of debate which lies classically within the policy arena and is not a question of law. All the Court is concerned with is whether the charges are such that they would so restrict access to the services in question by persons of limited means as to constitute an infringement or denial of the rights asserted by counsel. In reaching its conclusion on this question the Court must also take into account the fact that such persons who avail of in-patient services involving maintenance as referred to in the Bill would otherwise have had to maintain themselves out of their own means when living outside the care of the Health Board. Furthermore, there is nothing before the Court from which it could conclude that the judgment of the Oireachtas that a charge capped at the level of 80% of the maximum of the weekly old age (non-contributory) pension would generally cause undue hardship or be an undue denial of access to the services in question. Certainly there may be individual cases where, due to personal circumstances, the charge concerned would involve undue hardship. But, as previously outlined, the Oireachtas has put in place a provision in the Bill (subsection 4 as inserted in s. 53) expressly providing for an administrative mechanism for the remission in whole or in part of such a charge by a Chief Executive Officer in order to avoid undue hardship.
Conclusion
Accordingly the Court concludes that a requirement to pay charges of the nature provided for in the Bill could not be considered as an infringement of the rights asserted by counsel.
Delegated Legislation
Counsel assigned by the Court raised two matters which they submitted constituted the delegation of law-making powers in a manner impermissible under the Constitution. These are the extent of the power conferred on the Minister to make regulations and the ambit of the discretion conferred on the Chief Executive Officer of a Health Board to mitigate charges payable under the regulations in individual cases. The judgment will summarise the respective submissions of counsel on each point before setting out the Court’s conclusions.
The Power to make Regulations
Counsel assigned by the Court submitted that s. 53(2) of the Act of 1970, as amended by the Bill, is repugnant to the Constitution because the Oireachtas failed to ensure that there were sufficient statutory guidelines, by way of principles and policies, contained in the Bill which could authorise the Minister to impose charges by way of delegated legislation. The subsection conferred too broad a discretion on the Minister and in the absence of such principles and policies constituted an impermissible delegation of law-making powers which are reserved, under the Constitution, to the Oireachtas. Counsel principally relied on Article 15.2.1 of the Constitution and the interpretation given to that provision by this Court in Cityview Press Ltd –v- An Chomhairle Oiliúna [1980] IR 381.
Article 15.2.1 provides:
- “The sole and exclusive power of making laws for the State is hereby vested in the Oireachtas; no other legislative authority has power to make laws for the State.”
In Cityview Press, O’Higgins C.J. observed as follows (p. 398):
- “The giving of powers to a designated Minister or subordinate body to make regulations or orders under a particular statute has been a feature of legislation for many years. The practice has obvious attractions in view of the complex, intricate and ever-changing situations which confront both the Legislature and the Executive in a modern State … Nevertheless, the ultimate responsibility rests with the Courts to ensure that constitutional safeguards remain, and that the exclusive authority of the National Parliament in the field of law-making is not eroded by a delegation of power which is neither contemplated nor permitted by the Constitution. In discharging that responsibility, the Courts will have regard to where and by what authority the law in question purports to have been made. In the view of this Court, the test is whether that which is challenged as an unauthorised delegation of parliamentary power is more than a mere giving effect to principles and policies which are contained in the statute itself. If it be, then it is not authorised; for such would constitute a purported exercise of legislative power by an authority which is not permitted to do so under the Constitution. On the other hand, if it be within the permitted limits - if the law is laid down in the statute and details only are filled in or completed by the designated Minister or subordinate body - there is no unauthorised delegation of legislative power.”
Counsel also referred to the decisions of this Court in Laurentiu –v- Minister for Justice, Equality and Law Reform & Anor [1999] 4 IR 26 and Leontjava –v- D.P.P. & Ors, Supreme Court, Unreported, 23rd June, 2004. It was submitted that
s. 53(2) of the Act of 1970 as amended by the Bill patently fails to provide any form of guidance to the Minister as to the circumstances in which the charges should be imposed, or what the level of those charges should be. It was acknowledged that the Minister’s power was circumscribed by the exclusion from such charges of certain categories of persons referred to in s. 53(3), as inserted by the Bill, and the imposition of a maximum level of charge as prescribed by the new s. 53(9). It was submitted that subject to these limitations the Minister is nonetheless completely at large as to the circumstances in which the charges are imposed.
Counsel for the Attorney General also relied on the same case-law and submitted that the Bill clearly articulated detailed principles and policies which amply satisfied the requirements of Article 15.2.1 in accordance with the test laid down in Cityview Press. Counsel for the Attorney General pointed out that s. 53, as amended by the Bill, sets out the circumstances in which the charge can be levied; the nature of the charge; the maximum amount of the charge; and the persons who are entirely exempt from the charge.
The Discretion of a Chief Executive
Counsel assigned by the Court also relied upon Article 15.2.1 and the judgment of this Court in Cityview Press as the basis for impugning the discretion conferred on a Chief Executive Officer of a Health Board pursuant to s. 53(4) of the Act of 1970 as inserted by the Bill whereby such an officer may reduce or waive a charge imposed on a person if he is of the opinion that, having regard to the financial circumstances of that person, it is necessary to do so in order to avoid undue financial hardship. It was submitted that the Oireachtas had failed to properly define in the Bill the scope of this power delegated to the Chief Executive Officer and failed to define the financial hardship situations which might warrant the exercise of his discretion to waive a charge. Accordingly the power delegated to the Chief Executive was impermissible and contrary to Article 15.2.1 of the Constitution.
In this regard counsel for the Attorney General submitted that the power conferred on the Chief Executive Officer was not a law-making power and therefore Article 15.2.1 had no bearing on the matter. The power conferred on the Chief Executive Officer was not one which required him to make decisions regarding the level of charges generally but simply to exercise a discretion in individual cases in order to avoid undue financial hardship. In any event, it was submitted that the criteria “undue financial hardship” was sufficient to meet the test laid down in Cityview Press.
Conclusion on these issues
The Court does not find that the foregoing submissions of counsel assigned by the Court are well-founded. First, as regards the power delegated to the Minister to make regulations imposing charges, it should be noted that the Oireachtas has limited the imposition of the charges to “in-patient services” only insofar as they consist of the maintenance of a person (s. 53(11)), which only becomes payable when the in-patient service has been provided to a person for “(a) a period of not less than 30 days, or (b) periods aggregating not less than 30 days within the previous 12 months”. This is further complemented by s. 53 (10) as inserted by the Bill, which provides that “a period of 30 days referred to in subsection (9) begins to run immediately the person concerned is provided with in-patient services, and irrespective of whether during all or any part of that period the charge referred to in that subsection is not payable by virtue of the operation of subsections (3) or (4)”. Moreover, the Oireachtas expressly excluded certain categories of persons in receipt of such services in the future from any liability for the payment of charges (s. 53(3) as inserted by the Bill). The Bill also specifies the manner in which the charge is to become payable, namely, as a weekly charge. More significantly, subsection (9)(d) of s. 53, as inserted by the Bill, limits the maximum weekly charge to 80% of the maximum of the weekly rate of the old age (non-contributory) pension. This in turn must be considered in the context that the Bill also provides for any such charge to be reduced or waived by the Chief Executive Officer should the imposition of a charge cause undue hardship in an individual case.
It is evident that one of the underlying policies of the charging provisions is that persons who are provided with maintenance in a home under the Health Acts are expected to make a contribution towards that maintenance from their own means, even if those means are of a limited nature such as the old age (non-contributory) pension. Persons being provided with long-stay maintenance in a hospital or a home would otherwise have been responsible for their day-to-day maintenance when living elsewhere on their own means. In authorising the Minister to impose charges on the specified category of persons the Oireachtas clearly intended that the resources of Health Boards would benefit so as to better enable them to provide the services in question while at the same time seeking to avoid doing so in a manner which would cause undue hardship. The discretion left to the Minister is limited as indicated by the matters referred to above but in particular by the maximum level of weekly charge which he can impose and by the policy that the charges should not in general cause undue hardship.
The level at which charges can be fixed by the Minister is narrow in scope ranging from a nominal charge to 80% of the pension referred to. It was clearly the intention of the Oireachtas that any charges would not cause undue hardship generally or in individual cases and no doubt this is why it fixed the maximum charge at 80% of the pension on a judgment that this in itself should not cause undue hardship. On the other hand, if, hypothetically, the real value of the said pension was to fall over time because, for example, its level failed to keep pace with the rate of inflation, the Minister would be bound to avoid imposing charges, even within the scope open to him, that caused undue hardship generally. That is, at least implicitly, the intention of the Bill. The Minister in fixing charges within the limited scope granted to him must take into account the twin policies of the Act of making resources available to the Health Board from those who can pay the charges for the service provided without undue hardship and avoiding any general effect of undue hardship (as distinct from undue hardship that may arise because of the special circumstances of an individual).
In these circumstances the Court is satisfied that the imposition of charges by the Minister pursuant to the section in question would be no more than the implementation of the principles and policies contained in the Act and the power delegated to him to make the regulations is compatible with the Constitution.
As regards the criticism made of the discretionary power conferred on the Chief Executive Officer to waive or reduce a charge in a case of individual hardship, the Court considers that counsel for the Attorney General were correct in pointing out that that does not constitute the exercise of a delegated power to legislate but rather is the exercise of a administrative discretion to address the particular circumstances of an individual case. When public officials are charged with administering a statutory scheme it may be difficult, if not impossible, for the Oireachtas to prescribe in legislation for every special circumstance of individuals who find themselves on the margins of such a scheme. In this instance the task of the administrator is to avoid undue hardship in individual cases in the general application of the scheme. That is simply an administrative function. A subsidiary argument of counsel assigned by the Court was that judicial review of the decision of a Chief Executive Officer in the exercise of such a discretion would not be an adequate remedy to a person who felt they had been wrongly refused a waiver or reduction of a charge. The Court does not accept this argument. The criterion (undue hardship) according to which the Chief Executive Officer should exercise his or her discretion is adequately set out in the Act and there is no reason to consider that an arbitrary decision or other unlawful misuse of his or her powers by a Chief Executive Officer could not be subject to judicial review in the ordinary way.
Accordingly the Court is satisfied that s. 1(a) of the Bill amending subsection 2 of s. 53 of the Health Act, 1970 and the provisions of s. 1(b) of the Bill which insert subsections (3), (4), (9), (10) and (11) (insofar as the latter subsection defines “in-patient services”) in s. 53 of the Act of 1970 are compatible with the Constitution.
Constitutional Issues concerning the Retrospective Provisions’
Legislative BackgroundThe provisions of the Bill which the Court now proposes to consider are those which have retrospective effect on the rights of certain persons under the provisions of the Health Act, 1970. For the purpose of considering the issues which arise concerning these provisions, the Bill has to be seen against the background of certain key provisions of the Health Act, 1970, especially Part IV. As already noted the amendments it proposes relate exclusively to s. 53. That section concerns only “in-patient services”. It is therefore relevant to recall, in the context of these retrospective provisions, the nature of those services, the obligations of the Health Boards to provide them, the persons to whom they are to be provided and the provisions regarding charging for their provision.
Section 51 of the Act of 1970 defines “in-patient services” as meaning “institutional services provided for persons while maintained in a hospital, convalescent home or home for persons suffering from physical or mental disability or in accommodation ancillary thereto”. “Institutional services” refers to that term as defined in s. 2 of the Health Act, 1947, as including:
- “ (a) maintenance in an institution,
(b) diagnosis, advice and treatment at an institution,
(c) appliances and medicines and other preparations,
(d) the use of special apparatus at an institution.”
These are the persons in respect of whom Part IV of the Act of 1970 imposed upon Health Boards obligations to provide services. Health Boards are obliged, pursuant to s. 52 of the Act of 1970 to “make available in-patient services for persons with full eligibility and persons with limited eligibility”.
However, s. 53(1) of the Act states that, subject to subsection (2), which permits such charges in respect of persons with limited eligibility, “charges shall not be made for in-patient services made available under s. 52”. Regulations have been made from time to time pursuant to s. 53(2). Clearly, they were not made and could not have been made in respect of persons having full eligibility.
The interpretation of these and related provisions came before Finlay P., as he then was, in 1975 in In Re Maud McInerney, a Ward of Court [1976-1977] ILRM 229. It appears clear from the context of this case that, as was suggested by counsel during the hearing, between the passing of the Act of 1970 and the decision in the McInerney case, the practice had been to charge patients in most institutions on the basis that they were in receipt of “institutional assistance”, within the meaning of s. 54 of the Health Act, 1953, a term which meant “shelter and maintenance in a county home or a similar institution”. The nub of the McInerney decision was that the ward was in receipt of more than mere shelter and maintenance, and that there was an element of medical care involved. Relying on both the fact that the place of the provision of the services, as envisaged by s. 51 of the Act of 1970 , is a hospital or one of the other essentially health-care institutions mentioned in that definition and that the ward would not come within the alternative section (s. 54 of the Health Act, 1953 regarding “institutional assistance”) unless she was in receipt of shelter and maintenance and nothing else, the learned President interpreted s. 53 of the Act of 1970 as applying wherever the patient is in receipt of any medical care over and above pure maintenance. This decision was upheld by this Court on 20th December, 1976.
It was common case in the submissions on the reference that the relevant provisions of the Act of 1970 as interpreted in McInerney considerably narrowed the grounds on which a charge could be raised for institutional assistance. In reality, geriatric or severely disabled patients are in need of both maintenance and medical services.
The sum total of these provisions is that, by the legislation of 1970, at least following its interpretation in McInerney, the Oireachtas required and has continued to require Health Boards, at all times prior to the passing of the Bill, to make in-patient services available without charge to all persons “suffering from physical or mental disability”. While the individual circumstances of patients will vary enormously in terms of age and physical and mental capacity, it is obvious that, by enacting the Act of 1970, the Oireachtas was concerned to ensure the provision of humane care for a category of persons who are in all or almost all cases those members of our society who, by reason of age, or of physical or mental infirmity, are unable to live independently. They are people who need care. Even without the benefit of statistical or other evidence, the Court can say that the great majority of these persons are likely to be advanced in years. Many will be sufferers from mental disability. While some will have the support of family and friends, many will be alone and without social or family support. Most materially, in a great number of cases, the patients will have been entitled to and in receipt of the non-contributory social welfare pension.
This was the position in law and in fact following the enactment of the Act of 1970. The Court has been informed that on 6th August, 1976, a date later than the High Court decision and earlier than the Supreme Court decision in McInerney, the Department of Health sent a circular letter to all Health Boards. The circular informed the Boards of the terms of the Health (Charges for in-patient services) Regulations, 1976. It pointed out that, by virtue of s. 53(2)(a) of the Act of 1970, these regulations did not relate to persons with full eligibility. It went on to state:
- “However, in this respect, the precise definition of a person with full eligibility in s. 45(1)(a) of the Act should be carefully noted. A person who, while he was providing for himself in his own home, was deemed to have full eligibility could be regarded as not coming within that definition when he is being maintained in an institution where the services being provided include medical and surgical services of a general practitioner kind, with consequential liability for charges under the regulations.”
It is accepted that, following Circular 7/76, Health Boards generally continued to charge patients with full eligibility for in-patient services. This may have involved the withdrawal of the relevant medical cards. The Court has been informed that the State was advised in 2004 that charges were imposed on a flawed legal basis, going back as far as 1976, on persons with full eligibility. The Attorney General has expressly accepted in his written submissions that since 1976, “there was no legal basis for imposing such charges on persons with full eligibility”. The Court must assume, therefore, given the purpose of the Bill, that charges were made in contravention of the terms of s. 53(1) of the Act of 1970.
At all events, s. 1 of the Health (Miscellaneous Provisions) Act, 2001 amended s. 45 of the Act of 1970 with the effect of placing beyond doubt any question of the legality of charging for the relevant services. That section inserted the following subsection into s. 45:
- “(5A) A person who is not less than 70 years of age and is ordinarily resident in the State shall have full eligibility for the services under this Part and, notwithstanding subsection (6), references in this Part to persons with full eligibility shall be construed as including references to such persons."
Patients’ Claims for Restitution
While the unlawful or ultra vires collection of charges from patients with full eligibility thus falls into two periods, it is not necessary for the Court, in dealing with this Reference, to maintain any distinction between them. It will assume, as is implicit in the Bill, that charges were unlawfully imposed and paid for a period as far back as 1976. The charges will, for ease of reference, be described as “unlawful charges”.
Counsel assigned by the Court have submitted that, pursuant to the modern law of restitution, patients are entitled to recover charges for in-patient services imposed by Health Boards without lawful authority and contrary to the express provisions of the Health Acts. Reference was made, in particular, to The Right Honourable The Lord Mayor, Aldermen and Burgesses of Dublin –v- Building and Allied Trades Union (hereinafter the Dublin Corporation case) [1996] 1 IR 468 and O’Rourke –v- Revenue Commissioners [1996] 2 IR 1.
Although it is not seriously disputed by the Attorney General that such payments are normally recoverable, it is necessary to consider the nature of any such claim before examining the effect upon them of the Bill and the applicable provisions of the Constitution.
In the Dublin Corporation case, compensation had been paid to the defendants for property compulsorily acquired by the plaintiff pursuant to statutory powers. Because compensation had been assessed at a figure relating to reinstatement cost rather than market value and the defendants had not spent the compensation monies on reinstatement, the plaintiff sought to recover those sums, claiming that the defendants had been unjustly enriched. Keane J., on behalf of a unanimous Supreme Court, while rejecting the plaintiff’s claim, accepted that “under our law, a person can in certain circumstances be obliged to effect restitution of money or other property to another where it would be unjust for him to retain the property.” He continued:
- “The modern authorities in this and other common law jurisdictions, of which Murphy –v- The Attorney General [1982] IR 241 is a leading Irish example have demonstrated that unjust enrichment exists as a distinctive legal concept, separate from both contract and tort, which in the words of Deane J. in the High Court of Australia in Pavey & Matthews Proprietary Ltd. –v- Paul (1987) 162 CLR 221:--
Keane J. distinguished between a case where similar payments were exacted from a taxpayer who paid under protest and the case before him, where the taxpayer acquiesced without protest. Accordingly, he did not consider that the payments had been required from him colore officii as in the case of Dolan –v- Neligan [1967] IR 247, which applied to the first situation. He reiterated that, in the instant case,
- “The money was clearly paid under a mistake of law, without any protest by the plaintiff and in circumstances where there was no specific element of compulsion or duress”
- “The tax overpaid by the plaintiff was recoverable as a matter of right.”
This Court is satisfied that our law recognizes a cause of action for restitution of money paid without lawful authority to a public authority. Material elements may be whether the money was demanded colore officii, whether it was paid under a mistake of law, whether the parties were of equal standing and resources, whether the money was paid under protest and whether it was received in good faith. The decision of this Court in Rogers –v- Louth County Council [1981] IR 265 may be relevant. It is not appropriate, in the context of the present reference, to expound the precise contours of that cause of action, in the absence of evidence of particular cases. It will be apparent that a large number of patients who paid unlawful charges enjoy such a cause of action.
For the purposes of applying these principles to the cases of the patients concerned with the effects of the Bill, the Court naturally does not have the benefit of evidence regarding the actual circumstances in which individual patients paid charges levied by Health Boards without lawful authority. It is in a position, nonetheless, to draw sufficient inferences from the legislative history and the common experience of all members of our society. While we were informed that some patients protested at having to pay charges, it seems highly unlikely that, having regard to the category of persons involved, this happened to any significant extent. The patients in question necessarily belong to the most vulnerable section of society. They are, for the most part old or very old; they are, in many cases, mentally or physically disabled; they are also, very largely, in poor financial circumstances. They are most unlikely to have been aware of the provisions of the Health Acts or their rights to services or the terms on which they are provided.
Both the relevant organs of State and the Health Boards, on the other hand, were fully informed of the terms of the Health Acts, including the applicable provisions for charging for services. The charges must be regarded as having been imposed as a result of considered decisions of responsible public officials in full consciousness of those provisions.
In any event it is clear that the Oireachtas has acknowledged the existence of such claims since the avowed purpose of the Bill is to deem the charges in question lawful so as to save the exchequer the cost of having to meet legitimate claims for their recovery. In short the retrospective provisions of the Bill are premised on the existence of a quantity of such valid claims.
The Court considers that patients with full eligibility from whom charges for in-patient services were demanded and who paid them were entitled, in the absence of some strong contrary indication, to recover those charges as of right, subject, of course, to any of the defences normally available in civil proceedings. That right was that species of personal property known as a chose in action.
The Retrospective Provisions
Against this background, it is necessary to recall the essence of the retrospective provisions of the Bill. The key provision of s. 1(b) of the Bill is the amendment of s. 53 of the Act of 1970 by the insertion of a new subsection (5) whereby “it is declared that the imposition of a relevant charge is, and always has been lawful”. This provision applies only to charges paid prior to the enactment of the Bill, since subsection (11) defines “relevant charge” as a charge:
- (a) imposed or purporting to be imposed under regulations made (or purporting to be made) under subsection (2), and
(b) paid at any time before the enactment of this subsection.”
It will be recalled that the subsection of the Act of 1970, there referred to, empowered the Minister to make regulations providing for the imposition of charges only in respect of persons with limited eligibility. Two points need to be made about the drafting objective of these provisions. Firstly, it would not have made any sense to say that charges imposed in the past on persons with full eligibility were, at the time, lawful. That would have been inconsistent with the direct prohibition in s. 53(1) of the Act of 1970 and, in effect, an attempt to rewrite the past. Secondly, therefore, subsection (5), (which by virtue of subsection (6) does not apply to proceedings commenced before14th December, 2004) read with subsection (11), proceeds on the basis that such charges as were imposed on such persons were received under the guise of regulations adopted under s. 53(2), i.e., on persons with limited eligibility. This was based on the apparent rationale of Circular 7/76, namely that patients with full eligibility somehow ceased to belong to that category once they were resident in an institution and in receipt of in-patient services. But, as has already been observed in this judgment, counsel for the Attorney General has accepted that charges were imposed unlawfully from and after 1976. Moreover, the Bill purports to apply to charges imposed on persons aged seventy and over, who became automatically persons with full eligibility following the entry into force of the Act of 2001.
In effect what subsection (5), in conjunction with subsections (6) and (11), purport to do, as and from the entry into force of the Bill, is to deem the combined imposition and payment of the unlawful charges concerned to be lawful, and always to have been lawful, for the purpose of enabling the State to successfully resist any claim brought after the 14th December, 2004 insofar as such a claim is for the recovery of the charges in question on the grounds that they had, at least from 1976, been unlawfully imposed.
It is, in any event, not contested by the Attorney General that the effect of the subsection is to prevent recovery of such charges paid by any persons who had full eligibility and from whom they were demanded without lawful authority at any time since the passing of the Act of 1970.
Subsection (5), being subject to subsection (6), does not “apply in the case of a relevant charge which is the subject of civil proceedings—
(a) instituted on or before 14 December 2004, and
(b) for recovery of the relevant charge.”
14th December, 2004 was the date of publication of the Bill. The Bill does not, therefore, claim to apply to any proceedings commenced before that date. The obvious purpose of the provision is to avoid any unconstitutionality which would arise from legislative interference with existing litigation, on the principle laid down by the judgment of the former Supreme Court in Buckley & Ors –v- Attorney General [Sinn Féin Funds] [1950] IR 67. It is also important to note that, although subsection (5) purports to declare all prior imposition of relevant charges to be lawful, it has that result only in respect of charges which were also actually paid. It does not apply to charges purportedly imposed on persons with full eligibility but not yet paid.
Subsection (7) provides that subsection (5) is “in addition to and not in derogation of, any other ground (whether under an enactment or rule of law) which may be raised in any civil proceedings referred to in subsection (6) to debar recovery of a relevant charge”. This provision refers principally to the possible reliance on a defence based on the Statute of Limitations. Insofar as subsection (5) has the effect of entirely barring the recovery of a relevant charge, there is little if any room for subsection (7) to have effect. Nonetheless, it appears to declare that any defence at law may be raised in the case of proceedings which are exempted from subsection (5) by subsection (6). For these reasons, no argument has been advanced suggesting that subsection (7) is repugnant to the Constitution.
The principal combined effect of the provisions of subsections (5), (6) and (11) is to debar the recovery of charges demanded of and paid by persons with full eligibility, without lawful authority. It extinguishes the property right of those persons, consisting of a chose in action. It also does so by means of what is accepted as being retrospective legislation.
Submissions
Counsel assigned by the Court have, in dealing with subsection (5) and its related provisions, concentrated principally on its retrospective character.
Article 15.5
That Article of the Constitution, provides that the Oireachtas shall not “declare acts to be infringements of the law which were not so at the date of their commission”. Counsel assigned by the Court accepted that, in principle, the Oireachtas has the competence to adopt legislation which validates actions which were unlawful at the time they were committed. It may not, however, make unlawful any act which was, when committed, lawful. Counsel assigned by the Court submitted that subsection (5) implicitly renders it retrospectively unlawful to have failed to pay charges whose payment is declared always to have been lawful. Non-payment of these charges was, at all relevant times after 1976 lawful but has now been rendered retrospectively unlawful. The Attorney General stressed that subsection (5) is worded so as to apply only to the “imposition and payment” of a charge and, thus, does not apply where for any reason a charge was not paid.
Article 15.2.1
Under that Article, the “sole and exclusive power of making laws for the State is vested in the Oireachtas”. The Oireachtas, by s. 53(1) of the Act of 1970, laid down a legislative policy that Health Boards could not impose charges for in-patient services on persons with full eligibility. Counsel assigned by the Court submitted that the Oireachtas does not have the power retrospectively to validate actions which, when they were committed, were in contravention of the law. Where the Minister had power, pursuant to s. 53(2), to adopt regulations imposing charges in relation to persons with limited eligibility, but this was expressly prohibited by s. 53(1) in the case of persons with full eligibility, he would be acting ultra vires and unconstitutionally, if he purported to adopt regulations of the latter type. He would have been performing a legislative function. This distinguishes the Bill from other types of curative or validating legislation. This was not a case of a mere technical deficiency or want of power but entailed a violation of a provision of an Act of the Oireachtas. Reliance was placed on the dictum of Walsh J. in Shelly v District Justice Mahon [1990] 1 IR 36 at p. 45 that “an unconstitutional procedure cannot subsequently be declared by the Oireachtas to have been constitutional”. Counsel for the Attorney General pointed to a number of express restrictions in the constitutional text on the legislative power of the Oireachtas but said that there was no basis for saying that there can be some additional unidentified but implied restriction of the type alleged. The Bill is a type of curative legislation of which many examples had been enacted by the Oireachtas of Saorstát Éireann and the framers of the Constitution must have been conscious of the possibility of that type of legislation at the time of adoption of the Constitution. Counsel relied on the statement of Keane C.J. in Director of Public Prosecutions –v- Leontjava, Supreme Court, Unreported, 23rd June, 2004, that “…the Constitution affords a strikingly wide latitude to the Oireachtas in adopting whatever form of legislation it considers appropriate in particular cases”. Counsel also cited Pine Valley Developments Limited & Ors –v- Minister for the Environment and the Attorney General [1987] IR 23. This part of the argument led to extensive citation of United States authorities. Counsel assigned by the Court relied upon: Forbes Pioneer Boat Line –v- Board of Commissioners of Everglades Drainage District (1922) 258 US 338; Graham –v- Goodcell (1931) 282 US 409; Washington National Arena Limited Partnership et al. -v- Treasurer, Prince George’s County, Maryland (1980) 410 A.2d 1060. The Attorney General relied principally on United States –v- Heinszen (1907) 206 US 370.
Article 43
Counsel assigned by the Court submitted that, assuming that the Oireachtas had power to enact retrospective legislation in contradiction of its existing declared legislative policy, the Bill, nonetheless, infringes Article 43 read together with Article 40.3.2 of the Constitution, because it adversely affects vested interests. The persons who wrongly paid charges have a legal right to recover the charges exacted from them. This constitutes a claim in debt which is, for example, assignable. It constitutes a constitutionally protected property right (O’Brien –v- Manufacturing Engineering Limited [1973] IR 334) as well as a right to litigate, though this distinction may not be material. Reference was also made to Moynihan –v- Greensmyth [1977] IR 55, to Foley –v- Irish Land Commission [1952] IR 118, O’Callaghan –v- Commissioners of Public Works [1985] ILRM 364, Dreher –v- Irish Land Commission [1984] ILRM 94 and to Attorney General –v- Southern Industrial Trust (1957) 94 ILTR 161. The effect of the Bill is to abolish the right in its entirety and without any compensation. Reference was made to Hamilton –v- Hamilton [1982] IR 466. It was pointed out that, in Re Article 26 of the Constitution and the Planning and Development Bill, 1999 [2000] 2 IR 321, Keane C.J. said (at p. 352):
- “There can be no doubt that a person who is compulsorily deprived of his or her property in the interests of the common good should normally be fully compensated at a level equivalent to at least the market value of the acquired property.”
The effect of the Bill is to abolish the property rights in question in their entirety without compensation. This is an “unjust attack” on those rights for the purposes of Article 40.3.2 of the Constitution. This Bill does not merely delimit such rights by law in the interests of the common good, as envisaged by Article 43.2.2 of the Constitution. There is no balancing of competing constitutional rights, as claimed by the Attorney General. The only justification advanced is the financial interest of the State. This is not a case such as Tuohy –v- Courtney [1994] 3 IR 1. The Attorney General argues that the Bill is justified in the interests of the common good and that, in particular, it is concerned to cure a lacuna in legislation. There was never a substantive constitutional right to receive in-patient services free of charge. At most there was a statutory right to receive a benefit. In correcting the problem that arose, when the illegality was discovered, the State was concerned to balance social and economic considerations. These are matters peculiarly within the competence of the Oireachtas, rather than the courts, and the Bill enjoys a heightened presumption of constitutionality.
Proportionality
Counsel assigned by the Court drew attention to the test of proportionality as explained in Heaney and McGuinness –v- Ireland [1994] 3 IR 593 and approved in Re Article 26 of the Constitution and the Employment Equality Bill, 1996 [1997] 2 IR 321. The elements necessary, where a restriction of a right is involved, as explained by Costello J. in the former case, at p. 607, are that the restrictions must:-
- “be rationally connected to the objective and not be arbitrary, unfair or based on irrational considerations;
impair the right as little as possible, and
be such that their effects on rights are proportional to the objective…… ”
Article 40.1
Counsel assigned by the Court submitted that the Bill would give effect in three respects to invidious discrimination which would be repugnant to Article 40.1 of the Constitution. Firstly, s. 53(5), by validating retrospectively the imposition of charges on those who had paid but not on those who, in identical circumstances, had not paid, the Bill would discriminate, without any rational basis, between persons in identical legal situations. Secondly, s. 53(6) would discriminate between those who had and had not instituted legal proceedings prior to 14th December, 2004. Thirdly, the same subsection would discriminate between persons who had instituted proceedings for the recovery of the charge and those who had instituted proceedings by way of judicial review or otherwise merely for a declaration that a charge had been invalidly imposed. It was submitted that there was no justifiable rational difference or distinction, legal or moral, between these categories of persons, who comprised a single class. Reference was made to the dictum of Barrington J. in Brennan –v- Attorney General [1983] ILRM 449 at p. 480, and approved in the judgment of the Court in Re Article 26 of the Constitution and the Employment Equality Bill, 1996 [1997] 2 IR 321 that “the classification [adopted by the Oireachtas] must be for a legitimate legislative purpose … it must be relevant to that purpose, and that each class must be treated fairly”. Counsel also referred to Dillane –v- Attorney General [1980] ILRM 167 at 169, O’B. –v- S. [1984] IR 316 at 335 and Quinn Supermarkets Ltd –v- Attorney General [1972] IR 1. Counsel assigned by the Court submits that it constitutes invidious discrimination to provide that those who paid are disadvantaged by not having their money back, whereas those who did not pay are privileged by being allowed to keep the money. Furthermore, s. 53(4), while empowering the Chief Executive Officer of a health board to reduce or waive a charge imposed for the future, does not apply to those who paid in the past. Counsel for the Attorney General submits that, in each of these cases, the distinction was such as the Oireachtas was entitled to adopt. The Court in Re Article 26 of the Constitution and the Employment Equality Bill, 1996 held at p. 346 that Article 40.1 of the Constitution, recognizes the “legitimacy of measures which place individuals in different categories for the purposes of the relevant legislation.” In Re Article 26 of the Constitution and the Planning and Development Bill, 1999 [2000] 2 IR 321 Keane C.J., delivering the judgment of the Court, said:
- “where classifications are made by the Oireachtas for a legitimate legislative purpose, are relevant to that purpose and treat each class fairly, they are not constitutionally invalid.”
Article 34
Counsel assigned by the Court submitted that the combined effect of subsections (5) and (6) is to enable proceedings commenced before 14th December, 2004, seeking recovery of a relevant charge to survive, but not proceedings for judicial review or declaratory relief, such as have been mentioned in the immediately preceding paragraph under the heading of alleged discrimination. Counsel for the Attorney General submitted that any such claims would be entirely moot and would not, if they existed, be entertained by any Court. If they were not designed to recover any charge, they would not serve any purpose. Thus the subsection would not interfere in any meaningful way with the administration of justice.
Submissions of Attorney General re Murphy –v- Attorney General
The Attorney General, in his defence of the Bill, relied in particular on the decision of this Court in Murphy –v- Attorney General [1982] IR 241. While it would not be true to characterize it as the sole basis put forward to justify interference with the constitutional property rights of patients affected by unlawful charges, it undoubtedly loomed large both in written submissions and at the hearing. In that case, the Court held to be unconstitutional certain provisions of the Income Tax Act, 1967, which provided that the income of married couples be aggregated, resulting in the imposition of tax on a married couple at a higher rate than would be imposed on two single persons in identical circumstances. Following the delivery of its judgment, the Court agreed to an exceptional procedure whereby it would pronounce on the future effects of the declaration. Although there were differences between the judgments and one dissenting judgment, it is accepted that the majority judgment was that of Henchy J., who posed, at p. 306, the specific question:
- “Where the plaintiffs have paid, or have had deducted from their earnings, income tax collected under statutory provisions which were subsequently declared unconstitutional, can they recover back such income tax. If so, to what extent? It is a question of profound importance, not only for the plaintiffs and similar taxpayers, and not only in terms of the fiscal arrangements and requirements of the State, but also in a wider context, for its resolution involves a consideration of the further question whether, and to what extent, what has been done pursuant to, or what has happened on foot of, an unconstitutional enactment may be revoked, annulled, rectified, or made the subject of a claim for damages or for some other form of legal redress.”
Following a detailed review of authorities, Henchy J. concluded that, other than the plaintiffs in the very action who had mounted the constitutional challenge, and in their case only for a limited period, no other taxpayers should be held entitled to recover taxes collected from them in reliance on the unconstitutional provisions. Counsel for the Attorney General accepted that the Murphy case related purely to the exercise of judicial power, but submitted that, in the constitutional order, it was equally logical for the legislature to have such a power. Counsel submitted that the Murphy decision applied to the collection of taxes from married couples pursuant to a statute which had been held to be repugnant to the Constitution and, hence, deemed to have been void ab initio, whereas the unlawful charges were collected under the Health Acts on an ultra vires, but not an unconstitutional, basis. Furthermore, the persons concerned had received benefits from the State. It was submitted that the Bill is rooted in almost identical policy considerations. It was submitted strongly that the Bill represented the policy determination of the executive and the two Houses of the Oireachtas, organs of government directly accountable to the People, in relation to the finances of the State. Council for the Attorney General relied on the decision of the Court of Human Rights in National Provincial Building Society & Ors –v- United Kingdom (cited above) in support of their submissions based on Murphy.
Counsel assigned by the Court distinguished Murphy. They pointed out, firstly, that Henchy J. (at p. 318) attached importance to the presumption of constitutionality which prevailed at all times when the relevant taxes were paid and that the State was entitled to rely upon it. In Murphy, the Court accepted that the taxes in question had been received bona fide by the State, whereas in the case of patients wrongly charged for in-patient services, there was no such presumption. The charges were imposed in circumstances of clear illegality and the Bill precludes any inquiry as to whether the charges were imposed in good faith.
Conclusions on several issues raised by Counsel
Before dealing with what the Court sees as the core issue concerning the constitutionality of the Bill, there are a number of questions which arise from the submissions of counsel on both sides which the Court considers convenient to address at this stage.
Article 15.5
The first of these issues is that raised by counsel assigned by the Court as to the meaning and the effect of Article 15.5 of the Constitution which restricts the Oireachtas from adopting legislation with a certain kind of retrospective effect.
Article 15.5 of the Constitution provides:
“The Oireachtas shall not declare acts to be infringements of the law which were not so at the date of their commission.”
US Cases: Restrictions on Curative Legislation
The next question concerns a proposition advanced by counsel assigned by the Court, which they conceded was rather novel, that, even under its general legislative power, and apart altogether from any injustice to persons with vested rights, the Oireachtas did not have power to adopt curative legislation purporting to validate past acts which were expressly prohibited by the legislation then in force. This contention is founded on certain United States case law. However, it is appropriate to consider, in the first instance, the provisions of the Constitution. Article 15.2.1 provides that:
- “The sole and exclusive power of making laws for the State is hereby vested in the Oireachtas: no other legislative authority has powers to make laws for the State.”
The Constitution itself, however, places a number of restrictions, express or implied, on the scope of the legislative power. Most importantly, Article 15.4.1 provides that:
- “The Oireachtas shall not enact any law which is in any respect repugnant to this Constitution or any provision thereof.”
Nonetheless, having recognized these clear constitutional limits, the consequence of the role of the Oireachtas as the sole and exclusive law-maker for the State means that, in principle, it may legislate on any subject. There is no subject-matter in respect of which it is incompetent to legislate. The Oireachtas is the parliament of a unitary state. The Constitution of a federation necessarily designates the respective competences of the federal government and its component states or provinces. Keane C.J., as already cited, stated, with the agreement of the other members of the Court, in Director of Public Prosecutions –v- Leontjava, Supreme Court, Unreported, 23rd June, 2004, that “…the Constitution affords a strikingly wide latitude to the Oireachtas in adopting whatever form of legislation it considers appropriate in particular cases”. He was speaking, in that case, of the form rather than the subject-matter of legislation. Nonetheless, his words are equally apt if considered in the latter context.
In deference to the careful arguments of counsel assigned by the Court, it is appropriate to consider the authority advanced for the proposition that, having regard to the legislative background and history, the legislative power should be so limited as to deprive the Oireachtas of the power to enact the Bill. It is convenient to refer to the first in time of the American cases. It is United States –v- Heinszen (1907) 206 US 370. The entire matter arose against the background of the Spanish-American War. The President of the United States, while the islands were under the military control of the United States during the war, in the exercise of executive power, made orders imposing tariffs on goods imported into the Philippines. These were valid and lawful. However, upon the ratification of the treaty of peace with Spain, the Philippines were no longer a foreign country and the tariffs, though they continued for a time to be collected, were unlawful. A validating statute was passed by Congress with retrospective effect. The Supreme Court upheld the validity of this curative act, principally on the basis of ratification of the unauthorised act of an agent. Forbes Pioneer Boat Line –v- Board of Commissioners of Everglades Drainage District (1922) 258 US 338 was decided in 1922. It concerned the unlawful collection of tolls for passage through a lock of the defendants’ canal. A retrospective Florida statute purported to validate the collection. Holmes J. distinguished Heinszen. He said:
- “But, generally, ratification of an act is not good if attempted at a time when the ratifying authority could not lawfully do the act………If we apply that principle this statute is invalid. For if the legislature of Florida had attempted to make the plaintiff pay in 1919 for passages through the lock of a canal which took place before 1917, without any promise of reward, there is nothing in the case as it stands to indicate that it could have done so any more effectively than it could have made a man pay a baker for a gratuitous deposit of rolls.”
Murphy –v- Attorney General
Finally, before considering what the Court considers to be the core constitutional issues, it is at this point appropriate to consider the extent to which the judgments of this Court in Murphy –v- Attorney General [1982] IR 241 may be considered to have a bearing on the constitutional issues which arise in respect of the provisions and on which counsel for the Attorney General relied so extensively in their submissions. In doing so the Court must give careful consideration, firstly, to the judgment of the majority of this Court pronounced by Henchy J. in Murphy –v- Attorney General. The circumstances in which that judgment came to be given were unusual if not unique in the history of this Court. On 25th January, 1980, the Court, on appeal from the judgment of Hamilton J., as he then was, gave judgment declaring ss. 192 to 198 of the Income Tax Act, 1967, to be repugnant to the Constitution. The appeal, being taken by the Attorney General, concerned only the issue of constitutionality. The plaintiffs had included in their proceedings a claim for accounts and inquiries as to the amounts of tax overpaid by them as a result of the impugned sections and their repayment. This had not been the subject-matter of the appeal. Following the delivery of judgment on 25th January, 1980, the Attorney General –not, be it noted, the plaintiffs—applied to be allowed to “speak to the minutes of the order”. His purpose was to ascertain the extent to which the plaintiffs could sustain their claim for accounts and inquiries. In reality, the concern of the State related to the extent to which it might be compelled to make repayments of overpaid tax to persons similarly situated. The Court, Henchy J. dissenting, agreed to hear this application. This procedure related only to the claim of the plaintiffs in Murphy. Although the decision had implications for other taxpayers, the Court did not formally rule on their cases. Apart from repeating his principled objection to this procedure, Henchy J. pointed out that “the facts had not yet been fully investigated”. Nonetheless, it is apparent from his judgment that the Court had at its disposal a significant amount of information about the amounts of tax paid by the plaintiffs, the extent of the impact on them of the impugned sections and the date when they first objected: see pp. 217 and 318. It may be observed that, in the present cases, the Court has no information at all about the circumstances or even the name of any patient who has paid the unlawfully imposed charges, which are purportedly retrospectively validated by the Bill.
It is necessary, however, to examine the judgment delivered by Henchy J. on the issue. It is of the first importance to observe that the judgment of Henchy J. is not authority for the proposition that persons from whom money has been unlawfully collected by the State, whether in the form of taxes or otherwise, are not entitled to recover those amounts. The contrary is the case, as appears at several points in the judgment. The consequence of a declaration that a law is repugnant to the Constitution is that (see p. 313): “from the date of its enactment the condemned provision will normally provide no legal justification for any acts done or left undone, or for transactions undertaken in pursuance of it; and the person damnified by the operation of the invalid provision will normally be accorded by the Courts all permitted and necessary redress;” and at p. 314 that “it is central to the due administration of justice in an ordered society that one of the primary concerns of the Courts should be to see that prejudice suffered at the hands of those who act without legal justification, where legal justification is required, shall not stand beyond the reach of corrective legal proceedings…;” at p. 316, referring to monies collected under the condemned sections: “Whether the action be framed at common law for money had and received or (as here) in equity for an account of money held as a constructive trustee for the plaintiffs, I would hold that, in the absence of countervailing circumstances (to which I shall presently refer), such money may be recovered;…” at p. 317, referring specifically to the plaintiffs claim: “Any one of such payments would normally be recoverable as money exacted colore officii, for the nature of PAYE collection of income tax is such that in the relevant period the plaintiffs' salaries were subject to compulsory deduction by their employers of the income tax which was exigible under the now condemned statutory provisions. The payments were, therefore, involuntary to the point of being compulsory collections.”
It is clear, therefore, that Henchy J. pronounced in favour of a general rule of recovery of amounts of money unlawfully collected by the State or State authorities. The Attorney General relies, of course, on his several statements, at p. 314, that this is “not a universal rule” and that there may be “transcendent considerations.” The same page contains the following passage:
- Over the centuries the law has come to recognize, in one degree or another that factors such as prescription (negative or positive), waiver, estoppel, laches, a statute of limitation, res judicata, or other matters (most of which may be grouped under the heading of public policy) may debar a person from obtaining redress in the courts for injury, pecuniary or otherwise, which would be justiciable and redressable if such considerations had not intervened.”
Henchy J. cited, at p. 319, a number of authorities from other jurisdictions suggesting that there may be circumstances in which full restitution would be inequitable. In particular, a New Zealand statute allowed relief to be refused in full or in part where monies have been received in good faith and the recipient has so altered his position as to render full restitution inequitable. The Bill, however, contains no provision for inquiry as to whether the charges were received in good faith. The claims are to be extinguished whether or not the monies were collected in good faith. In this connection, it is particularly material that, apart altogether from the express prohibition of charging contained in s. 53(1) of the Act of 1970, as and from 2001, all persons aged seventy or over were entitled by statute to be treated as having full eligibility regardless or means. Nonetheless, collection of charges continued. Counsel for the Attorney General frankly and rightly accepted at the hearing that there was no conceivable basis upon which anybody could reasonably have thought the charges could lawfully be levied or collected from persons aged seventy or over after that time. He also accepted the possibility that some such fully eligible persons had made protests. The Court is satisfied, accordingly, that the Murphy judgment offers no support for the Bill, insofar as reliance is placed on equitable principles relieving defendants from full restitution on the grounds of good faith.
It is also necessary to consider the precise grounds, set out at pp. 319 and 320, for refusing recovery to the plaintiffs in Murphy beyond the date upon which they had instituted their proceedings. Henchy J. commences by recalling the presumption of constitutionality, stating that it is beyond question that the State in its executive capacity received the moneys in question in good faith, in reliance on the presumption that the now condemned sections were favoured with constitutionality. Clearly, the unlawful collection of charges, at present under consideration, was not protected by any presumption, constitutional or otherwise. For the reasons mentioned in the preceding paragraph, the State is not in a position to rely on any presumption of good faith. This is not to say that monies were necessarily collected in bad faith. Rather, as already stated, the Bill permits no inquiry as to whether there was good or bad faith. The validation of the unlawful collection of charges is the very justification and sole reason for which the Oireachtas came to enact retrospective validating legislation.
Finally, it is necessary to consider the decision of the European Court of Human Rights in National Provincial Building Society & Ors –v- United Kingdom (1980) 25 EHRR 127 which counsel for the Attorney General cited, in effect, as being analogous to and in support of their reliance on the decision in Murphy –v- The Attorney General. That decision arose from a long and extremely complex history of tax legislation and attendant litigation in the courts of England and Wales and then at the European Court. In deference to the strong reliance placed upon it, it is necessary to explain its background. Building societies in England collect tax from their deposit-holders, which they remit to the Inland Revenue. For a number of years, there existed an extra-statutory arrangement under which the societies negotiated a composite tax rate (taking account of the varying tax rates applying to their customers) and paid over tax in each year by reference to a preceding equivalent period. Different societies used different reference periods. It was decided, in the mid-1980s, to place the entire system on a new statutory footing. This involved abandoning the preceding-year basis. As a result, there was a “gap period” between the old and the new periods for which tax was paid. Regulations were adopted, containing provisions to enable tax to be recovered for the “gap periods”. These were held to be invalid in the English courts, for what the UK Government told the European Court of Human Rights, and it accepted, were “purely technical” reasons, and which do not concern us. The Woolwich Building Society successfully brought proceedings for recovery of tax paid under the invalid regulations, coincidentally those already cited regarding the law of restitution. Parliament passed retrospective legislation validating the regulations and excluding any recovery claims other than those of the Woolwich. There was a large dispute between the societies and the UK Government as to whether the effect of this legislation was to impose double taxation on the societies or whether the effect of the invalidation of the legislation was to confer very large windfall gains on the societies. It is vital to a proper understanding of the decision of the European Court to note that it fully accepted the Government’s position. The Court found that the societies had deducted the tax for the gap periods from interest paid to their investors and that these amounts were lodged in their reserves. The Court said (para. 59):
- “It is an inescapable conclusion that had steps not been taken to bring those amounts into account in the move from the prior period system to the actual-year system, the applicant societies would have been left with considerable sums of money representing unpaid tax.”
The Court rejected the argument that there was double taxation. There was mere acceleration of payment. The Court accepted that the effect of the retrospective legislation was to deprive the applicant societies of the right to bring a claim of the same type as the Woolwich, but considered that these would be “opportunistic legal proceedings to exploit technical defects in the …Regulations and to frustrate the original intention of Parliament.” It also considered that the effect of not adopting the contested legislation would have been to allow the societies “to retain a windfall.” It is easy to see why the Court did not accept that the societies were suffering any unjust interference with their claims. Indeed, the Court declined to rule directly that these claims were “possessions” for the purposes of Article 1 of Protocol 1. By reason of the changeover of payments, there was a gap. The societies would have been allowed to retain amounts for tax that they had collected from their clients.
The Attorney General argued that the decision of the majority of this Court in Murphy supported by the reasoning of the European Court in National Provincial Building Society –v- United Kingdom provides justification for the Bill. In this connection, it is submitted that the patients received the services for which they were charged and that their right to free provision of the services was statutory and not constitutional. The Court does not find these arguments persuasive. At the time of their provision, the patients were entitled to have the services free of charge and the charges were imposed and money demanded unlawfully and contrary to the express provisions of the statute. The situation of the building societies in National Provincial Building Society is much more analogous to the case of Minister for Social, Community and Family Affairs –v- Scanlon [2001] IR 64 decided by this Court. The building societies could never, as a matter of justice, have been considered entitled to retain monies they had deducted for tax from their clients and not paid over to the Revenue. The Court, therefore, rejects the arguments of the Attorney General insofar as they are based on both Murphy and National Provincial Building Society.
Property Rights: Articles 40 and 43
Articles 40.3.2 and 43
The Court now turns to what it considers to be the core issues which arise from the submissions of counsel concerning the constitutionality of the Bill. These concern the nature of the existing rights of persons entitled to recover charges unlawfully paid and the justification of the State for delimiting those rights. In their submissions counsel assigned by the Court also argued that such legislation would be specially objectionable insofar as it purported to interfere with vested rights. They cited the judgment of O’Higgins C.J. in Hamilton v Hamilton [1982] IR 466 at 474:
- “Retrospective legislation, since it necessarily affects vested rights, has always been regarded as being prima facie unjust.”
- “The judicial authorities (which are mentioned in the judgment which the Chief Justice has just delivered) make clear that, because there is a presumption that a statute does not intend to operate unfairly, unjustly or oppressively by trenching on rights or obligations lawfully acquired or created before the statute came into force, it should be construed as prospective in its application and not retrospective, unless there is a clear and unambiguous intention to the contrary expressed, or necessarily implied, in the statute, or unless the change effected by the statute is purely procedural”.
These two statements concern only the approach of the common law to the interpretation of retrospective legislation. The topic was further considered by this Court in Minister for Social Welfare –v- Scanlon [2001] 1 IR 64. Fennelly J., speaking for a unanimous Court, referred to the need “to segregate the two issues, namely the correct approach to the interpretation of statutes with potential retrospective effect in accordance with common law principles and the interpretation of provisions with such effect in the light of the Constitution.” In the case of this Reference, it is not suggested that any particular issue of interpretation arises. It is acknowledged that subsection (5) has the retrospective effect of deeming the past collection and payment of charges to be lawful and that that will deprive the affected persons of the right to restitution. Indeed, that is its acknowledged purpose. The relevance of the Hamilton case is, therefore, its repetition of the presumption that retrospective legislation which affects vested rights is prima facie unjust. The relevance of the Scanlon case is that retrospective legislation is not necessarily unjust. In that case, the defendant had received disability benefits over a number of years, although he had been working during that time. At the time of payment of the benefits, there was no provision for their recovery. An amendment was introduced with retrospective effect. The constitutionality of the provision was not challenged, but it was submitted that it should, to be compatible with the Constitution, not be construed so as to have retrospective effect. This submission was rejected, except in one respect, on the ground that there was no identifiable constitutional right to retain benefits which had been wrongly obtained.
The nature of the property right enjoyed by patients affected by subsection (5) has already been analysed as being a chose in action. It is now necessary to consider the constitutional provisions protecting the rights of private property.
Under the heading, “Private Property” the Constitution contains the following Article:
1. 1° The State acknowledges that man, in virtue of his rational being, has the natural right, antecedent to positive law, to the private ownership of external goods.
2° The State accordingly guarantees to pass no law attempting to abolish the right of private ownership or the general right to transfer, bequeath, and inherit property.
2. 1° The State recognises, however, that the exercise of the rights mentioned in the foregoing provisions of this Article ought, in civil society, to be regulated by the principles of social justice.
2° The State, accordingly, may as occasion requires delimit by law the exercise of the said rights with a view to reconciling their exercise with the exigencies of the common good.
Article 40, s. 3 of the Constitution provides:
- 3. 1° The State guarantees in its laws to respect, and, as far as practicable, by its laws to defend and vindicate the personal rights of the citizen.
2° The State shall, in particular, by its laws protect as best it may from unjust attack and, in the case of injustice done, vindicate the life, person, good name, and property rights of every citizen.
- “Article 43 is headed by the words "private property." It defines… the attitude of the State to the concept of the private ownership of external goods and contains the State's acknowledgement that a natural right to such exists, antecedent to positive law, and that the State will not attempt to abolish this right or the associated right to transfer, bequeath and inherit property. The Article does, however, recognise that the State "may as occasion requires delimit by law the exercise of the said rights with a view to reconciling their exercise with the exigencies of the common good." It is an Article which prohibits the abolition of private property as an institution, but at the same time permits, in particular circumstances, the regulation of the exercise of that right and of the general right to transfer, bequeath and inherit property. In short, it is an Article directed to the State and to its attitude to these rights, which are declared to be antecedent to positive law. It does not deal with a citizen's right to a particular item of property, such as controlled premises. Such rights are dealt with in Article 40 under the heading "personal rights" and are specifically designated among the personal rights of citizens. Under Article 40 the State is bound, in its laws, to respect and as far as practicable to defend and vindicate the personal rights of citizens.
There exists, therefore, a double protection for the property rights of a citizen. As far as he is concerned, the State cannot abolish or attempt to abolish the right of private ownership as an institution or the general right to transfer, bequeath and inherit property. In addition, he has the further protection under Article 40 as to the exercise by him of his own property rights in particular items of property”.
- It is clear, particularly when the later decisions of the court are examined, that this approach cannot now be adopted without at least some reservations. It is no doubt the case that the individual citizen who challenges the constitutional validity of legislation which purports to delimit or regulate the property rights undertakes the burden of establishing that the legislation in question constitutes an unjust attack on those rights within the meaning of Article 40. It is also possible to envisage an extreme case in which the Oireachtas by some form of attainder legislation purported to confiscate the property of an individual citizen without any social justification whatever. In such a case, no inquiry would be called for as to whether the legislation also conformed to the requirements of Article 43. The challenge typically arises, however, as it has done here, in circumstances where the State contends that the legislation is required by the exigencies of the common good. In such cases, it is inevitable that there will be an inquiry as to whether, objectively viewed, it could be regarded as so required and as to whether the restrictions or delimitations effected of the property rights of individual citizens (including the plaintiff in cases other than references under Article 26) are reasonably proportionate to the ends sought to be achieved.
- That the provisions of Article 43 are relevant to the inquiry undertaken by the courts where they are considering a challenge to the constitutionality of legislation on the ground that it constitutes an unjust attack on the property rights of the citizen within the meaning of Article 40 was made clear in the subsequent decision of this court in Dreher –v- Irish Land Commission [1984] ILRM 94, which it will be necessary to consider at a later point.
In Tuohy –v- Courtney, [1994] 3 IR 1 this Court was concerned with a challenge to the constitutionality of a provision of the Statute of Limitations, 1957, proceeding, without necessarily deciding the point, on the basis that the right to litigate was a property right protected by the Constitution. It had been agreed that, “in legislating for time limits on the bringing of actions, [the Oireachtas] is essentially engaged in a balancing of constitutional rights and duties”. Finlay C.J., delivering the judgment of the Court, laid down a principle of general application when dealing with such legislation. He said, at p. 47:
- “What has to be balanced is the constitutional right of the plaintiff to litigate against two other contesting rights or duties, firstly, the constitutional right of the defendant in his property to be protected against unjust or burdensome claims and, secondly, the interest of the public constituting an interest or requirement of the common good which is involved in the avoidance of stale or delayed claims.
The Court is satisfied that in a challenge to the constitutional validity of any statute in the enactment of which the Oireachtas has been engaged in such a balancing function, the role of the courts is not to impose their view of the correct or desirable balance in substitution for the view of the legislature as displayed in their legislation but rather to determine from an objective stance whether the balance contained in the impugned legislation is so contrary to reason and fairness as to constitute an unjust attack on some individual's constitutional rights.”
The foregoing statement was followed by this Court in Iarnród Éireann & Anor –v- Ireland and the Attorney General [1996] 3 IR 321, a case concerning a challenge to the constitutionality of certain provisions of the Civil Liability Act, 1961, regarding concurrent wrongdoers, though the judgment of the Court is silent as to whether the rights of litigants in that context constituted property rights. Keane J., as he then was, had treated them as property rights in his High Court judgment. The same passage from Tuohy was applied by this Court in White –v- Dublin City Council [2004] 2 ILRM 509, also a case dealing with the constitutionality of a limitation period. Once more, the Court found it unnecessary, following the view of Finlay C.J., to determine whether the right to litigate constituted a property right. Implicit in the statement that there would be no material difference in the constitutional protection provided is the assumption that the Oireachtas may have been involved in deciding whether the principles of social justice required the regulation of the exercise of the property rights in question and whether their delimitation was therefore justified by the exigencies of the common good. Denham J., delivering the judgment of the Court, stated, at p. 531, that “striking a balance in the form of a limitation period is quintessentially a matter for the judgment of the legislator”. She went on to state that the passage from the judgment of Finlay C.J. “in effect restates………the presumption of constitutionality enjoyed by all acts of the Oireachtas”.
An important part of the analysis of justification for interference with constitutional property rights is the question of compensation. Reference has already been made to the statement of Keane C.J. in Re Article 26 of the Constitution and the Planning and Development Bill, 1999 [2000] 2 IR 321 (at p. 352):
- “There can be no doubt that a person who is compulsorily deprived of his or her property in the interests of the common good should normally be fully compensated at a level equivalent to at least the market value of the acquired property.”
For the purposes of its consideration of whether the Bill or any provision thereof is repugnant to the Constitution, the Court is satisfied that the correct approach is: firstly, to examine the nature of the property rights at issue; secondly, to consider whether the Bill consists of a regulation of those rights in accordance with principles of social justice and whether the Bill is required so as to delimit those rights in accordance with the exigencies of the common good; thirdly, in the light of its conclusions on these issues, to consider whether the Bill constitutes an unjust attack on those property rights.
According to the text of Article 43, the private ownership of external goods is a “natural right”. For that reason, it is “antecedent to positive law”. It inheres in man, “by virtue of his rational being.” The former Supreme Court, in Buckley –v- Attorney General [1950] IR 67 recalled that these rights had “been the subject of philosophical discussion for many centuries”. But it did say that the constitutional guarantee meant that “man by virtue, and as an attribute of, his human personality is so entitled to such a right that no positive law is competent to deprive him of it……” The right to the ownership of property has a moral quality which is intimately related to the humanity of each individual. It is also one of the pillars of the free and democratic society established under the Constitution. Owners of property must, however, in exercising their rights respect the rights of other members of society. Article 43.2.1, therefore, declares that these rights “ought, in civil society, to be regulated by the principles of social justice”. The property of persons of modest means must necessarily, in accordance with those principles, be deserving of particular protection, since any abridgement of the rights of such persons will normally be proportionately more severe in its effects.
For the reasons already given, the Court is satisfied that patients upon whom charges for in-patient services were unlawfully imposed from and after 1976 and, a fortiori, after 2001, and who paid those charges were entitled, as of right, to recover those charges. The actions for recovery could be based upon the law of restitution already discussed. They might be based on the modern approach to the recovery of money paid under a mistake of law (see Rogers –v- Louth County Council [1981] IR 265). The action might take the simple form of a claim for the repayment of money had and received to the use of the plaintiff or a claim in equity for a declaration that certain monies were held in trust. The form of the action is immaterial for present purposes. What is clear is that the patients had a property right consisting of a right of action to recover the monies. While the Attorney General has not seriously contested the existence of this form of right, counsel on his behalf have advanced some arguments designed to cast doubt upon it. Firstly, it was said that the right was a mere statutory right, the right to the free provision of services, a right susceptible of change or amendment. This, in the view of the Court, does not address the nature of the property right. Because the statutory right existed, patients were entitled to receive the relevant services free of charge. This right persisted so long as s. 53(1) of the Act of 1970 remained unchanged, as it did. Secondly, it was said that the patients had, in fact, received the services. The same response is appropriate. The services should have been supplied on the express legal basis that they were free of charge. The charging was unlawful. Thirdly, it is said that, in many cases, the beneficiaries of any recovery will be the relatives, often the distant relatives of the patients, who, in many cases are now deceased. This argument does not address the legal character of a property right. The right in question is assignable and will devolve on the estates of deceased persons. In any event, the Bill does not seek to establish any scheme for distinguishing between meritorious and unmeritorious beneficiaries of recoupment claims. All are treated in the same way.
In contrast to the approach taken by counsel for the Attorney General, as outlined in the preceding paragraph, counsel assigned by the Court relied on the views expressed by the European Court of Human Rights in Pressos Compania SA –v- Belgium (1995) 21 EHRR 301. That case concerned retrospective Belgian legislation concerning claims for damages by a number of ship-owners as a result of alleged negligence of Belgian pilots. The Belgian Government claimed that, as a result of a decision of the Cour de Cassation, it found itself exposed to enormous unforeseen damages claims. Belgium adopted a law exempting the Belgian Government from liability for the negligence of pilots, with retrospective effect. The applicants had existing claims. The Court held that the interference with existing claims to be “a deprivation of property within the meaning……” of Article 1 of Protocol 1. It noted that the justification was “the need to protect the State’s financial interests……” Dealing with the proportionality of the interference, the Court stated that “the taking of property without payment of an amount reasonably related to its value will normally constitute a disproportionate interference and a total lack of compensation can be considered justifiable……only in exceptional circumstances.” (para. 38). Responding to reliance on financial considerations, it stated:
- “Such considerations could not justify legislating with retrospective effect with the aim and consequence of depriving the applicants of their claim for compensation.
Such a fundamental interference with the applicants’ rights is inconsistent with preserving a fair balance between the interests at stake.”
While the Court does not rely on that case for its final conclusions, and although it has its own particular facts giving rise to issues to be resolved under the terms of the European Convention on Human Rights, it is nonetheless illustrative of the issues which can arise for courts when retrospective legislation affects the legal status of previous transactions.
As regards the issues arising in this Reference it bears repetition that the property rights to be abrogated in their entirety by the Bill belong to the most vulnerable members of society. While the extension of full eligibility to all aged seventy or over, regardless of means, in 2001 means that a number will not be of limited means, the reality is that a great many will still be among the poorest in our society. Whatever exceptions may exist, it is an undoubted fact that the Bill will affect very many people who are old, or poor or disabled, mentally or physically, or in many cases all of these. As already stated, persons so situated will almost certainly have had little or no capacity to understand their rights under the legislation or to protest at the unlawfulness of the charges. All of these elements will be relevant to a consideration of the grounds upon which the Attorney General justifies the legislation.
Although counsel for the Attorney General on occasions referred to the Bill as curative the Court does not consider that the Bill is simply a curative or remedial statute, insofar as its retrospective provisions are concerned. Curative statutes are those measures that will either ratify prior official conduct or make a remedial adjustment in an administrative scheme. They often are the result of previous court decisions which overrule certain administrative conduct. In these situations the legislature is simply correcting the statutory flaws or filling a gap in statutory authority which had not been considered necessary and which the Oireachtas could always have adopted. Curative statutes, in the classical sense, remove unintended flaws in existing legislation and help to give full effect to the legislative intent behind the initial or original legislation. It goes without saying that any such legislation must be in conformity with the Constitution but its purely curative or remedial nature is a factor to be taken into account in the consideration of any constitutional issue.
The situation which the Bill addresses is quite different. The original intent of the legislature is to be found in s. 53 of the Act of 1970, which expressly conferred on persons of full eligibility under the Health Acts the right to in-patient services without charge. In deeming the charges imposed contrary to the provisions of that section as lawful the Bill is not simply curative, since it goes directly contrary to the legislative intent of the initial legislation. It thereby seeks to alter the legal effect of completed transactions which had been conferred on them by an Act of the Oireachtas. This inevitably gives rise to considerations that differ from the simply curative or remedial legislation of the kind referred to above, particularly in respect of the rights of persons to recover monies paid for charges which were imposed on transactions contrary to the express intent of the Oireachtas.
Furthermore, for this reason it should be emphasised that it would be entirely inaccurate to characterise the recovery by persons of the monies which they paid in respect of the unlawful charges as anything in the nature of a windfall for such persons with a valid claim.
Justification Expense to the State
It is admittedly not possible to establish definitively the factual background to the legislation, although this judgment seeks to identify certain matters of fact on the basis of common sense. The basic proposition advanced on behalf of the State is clear and simple. It is that the cost to the exchequer of repaying all patients in the relevant category will be very great. It was not contended on behalf of the State that it is faced with a serious financial crisis. It was stated that, going back as far as 1976, some 275,000 patients would have received the relevant services. Taking into account the right of the State to limit its liability by reliance on the Statute of Limitations, it was said that the figure to be repaid for the past six years could be of the order of €500 million. Counsel assigned by the Court pointed out that the total budget for the health services for the current year is of the order of €11 billion, which was not contradicted by counsel for the Attorney General.
The Court accepts that, upon discovery of an unforeseen liability to reimburse patients in the relevant categories, the State may find itself faced with a significant additional financial burden. However, while it is the opinion of the Court that the financial burden on the State of making the relevant repayments is a substantial one, it is by no means clear that it can be described as anything like catastrophic or indeed that it is beyond the means of the State to make provision for this liability within the scope of normal budgetary management.
Counsel for the Attorney General has submitted, in reliance especially on Article 43 of the Constitution and of the judgment of this Court in Tuohy –v- Courtney [1994] 3 IR 1 that the Oireachtas, in enacting the Bill, was engaged in balancing complex economic and social considerations, a matter classically within legislative rather than judicial competence. Accordingly, the Court should be extremely slow to intervene. It should be recalled also that Keane C.J. wrote to similar effect in Re Article 26 of the Constitution and the Planning and Development Bill, 1999 [2000] 2 IR 321 where, speaking of the presumption of constitutionality, he said at p. 358:
- “It is peculiarly the province of the Oireachtas to seek to reconcile in this area the conflicting rights of different sections of society and that clearly places a heavy onus on those who assert that the manner in which they have sought to reconcile those conflicting rights is in breach of the guarantee of equality.”
In considering that argument, it is of prime importance to consider the extent of the interference with property rights proposed by the Bill. What it proposes is the extinction of the rights in question. All patients, from whom charges have been unlawfully collected, regardless of their circumstances, are simply to be deprived of any right to recover sums lawfully due to them. No relief against this effect is provided, discretionary or otherwise, in the Bill, though the Court was informed of the discretionary decision of the State to make ex gratia payments of €2,000 each to some 20,000 people. The absence of compensation is, in reality, the object of the legislation. This aspect of the case law is not, therefore, particularly relevant, except to show the exceptional nature of these aspects of the Bill.
In the view of the Court, such legislation cannot be regarded as “regulating” the exercise of property rights. It is straining the meaning of the reference in Article 43.2.1 of the Constitution to the “principles of social justice” to extend it to the expropriation of property solely in the financial interests of the State. This is not at all the type of balancing legislation which was in contemplation in Tuohy –v- Courtney, White –v- Dublin City Council [2004] 2 ILRM 509 or Iarnród Éireann & Anor –v- Ireland and the Attorney General [1996] 3 IR 321. All of these cases concerned legislation designed to reconcile the interests of different categories of people in society. The case of the Planning Bill, 1999 might be thought to present an alternative case of such reconciliation. However, that Bill was not designed to protect the financial interests of the State, but rather to provide land for housing for social reasons. Furthermore, there was provision for compensation. The Court does not exclude the possibility that, in certain cases, the delimitation of property rights may be undertaken in the interests of general public policy. However, the invocation of these Articles in circumstances where rights such as arise in this case, rights very largely of persons of modest means, are to be extinguished in the sole interests of the State’s finances would require extraordinary circumstances.
Moreover, it is evident from the terms of the Bill and the submissions on behalf of the Attorney General, that the persons who are affected by its retrospective provision are being required by the Bill to bear the consequential burden of the unlawful charges in order to protect the exchequer generally, or the health budget in particular, from that burden. The rationale for so doing, according to the submissions of the Attorney General, is that these were persons who actually benefited from the services in question. The Court does not accept this as a rational basis for requiring that class of person to bear the burden of the ultimate cost of the charges which were unlawfully imposed on them. Those persons are in no different position from all other persons who enjoyed a whole range of free statutory services or benefits under the Health Acts. The fact that they received a service to which they were freely entitled by statute is not a distinguishing feature. Their only distinguishing feature is that they were unlawfully charged for the service.
It is, in effect, for this reason that their property rights are being abrogated.
Where a statutory measure abrogates a property right, as this Bill does, and the State seeks to justify it by reference to the interests of the common good or those of general public policy involving matters of finance alone, such a measure, if capable of justification, could only be justified as an objective imperative for the purpose of avoiding an extreme financial crisis or a fundamental disequilibrium in public finances.
Having regard to the terms of the Bill and taking into account all of the submissions of counsel, nothing has emerged in the course of the Reference from which the Court could conclude that the abrogation of the property rights in question is an imperative for the avoidance of an extreme financial crisis or a fundamental disequilibrium in public finances.
For the reasons set out above the Court is satisfied that subsection (5) and the associated provisions of the Bill constitute an abrogation of property rights and an unjust attack on them contrary to the provisions of the Constitution and in particular Articles 43 and 40.3.2..
Having regard to the conclusion expressed in the immediately preceding paragraph, it is unnecessary to consider any argument based on the principle of proportionality. It is also not necessary to consider the arguments related to Article 40.1 and Article 34. The Court does not consider that any issue arises concerning subsection (8) of s. 53 of the Act of 1970 as inserted by s. 1(b) of the Bill.
Decision of the Court pursuant to Article 26
The prospective provisions of the Bill, that is to say those provisions which require the imposition of charges for in-patient services to be provided in the future, concern matters for which the Oireachtas has power to legislate. The power to regulate and impose such charges delegated to the Minister by s. 1(a) of the Bill falls within the principles and policies of the Bill and, in the view of the Court, is compatible with Article 15.2.1 of the Constitution. Having regard to the maximum level of charges and the discretionary provision concerning the imposition of charges in individual cases, the Court does not consider that those charges, either in principle or in themselves, could be considered an infringement of any constitutional right.The retrospective provisions of the Bill are those which abrogate the right of persons, otherwise entitled to do so, to recover monies for charges unlawfully imposed upon them in the past for the provision of certain in-patient services.
The practice which gave rise to the imposition of such charges was not one which was followed simply in the absence of lawful authority but was one which was contrary to the express provisions of s. 53(1) of the Health Act, 1970 by virtue of which the Oireachtas has decreed that the in-patient services in question be provided without charge. The recovery of such monies thus unlawfully charged by those entitled to do so could not properly be characterised as a ‘windfall’.
The Court considers that the right to recover monies for the charges thus imposed is a property right of the persons concerned which is protected by Articles 43 and 40.3.2 of the Constitution from, inter alia, unjust attack by the State.
The Constitution, in protecting property rights, does not encompass only property rights which are of great value. It protects such rights even when they are of modest value and in particular, as in this case, where the persons affected are among the more vulnerable sections of society and might more readily be exposed to the risk of unjust attack.
For the reasons expressed in this judgment the Court has decided that the retrospective provisions of the Bill contained in s. 1(b) which provide for the insertion of subsections (5), (6) and (7), and subsection (11) insofar as it defines “relevant charge”, in s. 53 of the Act of 1970, are repugnant to the Constitution and in particular Articles 43 and 40.3.2 thereof.