The High Court has set aside an order requiring solicitor Owen Swaine to pay more than €1.66 million in tax, granting him leave to defend Revenue’s claim at a plenary hearing. The court said the dispute raised issues that could not be resolved through summary proceedings and required oral evidence.
The ruling, delivered by Mr Justice Barrett on 28 February 2014, concerned summary proceedings brought by the Revenue Commissioners. The Master of the High Court had ordered payment on 17 October 2013. Swaine then brought proceedings seeking to set that order aside and obtain a full hearing.
The judgment describes the tax claim as €1,662,288.01, plus interest and costs. It records that Swaine relied on a repayment agreement with Revenue and a separate undertaking concerning tax liabilities. Revenue accepted that a repayment agreement had existed, though the court said it did not appear to have been documented.
In a letter dated 21 June 2011, Swaine undertook to discharge audit liabilities and outstanding taxes from proceeds of certain High Court cases. Revenue replied on 14 July 2011, accepting the letter as an undertaking that he would pay outstanding taxes from settlement proceeds. The cases had been brought on behalf of about 140 clients against the State over allegedly illegal nursing-home charges. The court accepted Revenue’s evidence that it believed settlement was imminent; Swaine’s counsel said one case had since settled.
Swaine argued that Revenue had agreed not to pursue the tax liabilities until those cases were resolved. The judgment noted evidence that his tax liabilities had increased, which could undermine reliance on the repayment agreement alone. But it considered it arguable that the undertaking and Revenue’s acceptance might create a separate contractual obligation or support an estoppel defence. Those issues were not finally decided.
Justice Barrett said it was not “very clear” that Swaine had no defence. The court ordered that the Master’s payment order be set aside and gave Swaine leave to defend all sums claimed at a plenary hearing. It said the ruling was confined to the monies pursued in these summary proceedings.