The High Court declared unlawful a passenger charge imposed on Island Ferries Teoranta under the 2003 Fishery Harbour Centres (Rates and Charges) Order, finding that the charge was an unreasonable and oppressive use of the Minister’s powers.
The judgment, delivered by Mr Justice Cooke on 18 October 2011, concerned a €1.20 charge for each passenger departure from Rossaveel harbour by vessels licensed to carry at least 100 passengers. Island Ferries operates services between Rossaveel in County Galway and the Aran Islands.
Before the new charge took effect in May 2004, the company paid annual vessel charges. The new system linked the charge to passenger numbers. The court said the company’s harbour dues rose from €26,965 in 2003 to €163,724 in 2004 and €258,774 in 2005. The company had public service contracts requiring year-round sailings and setting fares, which could not be changed without ministerial consent.
The company refused to pay the new charge. In August 2005, the Minister withdrew the operating permit for its vessel Ceol na Farraige, which was detained at Rossaveel. The vessel was released after the company provided a €200,000 bond, and permits for two vessels were reinstated from 3 October 2005.
The court held that the legislation allowed charges for use of harbour facilities, including use by passengers. But it found the particular per-passenger charge was not set as a fair commercial price for the facilities used. The Minister’s main aim had been to raise revenue to address deficits across the fishery harbour centres, and the charge placed a disproportionate share of Rossaveel’s operating costs on ferry operators despite the harbour’s more intensive use by fishing vessels. The court also pointed to the impact on Island Ferries’ fixed-fare public service contracts and to differences between the charge on vessels carrying 100 or more passengers and charges on smaller vessels.
The court declared Charge No. 10(a) of Schedule 1 unlawful as ultra vires in its application to the company, saying that provision was severable from the rest of the order. It did not invalidate the entire 2003 Order. It found the company had not established its challenge to two harbour bye-laws and did not decide the constitutional claims. It also did not need to adjudicate the Competition Act claim: its comments that the charge would have infringed the Act if valid were conditional.
The judgment addressed only the first two of three case-management modules: basic competition issues and harbour charges. Claims concerning damages, including losses allegedly caused by the vessel’s detention, and the defendants’ counterclaim for unpaid charges and interest were left for later determination.