Francis Shortt (plaintiff) v Commissioner of An Garda Síochána, Ireland and the Attorney General (defendants)
Tort - Miscarriage of justice - Malicious prosecution - Causation - Remoteness of damages - Damages - Assessment - Principles to be applied - Classification - Aggravated damages - Whether grounds for award of aggravated damages encompassed by award of general damages under statutory scheme for miscarriage of justice - Exemplary damages - Criminal Procedure Act 1993, sections 2 and 9.
The High Court (Mr Justice Finnegan, President of the High Court); judgment delivered October 12th, 2005.
The plaintiff had established the required factual nexus between his malicious prosecution by the Gardaí and conviction therefor and the damage suffered by him, including loss of liberty and reputation, stress and other mental and physical injury, financial loss arising from a fire and the receivership of his premises which satisfied the test of causation. That whilst grounds for awarding aggravated damages existed, they were encompassed by the award of general damages made under the Criminal Procedure Act 1993 as it was intended to take account of injury to feelings, loss of dignity and humiliation, frustration and helplessness and despair, including despair at the failure of the criminal justice system.
Mr Justice Finnegan so held in awarding the plaintiff €1,923,871 in damages.
Eoin McGonigal SC, Brian O'Moore SC, Hugh Mohan SC and Desmond Murphy BL for the plaintiff; Edmund Comyn SC, Shane Murphy SC, Paul Burns SC and Douglas Clarke BL for the defendants.
Mr Justice Finnegan said that the plaintiff was convicted of permitting drug dealing on his premises, the Point Inn, Co Donegal, between June and August 1992 and imprisoned for 27 months.
The plaintiff applied to the Court of Criminal Appeal under section 2 of the Criminal Procedure Act 1993, which provides for an application by a convicted person on the grounds that a new or newly-discovered fact shows that there has been a miscarriage of justice in relation to his conviction. His conviction was quashed on that basis. The Court of Criminal Appeal certified, pursuant to section 9(1) of the Act of 1993, that a newly-discovered fact showed that there had been a miscarriage of justice. The plaintiff then had the option, under section 2 (2) of the Act, of applying to the Minister for compensation or of instituting an action for damages arising out of the conviction. The plaintiff opted to institute an action for damages.
As the parties were in agreement that the court should assess damages pursuant to section 9 (2) of the Act of 1993 in respect of the period commencing on the date on which the plaintiff was charged on October 1st, 2002, Mr Justice Finnegan did so. He also, as agreed between the parties, adopted the approach in R. (O'Brien) v. Independent Assessor (Court of Appeal, July 29th, 2004) of making a single award of damages rather than breaking the same down into a number of discrete heads of award in respect of various headings of claim which could be maintained at common law. The plaintiff claimed further or in the alternative damages for breach of constitutional rights, for conspiracy, for negligence and breach of duty, for malicious prosecution, for false imprisonment, for loss of reputation including, but not confined to damages for libel and slander and damages for deliberate and conscious abuse of statutory power.
Mr Justice Finnegan proposed not making awards under any of those headings in respect of anything which occurred after the plaintiff was charged, notwithstanding that the evidence would entitle a claim on all or any of such basis to succeed in the alternative to the claim under section 9. He would, however, have regard by analogy to the common law in relation to such claims, insofar as the plaintiff claimed damages and aggravated and/or exemplary damages in respect of his claim under section 9, upon the basis that the parties were in agreement that he should do so.
The defendant accepted that the matter should proceed as an assessment, the issues being causation and remoteness of damage.
Reviewing the plaintiff's evidence, Mr Justice Finnegan said that the plaintiff took control of the Point Inn in 1991 and renovated it with the aid of a mortgage on his family home and obtained planning permission for a caravan park across the road from the Point Inn. On the opening night, the nightclub was visited by Sgt McPhillips of the local Garda station. On leaving the premises he told the plaintiff "Get your house in order".
Arising out of this, the plaintiff met with the Garda officer in charge of the district who agreed to look into the events of the opening night. No mention of illegal drugs was made in the course of that meeting.
On May 17th, 1992, the plaintiff wrote to Sgt McPhillips complaining of victimisation and discrimination. After the premises closed, the Gardaí returned to carry out a further inspection looking for illegal drugs. No trace of illegal drugs was found. Thereafter on each night that the nightclub operated until August 3rd/4th, 1992, undercover Gardaí attended at the premises.
The plaintiff sent a further letter to Supt Kenny complaining that other nightclubs in the area were not being subjected to the same level of supervision. Shortly thereafter the plaintiff was served with 32 summonses which alleged that he knowingly allowed the dealing of drugs on his premises.
At this time threats to the plaintiff's life were made by the IRA and he closed the premises on a couple of occasions. The plaintiff's belief was that those threats arose as a result of adverse publicity following the Garda raids. In February, 1993, the plaintiff elected for a trial before a jury in the Circuit Court.
At this point, counsel for the plaintiff referred to the judgment of Hardiman J. delivered on July 31st, 2002, on the application for a certificate pursuant to section 9(1) of the Criminal Procedure Act 1993 and in particular to those passages dealing with newly discovered material.
The Court of Criminal Appeal found that the second statement of Det Garda McMahon, which was relied on at the trial, was false and that his first statement which had been suppressed was inconsistent with a significant aspect of his other evidence and that a miscarriage of justice had occurred.
Reverting to the evidence, Mr Justice Finnegan noted that after the first trial aborted the plaintiff decided to sell the Point Inn. Gardaí continued to attend at the premises and this affected the business and there was a real risk that the licences might not be renewed. He intended to retain the caravan park which was then under construction.
The asking price for the Point Inn was £500,000. While there was interest, no sale was concluded and the plaintiff believed this to be because prospective purchasers were awaiting the outcome of the trial in the belief that the premises could be obtained at a lesser price if he should be convicted. However, on March 26th, 1995, the Point Inn was destroyed by fire.
A receiver was appointed over the Point Inn and the caravan park by the International Fund for Ireland in September 1995. The Fund had approved the plaintiff for a grant of £221,000, which was secured by a charge on the premises, £75,000 of which was paid to him. The receiver sold the Point Inn in its fire-damaged state and the caravan park for £152,000. The indebtedness to the International Fund for Ireland and secured creditors and the costs and expenses of the receiver were discharged, leaving nothing for the plaintiff.
The plaintiff then dealt with his claim for special damages which were claimed under four headings: (1) loss of earnings from the Point Inn; (2) loss of capital value of the Point Inn; (3) loss of capital value of the campsite; and (4) loss of future earnings.
Had he not been imprisoned he would have expected an annual profit of £150,000 from the premises. Because of the plaintiff'sconviction, the development of the caravan park did not proceed further. Had he been able to complete the development of the caravan park, his intention was to run it for some two to three years and sell the permanent sites to caravan owners.
A number of suppliers registered judgment mortgages against the plaintiff's property which were discharged by the receiver out of the proceeds of sale of the Point Inn and the caravan park. The plaintiff also claimed the sum of £10,000 which he paid for legal fees in respect of his first trial.
Mr Justice Finnegan accepted the plaintiff's factual account as to what occurred and the effect upon him of his being charged, of his abortive trial, his trial and his imprisonment and the situation which he faced. He was of the view that insofar as the plaintiff had not yet been vindicated in the eyes of the community, the award of damages in this action would fully vindicate him and did not propose making an award of general damages into the future.
The defence essentially confined itself to arguments on causation and remoteness of damage and quantum in relation to special damages. Thus it was argued that the defendant was not liable in respect of the fire at the Point Inn and the consequences of the same, the receivership and its consequences.
Mr Justice Finnegan was satisfied that the plaintiff had established causation, that is the required factual nexus between the events of which he complained, principally his conviction, and the closing of the Point Inn and the fire there and its sale together with the caravan park by the receiver. The Gardaí certified the fire as subversive, which satisfied the court that it occurred due to a perception that the plaintiff was involved in drug dealing. The plaintiff had received threats from the IRA which, as a matter of probability, satisfied the court that the threat was ultimately carried out in terms of the burning down of the premises, the conviction being the proximate cause.
The fire and the receivership occurred at a time when the plaintiff was in prison. Were he not in prison, if on the basis of delay in carrying out the caravan park development, the International Fund for Ireland had sought to recover the grant, Mr Justice Finnegan was satisfied that the plaintiff could have satisfied their claim by raising a mortgage on his family home, in which event the receivership would not have occurred, and, as a matter of probability, the plaintiff's entire enterprise would not have collapsed and, accordingly those losses were foreseeable. The evidence of accountants for both parties was confined to one element of quantum, namely the loss of net profits of the Point Inn. They were effectively ad idem and, on the basis of the same, the court assessed this loss at €550,000.
Mr Justice Finnegan ascribed a value to the caravan park as of the date of hearing of €350,000.
Taking into account that he was not satisfied that had the plaintiff continued to operate the licensed premises that he would have developed it in the same manner, or to the like extent, as it developed under the purchaser and, insofar as stigma was concerned, that the existence of two endorsements would not concern a purchaser as these would be removed from the licence upon transfer to him, he ascribed a value to the Point Inn at today's date of €700,000. However, in awarding damages, he was satisfied that it was appropriate to deduct from that sum the amount of the malicious injury award of €126,974. In addition, the plaintiff received a benefit from the proceeds of the receiver's sale as follows: (i) repayment of grant to International Fund for Ireland: €95,250; (ii) payment of creditors: €21,555 which had to be deducted in arriving at the loss to the plaintiff. In those circumstances, damages flowing from the loss of the Point Inn and the caravan park were calculated as €806,221.
The claim at common law was in relation to events which occurred prior to the plaintiff being charged as of October 1st, 1992. They could be summarised as follows: 1. The attendance at the Point Inn on April 18th, 1992, of Sgt McPhillips and his regular attendances thereafter with a small number of gardaí to inspect the same; 2. roadblocks on the road from Derry to the Point Inn on two occasions; 3. the raid on the plaintiff's premises on the night of the 3rd/4th August, 1992, by a large number of gardaí and their conduct in the course of such raid.
There were a number of matters which Mr Justice Finnegan considered relevant in this assessment. When the plaintiff reopened his premises as the Dungeon on April 18th, 1992, it already had a licensing history. There were two endorsements arising out of sales after hours.
The plaintiff admitted that at times he had not obtained a special exemption order, but nonetheless carried on business after ordinary licensing hours. He was therefore satisfied that the attendances by gardaí on the premises were appropriate to ensure compliance with the licensing laws. While subsequent events might raise a suspicion that the attendances were otherwise motivated, he was not satisfied, as a matter of probability, that this was so.
With regard to the two roadblocks of which he heard evidence he was not satisfied that these were directed otherwise than at persons who intended to attend at the plaintiff's premises.
The first such roadblock occurred on June 7th, 1992, after the plaintiff's premises had reopened as the Rave in the Cave.
While he was satisfied that the plaintiff had no knowledge at that time of the connotation of "rave", that word had a connotation with drug use. For this reason, he was not satisfied that the setting up of these two roadblocks was motivated by any improper purpose: it may equally have been a legitimate exercise on the part of the gardaí to prevent the sale or consumption of drugs on the premises, there being a legitimate concern that the name of the premises might attract persons intent on supplying or consuming drugs.
Finally, with regard to the night of the 3rd/4th August, 2002, this was a search carried out pursuant to a search warrant. The effect of the evidence was that if such an operation was to be successful an element of surprise was necessary, and it was necessary in effect to saturate the premises with gardaí so as to prevent persons in possession of drugs disposing of the same in the toilets or on the floor. On the evidence, the court was not satisfied that the Garda operation was an abuse of the powers conferred by the search warrant, and it awarded damages of €5,000 in respect of the same under the heading of breach of constitutional rights as general damages.
Mr Justice Finnegan then dealt with the claim under section 9(1) of the Criminal Procedure Act 1993. In terms of general damages, he regarded the claim for the purposes of assessing damages as analogous to one for defamation, and accordingly the dicta of the Supreme Court in De Rossa v Independent Newspapers plc 4 IR 432 was deemed relevant. Thus, he said it was not necessarily appropriate in arriving at an award to have regard to the level of damages for personal injury and the award should be sufficient to operate as a vindication of the plaintiff to the public in general and, in particular, to the community in which he lives.
The court should make an overall award which, whilst having regard to the level of awards made in respect of the several torts comprised in the claim, reflects the wrong suffered by the plaintiff. The major elements in the account given by the plaintiff for which he required to be compensated were: the stressful effect upon the him of being charged, tried, convicted and imprisoned; the 27 months for which he was in prison; the effect upon him physically and mentally and in terms of personal injury of his imprisonment; his exclusion from family life; the effect upon his reputation and standing in his community, taking the view that the award in this case would finally vindicate the plaintiff; the plaintiff's membership of the Chartered Institute of Accountants being under threat; the age of the plaintiff when the events commenced, and his suffering having spanned a period of 12 years.
Taking all those circumstances into account, Mr Justice Finnegan awarded the plaintiff €500,000 general damages under the Act of 1993. Assessing the claim for aggravated and exemplary damages under the Act of 1993, Mr Justice Finnegan said that both aggravated and exemplary damages are awarded in respect of the external circumstances accompanying the cause of action.
The former are measured on the basis of compensation and represent additional compensation to a plaintiff where his sense of injury is heightened by the manner in which, or the motive for which, the act giving rise to the claim was committed. Such damages represent a recognition of the added hurt or insult to a plaintiff who has been wronged and a recognition of the cavalier or outrageous conduct of the defendant. Having regard to the evidence adduced on the application for a certificate pursuant to section 9(1) of the Act of 1993, Mr Justice Finnegan said that the plaintiff was sacrificed to assist the career ambitions of members of the Garda. However, the court had to ensure that there was no element of double compensation.
The award of general damages by analogy to the common law was intended to take account of injury to feelings, loss of dignity, humiliation, frustration, helplessness and despair including, in the case of a claim under the 1993 Act, despair at the failure of the criminal justice system.
In those circumstances, he did not make an award under the heading of aggravated damages.
As to exemplary damages, Mr Justice Finnegan said that their aim was to punish the defendant and to deter the defendant and others from engaging in conduct that is malicious or socially harmful. An exemplary damages award may also be intended to vindicate the rights of the plaintiff, or to vindicate the strength of the law. In the context of the Constitution, the particular purpose of exemplary damages was to vindicate and defend individual constitutional rights, to punish the defendant's disregard of them and to deter their breach. He said that while an argument existed as to the rationality of awarding exemplary damages where liability is vicarious, the Supreme Court had no difficulty in making such an award in McIntyre v. Lewis 1 IR 121. In the circumstances of this case, there was an outrageous abuse of power by the gardaí involved. Planted and perjured evidence was relied upon.
It had not been expected by them that the plaintiff would be sent to prison, but when he was, they took no step to remedy the situation. In marking this conduct, an award of substantial exemplary damages was justified.
Again, being conscious of the risk of awarding double compensation, he awarded the plaintiff under this heading €50,000 to give a total award of €1,923,871.
Solicitors: Ward & Wall (Dublin) for the plaintiff; The Chief State Solicitor for the defendants.
Paul Christopher, barrister