THE SUPREME COURT
RECORD No. 12051P
65/98
O’FLAHERTY J
MURPHY J
LYNCH J

BETWEEN:
SUPERWOOD HOLDINGS PLC
SUPERWOOD LIMITED
SUPERWOOD EXPORTS LIMITED
SUPERCHIP LIMITED
SUPERWOOD INTERNATIONAL LIMITED
SUPERWOOD (UK) LIMITED
APPELLANTS
AND

DERMOT P SCULLY, JOSEPH M TYRELL, DERMOT F HERBERT, TERENCE P CRAWFORD, WILLIAM SLEATER AND THOMAS F CONROY PRACTISING UNDER THE STYLE OF SCULLY TYRELL AND COMPANY
RESPONDENTS

JUDGMENT OF MR JUSTICE FRANCIS D MURPHY DELIVERED THE 4TH DAY OF NOVEMBER 1998 [Nem. Diss.]

By order dated the 3rd day of March 1998 Smyth J dismissed the Plaintiffs’ claim herein for want of prosecution and in a carefully reasoned judgment set out the long and troubled history of this and associated litigation and analysed the relevant legal principles.

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It appears that the Appellants had a contract or contracts of insurance with the Sun Alliance and other insurance companies (the Insurers) to protect the Appellants from consequential loss in certain events. In or about the year 1987 an event occurred which, the Appellants contend, gave rise to a claim on foot of those policies. The Respondents herein are loss adjusters who were retained by the Insurers to advise them in relation to the claims of the Appellants. The Appellants instituted proceedings (the “Main Case”) (bearing the High Court Record Number 1989 7315P) against the Insurers on the 20th June 1989.

The proceedings herein might be regarded as subsidiary to the Main Case and certainly arise out of actions taken and statements made by the Respondents in relation to that case. These proceedings were commenced by a plenary summons issued on the 22nd December 1988 that is to say some months before the Main Case. An unusual feature the action herein is that the “damages for negligence inducing breach of contract and libel” identified in the plenary summons would appear from the statement of claim - delivered on the 2lst December 1989 -to have been based on events alleged to have occurred some months after the plenary summons was issued. However, the general thrust of the Appellants’ claim was that the Respondents, in reports provided by them to the Insurers, had defamed the Appellants and had induced or attempted to induce the Insurers to repudiate the policies issued by them to the Appellants.

In the Main Case the Appellants claimed damages against the Insurers for breach of contract and negligence in relation to the performance of their duties in respect of the policies of insurance aforesaid. By any standard there is a very considerable overlap between the Main Case and the present proceedings.

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The Main Case proceeded apace. The writ was issued on the 20th June 1989 and the hearing commenced before the High Court the following month. It concluded approximately one year later. Judgment was delivered on the 15”' August 1991 by Mr Justice O’Hanlon in pursuance of which the Appellants’ claim against the insurers was dismissed. That decision was appealed to this Court where it was heard in early 1995 and judgment was delivered on the 27th of June 1995. This Court reversed the decision of Mr Justice O’Hanlon and remitted the Main Case to the High Court for the assessment of the damages. The assessment has involved a troublesome and protracted hearing which has not yet been concluded.

By contrast the above proceedings proceeded in a desultory fashion. The Statement of Claim was not delivered for nearly twelve months after service of the plenary summons and then only in response to a motion to dismiss. A further motion to dismiss a portion of the Plaintiffs’ claim was issued on the 16th February 1990 and was ultimately disposed of by the order of McKenzie J on the 9th of July 1990. A request by the Respondents for voluntary discovery on the 9th November 1990 did not meet with a favourable response so that a motion for that purpose was issued before the Master on the 29th of November 1990. Following the dismissal of the Appellants’ case against the Insurers the Respondents herein requested the Appellants by letter dated the 12th November 1991 to discontinue the case against them. There was then a period of inactivity between November 1991 and May 1996. That is the period largely taken up by the appeal of the Main Case to this Court. When judgment was given in favour of the Plaintiffs the Appellants issued a notice of intention to proceed but in the absence of further activity the Respondents launched the motion dated the 11th December 1996 to dismiss which gives rise to this appeal. The chronology of events prepared by the Appellants setting out the events relating to the two proceedings is annexed as a schedule hereto.

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Like the learned trial Judge there is one aspect of these proceedings of public and professional importance to which I would draw particular attention. The Appellants’ claim herein is based on the contents and publication of documents specifically referred to in the Statement of Claim. It appears to be common case that the Appellants first obtained sight of those documents as a result of discovery obtained not in these proceedings but in the Main Case. In relation to that aspect of the matter the learned trial Judge quoted from the judgment of Finlay CJ in Ambiorix Ltd & Ors v. Minister for the Environment & Ors [1992] ILRM 209 at 215 as follows:- 

“As a matter of general principle, of course, a party obtaining the production of documents by a discovery in an action is prohibited by law from making any use of any description of such documents or the information contained in them otherwise than for the purpose of the action. To go outside that prohibition is to commit contempt of court.”

Counsel appearing for the Appellants in the appeal before this Court had not been retained in the matter when this issue first arose and was unable to explain the apparent and serious breach of that well established rule. All that could be said was that the matter had been adverted to in the application before McKenzie J and that the parties appeared to have proceeded with the matter notwithstanding the apparent abuse of process. I am strongly of the view that these proceedings should not be disposed of finally without an appropriate investigation of what appears to be a very serious matter.

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In acceding to the Respondents’ application to dismiss the Appellants’ claim herein for want of prosecution the learned trial Judge understandably and correctly relied on the principles established by this Court in Primor Plc v. Stokes Kennedy Crowley [1996] 2 IR 459. I differ, however, from the learned trial Judge as to how those principles should be applied to the present matter. The consideration of all of the principles identified in the Primor case is to enable the Court to answer the question posed by Hamilton CJ (at page 466) namely,

 “...........whether it is fair to the defendant to allow the action to proceed and whether it is just to the plaintiff to strike out the action.”

As the learned trial Judge noted in his judgment the Appellants conceded that the delay was inordinate. They disputed the contention that it was inexcusable. Even if the delay were both inordinate and inexcusable it was contended that the balance of justice lay in favour of the case being permitted to proceed.

That the Appellants processed the litigation at a leisurely pace has already been noted. Any action which they took appears to have been a response to motions to dismiss for want of prosecution. On the other hand there was no delay in issuing the plenary summons itself. Furthermore the period which elapsed between the issue of the writ and the order for discovery was less than two years. The longest period of inactivity was between the date of the delivery of the judgment of the High Court in August 1991 and the judgment of the Supreme Court in June 1995. Whilst the Respondents did by letter dated the 12th of November 1991 request the Appellants to discontinue the proceedings against them this would not appear to have been a matter of great consequence. If the High Court judgment was not

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appealed or if it was upheld on appeal the action against the Respondents of its very nature was bound to fail. Whilst the Respondents could have pressed for a dismissal of the action at that stage I would infer or presume that all parties took the view that the issue might be resolved finally by the decision of the Supreme Court. Certainly I would be surprised if either party would have wished to incur expenditure comparable to that involved in the Main Case to resolve an issue already determined by the High Court. I would hesitate to differ from the learned trial Judge who has a unique experience of all of the facts surrounding this troublesome litigation but I am unable to accept that the delay which did undoubtedly occur was inexcusable.

I differ too from the learned trial Judge in his conclusion that there is a substantial risk that it will not be possible to have a fair trial of the issues between the Appellants and the Respondents. I fully appreciate that ten years has elapsed since the accrual of the alleged cause of action and I accept of course the general proposition that memories fade and become less reliable with the passage of time. In that context it is true that this case is not a “documents only” case and that there must be some aspects in which personal recollection would be of significance. On the other hand there are special features of this case which must provide considerable reassurance for those who may be called upon to give evidence on behalf of the Respondents. In the very nature of the task in which they were engaged the Respondents conducted a meticulous examination of the affairs of the Appellants and recorded their findings in the detailed reports which were disclosed in the discovery in the Main Case. No doubt these reports were compiled by reference to notes or preliminary drafts which are still extant. These documents would be invaluable to any witness required to refresh his recollection of disputed facts. Moreover, the witnesses must perforce have refreshed and will indeed again refresh their memory of the matters in issue. It appears that

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the Respondents or some of them were crucial witnesses in the original hearing before O’Hanlon J and are due to be called as witnesses in the proceedings at present at hearing before Smyth J. The reality of the matter is that the Respondents have not closed their files on the case or their minds to the facts therein. Whilst Smyth J does refer to some persons engaged by the Respondents as having retired from their positions with that firm, it does not appear that there has been anything like the dramatic changes which were referred to in the Primor case. In that case most of the staff of Stokes Kennedy Crowley who had worked on the disputed audit had left the company and a majority had left the jurisdiction. Of the partners who had been involved in the work one had died and three others had retired. I do not doubt that there will be difficulties in presenting the Respondents’ defence if and when the proceedings come to trial but I do not believe that the evidence has established that the prejudice to the Respondents is such “that a fair trial between the parties cannot now be held”.

In those circumstances it seems to me that the appeal should be allowed though the Appellants must be put on terms which will ensure that no further prejudice is caused to the Respondents.

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CHRONOLOGY OF EVENTS

SUPER WOOD & ORS
V. SCULLY TYRRELL & ORS	.	.	SUPERWOOD & ORS
V. SUN ALLIANCE & ORS	
1. Writ issued	22/12/88	.	.	
2. Appearance	23/12/88	.	.	
.	.	Writ issued	20/06/89	
.	.	Statement of Claim delivered	20/06/89	
.	.	Plaintiff’s Affidavit
of Discovery sworn	26/06/89	
.	.	Defendant’s Notice for Particulars	27/06/89	
.	.	Defence	29/06/89	
.	.	Defendant’s Affidavit of Discovery sworn	03/07/89	
.	.	Plaintiff’s Reply to Particulars	06/07/89	
.	.	Reply to Defence	14/07/89	
.	.	High Court hearing commenced	19/07/89	
3. Motion to dismiss for want of prosection	17/11/89	.	.	
4. Order giving Plaintiffs time to deliver Statement of Claim	07/12/89	.	.	
5. Statement of Claim delivered	21/12/89	.	.	
6.	Notice of Change of Solicitor by Defendants	24/01/90	.	.	
7. Defendants Motion to dismiss portion of Plaintiff’s claim	16/02/90	.	.	
8. Replying Affidavit of Richard J. Bunyan	07/03/90	.	.	

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9. Affidavit of Joe Tyrrell	23/03/90	.	.	
10. Supplemental Affidavit of Richard J. Bunyan	16/05/90	.	.	
11. Order of Mr. Justice McKenzie	09/07/90	.	.	
.	.	High Court hearing concluded	20/07/90	
12. Defendants Notice for Particulars	29/08/90	.	.	
13. Defence delivered	29/08/90	.	.	
14. Plaintiffs Reply to Particulars	02/11/90	.	.	
15. Defendants Further Notice for Particulars	09/11/90	.	.	
16. Defendants Request for Voluntary Discovery	09/11/90	.	.	
17. Defendants Motion for Discovery	29/11/90	.	.	
18. Order of the Master	29/11/90	.	.	
.	.	Judgment delivered	13-15/08/91	
19. Letter Requesting Plaintiffs to discontinue	12/11/91	.	.	
.	.	Appeal before Supreme Court from
to	
13/02/95
13/03/95	
.	.	Judgment of Supreme Court	27/06/95	
20. Notice of Intention to proceed	28/05/96	.	.	
.	.	Amended Defence delivered	19/11/96	
21. Defendant’s Motion to Dismiss	11/12/96	.	.	
22. Replying Affidavit of Derek Burke	27/01/97	.	.	

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.	.	Commencement of High Court Assessment of Damages (Continuing)	19/02/97	
23. Supplemental Affidavit of Ivan Durcan	05/02/97	.	.	
24. Supplemental Affidavit of Ivan Durcan	19/02/98	.	.	
25. Order of Mr. Justice Smyth	03/03/98	.	.	
26. Notice of Appeal to Supreme Court	30/03/98	.	.