[2018] IELCA 8 THE HIGH COURT

2015 7742P

BETWEEN

STARQUAY LIMITED TRADING AS FRIDGE RENTALS

PLAINTIFF

AND

REFRIGERATION RENTALS LIMITED

DEFENDANT

RULING ON PRELIMINARY ISSUEJurisdiction

s 17 of Courts Act 1981, as amended by s 14 of Courts Act 1991

Introduction and Background

1. The Plaintiff issued a Notice of Taxation on 12th October, 2017 returnable for 6th December 2017, which was adjourned by consent of the parties to 2nd February, 2018 when the matter was heard before me. The issue between the parties is a preliminary but important point, as it affects the nature of and the basis of the Taxation of the Plaintiff’s costs. It concerns the applicability or otherwise of s 17 of the Courts Act, 1981 as amended by s 14 of the Courts Act, 1991.

2. The Bill of Costs submitted is detailed and contains a more amplified history of the proceedings. I defer to its content in that regard.

3. Mr Robert McGarr BL, attended the hearing before me on behalf of the Plaintiff and Mr Ray Ryan BL, represented the Defendant. Both were also Counsel who negotiated a settlement of these proceedings and arranged to have them ruled before Gilligan J.,on the 24th April, 2016. I will refer to the submissions as being the Plaintiff’s or the Defendant’s, as the case may be.

4. The Plaintiff issued these High Court proceedings against the Defendant, seeking various relief as against the Defendant on the basis of passing off

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(I will use the neutral term). For present purposes, it is sufficient to record, as an act of mechanics, the following steps.

5. The Plaintiff issued High Court proceedings on the 25th September, 2015. A Notice of Motion dated the 28th January, 2016 was issued seeking an Interlocutory Injunction. The Motion was grounded on affidavit, which was followed by the usual exchange of replying affidavits. The Motion was adjourned from time to time. I am informed that the application for the Injunction was never opened to the Court but was due on for hearing on the 31st May, 2016.

6. The parties arranged a settlement meeting, which took place on the 20th

April, 2016. I was informed that these negotiations were protracted and lasted from 10am to 4pm. Heads of agreement were reached between the parties culminating in a written settlement agreement. It was submitted to me that the signed settlement agreement was brought before the Court for Ruling on 28th April, 2016. I was informed that it was on the suggestion of the Court, that such heads of agreement were to be incorporated into an Order, so as to facilitate any future requirement for enforcement. The only slight distinction (nothing turns upon it) between the written heads of agreement and the terms of the Order, is that there is provision for reserved costs. An agreed Order was ultimately made by the High Court (Gilligan J.) on the 24th April, 2016.

7. The applicable part of the Order of the Court reads

“11. An Order directing the Defendant to pay the Plaintiff’s costs, to include all reserved costs, to be taxed in default of agreement;

8. Put simply, the Plaintiff contends that the costs of the proceedings, provided for at numbered paragraph 11 are High Court costs and the Defendant contends that the costs which the Plaintiff is entitled to are Circuit Court costs.

9. It may be helpful to summarise the relevant statutory provisions in issue. Section 14 of the Courts Act, 1991 amended s 17 of the 1981 Act by the substitution of the following.

“17(1) Where an order is made by a court in favour of the plaintiff or applicant in proceedings (other than an action specified in subsections (2) and (3) of this section) and the court is not the lowest court having jurisdiction to make an order granting the relief the subject of the order, the plaintiff shall not be entitled to recover more costs than he would have been entitled to recover if the proceedings had been commenced and determined in the said lowest court.

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(2) In any action commenced and determined in the High Court, being an action where the amount of damages recovered by the plaintiff exceeds £25,000 but does not exceed £30,000, the plaintiff shall not be entitled to recover more costs than he would have been entitled to recover if the proceedings had been commenced and determined in the Circuit Court, unless the judge hearing the action grants a special certificate, for reasons stated in the order, that, in the opinion of such judge, it was reasonable in the interests of justice generally, owing to the exceptional nature of the proceedings or any question of law contained therein, that the proceedings should have been commenced and determined in the High Court.

(3) In any action commenced and determined in the High Court, being an action where the amount of the damages recovered by the plaintiff exceeds £5,000 but does not exceed £15,000, the plaintiff shall not be entitled to recover more costs than whichever of the following amounts is the lesser, that is to say, the amount of such damages or the amount of costs which he would have been entitled to recover if the action had been commenced and determined in the Circuit Court. …”

The Plaintiff’s Submissions10. The Plaintiff submitted that it had two points to make. First, is s 17 of

the Courts Act engaged when a Consent Order is made, if it is, that is the end of the matter. If not, High Court costs are recoverable. Second, and by way of response to the Defendant’s submission, the Defendant has contended that goodwill is not a property within the meaning of the Third Schedule of the Courts (Supplemental Provisions) Act, 1961 and accordingly, the Circuit Court could not have dealt with the matter.

11. The Plaintiff outlined a broad history of the background of the matters involved in the proceedings, referring me to the first five paragraphs of the Plenary Summons, outlining the fact that the Plaintiff has a Registered Business Name, not a Trademark. The terms of settlement at points 1 through 10 are in the nature of an Injunction, and as a consequence are focussed on activities, which are likely to cause confusion to people within the marketplace. It was submitted that there was no discussion during the settlement meeting as to whether or not Circuit Court costs were applicable, the negotiations were in the main focussed on the injunctive measures and once they were agreed there was discussion about a sum of money (the Plaintiff submits not damages) to cover the Plaintiff’s inconvenience for having to instruct solicitors and a nominal sum of €7,500 was agreed. The terms were reduced to writing and signed by the Principals, which contained an undertaking that those terms would be ruled before the Court.

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12. The Plaintiff submitted that during the proceedings before the Court or in the process of settlement, there was no discussion or opening of the case before the Court, there was no opening of affidavits, once the matter was settled, it was simply a matter of attending the Chancery list on that day and having the written settlement agreement made an Order of the Court.

13. The Plaintiff referred to the judgement of the Supreme Court in Cronin v Astra Business Systems [2004] IR 476. In that case, the Plaintiff had accepted a lodgement made by the Defendant of a sum of money within the monetary limits of the jurisdiction of the Circuit Court. The Costs were duly Taxed by the Taxing Master who concluded that the costs should be Taxed on the High Court Scale, having regard to the specific provisions of s 17 (1) of the Courts Act, 1981 as amended. The Taxing Master’s decision was upheld by Butler J., [2003] 2 IR 603 and ultimately by the Supreme Court. The Plaintiff referred me to the entirety of the judgement but specifically to paragraph 26 of the judgement, which provides

“…Section17(1), as has been accepted, specifically governs only the situation where the amount of damages is ordered by the court. Its terms should not, in my view, be extended to cover the acceptance by the plaintiff of a lodgement. I am unable to accept that in all circumstances and in every case the value of a case can be measured by the amount of an accepted lodgement. I consider that the learned trial judge was correct in his conclusion that he could see no basis for determining that it was the intention of the Oireachtas that a plaintiff who institutes proceedings in the High Court and accepts a sum lodged that is within the jurisdiction of the Circuit Court should not be entitled to have her costs taxed on a High Court basis.”

14. The Plaintiff also referred me to a case of Brian Kelly v The Minister for Defence and The Attorney General [2009] IR 244. Unlike Cronin, the Plaintiff in Kelly, which was a claim involving Army Deafness, had settled his case for a monetary sum falling within the Circuit Court jurisdiction. The Plaintiff referred me in particular to paragraph 34 of the judgement, wherein the learned Judge sets out her conclusions;

“ConclusionsSection 17 of the Courts Act 1981 is a self-contained statutory scheme designed by the legislature to impose a cap on costs that may be recovered by a successful plaintiff or applicant where the order made in his favour is made by a court which is not the lowest having jurisdiction to make the order granting the relief the subject of the order. I have already referred to a passage from the judgment of Hardiman J. in the case of O’Connor v. Bus Atha Cliath, in which he described the purpose of the statutory scheme contained in s. 17.

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Murray J. (as he then was) in the same case stated the following at pp. 493 – 494:-

“The relevant provisions are part of a statutory scheme whereby claims may be brought in different courts according to the level of their jurisdiction to give the relief sought by a plaintiff. It is clear that among the policy reasons for such provisions is that they facilitate the efficient administration of justice, and are of convenience to all the parties in bringing their cases, where appropriate, before courts of local and limited jurisdiction. In particular, in the present context, it will usually mean that lower costs are incurred by both the plaintiff and the defendant than if the proceedings had been brought to the higher court.

It is clearly in the public interest that claims are in principle brought before the lowest court having jurisdiction to hear and determine the claim with a view to the proper and efficient administration of justice and for the purpose of minimising the cost of litigation generally and in particular for the parties. There is therefore an onus on a Plaintiff to bring the proceedings before the court having the appropriate jurisdiction.”

Bearing in mind the judgments of Murray J. and Hardiman J. in that case, there can be no doubt that the policy behind s. 17 is to compel plaintiffs to bring their proceedings in the appropriate jurisdiction in respect of the relief being sought and to encourage this by ensuring that the costs recoverable by a successful plaintiff in circumstances where the claim has been brought in a higher jurisdiction than that which is necessary, shall not exceed the costs that would be recoverable had the case been brought in the appropriate jurisdiction. 

As pointed out earlier, there was no dispute between the parties as to the principles applicable to the construction of the section. Reference was made to Bennion on Statutory Interpretation and I think that the submissions in this regard can be helpfully summarised by a passage contained in a judgment of the Supreme Court in the case of E.M.S. v. Minister for Justice [2004] 1 IR 536, which concerned the meaning of a provision of the Illegal Immigrants (Trafficking) Act 2000. At p. 540 of the judgment in that case, Hardiman J. who gave the judgment of the court stated as follows:-

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“Is what the statement of grounds describes as the respondent’s ‘refusal [to] give consent to the applicant herein to make a further application for a declaration of refugee status pursuant to s. 17(7) of the Refugee Act 1996’a ‘refusal’ within the meaning of s. 5(1)(k) of the Act of 2000? In approaching this question one must first have regard to the very basic canon of construction summarised in Bennion, Statutory Interpretation (3rd Ed. 1997) at s. 285 as follows: -

‘Prima facie, the meaning of an enactment which was intended by the legislator (in other words its legal meaning) is taken to be that which corresponds to the literal meaning.’

The author notes that the literal meaning corresponds to the grammatical meaning unless that meaning, deduced in the relevant context, is ambiguous. In that event then any of the possible grammatical meanings may be described as the literal meaning. Authorities from several different centuries are cited for those basic propositions.”

It is the contention on behalf of the defendant herein that the word “determined” as used in s. 17(3) encompasses matters which have been concluded in the High Court but not necessarily concluded as a result of a hearing before the High Court. The plaintiff’s contention in this regard is that the word “determined” should be understood only in the context of a determination by the High Court of the matters in dispute between the parties. I referred earlier to the dictionary definitions of the word “determined” with which I had been supplied. Mr. Barniville SC on behalf of the defendants placed particular emphasis on the second definition given in the Oxford Modern English Dictionary i.e. “decide or settle”. It is interesting to note that in the dictionary definition relied on by the defendants, an explanation as to the usage of the word in that context is given as follows: “Decide or settle (determined who should go)”. Relying on that definition of determine, it would appear that the meaning of “determined” in the context is somewhat ambiguous. A case decided in the High Court could only be decided in the context of a hearing but of course a settlement can occur before, during or indeed after a hearing. Again the fourth definition given, “make or cause a person to make a decision” seems to me be supportive of the contention made by the plaintiff as to the meaning of the word “determined” as used in s.

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17(3). In that context it seems to me that there is certainly some ambiguity in the meaning of the word determined as used in s. 17(3). Murdoch’s Dictionary of Irish Law uses the definition of the word “determine” as follows: “to come to an end or bring to an end”. In that sense it is clear that proceedings commenced in the High Court may be brought to an end by a variety of means e.g. they may be discontinued, they may be struck out, they may result in a decree for the plaintiff or the defendant or they may be settled. In other words, a variety of interpretations for the word “determined” can arise. 

Given that the word “determined” as used in s. 17(3) is capable of a number of different meanings, it seems to me that it is important to look at the precise wording of s. 17 as a whole, in order to see if some further guidance can be obtained from the section as to the meaning of the word “determined”. In that regard I think it is necessary to go back to s. 17(1) which provides: -

“Where an order is made by a court in favour of the plaintiff or applicant in any proceedings (other than an action specified in subsections (2) and (3) of this section) (my emphasis) and the court is not the lowest court having jurisdiction to make an order granting the relief the subject of the order, the plaintiff should not be entitled to recover more costs than he would have been entitled to recover if the proceedings had been commenced and determined in the said lowest court.”

The objective and intention of s. 17 has been clearly set out in the judgments of Murray J. and Hardiman J. to which reference has already been made. It is also clear from the judgment of McGuinness J. in the case of Cronin referred to above that s. 17(1) refers to an order made by the court following a hearing. That being so, I have come to the conclusion that when s. 17 (1) refers to the actions specified in subss. (2) and (3) of the section it is referring to actions where the proceedings have resulted in an order made by a court following a hearing. I am fortified in this view by the specific provisions of subss. (2) and (3). The general rule as set out in s. 17(1) and (3) is that a plaintiff cannot recover more costs than he would have been entitled to recover if the proceedings had been commenced and determined in the lowest court. Section 17(2) provides a limited exception to that rule in cases where the amount of damages recovered by the plaintiff exceeds £25,000 but does not exceed £30,000. In those circumstances, the judge hearing the action can grant a special certificate for reasons stated in the order that in the opinion of the judge it was reasonable that the proceedings should have been commenced and determined in the High Court. It goes without saying that such a decision cannot be made without a hearing of the matter. Section 17(3) amounts to the imposition of a sanction on plaintiffs whose damages fall within the range of £5,000 but do not exceed £15,000. I am inexorably driven to the conclusion that in s. 17(3) the use of the phrase “in any action commenced and determined

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in the High Court” as used in that section, bearing in mind the provisions of s. 17(1) and s. 17(2), can only mean determined following a hearing in court. That seems to me to be the logical conclusion to draw from the scheme of the section as a whole. 

In the Cronin case reference was made in the course of her judgment by McGuinness J. to the various considerations that may induce a plaintiff to accept a lodgement. She concluded that in most cases subjective and objective considerations would have come into play. She went on to comment: -

“I am unable to accept that, in all circumstances and in every case, the value of a case can be measured by the amount of an accepted lodgement.”

It is also the case that most personal injury actions are compromised without the parties proceeding to a full hearing. It is important that parties should, where possible, compromise proceedings. The compromise of an action saves time in terms of court hearings and as a consequence, saves costs. The observations of McGuiness J. in respect of lodgements are just as relevant to the compromise of proceedings. 

I am of the view that in enacting the provisions of s. 17 of the 1981 Act, the intention of the legislature was to deal with those cases where the order of the court was made following a hearing as opposed to circumstances where the parties themselves reached a compromise. The overall thrust of s. 17 appears to me to have been intended to apply to those circumstances where a plaintiff has persisted in pursuing a case through to a hearing resulting in a decree for damages which comes within specified limits and thus falls to be determined in accordance with the provisions of s. 17 of the 1981 Act.

In the circumstances, it seems to me that I should not allow the appeal of the defendants herein and should affirm the ruling of the Taxing Master herein.” 

15. The Plaintiff submitted that the Court in Kelly concluded that s 17 is a self-contained scheme to be read in its entirety.

16. The Plaintiff submitted that at paragraph 42 in Kelly the Court’s conclusions are to the effect, that in enacting s 17 of the Act of 1981, the intention of the legislature was to deal with those cases where the Order of the Court was made following a hearing as opposed to where a compromise had been reached between the parties. The Plaintiff submitted further that where a Plaintiff has persisted in pursuing a case through to a hearing resulting in a decree for damages which come within specified limits, the

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legal costs thus fall to be determined in accordance with the provisions of s 17 of the 1981 Act.

17. The Plaintiff referred me to The County Council of the County of Meath v Christopher Rooney and Irish Helicopters Limited [2009] IEHC 564. The Plaintiff submitted that this is an example of circumstances where a case was partially compromised and part went to a hearing, this was therefore a case that was heard and determined, it is distinguishable on its own facts.

18. I was referred to Savickis v Governor of Castlerea Prison, Minister for Justice and Equality, Irish Prison Service, Ireland and Attorney General – Judgement on Costs Only [2016] IECA 372. The Plaintiff submitted that the fact that the case went to a full hearing in the High Court and the Court of Appeal, that these particular facts engaged s 17. In Savickis the Plaintiff had issued High Court Proceedings for assault, negligence and breach of constitutional rights arising from an altercation in a prison. The Plaintiff had a Trial before a Jury in the High Court [2016] IEHC 310, which awarded him a net sum of €225. That Order was Appealed and the Court of Appeal [2016] IECA 310/1 (Hogan J) and [2016] IECA 310 (Irvine J) increased the damages to a sum of €17,225 to include a sum for exemplary damages. Following the hearing in that case an application was made by Counsel for the State for an Order pursuant to s 17(3) of the Courts Act, 1981 as amended. The Plaintiff submitted that this case was distinguishable on its own facts, as the case was one which was heard and determined and because of that, s 17 was engaged.

19. The Plaintiff submitted that the cases of Savickis and Rooney are distinguishable on their own facts. They were capable of being distinguished as the cases were heard and determined and because of that s 17 was capable of being engaged.

20. I now turn to the Plaintiff’s second point. The Plaintiff submitted that the subject matter in issue was not property within the meaning of the Third Schedule of the Courts (Supplemental Provisions) Act, 1961. Referring to Rodgers v Mangan (Geoghagan J) 15th July, 1996 (sic) neutral citation [1999] IEHC 238 in support.

21. The Plaintiff submitted that the proceedings are of a type that fall under the general description of passing off, essentially to protect the goodwill and reputation of a business from damage, through misrepresentation, actual or anticipated. In the Plenary Summons issued, the primary relief was Injunctive, not as an ancillary relief. The terms of the settlement

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agreement at paragraphs 1-10 were exclusively injunctive in nature. The monetary amounts agreed were not damages.

22. The Plaintiff submits that the source of the Circuit Court’s jurisdiction to grant an Injunction is contained in s 22 of the Courts (Supplemental Provisions) Act, 1961, which refers to the civil jurisdiction of the Circuit Court by reference to the Third Schedule to the Courts (Supplemental Provisions) Act, 1961 and in particular entry number 27 on the Schedule.

23. The Plaintiff submitted that it is not generally accepted that goodwill constitutes “property” and that any argument to this effect is weak, as goodwill cannot be assigned separately from the business to which it relates, stating that it cannot be bought, sold, charged or transferred in its own right.

24. Citing Rodgers v Mangan as authority that in this jurisdiction, actions concerning damage or potential damage to goodwill are not considered to be actions concerning “property” but are rather treated as involving wrongful activities which either already or have in the future, the potential to cause financial loss to a business. In Rodgers which involved an application for an Injunction to restrain the Defendant from operating a bus service along a particular route from Dungloe to Coleraine, by the time the case came on the claim for Injunctive relief had fallen away and the only relief awarded was a sum of IR£3,000. The argument in relation to the appropriate costs was heard before Geoghagan J., Counsel for the Defendant contending for the application of s 17(1) of the 1981 Act, as amended and initially applying for District Court costs, which was rejected on the grounds that the District Court does not have any power to grant injunctive relief. The Plaintiff drew my attention to the following passage from Rodgers which it was submitted agreed with the proposition advanced by the Plaintiff. It was submitted that a careful reading of the Schedules support the case being made by the Plaintiff in the present case that goodwill is not property, within the scope of the Third Schedule to the 1961 Act.

“The gist of the action is a certain kind of activity causing financial loss. I do not think it is an action in relation to property within the meaning of Column 2 reference 27 of the Third Schedule to the 1961 Act. I realise that one could argue that the goodwill of the business has a value and that in that sense it might be said to be an action relating to property. But I do not think that it is an action in relation to property in the sense that a trespass or nuisance action is. The injunction to

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which the Plaintiff would have been entitled to here was not an injunction to restrain interference with property or the enjoyment of property but rather with the wrongful causing of financial loss by a wrongful activity.”

25. The Plaintiff submitted that the Defendant’s argument in the present case lacked bona fides. The position of the Defendant in Rodgers v Mangan was an arguable one, as the claim for injunctive relief was not pursued when the matter went to a full hearing, therefore they reserved their right to contest the jurisdictional basis for costs at a later time. This, it was submitted contrasted with the situation in the present matter where the Defendant consented to 10 separate Orders, all of an injunctive nature which remained necessary up to the end of the case and there was no attempt by the Defendant to negotiate a Costs Order on the basis of the Circuit Court scale and objecting to what was now suggested ex post facto the settlement of these proceedings.

26. Commenting on the cases advanced by the Defendant, Counsel for the Plaintiff submitted that the case of Jacob Fruitfield Food Group Limited v United Biscuits (UK) Limited [2007] IEHC 368, is a case which in the main dealt with the application of the principles enunciated in Campus Oil v Minister for Industry (No.2) [1993] IR 88 and only in passing did it mention the Third Schedule to the Courts (Supplemental Provisions) Act, 1961 and likewise a passing reference to defining goodwill as property. The Plaintiff submitted that the issue of costs is not discussed in the judgement nor is s 17 of the Courts Act, mentioned. The fleeting references are obiter comments and do not assist in resolving the current issue. The Plaintiff submits that the judgement was not concerned with the question of jurisdiction in any way, shape or form and no assertion was made by either party in Jacob Fruitfield Food Group that the Circuit Court was the appropriate venue. There is no mention of costs. There is no mention of, least alone any question of overruling Rodgers v Mangan. The Plaintiff submitted that even accepting that goodwill falls into the general category of “intellectual property” such a colloquial reference alone does not suffice to overrule a specific judgement on the point, which is represented as the state of the law as described in Rodgers v Mangan notwithstanding any contrary academic commentary.

27. Commenting on the case of Tommy Hilfiger Europe and Others v Derek McGarry Trading as Lifejacket, Goodstock and Lifejacket Limited [2009] 1 ILRM 161, the Plaintiff submitted that predominantly, that case was concerned with a Trademark Infringement, albeit with reference to passing off as an alternative or supplemental cause of action. It was submitted on

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behalf of the Plaintiff that there is a significant distinction that can be drawn between a registered trade-mark and unregistered rights that are represented by goodwill attaching to a business. Trademarks can be assigned and transferred pursuant to s 28 of the Trade Marks Act, 1996. The Plaintiff submitted that this is one of the classic indicators of an item of property; that it can be transferred, bought, sold or mortgaged. Goodwill cannot be transferred separately from the business to which it attaches. Counsel submitted that the discussion in Hilfiger is entirely predicated on the position of Trade Marks, as items of property and there is no discussion contained in that judgement in relation to the position of goodwill of a business simpliciter.

28. The Plaintiff submitted that the appeal to the Supreme Court in Hilfiger, was focussed on establishing that s 17 of the Courts Act, 1981 operated to establish jurisdiction in the Circuit Court and that this application actually failed before the Supreme Court. It was further submitted that the judgement in Hilfiger makes no reference to the jurisdiction of the Circuit Court in relation to the goodwill of a business and as to whether goodwill constituted “property” for the purposes of the Third Schedule of the Courts (Supplemental Provisions) Act, 1961. The Plaintiff submitted that this point was not canvassed. There is no evidence in the Hilfiger judgement that anything other than a damages claim was dealt with by the Court post the Interlocutory stage of those proceedings.

The Defendant’s Submissions

29. The Defendant submitted that the costs to which the Plaintiff is entitled to are Circuit Court Costs, applying s 17 of the Courts Act, 1981 and referred me to the relevant provisions thereof.

30. The Defendant submitted that the action was a claim for passing off, instituted by a Plenary Summons where the first relief sought is a permanent Injunction to restrain passing off. He agrees with the Plaintiff’s submissions that this is not an action relating to a Trade Mark. The first relief sought was an Interlocutory Injunction, grounded on an affidavit sworn by Mr Kieran Kenny who deposed to the Plaintiff’s application to restrain passing off. The reason that he emphasises the nature of the relief sought, is that it could have been obtained in the Circuit Court. The Defendant submitted that its position differs from the Plaintiff’s submission in that regard.

31. The Defendant submitted that the progression of the case and the events which centred around the settlement of the proceedings should not have

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been ventilated at the Taxation nor the history or circumstances of it. There is an agreement and a High Court Order and there is where matters stand.

32. The Defendant submitted that without fear of contradiction, the Court never substantially considered any of the issues. The Order was a matter of consent and it is a historical fact and that Order is of fundamental importance. The parties are left with the terms of the settlement, which were all about meeting the Plaintiff’s concerns. The payment of damages is very substantially below the threshold of the High Court jurisdiction, although it has changed since, the sum is still in the nature of a Circuit Court Determination.

33. The Defendant referred me to the Rooney judgement and in particular to the extract below, where the policy considerations underlying s 17, are adverted to. The extract which was brought to my attention states

“Section 17 of the Courts Act 1981 is a self-contained statutory scheme designed by the legislature to impose a cap on costs that may be recovered by a successful plaintiff or applicant where the order made in his favour is made by a court which is not the lowest having jurisdiction to make the order granting the relief the subject of the order. I have already referred to a passage from the judgment of Hardiman J. in the case of O’Connor v. Bus Atha Cliath, in which he described the purpose of the statutory scheme contained in s. 17. Murray J. (as he then was) in the same case stated the following at pp. 493 – 494: -

“The relevant provisions are part of a statutory scheme whereby claims may be brought in different courts according to the level of their jurisdiction to give the relief sought by a plaintiff. It is clear that among the policy reasons for such provisions is that they facilitate the efficient administration of justice, and are of convenience to all the parties in bringing their cases, where appropriate, before courts of local and limited jurisdiction. In particular, in the present context, it will usually mean that lower costs are incurred by both the plaintiff and the defendant than if the proceedings had been brought to the higher court.

It is clearly in the public interest that claims are in principle brought before the lowest court having jurisdiction to hear and determine the claim with a view to the proper and efficient administration of justice and for the purpose of minimising the cost of litigation generally and in particular for the parties. There is therefore an onus on a Plaintiff to bring the proceedings before the court having the appropriate jurisdiction.”

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34. The Defendant submitted that when one looks at both Kelly and Rooney, the purpose, policy and effect of s 17 is a cap on costs, where the Court proceeded in is not the lowest Court having jurisdiction. The Defendant submits that where parties settle a case that the policy considerations underlying s 17 are not ousted or disengaged or somehow do not apply.

35. The Defendant submitted that these are first principles, weight has to be given to the issue of mandatory provisions. There is an obligation on the Plaintiff to proceed in the lowest Court having jurisdiction.

36. The Defendant submitted that the decision in Rooney postdates the decision in Kelly. Rooney was a case where a settlement had been reached and the Court was required merely to deal with the issue of costs and this is explicitly clear from the first pages of the judgement, the outstanding issue related to the PLV or RV of the lands, the subject matter of the proceedings.

37. The Defendant submitted that it would be idiosyncratic to interpret the provisions of s 17, the effect of which is to effectively force a Defendant to run a case, thereby exposing himself on costs, so as to invoke the help and protection that the section in question is designed to afford him, by having to pay more costs than he otherwise should have to pay.

38. The Defendant submitted that Kelly supports the Defendant’s case that where Circuit Court costs apply, not in so far as s 17(1) is applicable but rather where s 17(3) applies. It is a different sub-section with a difference of words and that taking both sections, there is a different wording, which is a point which makes Kelly distinguishable.

39. The Defendant submitted that Savickis is an important case, dealing as it does with the underlying policy considerations which are as applicable to the present matter as they were in Savickis.

40. The Defendant submitted that Hilfiger is of importance to support the Defendant’s case. I was referred to the headnote, wherein the Supreme Court concluded that the Circuit Court had jurisdiction. Also in the body of the judgement, the Court concludes at page 4, second paragraph

“The Circuit Court is a creation of statute and enjoys only that jurisdiction conferred upon it by statute. The court was established by the Courts (Supplemental Provisions) Act 1961 and its jurisdiction is set out in the Third and Fourth Schedules thereto. For present purposes the Fourth Schedule is irrelevant. The Third Schedule at reference no 6 confers upon the Circuit Court jurisdiction in actions founded on tort subject to a limitation on the amount of damages which may be awarded.

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The respondents’ action founded on passing off is an action founded in tort and accordingly the Circuit Court has jurisdiction.”

41. The Defendant submitted that from the “get go” in the within proceedings, they are analogous to Hilfiger referring me to the top of page 3 of 10 of the ILRM version of the judgement, quoted below and that this carries sufficient weight when set against the Plaintiff’s reliance on Rodgers v Mangan the relevant passage states

“… in the early part of 1999, the Respondents became aware of the sale by the Appellants in the State of garments in circumstances where they believed that their trademarks were being infringed and which amounted to passing off”

42. The Defendant submits that Cronin v Astra Business Systems is readily distinguishable as it has to do with the acceptance of a lodgement, submitting that Cronin is not authority for a settlement of a case. The rules and policy considerations underlying the payment into Court and the acceptance of a lodgement are different.

43. In conclusion it was submitted that this is an action in passing off. The Circuit Court has jurisdiction. The High Court made an Order which does not stipulate that High Court costs should be paid. The monetary value of €7,500 is well within the Circuit Court jurisdiction and therefore the lower rate of Circuit Court Costs should apply, the fact that the Plaintiff did not stipulate that High Court costs should apply, is actually a point in the Defendant’s favour. Hilfiger is authority for the Circuit Court to have jurisdiction. The Policy decisions obligate a party to go in the lowest Court having jurisdiction. Even where a case is settled, s 17(1) applies.

The Plaintiff’s Counter Submission

44. The Plaintiff submitted that despite the many references by the Defendant in submissions to the judgement in Rooney the Plaintiff expressed surprise at how Rooney was opened, without referring to page 5, when the same Judge made a specific reference to it being distinguishable on its facts from Kelly the relevant section provides

“This is a case in which the issue of costs has to be determined by the court. I am mindful of the objective and intention of section 17. This is not a situation like that which pertained in the case of Kelly v. Minister for Defence and Attorney General, as in that case, the parties themselves had reached an agreement on the issue of costs and in those circumstances it was not appropriate to apply the provisions of s. 17 of the 1981 Act and in particular the provisions of section 17(3). Here the

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position is somewhat different. The issue of costs is a live issue and one that has to be determined by the court. I have already set out the terms of s. 17(1) and it is mandatory in its terms. Given the point made on behalf of the plaintiff that there is no evidence before the court on this particular issue, it seems to me that there is one way to resolve that issue and that is by making an appropriate inquiry into the rateable valuation of the lands and premises at issue in these proceedings. If it follows as a result of that inquiry, that this is a case in which the Circuit Court would have jurisdiction, then obviously an order for Circuit Court costs should be made. In that event I have no hesitation in saying that it would be an appropriate case in which to certify for Senior Counsel having regard to the nature of the issues involved, but it does seem to me that the first matter to be clarified is the question of jurisdiction. I will hear the parties further on how that will be done.”

45. The Plaintiff submitted that there are also countervailing public policy considerations, where the Plaintiff is required to seek Injunctive relief. The Plaintiff submitted that as to the point about being forced to run a case is not sustainable. The Plaintiff could have also been required to run the case. The Plaintiff submitted that the Defendant could have offered Circuit Court costs during the course of settlement negotiations, which it did not.

46. The Plaintiff submitted that all of the cases, such as Cronin, Rooney, Kelly and Rodgers and O’Connor, and all of the cases on point, recognise that s 17 is a self-contained code. It is not, on the authorities capable of being applied disjunctively. The Plaintiff submitted that the applicability of s 17 is determined on whether or not a case has been heard and determined.

47. The Plaintiff submitted that Hilfiger was a hearing and despite the references, the Court refused to restrict the costs to Circuit Court costs. Also in Hilfiger, it was submitted that the infringement was conceded and it was a Trademark and so s 18 of the Trade Marks Act, 1996 applied. It was a hearing to assess damages when no Injunction was sought. Goodwill was not mentioned.

Discussion and Conclusions48. In the course of discussions with Counsel during the Taxation hearing, I

sought assistance from Counsel for the Defendant as to the Plaintiff’s Counsel submissions that the jurisdiction is not to be found in the Third Schedule of the Courts (Supplemental Provisions) Act, 1961. Counsel for the Defendant submitted that Hilfiger offers the cure. Submitting that it could not be clearer that Rodgers and Mangan is lower in the jurisprudential hierarchy than Hilfiger. The Defendant’s submission was

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that the proceedings could and should have been taken in the Circuit Court.

49. In the course of both the Plaintiff’s and the Defendant’s submissions, the case of Rooney, was referenced. It was the Defendant’s submission, that notwithstanding the distinction made (page 5 quoted above) it was the Defendant’s submission that it is a materially different subsection, what was in play was s 17 (3) and that s 17(1) and (3) are capable of being read independently of each other and applied disjunctively.

50. I inquired from the Plaintiff if there was any discussion about costs before the Court when the settlement was being ruled before Gilligan J., as on my reading of the two documents, one being the signed settlement agreement and the other the High Court Order, there was no reference to reserved costs contained in the written terms of settlement, executed by the parties, yet the Order of the Court (at point 11 – see paragraph 6 above) refers to reserved costs. The Plaintiff submitted that there was no discussion about this, merely the debate with the Court about having the terms of settlement provided for in the Order of the Court to facilitate enforcement, should it prove necessary.

51. In response to the Defendant’s submission, which states that the proceedings could and should have been taken in the Circuit Court, it was the Plaintiff’s case that the Circuit Court is a Court of limited jurisdiction and can only operate within its rules. If the Plaintiff limited his claim in monetary terms to the limit of the Circuit Court but stated that if the primary relief was an injunction, he could not have brought them in the Circuit Court and it is supported in that view as the decision of Rodgers is clear authority for that.

52. In response to my inquiry the Plaintiff submitted that because the case did not go to a hearing, s 17 is not engaged. It is also not engaged because there was no discussion between the parties about it. It was the Plaintiff’s position that it would not have settled the case because if it was raised he would not have allowed the case to settle. I inquired if a Taxing Master was required to look behind the terms of a Consent Order, and the Plaintiff submitted (and the Defendant objected) that a Taxing Master had to give effect to the intent of the parties. A Taxing Master should go as far as interpreting the literal intention of the parties. A Consent Order cannot trigger s 17 and the answer is to be located in Cronin, Kelly, Rodgers, et al. The cases relied upon by the Defendant are all distinguishable, as in the case of Savickis, Rooney, Hilfiger were all cases that were to a hearing and accordingly, were heard and determined.

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Conclusions

53. I have carefully considered the submission of the parties and I have read and considered the material submitted to me and referred to me.

54. A Taxing Master takes his jurisdiction from the Order of the High Court and can only Tax costs in accordance with the Superior Court Rules, the Statutory architecture and the directive jurisprudence. I do not believe that a Taxing Master is empowered to assess the objective intention of the parties to a settlement agreement. That is a function reserved to the administration of justice and therefore a power reserved to the Court.

55. The costs in this matter arise from a settlement entered into between two parties, over the course of a settlement meeting which lasted almost an entire day, with the benefit of skilled and able legal advice.

56. The issues in this case did not go to a hearing. Thus the case was not heard and determined. I conclude that the provisions of s 17 (1) of the Courts Act, 1981, as amended by s 14 of the Courts Act, 1991 are not engaged.

57. In so concluding I determine that the dicta in Cronin v Astra Business Systems [2004] IR 476 which is authority for the proposition that the section is only engaged where the claim has been determined by a Court after a hearing. In O’Connor v Bus Atha Cliath, similar conclusions were reached on the application of the same section, the Court concluding that the necessity for the application of the section to be applied requires a case to be heard and determined. In Kelly v Minister for Defence [2009] IR 244, in similar circumstances where a case had been settled within the jurisdiction of the Circuit Court, the Court concluded in that case that giving effect to the legislative intent, meant engaging in an exercise of statutory interpretation and in following the judgement of the Supreme Court in O’Connor v Dublin Bus [2003] 4 IR 459. The learned Judge in Kelly concluded that as regards s 17(1) she was bound by the decision in Cronin. The learned Judge in Kelly concluded

“I am of the view that in enacting the provisions of s. 17 of the 1981 Act, the intention of the legislature was to deal with those cases where the order of the court was made following a hearing as opposed to circumstances where the parties themselves reached a compromise. The overall thrust of s. 17 appears to me to have been intended to apply to those circumstances where a plaintiff has persisted in pursuing a case through to a hearing resulting in a decree for damages which comes within specified limits and thus falls to be determined in accordance with the provisions of s. 17 of the 1981 Act.”

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58. In reaching her conclusion, the learned Judge was clear that s 17 is self-contained scheme designed by the legislature to impose a cap on costs. Where the parties have resolved a matter between them, as in the present matter, there was an express agreement reached between those parties to make their own arrangement in respect of costs. I conclude therefore that absent a determination of the proceedings and by that I conclude a hearing so as to be a determination, as envisaged in O’Connor or Cronin or where the parties reach a settlement as in Kelly.

59. It is noteworthy and instructive, that in cases where s 17 was engaged, as in Savickis, and Rooney, these were matters that went to a hearing, so there was a determination. Furthermore, in Rooney, the case is readily distinguishable, as the proceedings could have been maintained in the Circuit Court, pursuant to its own Rules, as the particular provisions of the Local Government Planning and Development Act 2000, provides specifically for that jurisdiction, the issue in Rooney as to High or Circuit Costs, was also related to the issue of PLV or Rateable Valuation, the learned Judge states

“…It is correct to say that there is no evidence on affidavit in this case or otherwise as to the rateable valuation of the property comprised in Folio MH 35369F. I think it is fair to say that if the proceedings had been commenced in the Circuit Court, it would have been necessary to have such evidence in order to establish the jurisdiction of the Circuit Court to deal with the matter. This is one of those cases where the Circuit Court and the High Court have jurisdiction to deal with the type of application, but in the case of the Circuit Court, the Circuit Court being a court of limited jurisdiction, jurisdiction in such a case as this is shown by reference to the rateable valuation…”

60. Furthermore, in Hilfiger a case which went to a hearing, the Supreme Court exercised its discretion not to allow the engagement of s 17.

61. In Rodgers v Mangan the case went to a hearing and the Court exercised its discretion not to allow the engagement of s 17.

62. In Savickis, the case went to a hearing and the Court felt bound to apply s 17.

63. I conclude therefore that on all of the facts before me that s 17 of the Courts Act, 1981 as amended is not engaged.

64. As to the point about severing or determining s 17 (3) disjunctively from s 17 (1) as the Defendant urges I believe that this does arise, simply on the basis that the proceedings were not determined in the High Court as envisaged in the cases referred to previously. Furthermore, O’Connor v Bus

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Atha Cliath, clearly holds that the engagement of s 17(3), is dependent on s 17 (1) being engaged. In other words, the engagement of s 17(3) only comes into play if s 17(1) is engaged. Given that I have concluded that s 17(1) is not engaged, I conclude that s 17(3) is incapable of application.

65. I believe that having determined the issues arising in connection with the applicability or otherwise of s 17, that disposes of the jurisdiction point. The Plaintiff is entitled to have its costs Taxed on the High Court basis.

66. As to the second point, and without wishing any disrespect to the effort, labour or quality of the submissions of Counsel, I believe that the second argument is best left over for another occasion. I remain uncertain that such an issue is not one which may require a determination by the Court, given the limited jurisdiction of the Taxing Master.

67. I will hear the parties’ further submissions arising on the matters determined herein.

Dated the 8th Day of March 2018.

Paul M BehanTaxing Master

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