Irish Companies Reap Benefits of New Commercial Court - International Law Office

International Law Office

Company & Commercial - Ireland

Irish Companies Reap Benefits of New Commercial Court

November 22 2004


For many years there was a broad consensus among Ireland's business community that there was a need for a court which specifically handled commercial cases in an efficient and businesslike manner. There was a perception that commercial litigation in Ireland was frustratingly slow and the costs far too burdensome. On January 12 2004 a new Commercial List began operating in the Irish High Court. This quickly became known as Ireland's new Commercial Court.

The rules which implemented the new Commercial Court introduced a number of features into the Irish High Court system to make it more business friendly, including the following:

  • In order to focus the Commercial Court on 'commercial' cases, the minimum amount in dispute should not generally be less than €1 million (although the court retains discretion to handle cases of lower value). This minimum also means that cases where smaller amounts are in dispute do not block up the system for companies needing a quick decision in a corporate matter where large sums of money are at issue.(1)

  • The Commercial Court can direct the holding of a case management conference to be attended by solicitors to the parties. By directing both sides to meet face to face, matters in dispute can often be resolved outside the courtroom and again accelerate the pace at which the case is handled.

  • There are now provisions which allow for the proceedings to be adjourned in order for them to be referred to mediation, conciliation or arbitration. This is an important change and takes into account the increasing importance of alternative dispute resolution procedures for companies in Ireland today.

  • There have been some interesting technological developments, including allowing the use of oral evidence by video link. This makes things easier for companies which may have offices in a number of countries, as it allows their executives who may not be able to travel to the Commercial Court to give evidence from abroad. Again, in order to facilitate the needs of business, the Commercial Court is equipped with the latest technology to allow for filing of documents by electronic means and the use of computers in court.

  • The Commercial Court judge, Justice Peter Kelly, has made it clear that he intends the Commercial Court to offer a highly efficient service and that the court will not hesitate to impose sanctions on parties which are in default. The court has already done so in one case where a plaintiff was penalized for delay by a significant award of costs against him.

The majority of the cases entered to the Commercial Court so far relate to business contracts or the construction of business documents or contracts, but there have also been cases relating to insurance, intellectual property rights and judicial review. While the Commercial Court is clearly in its early days, the statistics emerging from the first seven months of its operation up to August 11 2004 show that of the 23 applications for admission, 21 cases were admitted while two were refused entry to the court's list. Of the 21 cases admitted, 14 of these have already been disposed of either by way of full hearing or settlement. One quite astonishing statistic is that the average time period from the entry of a case into the list to its conclusion is only five to six weeks.

It is probable that some of the cases which were dealt with in the Commercial Court had already been ongoing, so it will only be possible to assess what the real average time will be once the court has been in operation for a longer period. Nonetheless, it is abundantly clear from the information which has emerged to date that cases are proceeding at speeds which were previously unheard of. This will result in Irish companies being less wary of the timing involved in resolving a dispute in the Irish courts, which previously may have taken years to resolve. By speeding up the proceedings, legal costs will also inevitably be significantly reduced, thus removing another perceived barrier to having an issue settled by the Irish courts.

The establishment of the Commercial Court has undoubtedly resulted in savings to businesses in Ireland so far, both as a result of the more specialized approach to cases and also due to the use of modern information technology in proceedings before the court. While it could be said that the new rules envisage a certain amount of front-loading of work and expense, trials will be shorter or will become unnecessary where cases can be settled or resolved through alternative dispute resolution. The establishment of the Commercial Court has become an important part of the legal infrastructure in Ireland. Indeed, Ireland may become an attractive neutral venue for companies which have no connections in Ireland and which require an efficient resolution of commercial disputes by a court that accommodates modern business commercial needs.


For further information on this topic please contact Lorcan Tiernan at Dillon Eustace by telephone (+353 1 6670022) or by fax (+353 1 6670042) or by email (info@dilloneustace.ie).


Endnotes

(1) There is a very important provision which allows the court to deal with any other claim (other than personal injuries) which the judge considers appropriate for entry into the court list, having regard to the commercial and any other aspect of the case. Five of the 21 cases dealt with up to August fell into the 'catch-all' category of cases which do not necessarily have a value of €1 million.



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