Sunday 21 October 2018

INM fails in court bid to have ODCE decision quashed

ODCE director Ian Drennan. Photo: Steve Humphreys
ODCE director Ian Drennan. Photo: Steve Humphreys

Andrew Phelan

Independent News and Media has failed in a legal challenge to the corporate watchdog's decision to apply for inspectors to be appointed to the company.

The High Court ruled against INM, which had sought to quash a decision by the Office of the Director of Corporate Enforcement to seek the appointment.

Mr Justice Seamus Noonan's judgement paves the way for ODCE director Ian Drennan to proceed with his application, which will be heard on a later date.

The investigation centres on a range of corporate governance issues at the country's largest media group and the inspectors would have far-reaching powers of inquiry.

The ODCE had initiated the application for inspectors over concerns about an alleged data breach at INM in 2014 and other issues arising from protected disclosures made by the company's former CEO Robert Pitt and chief financial officer Ryan Preston in 2016 and 2017.

In its judicial review proceedings, INM argued there was no basis for the appointment of inspectors and maintained the ODCE application was made in breach of its right to fair procedures.

Mr Justice Noonan. Photo: Donal Doherty
Mr Justice Noonan. Photo: Donal Doherty

The ODCE countered that there was no legal obligation on the watchdog to consult the company.

Yesterday, Mr Justice Noonan said he was dismissing INM's application to quash the ODCE's decision.

He said INM's proposition that it had a right to be consulted was "novel and without precedent" and, as a matter of law, "cannot be sustained".

The court could not take cognisance at this stage of any damage INM claimed to have suffered as a result of the ODCE decision, the judge said.

There was an important public interest in the functions performed by the ODCE, he said.

Mr Justice Noonan said in his ruling that if INM was correct in submitting that it has an answer to all the respondent's concerns, "it now has the fullest opportunity of putting this before the court which may well be persuaded that it should decline the application."

Much of INM's complaint appeared to concern the appointment of inspectors as distinct from the application to do so, he continued.

He said INM's suggestion that the ODCE had "reached conclusions" in its affidavit grounding the application was "somewhat surprising". It was difficult to see how the directors could have made his application without "expressing some views on the state of affairs with which he is confronted".

"These are plainly not determinative of anything and it will ultimately be a matter for the court to accept them or not," Judge Noonan continued.

If INM was entitled to fair procedures and a right to consult "the prospect looms large of the respondent becoming embroiled in lengthy, complex and costly procedures".

It was hard to envisage how in practice such a system could be workable, he said.

Minutes later, High Court president Mr Justice Peter Kelly said the ODCE's case would be mentioned next Wednesday to fix a hearing date for the application.

Mr Justice Kelly then heard the Central Bank wished to renew an application for access to legal documents filed in the case by the ODCE and INM.

He asked counsel for the Central Bank to indicate in an affidavit what documents were being sought.

Irish Independent

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