The Gazette 1992

GAZETTE

SEPTEMBER 1992

under the 1990 Act. The examiner prepared

a scheme of arrangement for the company

and presented it to the Court. A creditor bank

sought standing to object to the scheme at the

hearing. The bank argued that if the scheme

was adopted the repayment of its loan would

be deferred. The bank also drew attention to

evidence of fraud by a director of the com-

pany prior to and after the commencement of

the protection and argued that the scheme

should not be approved.

Held

by Costello J

approving the scheme: (1) the bank had stand-

ing to appear under s.22 of the 1990 Act,

having a contractual interest which would be

impaired by the scheme of arrangement pro-

posed by the examiner, since the scheme

would involve deferment of the bank loan

and it would therefore lose interest on that

loan; (2) not without hesitation, the scheme

should be allowed to proceed, subject to

some of the amendments which had been

suggested by the bank, since the company

was probably capable of surviving under the

scheme; and it was significant that the scheme

had been approved by all the company's

creditors and by Udaras na Gaeltachta; (3) the

scheme would be subject to any proceedings

the bank may be advised to take against any

of the company's directors arising from any

wrongdoing in relation to the company's

relations with the bank; (4) the bank was

entitled to its costs as an expense of the

examination under s.29 of the 1990 Act.

Browne and Ors v Attorney General High

Court 6 February 1991

CONSTITUTION — INCOME TAX — BENEFIT IN KIND

— SALES REPRESENTATIVES — CAR SUPPLIED BY EM-

PLOYER AND AVAILABLE FOR PRIVATE USE — AVAIL-

ABILITY FOR PRIVATE USE TAXED AS BENEFIT IN KIND

— WHETHER IN BREACH OF RIGHT TO EARN LIVELI-

HOOD —WHETHER ARBITRARY — Finance Act, 1982,

s.4 — Constitution, Article 40.1, 40.3.

The plaintiffs were all sales representatives.

Their respective employers had supplied them

with cars for their employment, and they

were permitted to use the cars for private

purposes. Where such private use occurred,

the plaintiffs paid for the petrol involved. One

of the plaintiffs did not use the car for any

private purpose. Under s.4 of the 1982 Act,

the availability of such cars for private use

was treated as taxable income. Taking ac-

count of various deductions allowed under

s.4, the effect was that the three plaintiffs were

taxed for the availability of the cars for private

use. They claimed that s.4 of the 1982 Act

constituted an unjust attack on their right to

earn a livelihood or alternatively was arbi-

trary in its effect.

Held

by Murphy j dismissing

the claims: (1) in relation to taxation legisla-

tion, the presumption of constitutionality was

particularly strong and the plaintiffs faced an

uphill battle to establish their case. Dicta in

Madigan

Attorney General

[1986] ILRM

136 applied; (2) the 1982 Act did not tax the

car or its business use, nor even its private use;

rather it taxed the availability for private use;

and while the burden fell more heavily on

some because of the low level (or nil level in

the case of one of the plaintiffs) of private

mileage actually used, it could not be argued

that this in itself rendered the 1982 Act un-

constitutional, because there could be no

objection in principle to the imposition of

taxation on the availability of an asset any

more than on ownership or possession of

assets; and in any event there were alternative

arrangements which employers and employ-

ees could enter into where the application of

s.4 of the 1982 Act resulted in a heavy burden

of taxation on an individual employee; (3) the

1982 Act was not arbitrary in its application,

but was predicted on the reasonable assump-

tion that a car made available for private use

was, in general, likely to be used for that

purpose.

Brennan v Attorney General

[1984)

ILRM 355 distinguished.

Per

Murphy J: it was

not necessary to consider the validity of the

benefit in kind tax taking account of the

impact of inflation from the time it was first

introduced in 1958 by reference to an annual

income of £15,000, since s.4 of the 1982 Act

stood on its own without reference to any

earlier statutory provisions on the subject.

Boyle

Lee and Goyns Supreme Court

December

1991

CONTRACT — SALE OF LAND — 'SUBJECT TO CON-

TRACT' —WHETHER LETTER INCLUDING TERMS FOR

SALE 'SUBJECT TO CONTRACT' CAPABLE OF CONSTI-

TUTING NOTE OR MEMORANDUM OF AGREEMENT

— WHETHER CONCLUDED ORAL AGREEMENT MADE

— LAW REFORM— Statute of Frauds (Irl) 1695, s.2

The defendants were the owners of a house.

The house was placed with an auctioneer,

and the plaintiff made an offer of £90,000 for

the house. The auctioneer obtained the oral

agreement of the defendants to the figure

offered by the plaintiff. The plaintiff inquired

about a deposit, and the auctioneer stated

that this would be a matter for the solicitors in

the transaction to determine. The auctioneer

wrote to the defendants' solicitor stating that

the figure of £90,000 had been agreed with

the plaintiff 'subject to contract' and further

stating that the letter itself was 'for informa-

tion purposes only and does not by itself

constitute part of a binding contact.' The

letter included reference to the property and

that it was to be sold subject to existing

tenancies. The defendants ultimately did not

proceed with the transaction, and the plaintiff

then brought proceedings for specific per-

formance. In the High Court Barrington J held

that there was a concluded oral agreement

and that the letter written by the auctioneer

constituted a sufficient note or memorandum

for the purposes of the Statute of Frauds. On

appeal

Held

by the Supreme Court (Finlay CJ,

Hederman, McCarthy, O'Flaherty and Egan

JJ) allowing the appeal: (1) (per Finlay CJ,

Hederman, O'Flaherty and Egan JJ; McCarthy

J dissenting) on the evidence, the issue of a

deposit had not been agreed between the

auctioneer and the plaintiff and the trial judge

had erred in his finding that there was a

concluded oral agreement; (2) the letter from

the auctioneer to the defendants' solicitor, by

its terms, could not be regarded as a note or

memorandum for the purposes of the Statute

of Frauds, and on that ground also the plain-

tiffs action should be dismissed. Per Finlay

CJ, Hederman and McCarthy JJ: the decisions

of the Court in

Kelly v Park Hall School Ltd.

(1979] IR 34 and

Casey v Irish Interconti-

nental Bank Ltd

119791 IR 364 should not be

followed.

Per curiam:

for the sake of legal

certainty the phrase 'subject to contracf should

be regarded as reflecti ng the absence of agree-

ment between parties.

Per

O'Flaherty J: con-

sideration should be given to the replacement

of the Statute of Frauds with a legal require-

ment that all contracts for the sale of the land

be in writing.

The People (D.D.P.) v Martin Court of

Criminal Appeal

July

1991

CRIMINAL LAW— APPEAL — SENTENCE — EVIDENCE

OF BAD REPUTATION —GROUNDS NOT ARGUED IN

TRIAL COURT

The applicant pleaded guilty to maliciously

causing grievous bodily harm with intent to

disfigure, contrary to s.18 of the Offences

against the Person Act 1861. In the Circuit

Court, evidence was given by the arresting

Garda that certain people would not testify

against the applicant because they were in

fear of their lives, and he also stated the

applicant was a violent person. The trial

judge sentenced the applicant to seven years

imprisonment, having regard to the evidence

of the Garda and the applicant's previous

convictions. On application for leave to ap-

peal

Held

by the Court of Criminal Appeal

(McCarthy, Barr and Lavan Jj) dismissing the

application: (1) evidence of bad reputation

should, as a general rule, be restricted and

should not be allowed to found a view that the

applicant had committed previous offences;

but since the trial judge had not drawn such

conclusions in the instant case the applica-

tion would be dismissed; (2) although the

arguments made on appeal had not been

advanced in the trial court, this should not

preclude the applicant from raising them on

appeal. Dicta in

The State (O'Connor)

v O

Caomhanaigh

[1963] IR 112 applied.

Director of Public Prosecutions v Holmes

High Court

December

1991

CRIMINAL LAW — ROAD TRAFFIC — DANGEROUS

DRIVING — EVIDENCE AS TO PRE-ACCIDENT CONDI-

TION OF VEHICLE—GARDAGIVING EVIDENCETHREE

HOURS AFTER INCIDENT SUBJECT MATTER OF PROS-

ECUTION—WHETHER ADMISSIBLE— Road Traffic Act

1961, s.53 — Road Traffic (Amendment) Act 1978, s.10

The defendant had been charged, inter alia,

with the offence of driving a mechanically

propelled vehicle when it was in a condition

that was dangerous, contrary to s.53 of the

1961 Act, as inserted by s.10 of the 1978 Act.

Evidence was given that the Cardai were

called to the scene of a crash involving a

minibus driven by the defendant. A Garda

began giving evidence of his examination of

the minibus after the accident. Objection was

taken on the basis that the scene of the

accident had not been fully preserved, that

the chain of evidence had been broken and

that the examination had taken place three

hours after the accident. The prosecution

stated that the evidence would relate solely to

the pre-accident condition of the minibus.

The District Court Judge declined to hear the

evidence and dismissed the dangerous driv-

ing charge. On case stated

Held

by Lavan J

remitting the case to the District Court: having

regard to the accusatorial nature of criminal

proceedings, there was no sound basis in law

for the trial court refusing to hearthe evidence

being tendered by the prosecution in relation

to the pre-accident condition of the minibus.

Dicta in

The State (O'Connor) vLarkin

[1968]

IR 255.

B.L. v M.L. Supreme Court

December

1991

FAMILY — HUSBAND AND WIFE — PROPERTY —

TRUST — WIFE CONTRIBUTING TO FAMILY FUND

THROUGH REMAINING AT HOME — WHETHER GIV-

ING RISE TO BENEFICIAL INTEREST IN HOME — CON-

STITUTION — POSITION OF WIFE IN HOME —

WHETHER GRANTING SUCH INTEREST WOULD

AMOUNT TO UNWARRANTED DEVELOPMENT OF

LAW — Constitution, Article 41.2

The parties had married in 1968, and had two