The Supreme Court has overturned a High Court ruling which had found that the Minister for Enterprise acted outside her powers when appointing an authorised officer to examine books and records of two Dunnes Stores companies.
The dispute arose from a July 1998 decision by then minister Mary Harney to appoint an officer under section 19 of the Companies Act 1990. The examination concerned Dunnes Stores Ireland Company and Dunnes Stores (Ilac Centre) Ltd.
The Minister's stated reasons referred to findings in the McCracken and Buchanan reports. Those included concerns about company funds allegedly used in transactions involving Michael Lowry, Charles Haughey and others, unidentified beneficiaries of payments, possible failures to keep proper books and wider questions about corporate governance.
Dunnes challenged the appointment by judicial review. The High Court had held that the appointment was ultra vires, meaning outside the Minister's statutory powers. Constitutional arguments about section 19 were therefore left undecided at that stage.
In the Supreme Court, Mr Justice Murray held that section 19(2)(a) deliberately conferred a broad preliminary investigative power. It allowed the Minister to examine company books and documents where there were reasonable grounds for considering whether a court should later be asked to appoint an inspector.
The court rejected Dunnes' argument that concerns about corporate governance were too vague or outside the scope of the legislation. It held that statutory obligations under the Companies Acts form part of the standards by which companies are governed and that serious past abuses identified in official reports could justify further examination.
The court also found that the Minister had given sufficiently specific reasons and that the decision was neither irrational nor disproportionate. It allowed the appeal in relation to section 19(2)(a) and, agreeing with the Chief Justice, also in relation to section 19(2)(d).
The ruling did not finally dispose of the entire case. The proceedings were remitted to the High Court to decide the outstanding constitutional challenge to the relevant statutory provisions.