O'Keeffe v Hickey

Factual and Procedural Background

The Plaintiff was sexually assaulted while a primary-school pupil by the first-named Defendant, a lay teacher who abused her during individual music lessons. She successfully sued that Defendant and obtained an award of €305,104, although he lacked the resources to satisfy the judgment in full. She also received €53,000 from the Criminal Injuries Compensation Tribunal.

Separately, the Plaintiff commenced these proceedings against the Minister for Education and Science, Ireland and the Attorney General (collectively, the “State Defendants”), contending that they were vicariously liable for the teacher’s assaults. The High Court dismissed the action and the Supreme Court dismissed the Plaintiff’s appeal on liability. The present ruling concerns only the issue of costs following that substantive appeal.

Legal Issues Presented

1. Whether, notwithstanding the Plaintiff/Appellant’s failure on the merits, special or exceptional circumstances justified a departure from the general rule that costs follow the event.
2. Whether the orders for costs made in favour of the State Defendants in both the High Court and the Supreme Court proceedings should stand or be set aside.

Arguments of the Parties

Appellant’s Arguments

• The litigation was an important “test case” affecting numerous pending claims concerning the State’s potential vicarious liability for sexual assaults by teachers whose salaries are paid by the Minister.
• The public importance and complexity of the issues constituted exceptional circumstances warranting the exercise of the Court’s discretion to refuse an award of costs against an unsuccessful litigant.

Respondents’ Arguments

• Under the ordinary principle, the unsuccessful party should pay the successful party’s costs, and the State Defendants had been found free of liability.
• No sufficient basis had been shown for displacing that principle, although counsel indicated that a “sympathetic view” might be taken in enforcing any costs order.

Table of Precedents Cited

Court’s Reasoning and Analysis

The Supreme Court reaffirmed that costs ordinarily follow the event, reflecting the equity that a successful, fault-free party should be indemnified by the loser. However, the Court retains a discretion to depart from that rule in special or exceptional circumstances.

Having adopted the principles set out in Cork County Council v. Shackelton, the Court identified several exceptional factors:

• The appeal functioned as a true test case influencing a “substantive volume” of similar claims involving historical sexual abuse by teachers whose salaries were State-funded.
• The legal landscape was unusually complex, involving historic and evolving relationships among school managers, owners, teachers, the Minister and the constitutional duty to provide free primary education.
• The public importance of clarifying the law on vicarious liability for abuse in the educational context was considerable.
• Counsel for the State Defendants had indicated that any costs order, if granted, might be enforced with leniency, acknowledging the sensitive circumstances.

Balancing these considerations, the Court concluded that it would be unjust to burden the Appellant with the State’s costs.

Holding and Implications

NO ORDER AS TO COSTS was made in favour of the State Defendants in the Supreme Court. The existing High Court order for costs against the Appellant was also set aside, with no order for costs in those proceedings.

Implications: While the decision does not create a standalone precedent altering the general rule on costs, it underscores that Irish courts may relieve an unsuccessful litigant of adverse costs where a case is genuinely test-case litigation raising complex issues of broad public importance, particularly against State parties.