Dunnes tells High Court of fiscal `harassment' by State

The decision to appoint an authorised officer to two Dunnes Stores companies was an unjustified exercise in "fiscal prurience", replicated other inquiries including the McCracken tribunal and amounted to "harassment", the High Court was told yesterday.

Mr Dermot Gleeson SC, for Dunnes Stores Ireland Company and Dunnes Stores (Ilac Centre) Ltd, and Ms Margaret Heffernan, a director of both companies, was opening the rehearing of a challenge to the decision of the Minister for Enterprise, Trade and Employment, Ms Harney to appoint an authorised officer to the two Dunnes companies in July 1998.

Mr George Maloney was initially appointed authorised officer but subsequently resigned and was replaced by Mr Gerard Ryan.

The action had been heard over 11 days from April 13th 1999 before Mr Justice Kinlen in the High Court but his judgment was appealed by both sides and the Supreme Court last February remitted the matter for rehearing in its entirety before the High Court.

The Supreme Court agreed with complaints by Dunnes that the High Court judge had failed to determine a number of issues, including the question of the constitutionality of Section 19 of the Companies Act 1990, under which Mr Ryan was appointed.

The case reopened yesterday before Mr Justice Butler and is expected to last at least six days.

In opening submissions, Mr Gleeson said Dunnes had facilitated the Minister's requests for information and had provided documents apart from the Price Waterhouse report, a privileged document compiled for litigation between members of the Dunnes family. Then, "out of the blue" in July 1998, Ms Harney had appointed an authorised officer.

Mr Gleeson said Dunnes was very seriously taken aback by this and asked the Minister why she had done this. The Minister had refused to give reasons and Dunnes took legal action. This resulted in the High Court ordering the Minister to give reasons and the Minister had purported to do so. Dunnes claimed these were not good reasons and was challenging them.

At the heart of the case was whether the reasons "passed muster" and the interpretation of Section 19 of the Companies Act, covering the appointment of an authorised officer, counsel said.

Dunnes had co-operated with other inquiries and tribunals, including the McCracken and Moriarty tribunals, but was not willing to repose its trust in a non-judicially supervised examination put in place by Ms Harney who was giving Section 19 an application it could not bear.

The Minister's purported exercise of the Section 19 power was an "eccentric, puzzling and flawed" attempt to operate the Section and was "poorly thought out from the start".

The hearing continues today.