The Court of Appeal has dismissed a claim that a High Court judge should have excused himself from continuing to hear a case related the the ponzi scheme run by jailed US fraudster Bernie Madoff.
A year ago, the High Court's Mr Justice Michael Twomey adjourned generally an application from British Virgin Islands (BVI) registered investment fund, Defender Ltd, that the judge recuse himself from hearing its case against Dublin-registered HSBC Institutional Trust Services Ireland Ltd.
It followed Defender's unhappiness with comments made by the judge when he decided Defender could not maintain a $141m damages claim against HSBC.
Defender claims, among other things, negligence and breach of contract in HSBC's alleged role as a custodian of funds which were lost as a result of fraud by its alleged sub-custodian, Bernie L Madoff Securities LLC.
Ms Justice Twomey ruled that because Defender had already settled its claim against Madoff for loss of its investment, it could not also pursue its damages claim against HSBC. This comes under an area of law relating to "concurrent wrongdoers" which meant Defender could not therefore pursue the other wrongdoer (HSBC).
While that decision ended the claim for damages, the court still has to deal with outstanding restitution and constitutional claims.
Defender then asked the judge to recuse himself from continuing to hear the case because it claimed certain passages in his judgment indicated "an antipathy towards the claim that amounted to objective bias."
Among the judge's comments were that the expected five months it would take to deal with the case was an inordinate amount of court time. Were it a €1m rather than a €141m claim, five months of court time would not be sought, he said.
This suggested it was not the complexity of the legal issues involved "but the amount of money the parties are prepared to spend disputing those legal issues," he said.
The judge said the "depth of the pockets" in this case was perhaps best illustrated by the face that one set of legal submissions had seven barristers - four seniors and three juniors - listed as co-authors of those submissions.
In a subsequent decision in relation to the recusal application, the judge said he was not refusing to hear the application but, in the interest of efficient use of court resources and judicial time, he was "refusing to hear the recusal motion now."
This was because if the case came back to him in the future, possibly up to four years time, it would have been a complete waste of time deciding if he should recuse himself from a case he was never going to hear.
In its appeal over that decision, Defender said what the judge had done was, among other things, tantamount to a refusal to hear the recusal application and his failure to recuse was an error in fact and law.
Today, the Court of Appeal dismissed Defender's appeal.
Ms Justice Caroline Costello, on behalf of the three-judge court, said Mr Justice Twomey adjourned generally the recusal application with liberty to apply to the court. "Those decisions were not tantamount to declining, or refusing, to hear the motion", Ms Justice Costello said.
It constituted an exercise of a trial judge's discretion in relation to the conduct of complex litigation, she said.