Taxpayer foots the bill for action against State watchdog

Dublin City Council challenged one of the State’s watchdogs in court but the only real outcome is that the taxpayer foots both bills, writes Investigative Correspondent Conor Ryan.

Taxpayer foots the bill for action against State watchdog

DUBLIN City Council was so concerned that one of its high profile councillors was found to have inadvertently broken the law it went to the High Court in an unsuccessful bid to restore his good name.

The council was taking on the Standards in Public Office Commission watchdog (Sipo). So either way taxpayers were footing the entire bill.

Internal documents have now shown that the council had already decided not to pursue a low-cost alternative approach to address its concerns.

They also show the council had asked a barrister to assess non-judicial options but it did not explore them until the case was already set for hearing.

When these documents were put to the council it said it only opted to go into court after “consultation with the Department of the Environment”.

In response the department sought to downplay its involvement in the decision making process and said neither it or Phil Hogan, the environment minister, gave approval to the costly move.

The High Court move resulted in an emphatic defeat for the council which was considering taking to the Supreme Court until recently.

The court found that the council produced no evidence to support its overarching concern — that the wider implications of the decision would stop the authority from functioning properly.

Ultimately it lost the judicial review although its senior counsel has told it he believes the ruling was “wrong”.

The council’s own legal bills have run to €115,000, it will also have to pay Sipo’s costs when they are finalised. It expects its bill to hit €200,000.

The council also picked up the tab for the councillor’s legal cost because it had approached him about taking the action rather than the other way around.

The issue

The spat concerned a decision by Lord Mayor Oisín Quinn to vote on a development plan motion that allowed for higher storey limits for many buildings in the city.

One of the sites affected was the four-storey 84-93 Lower Mount St premises. It was owned by Cllr Quinn and other members of his family. The offices were rented to the Office of Public Works for €1.7m a year.

Last December the office block in question was sold by the family partnership for €6.35m to a property investment trust Green Reit.

Following an investigation and oral hearings Sipo decided that under the Section 177 of the Local Government Act Cllr Quinn had an interest in the decision the council took on building heights and should not have voted on it.

However, the commission said that because he had got incorrect advice from the council before the meeting he had acted in good faith.

When it later came before Mr Justice John Hedigan his judgment was blunt.

The judge said the council had not brought forward any evidence to support its primary concern that Sipo’s decision would have a detrimental impact on the role of all councillors with property interests.

And he said Sipo’s reasoning was “perfectly adequate” and should not be overturned.

“I consider the commission’s [Sipo] determination to be eminently reasonable and to be a fair and rational appraisal of perception based upon an agreed factual background as presented to it,” said the judge.

The Property

The current lord mayor of Dublin is a Labour Party representative and a senior counsel specialising in employment law.

He is a nephew of Education Minister Ruairí Quinn and a son of the former chairman of the ESB and ex-AIB director Lochlann Quinn.

Under the old development plan for Dublin City the Mount St property held in the name of Lochlann Quinn and his children would have been very unlikely to have got permission for redevelopment.

But the building’s prospects improved when the council voted to approve two motions which set new building heights in the current development plan.

These two decisions removed specific planning barriers and has, in theory, allowed the building at Lower Mount St and others like it to be demolished and rebuilt up to a maximum of seven stories.

The motions were not specific to the offices at 84-93 Lower Mount St, which was owned by Oisín Quinn and his family.

However, the Grist Williams valuers report, commissioned by Sipo, found the motions had benefited the Quinn property.

The valuation report said in 2011 the market did not make demolition viable but in two to four years this was liable to change.

As it turns out the building was sold by the Quinns in December 2013 for €6.35m, according to a share prospectus of the purchasers Green Reit.

The lord mayor had a one-sixth share in the asset.

Sipo Investigation

After it sat to consider the issues in December 2011 Sipo decided that Cllr Quinn had acted in good faith but he had voted on the changes and this breached the Local Government Act.

Before the planning motions were decided in 2009 and 2010 on Cllr Quinn sought the advice of the council’s law agent Terence O’Keeffe, the city manager John Tierney and the assistant city manager Michael Stubbs about whether he should absent himself from the debate.

Mr O’Keeffe phoned Cllr Quinn before the meeting and said his one-sixth interest in the specific property was not significant enough to warrant him pulling out of all votes that affected policies for buildings generally.

The view taken by the council that because the motion was not site specific Cllr Quinn should not be concerned. He had declared an interest at the beginning of the development plan debate and this was sufficient.

Sipo, and later the High Court, disagreed.

Speaking this week Mr Quinn said that although the Sipo report had exonerated him he did accept the council’s view that the approach taken by Sipo could have far reaching implications for councillors across the country.

He said councillors, or their relatives, would have many different interests that could potentially be affected by development plan decision and it would be unreasonable to expect elected representatives to seek their own legal advice on every possible cross over.

Council’s trouble

Having offered incorrect advice to Cllr Quinn the council was indirectly in the dock. It wrote to Sipo and said even though the commission had decided Cllr Quinn had acted in good faith its findings had far-reaching consequences.

“The matter is of considerable gravity for individual councillors because a failure to comply with any of the requirements of Section 177 constitutes a criminal offence,” said Mr O’Keeffe.

A legal memo to the assistant city manager, Mr Stubbs, said the council should write to the Department of the Environment to seek its advice.

It said it could affect an authority’s ability to achieve a quorum at a meeting if councillors had to excuse themselves for votes which may have “remote” connections to them.

The council said that a valuation report commissioned by Sipo, which estimated the likely benefit the property would have from the development plan changes, should have been put to it for a response.

The decision to go into court was ultimately approved by the then city manager, and now managing director of Irish Water, John Tierney. He signalled his backing shortly before papers were filed in the High Court.

Despite agreement at executive level the decision was not without question.

In a memo to the council’s law agent, Terence O’Keeffe, senior solicitor Carol McEntee queried the route pursued by the council.

She said on April 2, 2012 the council received an opinion from Eamon Gailligan SC which gave it two options.

The first was to go to the High Court, where its chances were rated as “better than 50%”.

The second was to bring its concerns to the Department of the Environment and the Attorney General to resolve the situation for future.

“Notwithstanding Mr Galligan’s advice that we could bring the unsatisfactory result of the decision from the Commission to the Department of the Environment and/or the Attorney General, this appears not to have occurred,” said Ms McEntee.

The council instead wrote to Sipo telling it that it would instigate judicial review proceedings.

The decision to go to the High Court was ultimately approved by the then city manager John Tierney on June 21, 2012.

By that stage the council had already failed to get Sipo to agree to a settlement which would have involved the commission agreeing to quash its findings against Cllr Quinn.

The council has released records of disquiet among some of Cllr Quinn’s colleagues in the chamber.

Cllr Ruairí McGinley had written to executive manager Vincent Norton urging caution on the prospect of going to court to challenge Sipo.

Cllr McGinley said the council had more to lose in a judicial review than by the current position and he was highly concerned by the prospect.

However, Mr Norton said the city manager felt the organisation had to fight the case in court.

“It is clear that the city manager would be failing in his duty to the council if these findings and determinations were not challenged.

“It is for these reasons that the council initiated this action,” he said.

The Supreme Court

Until recently the council was strongly considering doubling down and bringing the High Court judgment to the Supreme Court.

It still believes councillors could be challenged for many different decisions taken where they themselves or their relatives had interests in. It said the problem needs to be clarified.

The new city manager, Owen Keegan, told the February meeting of the council that the costs of the case were likely to run to €200,000 but he had reviewed the file and felt the council’s decision was reasonable.

He said if councillors were to ask the executive for legal advice in future they would be told they were on their own.

The city manager said he had got a report from the senior council who was advising the authority on the case and he said Judge Hedigan was “wrong”.

Mr Keegan said this report said the High Court ruling was “illogical in a number of respects” and did not give proper consideration to the arguments put forward by the council.

The council considered going to the Supreme Court but ultimately decided not to and instead take the option it refused to take on day one and address the issue with the department.

The Department’s input

The council was asked to comment on the documents released under the Freedom of Information Act and it decision not to pursue the low-cost approach it defended its actions.

It said while the High Court did not support its case it only opted to go before a judge after teasing out the issues with the Department of the Environment.

“Dublin City Council took the view that in the absence of a satisfactory response from the Standards in Public Office that judicial review proceedings were appropriate and justified in the circumstances. The High Court did not agree.

“The decision to take Judicial Review proceedings was not taken lightly and followed consultation with the Department of the Environment,” it said.

This was put to the department along with questions on whether its officials or Hogan had approved of the decision to take on Sipo.

In a statement the department downplayed its involvement and the council had not looked for permission to proceed.

“The department did meet with the city council to discuss the implications for development planning processes of the Sipo report into Councillor Oisín Quinn, and potential ways forward, before judicial review proceedings were issued by the council.

“The decision to initiate judicial review proceedings was taken by the city council, and the department’s or minister’s endorsement was neither sought nor offered,” it said.

Ultimately the spat between the local authority and the State’s watchdog has resulted in a legal battle that arrived back at the same point.

The bill has been for taxpayers to pick up.

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