The Court of Appeal has dismissed Dr Joseph Sheehan’s appeal over a 2015 settlement with Talos Capital, rejecting his claims that Talos misrepresented the position of a potential claim against IBRC and that an IBRC payment should reduce his liability to Talos.
The judgment, delivered by Mr Justice Maurice Collins on 26 November 2021, upheld the High Court’s dismissal of Sheehan’s claims. The appeal court also said the High Court judge’s published criticisms of Sheehan as a “serial litigant” and comments about a possible Isaac Wunder order were inappropriate and unfair. No such order had been sought or made.
Sheehan had claimed that emails sent during settlement discussions in November 2015 misrepresented that the full amounts under UK costs certificates remained outstanding. He argued that the emails implied that JCS, the company he sought to regain control of, still had a claim against IBRC for the return of a forfeited €2.4 million deposit. The Court of Appeal found that the emails had to be read in the context of earlier correspondence and attached schedules, which showed a substantial reduction in JCS’s costs and expenses. It concluded that a reasonable person would not have understood the 16 November emails to mean that the full costs certificate amounts remained unpaid.
The court also held that Sheehan had not established an implied representation that JCS’s claim against IBRC remained intact. His legal team did not raise the potential claim during the settlement discussions or seek confirmation that it remained available. Sheehan had not given evidence at trial, and the appeal court said that this raised questions about proof of how he understood potentially ambiguous statements. It did not decide whether his absence from the witness box would, by itself, have been fatal to the claim.
The court rejected Sheehan’s separate argument under section 17(2) of the Civil Liability Act 1961. It found that any claim for the return of the deposit belonged to JCS, which had paid it and was entitled to receive the €1.7 million settlement from IBRC. JCS later paid that money to Talos under its separate loan arrangements. The court said that this did not make Talos the party to whom IBRC was responsible for the relevant loss, so the statutory provision did not apply. It did not need to decide whether the parties had caused the “same damage”.
The appeal was dismissed. The court proposed that Sheehan pay the appeal costs, while giving him 14 days to seek a brief supplemental hearing on costs. The Court of Appeal did not set aside the High Court judgment, but said its own judgment vindicated Sheehan’s position regarding the High Court’s criticism of him as a litigant.