The High Court has dismissed Neal Duggan’s judicial review challenge to the Irish Auditing and Accounting Supervisory Authority’s decision not to open a statutory inquiry into how the Institute of Chartered Accountants of Ireland handled two complaints about Deloitte.
Mr Duggan, a shareholder in Irish Press plc, had complained about the notification of Deloitte’s resignation as the company’s auditors and the firm’s later reappointment. The Institute dismissed one complaint on the basis that there was no case to answer, and the other because it did not concern a disciplinary matter. Mr Duggan then asked the Supervisory Authority to examine whether the Institute had followed its approved procedures.
The Authority’s board considered the request in September 2018. It decided the issues lacked sufficient gravity for an inquiry and could be addressed through the Authority’s routine supervisory work. The Authority notified Mr Duggan in October 2018. After his solicitors sought further reasons, it declined to provide them. The board minutes and a six-page paper assessing the complaints were later disclosed during the judicial review proceedings.
Mr Duggan argued that the reasons were inadequate, that only a Preliminary Enquiry Committee could make the decision, and that the board had relied on irrelevant considerations, including whether the complaints were sufficiently significant. The court held that the contemporaneous minutes and board paper could be considered alongside the notification letter and provided adequate reasons. The judge also said the letter alone would have been adequate, given the broad discretion involved.
The court found that the Authority was not required to appoint a Preliminary Enquiry Committee. The governing legislation and regulations made appointment discretionary; until a committee was appointed, the board retained the power to decide whether to initiate an inquiry. The judge also held that the board could consider the gravity of the issues and whether supervisory action would be more appropriate. The court said the challenge did not meet the applicable standard of unreasonableness or irrationality.
The judgment noted that the judge considered there was an obligation, with some hesitation, to give reasons to a complainant who formally requested them. The extent of the reasons required was limited by the nature of the decision. The court did not decide whether Mr Duggan had sufficient standing to bring the proceedings, because the challenge failed on its merits. The application for judicial review was dismissed; the court did not determine the underlying complaints against Deloitte or direct a fresh investigation.