Judgment: 2021-11-01 · Court archive

High Court refuses request to note settlement term that could affect €42,000 benefit repayment

The court declined to record by consent that an HSE settlement contained no payment for lost earnings, saying the agreed term could not qualify as a court order relieving the HSE of its statutory reimbursement obligation.

High Court · [2021] IEHC 682

Who, what, where, when and why

Who
  • Fahy (Plaintiff)
  • Department of Social Protection
What

The court declined to record by consent that an HSE settlement contained no payment for lost earnings, saying the agreed term could not qualify as a court order relieving the HSE of its statutory reimbursement obligation.

Where

No place detail is included in this summary.

When

Judgment:

Why

Reasons reported in the judgment

The High Court refused an application by Fahy and the HSE to include in an order striking out settled personal injury proceedings a term stating that Fahy’s settlement contained no payment for loss of earnings. The court held that the agreed term, whether “noted” or ordered, would not constitute an “order of a court” under section 343R(2) of the Social Welfare (Consolidation) Act 2005 capable of relieving the HSE of the obligation to reimburse recoverable benefits.

The High Court refused an application by Fahy and the HSE to include in an order striking out settled personal injury proceedings a term stating that Fahy’s settlement contained no payment for loss of earnings. The court held that the agreed term, whether “noted” or ordered, would not constitute an “order of a court” under section 343R(2) of the Social Welfare (Consolidation) Act 2005 capable of relieving the HSE of the obligation to reimburse recoverable benefits.

The proceedings concerned Fahy’s claim that he was injured while carrying out tiling work on behalf of his brother’s company, Fahy Tiling Contractors Ltd, at HSE premises. The claim had settled. The court was told that the company had no assets, was no longer trading and appeared to have no insurance. The HSE said it settled to avoid the litigation risk that even a finding of 1% negligence against it could leave it liable for all damages.

Fahy had received €42,000 in recoverable benefits from the Department of Social Protection in connection with lost earnings following the accident. The parties wanted the order to record that the settlement included no payment for lost earnings. The judge said the term was intended to persuade the Department that section 343R(2) excused the HSE from repaying that sum. Counsel for Fahy said the State was effectively making a payment from one State body to another, with no overall detriment to the State.

The court rejected that distinction. It said a settlement term agreed by parties with aligned financial interests is not a judicial finding based on evidence tested in an adversarial hearing. A post-settlement offer to provide evidence would not change that, because the parties’ interests remained aligned and the Department’s interests were not represented. The court said it was not questioning the bona fides of the parties or their lawyers.

The judge also rejected the suggestion that the HSE could decide on the Department’s behalf that the reimbursement should be forgone. The Department might take a different view of its budget or the State’s interests, the court said. The fact that both bodies were part of the State did not establish that they had the same interests.

The court therefore refused to include the requested consent term, whether as a note or an order. It concluded that such a term should not be inserted and would not itself qualify under section 343R(2) to remove the reimbursement obligation. The judgment addressed that application; it did not determine the underlying negligence claim after an adversarial trial. The judge reserved judgment to provide detailed reasons should the parties wish to appeal.

Read the original court judgment

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