The Court of Appeal has upheld orders requiring shareholders who challenged the 2012 sale of Irish Life to pay the Minister for Finance and Permanent TSB’s legal costs. It also refused their request to pause the proceedings pending a separate constitutional challenge, but granted a 21-day stay on execution of specified costs orders.
In a judgment delivered on 31 July 2023, Mr Justice Robert Haughton dismissed appeals by Gerard Dowling, Padraig McManus, Piotr Skoczylas, John Paul McGann, Tibor Neugebauer and Scotchstone Capital Fund Limited. The original proceedings sought to set aside a March 2012 direction requiring Irish Life and Permanent, now Permanent TSB, to sell its life assurance business, Irish Life, to the State for €1.3 billion.
The Court of Appeal had already dismissed the substantive appeal in November 2022, affirming the High Court’s finding that the appellants lacked standing under the Credit Institutions (Stabilisation) Act 2010 to challenge the direction. The July 2023 judgment concerned the High Court costs order, costs of the appeals and a recusal application, and requests for a stay. The court upheld the High Court order that the applicants pay the Minister and the notice party’s proceedings costs, including reserved costs, with costs to be adjudicated by a Legal Costs Adjudicator if not agreed.
The active appellants argued that the case raised issues of exceptional public importance and that costs should not follow the usual rule. The court rejected that argument, finding the proceedings were brought for personal advantage relating to the appellants’ shareholdings, rather than as public interest litigation. It also found the challenge to the March 2012 direction differed materially from earlier litigation over a July 2011 direction, which involved a €2.7 billion state recapitalisation.
The court awarded the Minister and Permanent TSB their costs of the appeal and the recusal application against Skoczylas, McGann and Neugebauer. It found Permanent TSB had a vital interest in the outcome and had contributed evidence and submissions. The recusal application had been rejected in April 2023; the court had found it was an abuse of process and that objective bias had not been established.
The court refused a stay of the underlying proceedings, noting that the Irish Life sale had been completed in 2012 and the business later resold to Canada Life. It also refused to defer costs until the outcome of separate constitutional proceedings, but stayed execution of the specified costs orders for 21 days from perfection of the order. That stay does not prevent costs adjudication during the 21-day period.
The appeals of Haug, who was deceased, and Keohane, who did not pursue his appeal, were struck out with no further order. No further costs were ordered against Dowling, McManus or Scotchstone beyond the affirmed High Court costs order.