Supporting Documents:

THE SUPREME COURT

DETERMINATION

BETWEEN

RESULT: The Court does not grant leave to the Applicant to appeal to this Court from the Court of Appeal

REASONS GIVEN:

1. The applicant seeks leave to appeal a decision of the Court of Appeal (Ryan P, Peart and Hogan JJ) delivered on 27th May 2016; judgment of Hogan J, [2016] IECA 152. This in turn upheld the decision of McGovern J in the High Court; judgment of 23rd October 2012, [2012] IEHC 425.

2. The applicant is a shelf company. It claims a right to participate in tendering for what is claimed to be a public contract whereby schoolchildren at national school and secondary level are transported by the State from their homes to their schools. Approximately 110,000 pupils are transported every day by this means but in order to do so the State has engaged Bus Éireann which manages the scheme, transporting around 10% of the children itself and providing arrangements through private contractors for the remaining 90%. The scheme operates on a cost recovery basis with the Minister reimbursing Bus Éireann.

3. It might be immediately noticed that competition in respect of the transport of children to school must be presumed to be open through the arrangements made. Challenged in these proceedings, however, is the overall arrangement between the State and Bus Éireann. The scheme has been characterised as an administrative one to affect the duty of the State under Article 42.4 of the Constitution to “provide for free primary education”. Questions set out in the judgment of Hogan J in the Court of Appeal encompassed the applicability of the procurement rules and European law in the context of whether those parties entered into a contract in writing, whether it is for pecuniary interest, whether it was in reality a unilateral administrative measure, and whether the contract had been one for indefinite duration which antedated the operation of the current rules, thereby being exempt. The scheme involves the State engaging Bus Éireann to administer the scheme which will enable a sufficient number of buses, staffed competently and safely, to attend particular locations to pick up children, bring them to school and bring them back again to the home after lessons end. This particular scheme was introduced in 1967, following the provision of free secondary education. Letters were exchanged appointing Córas Iompair Éireann, subsequently Bus Éireann, and financial arrangements were entered into which were then supplemented in 1975. The scheme therefore predates the relevant Directive and is made up of elements, including a 13% to charge to cover all other direct and indirect costs for services, which have changed over time, particularly in the context of the national crisis arising from bank debts which became apparent from September 2008.

4. After an analysis of the relevant national and European law, the Court of Appeal upheld the judgment of McGovern J in the High Court stating:

69. First, in light of the decision of the Court of Justice in Case C-159/11 Azienda Sanitaria Locale di Lecce (which was delivered some months after the judgment of McGovern J. in the present case), it is clear that if there was a contract, the fact that the payment was based on a cost recovery basis did not mean that it was not a contract for pecuniary interest within the meaning of Article 1(2)(a) of the 2004 Directive.

70. Second, even if there was a contract, it was a contract of indefinite duration coming within the scope of the Pressetext exemption. While it is true that the Scheme has evolved and changed in the last fifty years or so since its initial inception, STS have not identified any material change within the six month period immediately prior to the commencement of the present proceedings in October 2011. This is in itself a reason why the present appeal must fail as such contracts of indefinite duration fall outside the scope of the 2004 Directive.

71. Third, quite independently of this conclusion, in the light of the reasoning of the Court of Justice in Commission v. Ireland, it is clear that the scheme is an administrative arrangement between the Minister and CIÉ/Bus Éireann. Specifically, there is no concluded contract in writing between the parties for the purposes of Article 1(2)(a) of the 2004 Directive. This finding is in itself also fatal to the STS’s claim that there was such a contract and that it should have been put out to public tender.

72. It follows, therefore, that for the reasons just given I believe that McGovern J. was correct in the ultimate conclusion which he reached. I would accordingly dismiss this appeal.

6. Article 34 of the Constitution provides for the public administration of justice; describes the courts established by the Constitution and those which may be established by law; provides for the full and original jurisdiction of the High Court; and under Article 34.2 establishes the Court of Appeal and under Article 34.5.3° sets out its appellate jurisdiction. This reads:

4 1° The Court of Appeal shall—

i save as otherwise provided by this Article, and

ii with such exceptions and subject to such regulations as may be prescribed by law,

have appellate jurisdiction from all decisions of the High Court, and shall also have appellate jurisdiction from such decisions of other courts as may be prescribed by law.

3° The Supreme Court shall, subject to such

regulations as may be prescribed by law, have appellate jurisdiction from a decision of the Court of Appeal if the Supreme Court is satisfied that—

i the decision involves a matter of general public importance, or

ii in the interests of justice it is necessary that there be an appeal to the Supreme Court.

8. Primarily, this Court is now “subject to such regulations as may be prescribed by law”, an appellate jurisdiction from the Court of Appeal. Such an appeal may only be exercised provided that this Court is satisfied either that the relevant decision of the Court of Appeal “involves a matter of general public importance” or, alternatively, that it is, “in the interests of justice”, necessary that there be an appeal to this Court.

9. The Constitution has retained the entitlement of one appeal as of right from the High Court, subject to express exclusions or regulation by statute from the High Court to the Court of Appeal. What is sought here is a second appeal. The jurisdiction to bring an appeal to this Court is confined principally to cases where, as a result of the determination of the Court of Appeal, the decision of that court is such that the issues raised on a proposed appeal would involve a matter of general public importance or would be such that it is in the interests of justice that there be a further appeal to this Court.

10. Any ruling in a determination is between the parties. It is final and conclusive as far as the parties are concerned, and is a decision in relation to that application only. The issue determined on the application for leave is whether the facts and legal issues meet the constitutional criteria to enable this Court to hear an appeal. It will not, save in the rarest of circumstances, be appropriate to rely on a refusal of leave as having a precedential value in relation to the substantive issues in the context of a different case. Where leave is granted, any issue canvassed in the application will in due course be disposed of in the substantive decision of the Court.

11. The applicant seeks the referral of no less than 11 questions by this Court to the Court of Justice of the European Union. The argument is made that the law on this matter is not acte claire and running through the submissions is the thread of an argument that an appeal should be allowed to this Court so that reference can be made as to the interpretation of European law to the Court of Justice of the European Union. The fact that this Court can refer, and in particular circumstances is obliged to refer, points of law which are not clear in the context of the interpretation of European law to the Court of Justice of the European Union is not of itself a basis for taking up an appeal. What might be remembered is that before leave is granted the Court must be satisfied that the constitutional criteria are met. It is also worth recalling that an applicant can ask the Court of Appeal to refer a point of law. Finally, given that ingenuity can make many things seem arguable, the circumstances of the exchange of even lengthy submissions, as has happened regrettably in this case, do not necessarily elucidate that there is a degree of clarity lacking in European law such as to meet the test for referral.

12. The applicant complains that findings of fact have been made in the High Court and in the Court of Appeal which are incorrect relating to the arrangements for transport, their administrative nature, the existence of a contract, and whether they are meant to be commercial dealings. It is said that an exception has been recognised “that hitherto has not been dealt with” by courts in Europe or in European law. The concept that exceptions to directives must be construed narrowly is argued to be breached by the Court of Appeal in their findings. The entire nature of this scheme, affecting as it does many families in the State, is said to be of general importance.

13. The State respondent rejoins that the proceedings “confined to arrangements for school transport” over a particular six-month period, necessitated by the limitation period applicable in public procurement, and that the issue as to whether there is a question of general public importance should not be divorced from the factual matrix of the case. It is argued that there had been a failure on specific facts to establish that there was a contract concluded in writing in order to fit within the definition of Directive 2004/18/EEC Article 1(2)(a). It is claimed that the applicant has no standing since the case is made that what is involved here is a shelf company specifically incorporated or purchased for the purposes solely of this litigation. It is submitted that standard and existing European law was applied by the Court of Appeal and that the nature of the questions set are correct and that the answers given are obvious.

14. For Bus Éireann, similar points are taken at paragraph 3 the following as stated:

“While the applicant asserts that its appeal “involves a matter of general public importance and/or is in the interests of justice” for there to be an appeal, it purports to substantiate this claim by citing alleged errors it claims exists in the ruling of the Court of Appeal. As such, the reasons advanced in favour of leave to appeal – the status of a non-statutory administrative arrangement, the relevance of the indicia of a commercial contract and the requirement of “concluded in writing” – overlap with the grounds of appeal themselves. The applicant then relies on its disagreement with the Court of Appeal to extrapolate its contention that the issues are not acte claire and, given that the matter is a question of EU law, leave to appeal or to be granted to enable a reference to be made. Such an approach cannot be regarded as satisfying the “basic constitutional threshold””.

16. This analysis must essentially look to the reasoning of the High Court and of the Court of Appeal with a view to determining whether a point of law exists as a genuine controversy which has wide application to the public and is of such importance that a further appeal should be allowed to this Court. It is not shown that the interests of justice require an appeal and nor is the kind of error demonstrated which would require this Court to depart from its usual rule that it is not a court for the correction of error. The factual matrix is also important. There is nothing to suggest that in terms of the scheme administered by Bus Éireann, private contractors cannot apply in the ordinary way and in their local areas to compete for contracts to transport schoolchildren. Further, no element of the facts as presented demonstrates that the applicant is a transport company with a real interest in the outcome of these proceedings, as opposed to a vehicle for litigation. Fundamentally, however, what was applied by the Court of Appeal was an analysis of the law based upon the clear text of the Directive, overturning one finding of the High Court, but upholding the others on the basis of decisions made at the highest level by the Court of Justice of the European Union. Accordingly, there is nothing to suggest in the application that anything other than established principles of law were applied in a logical fashion in the context of an application for damages which had no appropriate factual matrix. The application should therefore be refused.

17. Accordingly, the Court refuses the application of the applicant for leave to appeal to this Court.

And it is hereby so ordered accordingly.