Insurer Indemnity Third‑Party Notices in the Circuit Court: No Section 27 Time Imperative and a “Manifestly Bound to Fail” Threshold on Set‑Aside

Introduction

Foley v 360 Degrees Complete Maintenance and Property Management Ltd [2025] IEHC 584 is a High Court judgment (Circuit Appeal) that clarifies the procedural and substantive contours governing third‑party proceedings in the Circuit Court where a defendant seeks an indemnity from its insurer. Mr. Justice Garrett Simons dismissed an insurer’s appeal seeking to set aside a third‑party notice on two grounds: alleged delay and an asserted contractual bar arising from an arbitration clause.

The case arises from a workplace accident on 11 December 2019. The plaintiff (an employee) alleges he fell on a staircase while clearing a property. He sued his employer in the Circuit Court. The employer (the “insured”) sought to join its insurer, Surestone Insurance DAC, as a third party on the basis that cover had been wrongfully declined. After the County Registrar granted leave (18 March 2025), the insurer moved to set aside the third‑party proceedings, first arguing delay, and later focusing on a contractual arbitration time‑bar. The Circuit Court refused to set aside; the insurer appealed to the High Court.

Justice Simons’ decision addresses three issues of wider importance:

Whether the statutory “as soon as is reasonably possible” requirement under section 27 of the Civil Liability Act 1961 applies to third‑party joinder of an insurer for indemnity in the Circuit Court.
How (and how far) a court should examine the underlying merits on a procedural application to set aside a third‑party notice.
What role delay and minor procedural lapses play when the third party is an insurer and no prejudice is shown.

Summary of the Judgment

The High Court dismissed the insurer’s appeal and affirmed the Circuit Court’s refusal to set aside the third‑party notice (with a proposed modification on costs).

Key holdings:

No section 27 time imperative for insurer indemnity joinders. Order 7 of the Circuit Court Rules (CCR) governs third‑party proceedings. Unlike the Rules of the Superior Courts (RSC) Order 16, it contains no express time limit for seeking leave. The statutory “as soon as is reasonably possible” requirement in section 27 of the Civil Liability Act 1961 applies where contribution is sought from a concurrent wrongdoer, not where indemnity is sought from an insurer (paras 10–13).
Nevertheless, courts retain a discretion to refuse leave on prejudicial delay. Even without a statutory or express rule‑based time limit, courts may refuse leave where delay is prejudicial—by analogy with the approach to late amendments (paras 12–13).
Merits test on set‑aside is stringent. On a procedural motion to set aside a third‑party notice, the court should not conduct a mini‑trial. It may only weed out cases that are “manifestly bound to fail” (applying the Woori Bank approach to amendments by analogy) (paras 18–19, 25–26).
Arbitration clause did not justify summary set‑aside. The insurer argued that failure to refer a declinature dispute to arbitration within 12 months (per a policy clause) meant the insured’s claim was “deemed abandoned.” The court held this raised complex issues (claim‑barring vs remedy‑barring; timing of the 12‑month period; equitable considerations given prior incorrect limitation advice by the insurer; standard‑form interpretation), none suitable for summary determination (paras 21–26). The claim is not manifestly bound to fail (para 26).
Delay arguments failed absent prejudice. The insurer showed no prejudice from the approximately 22‑month period between the summons and third‑party service; the insurer had long notice of the claim (since 2019 and through PIAB in 2022). The court noted, by analogy, the Supreme Court’s two‑year “benchmark” in delay dismissals (Kirwan v Connors [2025] IESC 21) and found the alleged delay insufficient to warrant set‑aside (paras 27–29, 36).
Short service irregularity was forgiven. A three‑day delay beyond the 21‑day service requirement in CCR Order 7, and a further two to three weeks to serve the remaining papers, was de minimis and regularised in the court’s discretion under Order 67 CCR (paras 30–32).
Nexus satisfied; case‑management flexibility preserved. There is an obvious nexus between the personal injury claim and insurance coverage issues; the Circuit Court can sequence issues (e.g., try liability/coverage facts first) as needed (paras 34, 37).

Analysis

1) Governing Framework and Clarifications Under the CCR

Justice Simons emphasises that, on Circuit Appeal, the High Court exercises the same jurisdiction as the Circuit Court (ACC Loan Management Ltd v Fagan [2021] IESC 20, [2021] 1 IR 781, paras 22–24). Thus, the analysis turns on the Circuit Court Rules, especially Order 7 CCR, which requires leave to issue and serve a third‑party notice, but—critically—does not prescribe a time limit (para 9).

The judge unequivocally rejects the importation of the RSC’s 28‑day time limit (Order 16 RSC) into the Circuit Court via Order 67 rule 16 CCR. That bridging rule does not apply where the CCR already comprehensively address the matter (para 9). Order 7 CCR stands on its own footing.

The decision then draws a crucial distinction:

Contribution claims against concurrent wrongdoers: The statutory requirement in section 27 of the Civil Liability Act 1961—that third‑party notices be served “as soon as is reasonably possible”—applies (paras 10–11).
Indemnity claims against insurers: Section 27 does not apply because such joinders are not premised on concurrency of wrongdoing (Haughton v Quinns of Baltinglass Ltd [2021] IECA 249, paras 56–59; para 11). This case falls into the latter category.

The court carefully limits a prior High Court statement in Bowen v H & M Hennes & Mauritz (Ireland) [2022] IEHC 658. Bowen said Order 7 CCR must be read in light of the overarching statutory obligation to serve third‑party notices as soon as reasonably possible. Justice Simons explains that was correct for contribution claims, but overbroad when extended to insurer indemnity joinders (para 14).

2) Precedents Cited and Their Influence

ACC Loan Management Ltd v Fagan [2021] IESC 20, [2021] 1 IR 781: Confirms the nature of a Circuit Appeal—High Court effectively exercises Circuit Court jurisdiction (paras 22–24 cited at para 7). This frames the procedural lens: CCR governs.
Haughton v Quinns of Baltinglass Ltd [2021] IECA 249: Supports the non‑concurrent nature of insurer joinder for indemnity, hence no section 27 overlay (para 11).
Stafford v Rice [2022] IECA 47; Croke v Waterford Crystal Ltd [2005] 2 IR 383: Illustrate that even where rules allow procedural steps “at any time,” courts retain a discretion to refuse on the ground of prejudicial delay. This analogy underpins the judge’s view that Order 7 CCR does not immunise late joinders from scrutiny (para 12).
Bowen v H & M Hennes & Mauritz (Ireland) [2022] IEHC 658: Narrowed. The “overarching” section 27 requirement applies in contribution contexts, not to insurer indemnities (para 14).
Woori Bank v KDB Ireland Ltd [2006] IEHC 156: Provides the “manifestly bound to fail” standard for considering merits on a procedural motion (in that case, amendments), transposed by analogy to set‑aside applications for third‑party notices (paras 18–19).
Kirwan v Connors [2025] IESC 21: Supplies a two‑year “benchmark” in the analogous area of delay dismissals, used here illustratively to assess whether an unexplained lapse should justify set‑aside in the absence of prejudice (paras 29, 36).

3) The Court’s Legal Reasoning

The judgment develops a coherent, layered approach to applications to join (or to set aside the joinder of) an insurer as a third party in the Circuit Court.

First, the court states three headline principles governing insurer indemnity joinders (para 13):

Section 27 of the 1961 Act does not apply.
No express time limit is prescribed by Order 7 CCR (unlike Order 16 RSC).
However, the court may refuse leave by reference to prejudicial delay, even though Order 7 contemplates applications up to trial.

Second, on the perennial question whether a court should probe the merits on a set‑aside motion, Justice Simons favours restraint. He cautions against allowing procedural debates to become mini‑trials, especially where affidavits conflict and oral evidence is lacking (paras 17–19). The adopted approach, mirroring Woori Bank, is:

Only if the third‑party claim is “manifestly bound to fail” should the court set aside on the merits.
This is a “very high threshold” (para 19).

Third, the court applies these principles to the insurer’s arbitration‑clause objection. The clause required referral to arbitration within 12 months of the disclaimer, adding that failure meant the “claim under the policy shall be deemed to have been abandoned” (para 22). The court identifies multiple reasons why the issue is unsuitable for summary disposal (para 25):

No authority was cited to show that non‑compliance is “claim‑barring” (extinguishing the claim) rather than “remedy‑barring” (only precluding arbitration). Absent authority, summary dismissal in a technical area is unwarranted.
No agreed facts; declinature pre‑dated the personal injury action; timing matters for when any contractual clock starts.
Equitable concerns: the insurer earlier told the insured (incorrectly) that the PI claim was statute‑barred, overlooking section 50 of the PIAB Act 2003, which suspends limitation while a claim is before PIAB (para 5). It would be inequitable if the insurer could now rely on a contractual time‑bar precipitated in part by its own misstatement.
Policy interpretation: if a standard form/adhesion contract is in play, ambiguity may be construed contra proferentem against the insurer.

On this foundation, the court holds it cannot be “manifest” that the insured’s claim must fail. The merits must be left to the trial court (paras 26, 35).

Fourth, the delay arguments fail for lack of prejudice. The insurer had early notice:

Claim notified December 2019; PIAB notification forwarded October 2022 (paras 5–6, 28).
Personal Injuries Summons May 2023; third‑party notice served April 2025.

With no prejudice shown, and the period falling below the two‑year benchmark noted by the Supreme Court in an analogous context, set‑aside would be disproportionate (paras 27–29, 36).

Fifth, as to a brief failure to comply with the 21‑day service period under Order 7 CCR, the court regularises the de minimis default under Order 67 CCR, taking into account:

Nature and extent of the breach;
Absence of prejudice; and
The purpose of the breached rule (paras 30–32).

Finally, the court confirms there is a sufficient nexus between the main and third‑party issues to justify management together, possibly with sequential hearings overseen by the Circuit Court (para 34).

4) Impact and Practical Significance

The judgment has immediate and practical implications for personal injuries litigation and insurance coverage disputes in the Circuit Court.

Clarified time framework in the Circuit Court: Defendants seeking to join insurers for indemnity are not constrained by section 27’s “as soon as is reasonably possible” obligation. This removes a source of uncertainty created by over‑generalised readings of Bowen and confirms that CCR Order 7’s architecture is distinct from RSC Order 16.
Delay still matters, but prejudice is pivotal: Even without a strict limit, unexplained delay can carry consequences if it causes substantive or logistical prejudice. Insurers resisting joinder should produce concrete evidence of prejudice (e.g., lost evidence, impaired investigation) rather than rely on bare elapse of time.
High merits threshold on set‑aside: Parties should not expect the court to decide technical coverage points summarily on a set‑aside motion. Insurers relying on policy time‑bars or arbitration clauses must show the insured’s claim is manifestly bound to fail to secure set‑aside. Absent clear authority and settled facts, coverage issues will be left for trial.
Arbitration clauses under scrutiny: Clauses stating that failure to arbitrate within a set time deems the “claim” abandoned may be contested on multiple fronts: whether they are claim‑barring or remedy‑barring; when the time starts to run; whether insurer conduct (e.g., incorrect limitation advice) creates equitable bars to relying on the clause; and whether ambiguities are construed contra proferentem.
PIAB timing and limitation accuracy matter: The court’s reminder that section 50 of the PIAB Act suspends limitation underscores the risk to insurers of giving incorrect limitation advice. Such errors may later count against them in equitable analyses.
Case‑management efficiency: The “nexus” approach allows coverage issues to be coordinated with the main action, potentially heard sequentially by the same judge, reducing fragmentation and inconsistent findings.
Costs signal: The High Court’s provisional view that costs follow the event “above and below” encourages careful appraisal before appealing set‑aside refusals (para 38).

Complex Concepts Simplified

Third‑party notice: A procedural step allowing a defendant to bring a third party (e.g., an insurer) into the existing proceedings to claim contribution or indemnity.
Contribution vs indemnity: Contribution is where multiple “concurrent wrongdoers” are each partly liable to the plaintiff and one seeks a contribution from the other(s). Indemnity is where one party (here, the insured) claims the third party (the insurer) must meet the loss entirely under a contract of insurance. Section 27’s “as soon as reasonably possible” requirement applies to contribution claims, not indemnity claims against insurers.
Concurrent wrongdoer: Another party who is also at fault in causing the plaintiff’s loss.
Manifestly bound to fail: A high threshold used on procedural motions. The court will only refuse or set aside a claim at this stage if it is clear it cannot possibly succeed, without weighing contested facts or complex law.
Remedy‑barring vs claim‑barring clauses: A remedy‑barring clause blocks a particular forum or procedure (e.g., arbitration) if time limits are missed; a claim‑barring clause purports to extinguish the underlying right to relief. Courts are slow to treat time clauses as extinguishing substantive rights absent clear authority and wording.
Adhesion contract and contra proferentem: Standard‑form contracts drafted by one party (e.g., insurers) may be interpreted against the drafter when ambiguous.
PIAB/Personal Injuries Resolution Board and section 50 (2003 Act): Referring a claim to PIAB suspends the running of the statutory limitation period while the PIAB process is ongoing.
Order 7 CCR vs Order 16 RSC: CCR Order 7 governs third‑party procedure in the Circuit Court and has no express time limit for seeking leave; RSC Order 16 (High Court) includes a 28‑day limit. Order 67 rule 16 CCR does not import the High Court’s time limits where CCR already provides.
De minimis delay and procedural regularisation: Minor non‑compliance (e.g., a few days late service) can be forgiven where no prejudice results and the purpose of the rule is not undermined.
Nexus and sequencing: The “nexus” test asks whether issues in the main and third‑party proceedings are sufficiently connected to justify joint management. Sequencing means the court may direct which issues are tried first for efficient resolution.

Conclusion

Foley v 360 Degrees sets out a clear, practitioner‑friendly roadmap for third‑party insurer joinders in the Circuit Court. It establishes that:

Insurer indemnity joinders are not subject to section 27’s “as soon as is reasonably possible” imperative; Order 7 CCR does not carry an express time limit and is not supplemented by the High Court’s 28‑day rule.
Yet, courts retain a discretion to refuse leave to join for prejudicial delay, reflecting broader principles applicable to procedural discretions.
On a motion to set aside, courts should not conduct a mini‑trial of coverage issues; only claims that are manifestly bound to fail should be struck out at this stage.
Absent demonstrated prejudice—and particularly where the would‑be third party had long notice—delay will rarely justify set‑aside; short service irregularities can be regularised.

The judgment also signals caution in treating arbitration time‑limit clauses as extinguishing substantive insurance claims, especially where ambiguity, equitable considerations, or insurer conduct muddy the waters. In reaffirming the primacy of nexus and efficient case management, Justice Simons’ decision promotes coherent resolution of liability and coverage issues within a single litigation stream, while preserving fairness by avoiding premature merits determinations. For insurers and insureds alike, the message is clear: document prejudice, beware overbroad reliance on section 27 in insurer joinders, and expect contested coverage points to be decided at trial, not on procedural skirmishes.