High Court of Ireland Decisions

harp graphic.

THE HIGH COURT

[2025] IEHC 224

[Record No. 2023/249 MCA]

BETWEEN

PADRAIC HANLEY

APPELLANT

AND

 

PBR RESTAURANTS LIMITED T/A FISH SHACK CAFE

RESPONDENT

JUDGMENT of Ms. Justice Marguerite Bolger delivered on 11^th Day of April 2025

 

1.            In my substantive judgment of 19 November 2024, I upheld the appellant's appeal on a point of law against a Labour Court determination, set aside the determination of the Labour Court and directed that the matter should be remitted to the Labour Court for a fresh hearing.  

2.            This is the appellant's application for the costs of his appeal in reliance on s. 169 of the Legal Services Regulation Act 2015 pursuant to which the appellant says he is entitled to his costs having succeeded in full in his appeal. The respondent submits that the default position is as envisaged by Order 105, r. 7 of the Rules of the Superior Court (hereinafter referred to as "the rule") and should apply and that no cost shall be allowed in appeals from the Labour Court without a "special order". The respondent relies on what it refers to as the "special nature" of an appeal from the Labour Court.

3.            Section 169 is well known to litigation lawyers and provides, in principle, that the successful party in civil proceedings is entitled to their costs against the unsuccessful party, subject to the court directing otherwise for reasons specified in the section which do not apply and are not relied on here. The only relevant aspect of s. 169 for the purpose of this application is the principle that costs follow the cause.  The section puts that on a statutory footing.

4.            Order 105, rule 7 provides:-

"No costs shall be allowed of any proceedings under this Order unless the Court shall by special order allow such costs."

The parties agree that the proceedings under the rule include an appeal such as this one was.

5.            In my judgment, I will address:-

(i)            The interaction between s. 169 and the rule;

(ii)           The tests for making a special order pursuant to the rules that have been developed by the courts;

(iii)         The role, if any, of s. 169  in determining the costs of proceedings that come within the rule.

6.            I wish to make it clear that, absent the rule, the costs in this case would undoubtedly be awarded to the successful appellant against the unsuccessful respondent. I do not consider that position to have been seriously challenged by counsel for the respondent who focused their submissions on what they said was the requirement of the rule to apply the default position envisaged by that rule, i.e. no order as to costs. The question for the court is, therefore, whether the default position on costs in an appeal such as this is a nil order, unless the court allows the costs "by special order". Consideration must also be given to whether s. 169 has any relevance or application to the costs of such an appeal or whether the position is determined only by the rule.

The interaction of s. 169 and the rule

7.            This is not the first occasion on which the interaction between these two provisions, one of legislation and the other of the Rules of the Superior Courts, has come before the courts.  On each previous occasion, the court was in a position to determine the costs of the appeal from the Labour Court by reference to the rule and did not have to deal with what Simons J. called "a potential conflict" (in Power v. HSE [2021] IEHC 454, at para. 14) between the two provisions. In Power the appellant had secured similar orders to here setting aside a determination of the Labour Court in which the Labour Court had erred in law and remitting the matter back to the Labour Court.  Simons J. found that the successful appellant was entitled to their costs:-

"irrespective of which costs regime applies. The appellant is entitled to recover his costs either on the basis that he has been entirely successful in his appeal, or on the basis that the exigencies of the case are such that a 'special order' is justified." (at para. 16).

8.            A later decision of the Supreme Court, Baranya v. Rosderoa Irish Meats Group Limited [2022] IESC 5 was also a successful appeal from a determination of the Labour Court. The Supreme Court found the Labour Court had erred in law in finding that a statement made by the appellant could not have been treated as a projected disclosure, set aside the Labour Court's determination and remitted the matter back to the Labour Court for a fresh adjudication. In the appellant's costs application, the respondent employer argued, similar to the respondent here, that the rule applied and that there should be no order as to costs. The appellant contended that the general words of ss. 168 and 169 must be taken to prevail as against these special words of rule.  The Supreme Court, similar to the approach adopted by Simons J., noted that the issues "raise questions of some importance, the resolution of which would itself require yet further argument and a reserved judgment" [at para. 6]. Nevertheless, the court proceeded to award costs to the successful appellant as, even if the respondent was correct that the proceedings were governed by the rule, the court nevertheless held that it would make a "special order" for costs in favour of the appellant.

The test for a "special case" that had been developed by the courts

9.            This Court and the Supreme Court have previously developed slightly different tests for determining the circumstances in which a special order pursuant to the rule should be made. In Power v. HSE, Simons J. found the case to have been one of public interest. He explained his rationale for this as follows:-

"[...]First and foremost, the appeal raised a point of law of general public importance in respect of the scope of the Protection of Employees (Fixed-Term Work) Act 2003. The appellant was entirely successful in his appeal. Crucially, the effect of the principal judgment is to correct a longstanding error on the part of the Labour Court in its interpretation of the legislation. Were the presumptive position under Order 105, rule 7, i.e. that the parties to appeals from the Labour Court should bear their own costs, to apply in cases which raise points of law of general public importance, this might have the unintended consequence that appeals raising such points might not be brought before the High Court(at para. 40).

There was an additional point in Power in relation to the litigation history between the parties that does not apply here. A similar costs application then came before the Supreme Court in Baranya and, in making the "special order", the Court explained this was because "Mr. Baranya raised an issue of some importance which has been resolved in his favour" (at para. 7). This is clearly a lower test than the public interest test that Simons J. found to have been satisfied in Power.

The role, if any, of s. 169 in determining the costs of proceedings that come within the rule.

10.         Addressing the role, if any, of s. 169 in determining the costs of an appeal that comes within the rule must consider firstly how the default position of the rule sits with the statutory default position of s. 169 and secondly whether there is a legal basis for the default position of the order displacing the default position of the statutory provision.

11.         In Conway v. Department of Agriculture [2021] IEHC 503 Hyland J. discussed the motivation behind the decision of the Rules Committee to create this different costs regime for an appeal from the Labour Court, and in doing so, to retain the costs arrangement that applies in the Labour Court, which has no jurisdiction to award costs. Hyland J. stated, at para. 8:-

"[T]he intention of the Rules Committee in making this change is that, in future, the default position is that no costs shall be allowed in appeals from the Labour Court without a special order. This marks a departure from the normal approach to costs set out in ss. 168 and 169 of the Legal Services Regulation Act 2015. It was presumably adopted given the special nature of these types of appeals. Disputes before the Labour Court arise in the context of an employment, or analogous, relationship. The Labour Court does not have the power to award legal costs. The Rules Committee presumably wish to ensure that a similar approach applied in respect of appeals against decisions of the Labour Court (subject to a discretion of the Court to make costs orders)."

12.         The rule does not entirely replicate the costs regime that applies in the Labour Court as it allows this Court a discretion to award costs by "special order". No such discretion is afforded to the Labour Court (or, indeed, the Workplace Relations Commission) which can never make an order for costs.

13.         A similar, though not identical, departure from the s. 169 default position on costs following the cause can be seen in s. 50(B) of the Planning and Development Act 2000. The imposition of that special rule in relation to costs in certain types of environmental litigation was by way of a statutory provision. It is also significant that, s. 169(5) expressly states that "Nothing in this Part shall be construed as affecting section 50B of the Planning and Development Act 2000 or Part 2 of the Environment (Miscellaneous Provisions) Act 2011".

14.         Thus, the exception to that default rule that costs follow the cause, was implemented by statute and was expressly referred to in s. 169. However, not so the subsequent exception to that general rule when the rule was made by the Rules Committee by Statutory Instrument 257/2020, pursuant to the provisions of the Courts of Justice Act 1936, as amended.  Even though the rule does not refer to s. 169 and s. 169 does not refer to the rule, the rule cannot be viewed in isolation from s. 169, regardless of the motivation, whether good, bad or indifferent, of the Rules Committee in making this broad exception to the statutory default position that costs follow the cause. A rule cannot and does not exist in a vacuum outside of a relevant statutory provision. It simply cannot be said that a statutory provision that conflicts with a rule of the Superior Courts is simply set at nought by the existence of that rule.

15.         A comparable issue of a different approach in a rule and a statutory provision was considered by this Court in Buchanan v. BHK Credit Union Ltd & ors [2013] IEHC 439. There was a conflict between a 28-day period for service of a third-party notice set down by O. 16, r. 1(3) of the Rules of the Superior Courts as against the statutory requirement of s. 27(1)(b) of the Civil Liability Act 1961 to serve the notice "as soon as reasonably possible". In determining that the Rules Committee could not cut down the Court's discretion to determine what period of time was reasonably possible for the purpose of s. 27(1)(b), by prescribing a 28-day time period, Hogan J. said (at para. 16):-

 "[I]t may first be recalled that the Rules of Court are simply statutory instruments which have been made and promulgated by the Superior Court Rules Committee (with the consent of the Minister for Justice and Defence) under the provisions of s.36 of the Courts of Justice Act 1924 in order to regulate aspects of court procedure. As I had occasion to point out in Gokul v. Aer Lingus plc [2013] IEHC 432, these Rules do not, of course, have the same normative status in our legal system as legislation enacted by the Oireachtas. Specifically, given that Article 15.2.1 of the Constitution vests the exclusive law-making function in the Oireachtas, it is axiomatic that the Superior Court Rules Committee could not have been given the power to amend the law (whether directly or indirectly) by the making of a statutory instrument of this kind: see, e.g., Cooke v. Walsh [1984] I.R. 710, 728-720, per O'Higgins C.J. Nor could the Superior Court Rules Committee themselves have expanded (or, for that matter, limited) the meaning to be ascribed to a particular statutory provision by the making of Rules of Court of this kind, since the terms of any such procedural regulation prescribed by statutory instrument must be ignored "in determining the scope of the [parent] Act": see Frescati Estates Ltd. v. Walker [1975] I.R. 177, 187 per Henchy J."   

Hogan J., therefore, concluded that:-

 "[T]he Rules Committee could not in any way seek to abridge or otherwise trammel the appropriate exercise of discretion by the Court under s.27(1)(b) of the 1961 Act by rules of court since this would have amounted to the indirect amendment of the law. This would be plainly contrary to Article 15.2.1." (at para. 18).

16.         From this analysis, it seems that in determining the costs of an appeal to this Court from the Labour Court, the Court must start with s. 169 rather than the rule. Any consideration of the rule must be in addition to a consideration of s. 169 and cannot occur in isolation from the statutory provision. A Labour Court appeal, being an appeal from a forum that has no jurisdiction to award costs to either party, could be viewed as part of the "particular facts and circumstances of the case" to which s. 169 permits regard to be had by this Court in determining a costs order that is different to the statutory default position that costs follow the cause. That, along with any other particular aspect of the nature and circumstances of the appeal could enable a Court to make the order envisaged by the rule, i.e. no order as to costs, as versus a "special order" directing one party to pay the costs of the other. Either way, it is clear that s. 169 must be the starting point and the rule is, at most, a qualification of that rather than the only provision applicable to a costs application of a Labour Court appeal.

Application of the law to the costs of this appeal

17.         The respondent disputes that the appellant's case engaged a public interest.  The test for a public interest case is high and confirmed by the Supreme Court in Little (No. 2) to be limited to cases in which "foundational issues of Constitutional or European law" have been raised, an approach reaffirmed very recently by the Supreme Court in Chain Wei Wei v Minister for Justice [2025] IESC 9. Whether or not the appellant's case was sufficiently similar to Mr. Power's (albeit without the same level of engagement with European law), I am satisfied that this appellant raised an issue "of some importance" for him, in relation to his protected disclosures point, the preliminary determination for the Labour Court and the application of the Supreme Court decisions in The Revenue Commissioners v. Karshan (Midlands) Ltd t/a Domino's Pizza [2023] IESC 24 to the determination of his employment status. The appeal also raised issues of some importance for the public in how the Labour Court will be required to deal with determining preliminary issues and unfair dismissal claims involving assertions of penalisation for having made a protected disclosure in the future. 

18.         A nil order as to costs could deter a party, who might find themselves in a similar situation in the future, from pursuing a statutory appeal, a point which was part of what persuaded Simons J. to make the special order in Power.

19.         However this court does not have to determine that this is a case of public interest or a case of some importance equivalent to Power or Baranya as it is clear that if the issue of costs is approached firstly from a consideration of s. 169 and then a consideration of the rule, that this is an appropriate case in which the appellant should be awarded the costs of the appeal.  

Conclusions

20.         For the reasons set out above, I make an order directing the respondent to discharge the appellant's costs of the appeal, to be adjudicated upon in default of agreement, to include the costs of making the application for those costs. If either party contends for a different order in relation to the costs of making the application, then I will allow them liberty to re-enter the matter before me within a period of two weeks of this judgment.

 

Counsel for the Appellant: Michael Kinsley BL

Counsel for the Respondent: Paul Twomey BL