Solicitors sue HSE for unpaid fees of €3.27m

TWO SOLICITORS who were suspended by the High Court earlier this year after admitting they operated secret accounts in a deliberate attempt to evade tax are suing the HSE for €3.27 million for alleged unpaid fees over a two-year period.

The legal action has been brought by Colm Carroll and Henry Colley, formerly practising as Roger Greene Sons, Bridge Street, Dublin, whose principal clients for several years were health boards. Both solicitors have ceased practising.

They are seeking €3.27 million for legal fees for work – mostly in relation to childcare cases – performed by the firm for the Northern Area and East Coast Area Health Boards between 2000 and 2002. The firm’s retainer for services for both boards was terminated with immediate effect in December 2004.

In the High Court earlier this year, Mr Justice Liam McKechnie rejected the Law Society’s application to strike off Mr Carroll and Mr Colley, who were the two partners and principals in the firm. The society made the application after both men admitted, following an investigation by the society, to operating secret accounts to evade tax. The accounts included an Ulster Bank deposit account into which lodgments of at least €32 million were made in a three-year period.

The judge instead suspended both men for a period of one year and restricted their practice for a further three years after that. Both were also directed to pay €50,000 compensation each to the Law Society compensation fund and each pay 50 per cent of the costs of the society. He noted both had made a substantial settlement with the Revenue Commissioners.

The Law Society has appealed the ruling and that appeal has yet to be heard by the Supreme Court.

At the Commercial Court yesterday, John Gordon SC, for the men, applied to have their action against the HSE heard by the Commercial Court.

John Hennessy SC, for the HSE, objected to the case being transferred from the ordinary court list on grounds of delay by the firm in advancing the proceedings since it served a plenary summons in March 2007.

Refusing the application to transfer, Mr Justice Peter Kelly said the Commercial Court’s objective is to speedily resolve commercial disputes. The court has limited resources and, in deciding whether to admit a case, is entitled to have regard to the conduct of the sides, he said.

In this case, the claim was for work done from March 2000 to April and May 2002. A plenary summons was issued in March 2007 and a statement of claim was not issued until June last, after the HSE had applied to have the case struck out for want of prosecution. Now, on the last possible motion day of this court term, it was being sought to transfer it to the Commercial Court. He said plaintiffs could not be said to have acted with expedition on any view. He refused the application and awarded costs to the HSE.

In their action, the plaintiffs said that, because of the volume of work performed for the health boards, they had until early 2002 been paid on the basis of fixed-sum monthly invoices in agreed amounts. In early 2002, after the reorganisation of the boards, they were asked to alter their billing process so that monthly billings would more closely reflect the work done in the month concerned and did so. Because of the workload involved in implementing the new billing process, they said it was not until May 2005 that they ascertained the differential between the monthly payments to them and the costs actually accrued.