Officer inquiring into Dunnes was properly appointed

The Tanaiste and Minister for Enterprise, Trade and Employment, Ms Harney, properly appointed an authorised officer to inquire into the affairs of two companies in the Dunnes Stores group, the High Court found yesterday.

But Mr Justice Kinlen also held that the officer, Mr Gerard Ryan, had exceeded his powers in the manner in which he made demands for documents from the company. It would, with hindsight, have been wiser to go the route of a court-appointed inspector, the judge remarked.

Both sides are considering appealing Mr Justice Kinlen's findings to the Supreme Court.

In a reserved judgment on the challenge by Dunnes Stores to the appointment of an authorised officer to two of its companies, Mr Justice Kinlen found that Mr Ryan exceeded his powers by wrongly basing his demands on a pre-condition that he was entitled to meet and question Dunnes Stores officials before getting documents.

Even though the court's finding that Mr Ryan exceeded his powers had not been something pleaded by Dunnes Stores, the judge said he would strike down the purported demand by the authorised officer. He allowed an amendment to the Dunnes' pleadings in the case to take account of his finding.

Dunnes had sought orders quashing the appointment of Mr Ryan as authorised officer to Dunnes Stores Ireland Co and Dunnes Stores (Ilac Centre) Ltd.

Dunnes alleged that Mr Ryan was effectively conducting a trawl through Dunnes affairs and that the same ground had already been covered in other inquiries.

The State argued there were ample reasons for Mr Ryan's appointment and that the Minister's concerns regarding the affairs of the two companies arose from the findings of the McCracken tribunal, from the authorised officers appointed to investigate the affairs of other companies and from the Institute of Chartered Accountants inquiry chaired by former Supreme Court judge, Mr Justice Blayney.

Mr Justice Kinlen said he was satisfied that the "authorised officer", was properly appointed by the Minister but the demands (for documents) made on the Dunnes group were not specific enough and he did not give the company enough time to comply with his demands.

Mr Justice Kinlen said the authorised officer was only entitled to seek production of specified documents. He had no authority to interview or interrogate members of the Dunnes group (prior to getting documents). An inspector could do that but an authorised officer could not.

The time given by Mr Ryan to Dunnes group officials to produce documents was too short. The time for complying with a request must be reasonable.

Following the report of the McCracken tribunal, Dunnes Stores was asked to facilitate inquiries being undertaken by a number of authorised officers appointed by the Minister. These inquiries related to Garuda, trading as Streamline Enterprises (a company owned by Mr Michael Lowry, TD) and Celtic Helicopters Ltd (a company owned by Mr Ciaran Haughey).

Last year Dunnes Stores challenged the Tanaiste's decision to appoint Mr Ryan's predecessor, Mr George Maloney, as an authorised officer to inquire into the two Dunnes Stores companies.

Ms Justice Laffoy who heard the earlier challenge decided that Dunnes Stores was entitled to be given reasons for the appointment of an authorised officer. The Tanaiste, Ms Harney, later swore an affidavit, which purported to set out in full the reason for her decision to appoint Mr Maloney and then replace him with Mr Ryan. Dunnes has claimed the reasons were not adequate.