Madness of one State company suing another

No sense in Gas Networks Ireland and Coillte facing off in court over gas pipe

A legal dispute has arisen between semi -State companies Gas Networks Ireland and Coillte, which highlights the inherent madness of taxpayer-owned companies suing each other.

The row is over a gas pipe that runs through a Coillte forest in Tipperary. It appears the dispute arose over whether or not the GNI pipeline was damaged by works carried out by a Coillte contractor.

GNI has now gone to the High Court last week it issued a writ against Coillte and the contractor. As part of the case, it is seeking a declaration from the court over whether or not Coillte breached its statutory duties.

Why is it necessary for two taxpayer-funded companies to require the services of one of the highest courts in the land to solve a row over a gas pipe?


Legal disputes

In August 2016, the government reissued the code of practice for the governance of State bodies. It includes a section on how to manage legal disputes between State organisations.

“Where a legal dispute involves another State body, unless otherwise required by statute, every effort should be made to mediate, arbitrate or otherwise resolve before expensive legal costs are incurred,” the code says.

“State bodies should pursue the most cost effective course of action in relation to legal disputes.”

In other words, use common sense.

If the legal costs in such a dispute go above €25,000, a State company must provide a written report to its parent department, and also to the Department Public Expenditure and Reform.

Expenditure of €25,000 would barely buy you lunch at the High Court. Throw in the cost of two sets of solicitors, two sets of junior counsel, two sets of senior counsel, and the bill for taxpayers will easily balloon past that level.

And it is all to establish which taxpayer-funded body is responsible for damage to a gas pipe.

Those involved may as well take taxpayers’ cash out into the middle of a Coillte forest and set fire to it.