Putting forward Mr Hugh O'Flaherty's name for vice-president of the European Investment Bank, and the Minister for Finance's announcement to that effect, were not in breach of the Constitution, the Supreme Court ruled yesterday.
The decision has cleared the way for the appointment of Mr O'Flaherty to the £147,000 a year EIB post if the bank so decides.
Dismissing a challenge by a college lecturer, Mr Denis Riordan, to the decision to put forward Mr O'Flaherty, the five-judge court said the "purported nomination" of Mr O'Flaherty by Mr McCreevy had no legal effect and was no more than an expression of the wish of one of its shareholders (the Irish Government) that a particular candidate should be appointed.
The court also ruled that the Government was not required to inform citizens of vacancies in the public service, State or EU before the Government might indicate a preference.
The "nomination" of Mr O'Flaherty is before the EIB board of directors, which has not yet decided whether to propose his name, along with those of other candidates, to the bank's board of governors.
The Supreme Court noted that Ireland, Denmark and Greece have an arrangement where each of them will put forward a candidate for EIB vice-president every third year and the other two will support that candidate.
The court noted that it was not disputed that the remaining members of the boards of directors and governors will normally accept the name of the person put forward for appointment in that manner, and in due course that person will be appointed by the board of governors on the proposal of the board of directors.
Although Mr Riordan lost his appeal yesterday against the High Court's rejection of his challenge he claimed afterwards that the decision was "a victory for democracy".
He contended that the Supreme Court had accepted the right of any citizen to apply for the position and said that right "must now be vindicated in practice by the EIB advertising the position and putting in place a fair and just selection process".
He indicated he would not be pursuing the matter to the European courts because it now rested with the EIB. He added that he would be asking the Supreme Court not to award costs against him because he had raised matters of great public importance. Costs will be decided on July 31st.
The Chief Justice, Mr Justice Keane, giving the judgment, said Mr McCreevy had purported on May 12th to nominate Mr O'Flaherty to the EIB position. On June 12th the High Court had dismissed Mr Riordan's challenge to that "nomination".
None of the State respondents in the case had any legal function in relation to the EIB appointment, with the exception of Mr McCreevy who, as a member of the board of governors, was entitled to vote on the board of directors' proposal, the Chief Justice said.
The arrangement or understanding that existed between three shareholders in the bank, which would in the normal course of events have led to the appointment of Mr O'Flaherty by the board of governors, on the recommendation of Mr McCreevy, was "of no legal significance", he added.
Mr Riordan's claim was that, in purporting to "nominate" Mr O'Flaherty without advertising that the vacancy existed, the State had effectively deprived others, including himself, of an opportunity to apply and be considered for appointment.
The State argued that the Government and Finance Minister, as a shareholder and governor of the bank respectively, were entitled as a matter of law to make known to the bank the name of a person they considered suitable for appointment. They said the courts might only interfere with the Government in the exercise of its executive functions where it was clearly established the Government was acting in breach of the Constitution.
This, the State argued, applied with even greater force in this case, where the executive was doing no more than transmitting its views on the appointment to another body which had the vested right to make that particular appointment.
The Chief Justice said the government collectively or individual ministers may indicate, over a huge area of activity, their wishes or preferences to other persons or bodies, and it would be a remarkable and novel step for a court to take it upon itself to declare political decisions of this nature unlawful.
However, it was not necessary in this case to express any concluded view as to whether circumstances could ever arise in which the mere expression of an opinion or a recommendation by a minister or government collectively on how another body might discharge a particular function could be successfully challenged on the ground that it was in breach of the Constitution.
Mr Justice Keane said Mr Riordan had failed to show that putting forward Mr O'Flaherty for the EIB vacancy and the announcement to that effect were unconstitutional. Even the most expansive construction of the constitutional guarantee of equality in Article 40 could not support the argument that the guarantee of equality required the executive to inform citizens of any vacancy in the State, public service or EU before the executive could indicate a preference on how it might be filled.
The Supreme Court also rejected a submission by Mr Riordan that a number of issues should be referred to the European Court of Justice for interpretation pursuant to Article 234 of the Treaty of Rome.