knowledge 28 July 2016 |

No Legitimate Expectation of Enforcement of the Law

At first blush, this conclusion, at the heart of the recent Supreme Court judgment in Atlantic Marine Supplies Limited & another v Minister for Transport & others¹, seems counterintuitive. All social interests reasonably expect that the law will be enforced so that society operates according to the rule of law. The court’s conclusion refers however only to the legal doctrine of legitimate expectation as a representation the breach of which can give rise to an entitlement to compensation for the person whose expectations have been frustrated by a State authority’s action or default. We are perfectly entitled to expect State authorities to enforce the law; we are just not entitled to be compensated by the State (in the absence of something like breach of statutory duty) if they fail to do so with 100% effectiveness.

In Atlantic, it had essentially been argued that a compliant business operator suffered loss because aspects of the maritime safety regime were not enforced; the plaintiff could not sell the expected volumes of safety equipment because the State authorities did not prevent ships and boats from unlawfully putting to sea without the equipment required by law.

Although the Supreme Court decided the appeal on other grounds, the State defendants made submissions based on concerns about the potential wider impacts of certain conclusions in the High Court judgment (which was otherwise upheld), and commented on the doctrine of legitimate expectation.

In Glencar Exploration plc v Mayo County Council (No. 2)²,  the Supreme Court had noted that the doctrine of legitimate expectation can be seen as deriving in part from the jurisprudence of the Court of Justice of the European Union, though some see it as a development of the doctrine of promissory estoppel. In the latter context Lord Diplock in an English case³ described it as arising in the case of decisions which affected other persons by:-

“(a) altering rights or obligations of that person which are enforceable by or against him in private law; or (b) … depriving him of some benefit or advantage which either

(i) he had in the past been permitted by the decision-maker to enjoy and which he can legitimately expect to be permitted to continue to do until there has been communicated to him some rational grounds for withdrawing it on which he has been given an opportunity to comment, or

(ii) he has received assurance from the decision-maker will not be withdrawn without giving him first an opportunity for advancing reasons for contending that they should not be withdrawn.”

Fennelly J in Glencar had tentatively suggested three propositions required to be established to succeed in a claim for damages based on a failure of a public authority to respect legitimate expectation: (1) the authority must have made a statement or adopted a position amounting to a promise or representation, express or implied, as to how it will act in respect of an identifiable area of its activity; (2) the representation must be addressed or conveyed, directly or indirectly, to identified persons or groups of persons actually or potentially affected in such a way that it forms part of a transaction definitively entered into or a relationship between that person or group and the public authority or the person or group has acted on the faith of the representation, and (3) the representation must be such as to create an expectation, reasonably entertained, that the public authority will abide by the representation such that it would be unjust to permit the public authority to resile from it.

These propositions were expressly endorsed by two later Supreme Court judgments. In the first, Lett & Company Limited v Wexford Borough Council & others⁴, damages were awarded though the court warned of “the dangers of application of too sweeping a statement of principle, and the difficulties posed by cross-fertilisation of concepts such as proprietary estoppel, promissory estoppel and legitimate expectation”. It held that “.. there is sufficient authority and principle to justify a court, once it has determined that there has been a breach of a legitimate expectation, to give such remedy as the equity of the case may demand…” (including damages).

In the second, Cromane Seafoods Limited & another v Minister for Agriculture, Fisheries and Food & others⁵, damages were not awarded. Some members of the court suggested that a court considering a legitimate expectation claim should consider the presence of potential “negative factors” militating against a legitimate expectation on which reliance could be placed. “Negative factors” would be “… issues which may either prevent those three tests from being met ( for example the fact that… it may not be legitimate to entertain an expectation that a past error will be continued in the future⁶) or may exclude the existence of a legitimate expectation by virtue of the need to preserve the entitlement of a decision maker to exercise a statutory discretion within the parameters provided for in the statute concerned or, alternatively, may be necessary to enable….legitimate changes in executive policy to take place⁷.”

In Atlantic, the Supreme Court disposed straightforwardly of the proposition that the mere enactment of legislation could ever amount to an actionable representation that the legislation would be enforced. It held that:

“…the passage by the Oireachtas of the 2006 Act … cannot in my view amount to a representation being made by the Minister that the law as enacted will be enforced….. The obligation on the Executive to enforce the law enacted by the Oireachtas is derived from the Constitution, and is not dependent on any concept of legitimate expectation which could be relied upon by a more limited group of citizens, to found a claim for damages. I also agree that it is, at a minimum, unlikely that the enactment of legislation which itself does not give rise to a right to sue for breach of statutory duty, could nevertheless give rise to a legitimate expectation sounding in damages in the same group. On similar reasoning it might indeed be said that if this is possible then at the level of principle, it would follow that all legislation was capable of giving rise to some such legitimate expectation on the part of interested parties,or indeed quite possibly any citizen, with a corresponding right to enforce such an expectation and to claim damages if it is possible to advance a claim in relation to them. It is not necessary to analyse the matter further: it is sufficient to conclude that the finding of legitimate expectation in this case cannot be upheld.”

The doctrine of legitimate expectation is part of the evolving landscape of State liability. To date, its application has generally been confined to cases where there is a reasonably clear representation by a State authority which is either directed to, or obviously capable of being relied on by, a relatively small and easily identifiable group of local residents or businesses. There may be an obvious injustice where, for example, local businesses have invested heavily in development based on what they are told of future State authority plans, but wrong-footed by a later change of policy. Decisions around representations, especially implied representations, and reasonableness of reliance are never a basis on which a claimant can be confident of success, especially where, as in legitimate expectation cases, context is key. Atlantic unsurprisingly confirms that given its essentially equitable origins (at least in the common law world), the doctrine is one which the courts will carefully control, and should not be expected to expand exponentially (or unexpectedly) any time soon.