Supreme Court allows appeal quashing inspector's report, restricting distribution to prosecutorial bodies only.

THE SUPREME COURT

Denham J.

Hardiman J.

Fennelly J.

Kearns J.

Macken J.

[S.C. No. 288 & 289 of 2005]

BETWEEN

GAMA ENDUSTRI TESISLERI IMALAT MONTAJ A.S.

RESPONDENT/APPLICANT

AND

THE MINISTER FOR ENTERPRISE, TRADE & EMPLOYMENT

AND

EDWARD NOLAN

APPELLANTS/RESPONDENTS

AND BETWEEN

GAMA CONSTRUCTION IRELAND LIMITED

RESPONDENT/APPLICANT

AND

THE MINISTER FOR ENTERPRISE, TRADE & EMPLOYMENT

AND

EDWARD NOLAN

APPELLANTS/RESPONDENTS

JUDGMENT of Mr. Justice Kearns delivered the 30th day of April, 2009

This is an appeal brought by the Minister for Enterprise, Trade & Employment from the judgment of the High Court (Finlay

Geoghegan J.) delivered on the 14th June, 2005 and the subsequent Order made on the 23rd June, 2005 herein which

granted a declaration that the preparation of a report dated 4th May, 2005 by the second named respondent was ultra vires

his powers as an Inspector under the relevant Employment Acts. The appeal is brought also from the Order restraining the

respondents from further circulating or publishing the said report, or any earlier version thereof, and further challenges the

Order of Finlay Geoghegan J. which quashed the said report in its entirety.

Whilst there are two sets of proceedings in being, both were brought on behalf of the Gama company. The applicant first

named in the title hereof (hereinafter “Gama Turkey”) has its primary seat or location in Turkey. The second named

applicant is Irish based and was incorporated in 1999. It is a company ultimately owned by Gama Turkey. Gama

Construction Ireland (hereinafter “Gama Ireland”) has a number of Irish subsidiary and related companies. Gama Ireland is

involved in the construction industry. It commenced operations in Ireland in 2000 and competed successfully for several

important public sector projects, funded mainly from the National Development Programme. Projects in Ireland include

major road projects, power stations and social housing. The value of the work carried out by Gama Ireland and its related

companies in the calendar year 2003 was of the order of €89 million. According to the 2003 audited Gama Ireland Group

accounts, there were 1,066 employees in Gama Ireland who received wages and salaries of €28,051,524 in that year. In

March, 2005 Gama Ireland had 927 current work permits, of which 924 were in respect of Turkish nationals. Before

deciding to grant work permits to Gama, the Work Permits Section of the Department of Enterprise, Trade & Employment

had received assurances from Gama Ireland and its legal advisors at that time that all provisions of Irish employment law

would be observed and that the ‘going rate’ would be paid to all Turkish workers. In work permits documentation, the

Turkish workers were described as employees of Gama Ireland or other Irish-registered companies.

On 8th February, 2005, Mr. Joe Higgins T.D. made the following statement in Dail Eireann in respect of alleged abuses of

employment rights by Gama Ireland:-

“There is a major foreign based multi-national construction company, employing approximately 10,000

people, 2,000 approximately in this State, which has secured massive local authority and State contracts here.

This company imports workers from its home base, who do not speak English, controls their passports and

work permits, accommodates them often in company barracks, demands an extent of hours worked that can

only be called grotesque and, incredibly, pays unskilled construction workers between €2 and €3 per hour

basic pay and skilled workers somewhere over €3 per hour. In short, this is a modern version of bonded

labour. The instigator is Turkish-based Gama Construction Ireland Limited.”

On the same day and in the aftermath of the foregoing allegations, the Minister for Enterprise, Trade & Employment

directed the Labour Inspectorate of his Department to carry out an urgent investigation into the matter. This direction does

not appear to have been the subject matter of any formal instrument. Be that as it may, it is clear that the subject matter of

the investigation was to enquire into allegations that:

(a) Gama Ireland was paying unskilled construction workers €2/€3 per hour and skilled workers somewhat more than €3 per

hour and was, therefore, in breach of the requirements of, inter alia, the National Minimum Wage Act 2000; and

(b) Gama Ireland was requiring its workers to work “grotesque” hours and was therefore in breach of the requirements of,

inter alia, the Organisation of Working Time Act 1997.

The second named respondent, Edward Nolan, (hereinafter “the Inspector”) is the head of the Labour Inspectorate. By

warrant of appointment dated 12th December, 2000, the Inspector was appointed by the Minister to be:-

“An Inspector to exercise all the powers and perform all the duties conferred or imposed on an inspector under

the following Acts:-

· Industrial Relations Acts 1946 to 1990

· National Minimum Wage Act 2000

· The Organisation of Working Time Act 1997

· Protection of Young Persons (Employment) Act 1996

and to be an authorised officer to perform all the duties conferred or imposed on an

authorised officer under the following Acts:-

· Redundancy Payments Acts 1967 to 1991

· Protection of Employment Act 1977

· Employment Agency Act 1971

· European Communities (Safeguarding of Employees Rights on Transfer of Undertakings) Regulations 1980

· Protection of Employees (Employers Insolvency) Acts 1984 to 1991

· Payment of Wages Act 1991”

The investigation commenced on 9th February, 2005. On the same day, Mr. Karaalioglu, the managing director of Gama

Ireland, wrote to the Minister in the following terms:-

“Dear Minister Martin,

As Managing Director of Gama Construction Ireland Limited, I am writing to indicate my company’s

willingness to fully co-operate with the planned investigation announced by your Department, following the

statement and misinformation by Deputy Joe Higgins, made under Dail privilege.

I would request that this investigation be carried out as a matter of urgency so that we can minimise the

damage to the company’s reputation.

I would like to emphasise that the company is prepared to fully co-operate with any planned investigation

carried out by Department officials. We are also happy to produce all documents requested by your

representatives to facilitate such an investigation.

If your officials wish to meet or interview any of our employees we will also co-operate and facilitate such

meetings and ensure that workers attending such meetings are paid as if they were working.

If I can be of any further assistance to you or your Department in this matter please do not hesitate to contact

me.”

The investigation proceeded and the Inspector was in regular written contact with Mr. Karaalioglu and later his solicitor, Mr.

Grogan of P. C. Moore & Co., Solicitors. Certain documents were requested in writing and various staff members were

interviewed by Mr. Nolan and a number of site visits were also made.

By letter dated 3rd March, 2005, a number of significant admissions were volunteered on behalf of Gama Ireland by Mr.

Karaalioglu as follows:-

· “There have been errors in calculating the payroll. These errors have been rectified with 5.5% additional payment. I

attach copy letters from the Head Office.

· The company is not keeping working time records in accordance with the regulations. I attach a copy letter from our

solicitors of 2nd August, 2002 which did advise me of the formal requirements. I would like to discuss your requirements

to rectify this matter going forward.

· We have found in the internal investigation that payslips were only handed out in Turkey where the employees have

their formal employment contract. Payslips for the February payroll onwards will also be handed to employees in

Ireland. In line with advice from SIPTU last week we are going to insert additional information.”

On the following day, 4th March, 2005, Murray Consultants issued a statement on behalf of Gama Ireland in which they

stated, inter alia:-

“An internal review of payroll procedures at Gama Construction has found errors in the calculation of

payments to expatriate employees in Ireland. On average this has resulted in employees receiving 8% less than

their entitlement over a limited period of time.

The shortfall was discovered last week during a review of payment procedures by management and company

advisors. Gama immediately made good the amounts due to each employee. An interest payment has also been

added to the amounts paid.

A full investigation is underway to discover how this breach of the company’s policies and normal procedures

occurred. A number of individuals have been suspended pending the outcome of the investigation. The

employees and their unions have been advised of the situation. The auditors and the relevant authorities have

been notified.

The review has also examined other aspects of payment procedures for expatriate employees and a number of

improvements have been introduced.”

Further detailed information was sought by the Inspector on 7th March, 2005. On 8th March, 2005 the Inspector sought a

letter of authority from Gama Ireland to enable Gama’s accountants (Price Waterhouse Cooper) to facilitate him in the

investigation of the company accounts over recent years. This prompted a reply from Gama Ireland on 9th March, 2005

wherein Mr. Karaalioglu referred many of the Inspector’s queries to the Gama Turkey company. He stated:-

“Gama Construction Ireland Limited has an agreement with Gama Industrie Inc. for the provision of services.

These services are paid for by the Irish company and accounted for in the records of the Irish company. The

Irish company does not directly employ any Turkish workers covered by the REA Agreement and therefore

could only respond to these questions on the basis of my understanding of matters. I think it is better that the

Turkish company would respond directly itself as they can give definitive answers which I cannot.”

This was the first occasion when the Inspector’s enquiries and questions were offloaded from the Irish company onto the

Turkish company. Subsequent to this letter, the Inspector communicated also with Messrs. Mattheson Ormsby & Prentice,

solicitors for Gama Turkey.

In the week commencing 14th March, 2005 an interview was sought by the Inspector with Mr. Karaalioglu.

Communications between the Inspector and the former solicitor to Gama Ireland in relation to the arrangements for a

meeting with the solicitor became increasingly fraught. There followed a letter from the Inspector to Mr. Karaalioglu on 16th

March, 2005. This is a letter of considerable importance because it sets out clearly the basis upon which the Inspector

believed he was conducting his investigation. In the letter he stated:-

“I must remind you that this investigation is being carried out at the direction of the Minister for Enterprise,

Trade & Employment and that it has full statutory authority. If you persist in refusing to meet with me this

week, I will regard this as an offence – see Section 12.2 of the Industrial Relations Act, 1969.”

Significantly, the letter did not at any point suggest that the Inspector was acting on foot of any inherent executive power, or

indeed under any statutory powers other than those conferred on him under the terms of his warrant of appointment.

On 18th March the Inspector was informed that Gama Ireland was now represented by Kilroys Solicitors. On 19th March

the interview with Mr. Karaalioglu took place ‘under protest’ by reason of alleged lack of information from the Inspector as

set out in a note handed over to him at the commencement of the meeting. At the same time, there were negotiations going

on between the Inspector and the solicitors for Gama Ireland and Gama Turkey in relation to their entitlement to see and

comment upon the draft report and the timeframe within which that might be done. In this regard it is important to note that

there were three draft reports, dated respectively 21st March, 2005, 24th March, 2005 and 13th April, 2005, the first two of

which were furnished to Gama’s legal advisors with a view to ensuring that Gama’s observations could be included in the

report. The time for comment was extended until 30th March, 2005.

On 31st March, 2005, Gama Turkey wrote alleging that the investigation and report were ultra vires the Minister and the

Inspector and sought an immediate undertaking that any report would not be published, in default of which proceedings

were threatened.

At this point, given that it is central to the decision of the learned High Court judge, it is appropriate to refer to the issue of

the proposed publication of the report. It is not in dispute that the respondents intended from the very beginning that there

would be a general publication of the report and not merely a limited circulation to the Minister and appropriate regulatory

authorities. This was the case notwithstanding that a somewhat different intent might be inferred from para. 1.1.2. of the

Inspector’s final report dated 4th May, 2005, which contained significant alterations from earlier drafts and in which he

states:-

“At the outset, I wish to emphasise that the report does not make findings of fact and is not comprehensive or

conclusive regarding the issues which were raised during the course of the said investigation. Rather, the

report seeks to highlight the core issues which arise in attempting to determine the accuracy of the allegations

made by Deputy Higgins in respect of alleged breaches of Irish Employment Law. In this context, it is also

appropriate to mention that a number of issues were raised during the course of the investigation which I

considered should be brought to the attention of the appropriate regulatory authorities by the Minister. Those

issues concern, inter alia, matters of competition, public procurement, taxation, corporate governance and

possible fraud. I wish to emphasise, however, that reference is only made to these issues so that they may be

considered by the appropriate regulatory authorities and that the report does not make any findings of fact in

this regard.”

When undertakings as to non-publication were not forthcoming, the present judicial review proceedings were launched.

Essentially the proceedings seek both prohibition against publication of the report and an order of certiorari to quash the

report regardless of its state of publication. This relief was sought on the basis that the intended general publication was an

“unlawful purpose” which had the effect of completely invalidating the report.

The matter came before the High Court (Kelly J.) in April, 2005 when an interlocutory injunction was sought to restrain the

respondents from publishing the report in question, either generally or to the named entities to whom it was intended to be

sent. Those entities were:-

· The Competition Authority

· The Department of Finance (Taxation and Government Contracts)

· Department of Transport

· Director of Corporation Enforcement

· Garda Fraud Squad

· Garda National Immigration Bureau

· Incorporated Law Society

· Irish Auditing & Accounting Supervisory Authority

· Irish Financial Services Regulatory Authority

· Joint Body of Local Authorities

· National Roads Authority

· The Revenue Commissioners

At that point in time, Kelly J. found that only one serious issue for trial was made out, namely, that the investigation and the

report was ultra vires because it was intended for general publication, such publication not being contemplated or authorised

by any of the relevant statutes. He thus continued the restraint on publication which had been granted at the time of the

leave application. He did not, however, accept contentions that the Minister was not entitled to direct the Inspectorate of his

Department to investigate the matter and report to him. Nor did he accept that the Inspectorate was not entitled to use its

statutory powers granted under the Employment Acts to conduct its investigation. Kelly J. was also of the view that the

Minister, on receipt of the information yielded up by the investigation, was “perfectly entitled” to send that information to

other enforcement agencies in the State.

The matter ultimately came on for hearing in the High Court (Finlay Geoghegan J.) who delivered a written judgment on

14th June, 2005. Because I agree with a great deal of what was said by Finlay Geoghegan J. in her judgment, I propose to

refer to it in extenso in this judgment.

Executive Power or Statutory Powers?

Perhaps the easiest issue to deal with at the outset is to determine whether, as contended for by the respondents, the

investigation proceeded under the general and inherent powers of the Executive or whether, as contended for by the

applicants, it derived its authority exclusively from the Employment Acts detailed in the Inspector’s warrant of appointment.

At p.12 of her judgment, Finlay Geoghegan J. stated:-

“On the facts herein I have concluded that the Minister did not establish either of the foregoing types of

tribunal of inquiry or any commission or tribunal of inquiry. Rather, he directed that an investigation into the

allegations made by Deputy Higgins be carried out by the Labour Inspectorate, i.e. by an inspector or

possibly a group of inspectors appointed pursuant to and for the purposes of the relevant Employment Acts. In

doing so, whilst the Minister may have given the direction as part of the executive power of the State he

invoked an existing statutory scheme for the conduct of the investigation. The consequence of the direction

given was that the investigation was to be conducted by an Inspector, i.e. a statutory officer in accordance

with the relevant statutory scheme. There is no basis upon which it can be considered that the Inspector in

investigating the allegations was exercising any executive power of the State. The Inspector was conducting

the Investigation as a statutory officer with the backing of the relevant statutory powers pursuant to a statutory

scheme or schemes established by the Oireachtas in the Relevant Employment Acts. There is no factual basis

for, nor indeed was any submission made on behalf of the respondents to the effect that the Inspector was

conducting this investigation as a civil servant on behalf of the Minister.”

I fully agree with the views of the learned High Court judge in this respect, notably having regard to what the Inspector

himself said when writing to Gama Ireland on 16th March, 2004, a letter to which I have already referred. As noted by

Finlay Geoghegan J. at p.13 of her judgment:-

“The Inspector expressly conducted the Investigation pursuant to and in reliance upon the statutory powers

given him by the relevant Employment Acts. As appears from the facts recited, the applicants to a large extent

voluntarily co-operated with the Inspector and produced the relevant books, records and other documents;

permitted inspections and interviews of employees and participated by giving interviews as requested.

However, as noted, when there appeared a reluctance to co-operate within the required time scale, the

Inspector, by a letter dated the 16th March, 2005, to the managing director of Gama Ireland, reminded him of

the offence he might be committing under s.12(2) of the Industrial Relations Act, 1969, if he refused to meet

within the time-scale sought.”

While extensive written submissions, many of them addressed to the theme of the powers of the Executive, were lodged on

behalf of the respondents for the purpose of this appeal, the fact that the investigation was so clearly and exclusively

premised on specific statutory powers renders it unnecessary in my view to enquire as to whether some inherent (though

never invoked) Executive power provided an alternative basis for this investigation. Nor do I consider it necessary to

consider further whether such power, undefined and apparently limitless in nature, may be said to overlap or run in tandem

with statutory powers in this case.

Circulation of Report compiled under statutory powers

The learned trial judge determined, correctly in my view, that the various statutory powers relied upon by the respondents

did not envisage, permit or authorise any general publication of the report. This finding was not challenged or disputed by

the respondents during the hearing of the appeal. Instead they fell back on the concept of inherent executive power to

provide a justification for the proposed general publication. However any such justification disappears once it is clear that

the investigation was a statutory one only. I also agree with the findings of the learned trial judge when she said, assuming

the report was compiled for lawful purposes, that it could be passed to the Minister and to persons or authorities concerned

with enforcing the obligations imposed by the Employment Acts. At p.20 of her judgment she stated:-

“An inspector must also have an implicit or consequential power under the relevant Employment Acts to pass

to the Minister and persons concerned with the civil enforcement procedures information, documents or

evidence gathered pursuant to the Inspector’s express statutory powers for the purposes of those persons

enforcing the obligations imposed by the Acts on employers either by way of civil procedures or by

prosecuting alleged offences. I have reached such conclusion by reason of the very limited role for an

inspector provided in the civil enforcement procedures and the limited offences which an Inspector may

prosecute. It would render almost useless the express powers conferred on an Inspector to gather and obtain

information for the purposes of enforcing the obligations imposed by the Acts unless he had a power to pass

on the information gathered.”

Finlay Geoghegan J. cited in support of her view the well known statements of O’Hanlon J. (in the High Court) and

McCarthy J. (in this Court) in the case of Desmond v. Glackin (No. 2) [1993] 3 I.R. 67. I will return to a discussion of this

case later.

Counsel for Gama did not dispute the fact that Desmond v. Glackin provides a clear authority for the proposition that a

lawfully commissioned report obtained by one branch of the Executive may be circulated to other branches of the Executive

with a legitimate interest therein. Counsel expressly resiled from inviting this Court to reconsider or redefine the law as laid

down in Desmond v. Glackin but argued that the present case is distinguishable from it on the basis that while the

information gathered at first instance in Desmond v. Glackin was obtained voluntarily, the information in the instant case

was, towards the end of the investigation at least, obtained by a person “clothed with statutory authority” and for that

reason could only be used or made available to the Minister and not be used for other purposes. That said, the overall

approach of Gama to the appeal was to stand four square over the determination of the learned High Court judge that one of

the ‘purposes’ for which the Inspector’s report had been commissioned, namely general publication, was an ‘unlawful

purpose’ which vitiated and tainted the entire process and warranted the quashing of the report.

FINDINGS OF THE HIGH COURT IN RELATION TO PUBLICATION

Under the heading “Vires of Report” Finlay Geoghegan J. (at p.16 of her judgment) noted that it was common case

between the parties that the Inspector had no express statutory power under the relevant Employment Acts to prepare a

report of the results of an investigation for publication.

She noted that the powers conferred on an Inspector by each of the relevant Employment Acts are similar. They are to:-

(1) Enter premises at reasonable times

(2) Require the production of, examine and take copies of records.

(3) Examine and take statements from persons.

(4) Initiate prosecution of certain offences under the Acts.

(5) Initiate civil proceedings on behalf of a worker in specified circumstances.

The only express reference to the preparation of a report by an Inspector is contained in s.34(4) of the National Minimum

Wage Act 2000.

Finlay Geoghegan J. conducted a careful and detailed analysis of the various Employment Acts. She also considered

whether such a power could be regarded as incidental to or consequential upon the express powers given to the Inspector.

However, she concluded (at p.20):-

“..I have also concluded that there is nothing in either the express powers nor the purposes for which those

powers are conferred which permits me to conclude that an Inspector has an incidental or consequential

power under any of the Acts to prepare a report intended for publication of the results of an investigation into

alleged breaches by an employer of statutory obligations.”

It is at this point, however, that a critical Rubicon was crossed in the reasoning process elaborated in the judgment. In

holding that the intention to publish the report was an “unlawful purpose” the learned trial judge decided, notwithstanding

that it was intra vires the powers of the Inspector to compile and furnish the report to the Minister for the purposes

authorised by the relevant Employment Acts, the fact that it was prepared for the purpose of general publication carried the

investigation and report outside the vires of the Inspector. At p.23/24 of her judgment she stated:-

“Counsel for the respondents laid emphasis upon the fact that at all stages the inspector in conducting this

investigation was doing so only for a permitted statutory purpose, namely investigating alleged breaches of

the Relevant Employment Acts. That is so. However, I have concluded that the principles in Kennedy v. The

Law Society of Ireland (No. 3)[2002] 2 I.R. 458 apply to the preparation of the report by the Inspector.

As already concluded, the Inspector has an implicit statutory power to collate and pass to the Minister and

other relevant civil and criminal enforcement authorities information, documents and potential evidence

obtained in exercise of his express statutory powers for the purpose of those authorities enforcing by the

authorised civil procedures obligations imposed on the applicants by the relevant Employment Acts or to

prosecute alleged breaches thereof. Such information might be put together in a document called “a report”.

The name of the document does not appear important. What is important is the purpose for which the report is

prepared. It must be a purpose authorised by one of the relevant Employment Acts.

I have already concluded, as a fact, that the Inspector has not prepared a report as described in the preceding

paragraph but rather a report for publication. Applying the principles set out by Fennelly J. in Kennedy v. The

Law Society of Ireland (No. 3) [2002] 2 I.R. 458, notwithstanding the implicit power of an inspector to

prepare a report of the results of an investigation conducted pursuant to express statutory powers for purposes

authorised by statute the preparation of the Report by the Inspector for a purpose not authorised by statute is

ultra vires the powers of the inspector.”

Because the decision of this Court in Kennedy v. The Law Society of Ireland [2002] 2 I.R. 458 was thus determinative of

this case in the High Court, it becomes necessary to consider the facts of that case in some detail and to consider whether

the combination of ‘lawful’ and ‘unlawful purposes’ identified in Kennedy find a true counterpart in the facts of the present

case. In my view they do not.

In Kennedy the Law Society appointed an investigating accountant under the Solicitors Accounts Regulations (2) 1984 to

inspect the books and accounts of the plaintiff’s solicitor practice. Unknown to the plaintiff, the Law Society believed that

the plaintiff was involved in a number of fraudulent personal injury claims and the accountant was also instructed to search

for evidence of such involvement when carrying out her investigation. This was a ‘hidden agenda’ in the sense that it was

not communicated to the plaintiff. On the contrary, it was specifically denied when the plaintiff’s suspicions were aroused

and he challenged the investigator as to the true purpose of her investigation.

It was held by this Court, firstly, that the investigation of fraudulent claims was not an authorised purpose under the

Solicitors Accounts Regulations. It was further held that, if the respondents lacked a particular power to investigate a matter

notwithstanding the wide powers available to them, necessity was not a good reason for inferring such a power to them. The

respondents, as delegatees of statutory powers, could not exceed the limits of the statute or the secondary legislation

conferring such power. A persona designata who pursued, albeit in good faith, a purpose not permitted by legislation by, for

example, combining it with other permitted purposes, would be enlarging by stealth the range of its own powers. (Cassidy v.

Minister for Industry & Commerce [1978] I.R. 297 followed). On the particular facts of the case it was not possible to

sever the impermissible purpose from the decision to appoint the third respondent. The impugned decision was a single

decision which did not distinguish between the permissible and impermissible purposes underlying same. It was impossible to

limit the prospective effect of the decision. Although the respondents were not necessarily acting mala fide in the sense of

knowingly exceeding their powers, they deliberately concealed their intentions regarding materials which they were not

authorised to investigate.

In the course of his judgment, Fennelly J. stated as follows at pp. 488 to 489:-

“In the present case, the finding of the learned trial judge places the dual objectives of the appointing decision

on an equal level of importance. It is trite law that statutory powers must be exercised reasonably and in good

faith and only for the purpose for which they were granted. The pursuit of the impermissible objective was as

important to the first respondent as the permissible one. Such an exercise of delegated power cannot be

allowed to stand.

Neither do I think the appointing decision can be rescued in part by severing the good part from the bad part.

In Pigs and Bacon Commission v. McCarron & Co. [1981] I.R. 451, O'Higgins C.J., at p. 469, distinguished

Cassidy v. Minister for Industry and Commerce [1978] 1 I.R. 297 on the ground that "… the orders made by

the Minister stood and continued to operate to the extent and in the manner contemplated by the empowering

legislation." In Pigs and Bacon Commission v. McCarron & Co., the authority had made an order for the

payment of a specified amount of levy and the court could not rewrite that by substituting a reduced levy.

The appointing decision in this case was a single one. It is not possible for the court to sever it. I reach that

conclusion for three reasons. Firstly, it does not distinguish between the valid and the invalid purposes it

purports to authorise. Thus it does not lend itself to the sort of severance that occurred in The State

(McKeown) v. Scully [1986] I.R. 524 and Glencar Exploration plc v. Mayo County Council [1993] 2 I.R. 237.

Secondly, it is not possible to limit its prospective effect, which was possible in the unusual circumstances of

Cassidy v. Minister for Industry and Commerce [1978] 1 I.R. 297. If an application for judicial review had

been heard before the appointing decision had been acted upon, it might have been possible for the court to

make an order limiting the investigation to be carried out. Even then, however, a question might have arisen

as to whether a decision so heavily influenced by an impermissible consideration should be allowed to stand:

the first respondent might not, it could have been argued, have made the appointing decision at all if it had

not been influenced by its concern about fraudulent claims. Thirdly, I think the decision should be quashed in

any event, because the first respondent engaged in a policy of deliberate concealment of its intentions,

especially when, as this court has held, the concealed intention related to material which it was not authorised

to investigate by means of the Accounts Regulations. In saying this, I am not saying that the first respondent

was acting mala fide, in the sense of knowingly exceeding their powers.”

The differences between the facts of the Kennedy case and the present case are readily apparent. In Kennedy, both

purposes, the permissible purpose and the impermissible purpose, fell within the scope and ambit of the investigation. The

accountant was examining the books as part of a routine inspection but was also looking for evidence of fraudulent claims

while doing so. In contrast, the purposes of the present inquiry were to investigate allegations that Gama workers were

underpaid and being compelled to work excessive hours, in breach respectively of the National Minimum Wage Act 2000

and the Organisation of Working Time Act 1997. A true counterpart to the facts of Kennedy would have been a scenario in

which (and I stress this is not something which arises in the present case) the Inspector availed of the authorised

investigation to inquire into some other matter of concern in relation to Gama, as, for example, the possibility that the

company was facilitating the illegal trafficking of Turkish citizens into this country.

The intended ultimate publication of any report emerging from the investigation is in my view a collateral and incidental act

outside of the purposes of the investigation itself. It is the means whereby the fruits of the investigation are dealt with in a

particular way. For example, if a production company were to make a film documentary about working conditions in rural

Ireland in the last century, the fact that the company had also decided and intended that the film be released say in Canada

but not in the U.S. could hardly be described as a ‘purpose’ of making the film in question. The purpose would always have

been to show the working conditions depicted in the film.

If publication was deemed to be a ‘purpose’ of an investigation, one might enquire what legal consequences would follow if

there was no intention to publish at the start of an enquiry, followed by the formation of an intention to publish in the middle

of the enquiry, followed by a still further decision not to publish following completion of the report. Would that report

thereby be invalidated ab initio because of an intention formed at a particular moment in time to deal with the fruits of a

perfectly legitimate investigation in a certain way? I do not believe so.

I am strongly of the view that to conflate the concept of publication with the purposes of the investigation itself was to

misapply Kennedy v The Law Society of Ireland in a critical respect to reach an incorrect conclusion as to the validity of the

report in this case. In my view the preparation and compiling of the report was a perfectly valid and legitimate exercise

under the statutory regime relied upon. Its validity is not undone because of a mistaken belief that the selfsame statutory

regime permitted general publication.

Even if I am mistaken in the view I have formed, the issue of publication is one which in this case can readily be severed

from the commissioning of the investigation and the preparation of the ensuing report. This is not a case like Kennedy where

the permissible and impermissible purposes were so interwoven as to be incapable of severance. However, I do not think it

is necessary to analyse this potential remedy further in light of the conclusions I have reached.

FAIR PROCEDURES

As noted by the learned trial judge, another issue in the proceedings was the allegation on behalf of the applicants that the

investigation had been conducted and the report prepared in breach of their entitlement to fair procedures. However, it was

accepted on Gama’s behalf during the hearing of the appeal that there could be really no complaint about a lack of fair

procedures in circumstances where the report and the results of the investigation were confined to statutorily permitted

purposes. As I take the view that a circulation of the report confined to the Minister and other civil or criminal enforcement

authorities for permitted statutory purposes under the relevant Employment Acts is perfectly permissible, it follows there is

no reality in the fair procedures arguments in this case. Any contentions of the applicants in this regard must be seen in the

light of the promised co-operation with this enquiry offered at the outset by letter dated 9th February, 2005. For most of its

time in preparation, the Inspector’s report was being compiled on the basis, much touted by Gama, that it was fully co-

operating with the investigation

Furthermore, there is clear evidence from the drafting changes in the successive draft reports that the Inspector was being

particularly careful and circumspect in formulating his views. Opportunities were provided at every turn for Gama to make

submissions and observations on the draft reports submitted to them and their legal advisors. Any suggested ‘findings’ in

early versions of the report became ‘assessments’ in the final version, which said report in turn called for a further inquiry.

It seems fairly obvious that legal advice as to fair procedures issues was being taken by the Inspector during the course of

preparation of the report and it seems to me the respondents can hardly be criticised for having his work vetted and

protected in this way. The net bonus to Gama was that the final report was both muted and provisional.

I do not believe that the findings of the learned trial judge on the issue of fair procedures can be impugned in any way.

DESMOND v GLACKIN

I indicated earlier that some discussion of the decisions of the High Court and this Court in Desmond v Glackin (No.2)

[1993] 3 I.R. 67 is both appropriate and relevant to the issues arising in this case. In that case an Inspector had been

appointed by the Minister for Industry & Commerce pursuant to the provisions of the Companies Act 1990 for the purpose

of investigating the affairs of a number of companies which had been involved in the purchase and sale of a site in

Ballsbridge in Dublin. In the course of his investigation the Inspector had requested the Minister to obtain information from

the Central Bank through the Minister for Finance concerning exchange control transactions involving one such company.

Mr. Desmond contended that there was no entitlement in the Minister for Finance to divulge information obtained by him

from the Central Bank, as his agent, in relation to transactions pursuant to the provisions of the Exchange Control Acts 1954

to 1962, to any person for any purpose other than the carrying out of the duties imposed on him by those Acts.

This contention was rejected both by O’Hanlon J. in the High Court and by McCarthy J. in delivering the judgment of this

Court on this particular issue.

At p.102 of his judgment in the High Court, O’Hanlon J. stated:-

“There appears to me to be a clear public interest in having all the information needed by the inspector for

the purposes of his investigation made available. I do not detect the existence of any significant public interest

of equal or near-equal weight in denying access by the inspector to this source of information. The knowledge

on the part of persons involved in transactions requiring them to make disclosure to the Central Bank under

the Exchange Control Acts, 1954 and 1962, that particulars of such transactions may, in unusual and

exceptional circumstances, be made available to an inspector appointed under the Act of 1990, and may - if he

finds the information relevant to the subject-matter of his investigation - be made public at some stage, may be

upsetting for the persons concerned but it cannot, (without illegality), diminish in any way the free flow of

information to the Central Bank under the Exchange Control Acts.

I have come to the conclusion that what was done in relation to obtaining information from the Central Bank

and making it available to the inspector was permissible and did not involve a breach of a duty of

confidentiality arising in favour of the applicants under the provisions of the Central Bank Acts, 1942 to 1989,

or the Official Secrets Act, 1963, or at common law or under the Constitution.”

The approach adopted by O’Hanlon J. received express approval from this Court when in the course of his judgment

McCarthy J. stated at p.132:-

“I am satisfied that there is no principle of law, nor indeed is there any principle of common sense, which

would prohibit a Minister of State who properly has obtained from an agent carrying out on his behalf a

statutory power vested in him, information which may be of assistance to another Minister of State in carrying

out a statutory duty imposed on him, such as the investigation by an inspector appointed under s.14 of the Act

of 1990, from assisting that investigation. I would affirm with approval the statement contained in the

judgment of O'Hanlon J., in respect of this particular issue, that the foundation of freedom in our society must

surely have a sounder base than the possible concept of government activity carried out, of necessity, in

watertight compartments. I am, therefore, satisfied that the learned trial judge was correct in rejecting the

application for a declaration and hold that there was nothing illegal or improper in any way in the obtaining,

which was done with full disclosure by the inspector, through the Minister for Industry and Commerce from

the Minister for Finance, of the information supplied by the Central Bank.”

This case is the clearest possible authority for the proposition that at least a private and limited circulation of the Inspector’s

report to the relevant statutory authorities was permissible. One might indeed go further to state that such circulation was

both desirable and indeed necessary if effective enforcement of the relevant Employment Acts was to be assured.

Despite the contentions of counsel for Gama, I believe the decision in Desmond v. Glackin, to be a case on all fours with

the instant case and quite distinguishable from the decision of Nicholls V-C. in Morris & Others v. Director of Serious

Fraud Office & Others [1993] 1 All E.R. 788. In that case the Director of the Serious Fraud Office (SFO) was investigating

the affairs of an insolvent deposit taking institution (B.C.C.I.) and for that purpose had obtained a large number of

documents from various sources, including a firm of chartered accountants who had provided auditing and accounting

services to B.C.C.I. for some years prior to its liquidation. The documents had been obtained by the Director pursuant to

the Criminal Justice Act 1987. The liquidators of B.C.C.I. wished to obtain access to the records in the possession of the

accountants and applied for an order requiring the SFO to produce the documents in its possession, including documents

seized from the accountants and other documents seized by the police from the premises of third parties. The question arose

as to the extent of the SFO power to make disclosure to the liquidators. Nicholls V-C. held that the powers of the SFO were

not to be regarded as encroaching upon the rights of individuals more than was fairly and reasonably necessary to achieve

the purpose for which the powers were created. Although the Criminal Justice Act 1987 authorised disclosure of information

obtained in the exercise of those powers to certain persons, office holders of a company such as liquidators and receivers

were not included amongst those to whom disclosure could be made. He further held there was no justification for implying

a general power for the SFO to disclose information obtained in the exercise of compulsory powers to persons not named

under the Act as persons to whom the information might be given. At pp.794 to 795, Nicholls V-C. stated:-

“In the absence of an express power to make disclosure to office-holders, is a power to make disclosure to

them to be implied? In my view it is not. Whether the list in s. 3 is to be regarded as exhaustive for all

purposes in respect of information obtained by the S.F.O. from all types of sources is not a matter I need

pursue on this application. Suffice to say, I can see no justification for implying a general power for the

S.F.O. to disclose information, obtained in the exercise of compulsory powers conferred by the Act, to persons

not named in s. 3. That, surely, is only what one would expect. The compulsory powers of investigation exist to

facilitate the discharge by the S.F.O. of its statutory investigative functions. The powers conferred by s. 2 are

exercisable only for the purposes of an investigation under section 1. When information is obtained in

exercise of those powers the S.F.O. may use the information for those purposes and purposes reasonably

incidental thereto and such other purposes as may be authorised by statute, but not otherwise. Compulsory

powers are not to be regarded as encroaching more upon the rights of individuals than is fairly and

reasonably necessary to achieve the purposes for which the powers were created. That is to be taken as the

intention of Parliament, unless the contrary is clearly apparent.”

Paradoxically, while this case was cited by the respondents as an authority for the proposition that general publication of the

Inspector’s report could in no sense be justified, it may also be seen as clear authority for the proposition that a private and

limited circulation of the report to the relevant statutory agencies is entirely warranted, given that such circulation may be

seen as being for “purposes reasonably incidental” to the exercise of the statutory powers in question.

Also cited was the decision in Marcel & Others v. Commissioner of Police of Metropolis & Others [1991] 2 W.L.R. 1118

in which an effort was made to secure the production from the police of documents seized by them in the course of

investigating allegations of criminal offences so that they could be used in civil proceedings which had been brought by a

company with which the plaintiffs were closely connected. The plaintiffs were the persons against whom allegations of

criminal conduct had been made and they applied for an injunction to restrain the police from dealing with the documents

seized save for the purposes connected with the investigation and prosecution of crime.

It was held by Browne-Wilkinson V-C that, since the police were authorised to seize, retain and use the documents only for

public purposes related to the investigation and prosecution of crime and the return of stolen property to the true owner,

they were not entitled to disclose documents seized under the Police & Criminal Evidence Act 1984, to a third party to

enable him to use the documents in civil proceedings to protect his legal rights since the public interest in ensuring that the

documents were used solely for the public purposes for which the power of seizure was conferred was inviolate and

outweighed the public interest in ensuring that in the civil proceedings all relevant information should be available to the

court. It was further held that where the police or any other public authority used compulsory powers to obtain information

and documents from a citizen, that information and those documents were received solely for those purposes and equity

would impose on the public authority a duty not to disclose them to third parties except by order of the court.

However, as was noted by O’Hanlon J. in Desmond v. Glackin (No.2) the critical distinction in Marcel v. Commissioner of

Police was that the disclosure of information obtained by the police was sought so as to make documents seized by the

police available for the purpose of civil proceedings between parties other than the persons whose documents had been

seized. Browne-Wilkinson V-C was approaching the issue on the basis that the powers to seize the documents were

conferred for the better performance of public functions by public bodies – an intention entirely different from that of

making the same information available to private individuals for their private purposes. At p.102 of his judgment, O’Hanlon

J. stated:-

“I do not share Browne-Wilkinson V-C's stated apprehension about the consequences of sharing information

lawfully obtained across a wide spectrum of state agencies and consider that it may be helpful for good

government and the welfare of the community. The Vice-Chancellor considered, at p. 1130, that "[t]he dossier

of private information is the badge of the totalitarian state". I would think that the protection of a free society

must rest on surer grounds than the operation of the affairs of state in water-tight compartments.”

I fail to see how any element of the cases cited on behalf of Gama assist their position in any way, other than as regards the

issue of general publication of the Inspector’s report. The cases relied upon do not speak to a limited and private circulation

of the report to the relevant statutory agencies who have the clearest of interest in upholding the efficacy of the relevant

Employment Acts.

I do not believe the respondents have made out any case which would suggest that the principles enunciated in Desmond v.

Glackin (2) can or should be revised or qualified in some way, nor have the respondents in my view established any real or

meaningful distinction between the facts of that case and those of the instant case. It is important to also note in this context

that under the Exchange Control Acts, 1954 and 1962, information had to be furnished to the Central Bank concerning

transactions involving the movement of funds into and out of the State, so that the material or information in issue might

equally, as in this case, be characterised as having been obtained under compulsion by persons or an authority “clothed with

statutory powers” in compliance with the relevant legislation.

CONCLUSION

For the reasons set out above, I would allow the appeal herein and reverse the order quashing the report of the Inspector

herein dated 4th May, 2005.

As I do not believe there are any powers of general publication within the statutory regime relied upon for this investigation,

I would further direct that the persons or bodies entitled to have sight of the report be confined to those State bodies with a

prosecutorial function in relation to the matters identified in the report. These bodies have already been identified in the

interlocutory order made herein by Kelly J.