Saturday 24 March 2018

Blow to judiciary as senior judge opts to retire early

Judge Peter Kelly.
Judge Peter Kelly.

Dearbhail McDonald and Jerome Reilly

ONE of the country's most senior judges is set to retire this year – six years before he reaches full retirement age.

The Irish Independent has learned that High Court judge Mr Justice Peter Kelly, pictured, who is head of the fast-track Commercial Court and president of the Association of Judges of Ireland (AJI), has notified the president of the High Court of his intention to retire.

It is understood that a date has not yet been finalised. But Mr Justice Kelly – whose high-profile cases included litigation between businessman Sean Quinn, his family and the former Anglo Irish Bank – could leave as early as Easter, according to senior legal sources.

The departure of Mr Justice Kelly, who was appointed to the High Court in 1996 and has served the minimum 15 years to be eligible for a judicial pension, would be a major blow to the judiciary and the courts ahead of the creation of a new, 10-judge Court of Appeal.

It also comes amid fears that other senior judges, who have not yet reached full retirement age or their full 15 years' service, will retire early ahead of new reductions on the pensions of high earners.

Last night the AJI, which represents 90pc of Ireland's judiciary, said it did not want to make "any comment whatsoever".

Judge Kelly did not respond to queries by the Irish Independent.

But the bench has been convulsed by the prospect of a "super tax" on their pensions and new rules which mean that judges will have to serve 20 instead of 15 years before being able to claim a pension – a move they fear will deter senior legal practitioners from applying to become judges.

From January 1 next, judges and other senior civil and public servants will have a "super tax" of up to 70pc imposed on any portion of their pensions above €115,000 per annum.

A 'grace period' has been introduced for public servants retiring on or before August 31 next.


This means that public servants and judges who retire before that date will have their pensions and lump sums based on their salaries before cuts were imposed following the Haddington Road Agreement, thereby avoiding the "super tax".

The High Court lost three experienced judges last year and saw two of its members, Ms Justice Elizabeth Dunne and Ms Justice Mary Laffoy, elevated to the Supreme Court.

Another High Court judge, Mr Justice Kevin Feeney, died unexpectedly last August and High Court judge Mr Justice Michael Hanna is unavailable after falling ill in Spain before Christmas.

Yesterday High Court judge Mr Justice Eamon de Valera held his last sitting.

And next week High Court judge Ms Justice Maureen Harding Clark (67), who served as an Irish judge on the International Criminal Court – and was one of the first judges at the International Criminal Tribunal for the Former Yugoslavia at The Hague – will retire.

Three senior judges, Supreme Court judge Mr Justice Nial Fennelly and High Court judges Mr Justice Daniel Herbert and Mr Justice Barry White, are due to retire this year on age grounds.

Judges are among a group of high earners who hold both private and public sector pensions. But they face potential six-figure tax bills when they retire because of a reduction on the tax relief on their pension funds.

Tax relief on pension funds worth above €2.3m was reduced three years ago – the previous standard fund threshold (SFT) was €5.14m.

The absolute value of the SFT is being reduced again, with effect from January 1, 2014, from €2.3m to €2m. Judges previously complained that they would be hit hard by changes to pension laws, as they built up significant private pension pots from their days as practising lawyers as well as their fast-track judicial pensions.

But last October's Finance Bill provides for an individual who has pension rights on January 1, 2014 in excess of the new lower SFT limit of €2m, to claim a Personal Fund Threshold (PFT) from Revenue in order to protect the value of those rights on that date.

And senior public servants are still being allowed to build up large pensions under complicated changes in the Budget.

Under the Courts and Court Officers Act 1995, the retirement age for judges of the High Court or Supreme Court is 70.

Before December 15, 1995, when the law was passed, it was 72. Judges who were judges of the High Court or Supreme Court when the new law came into effect get to stay in office until they reach 72.

Irish Independent

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