Lawyers at Dillon Eustace have highlighted what they describe as an “unusual” call for clarity from a High Court judge after a recent personal-injury case.

The lawyers said that the High Court had highlighted what it described as “a far from satisfactory” situation, whereby there is a divergence in the approach adopted by the courts to the insertion of certain terms into Personal Injury Settlement Orders.

Such terms may prevent the Department of Social Protection from recovering monies that it might otherwise be entitled to from a defendant or insurance company under section 343R(1) of the Social Welfare Consolidation Act 2005.

Loss of earnings

In a note on the firm’s website, the Dillon Eustace lawyers say that Moloney v Dunne and Bus Éireann came before the High Court after the Circuit Court had previously dismissed a claim for personal injuries.

Bus Éireann agreed to pay the plaintiff €10,000 in return for the plaintiff withdrawing his appeal.

Counsel for Bus Éireann applied to the High Court for an order striking out the proceedings and vacating all existing orders. The court was further asked to include a term to the effect that there was no claim for loss of earnings in the proceedings and/or that settlement did not reflect any claim for loss of earnings.

According to Dillon Eustace, Mr Justice Twomey (pictured) detailed “contradictory” approaches that had been adopted by the High Court to such applications.

Recoverable benefits

There have been findings that these terms are legal and can be included as an agreed term in Personal Injury Settlement Orders, while, in other instances, the High Court has held the terms to be unlawful on the basis they are to the detriment of an unrepresented third party (the department), and are a means by which the taxpayer ends up funding settlements of personal-injury claims.

The court noted that if the term were included, there would then be a court order to that effect that could be relied upon to claim that the department was not entitled to a repayment of recoverable benefits, despite the court having made no finding in this regard.

The court held that the insertion of such a term in this manner, in its view, would be “wrong”, as it would provide a financial advantage to the parties settling the case, to the financial determinant of the department and, ultimately, the taxpayer.

The defendant avoids having to pay the department any recoverable benefits and, as a result, has more funds to pay an increased settlement to the plaintiff. As such, it gives a direct financial benefit to a defendant/insurance company and an indirect financial benefit to the plaintiff.

Further, the department is not a party to the proceedings and has no say on the term proposed to be included in the order.

‘Need for clarification’

The Dillon Eustace lawyers point out that, despite the current legal uncertainty, the High Court is not permitted to state a case to the Court of Appeal, while the department has no right of appeal as it is not a party to such proceedings. No appeal by parties to such cases has yet been made.

“Unusually, the High Court has called for an appeal to be lodged to its own judgment, citing the need for clarification of the law in this area and also, public-interest concerns – including the fact that taxpayer funds are at stake, and public confidence is being undermined by the absence of uniformity in the courts,” the Dillon Eustace lawyers state.

They add that the court went so far as to indicate in its judgment that it was asking the registrar to provide a copy of the judgment to the Minister for Social Protection, given the discussion on possible proceedings by the State to clarify the position on the relevant section of the 2005 act.