Treasury Holding & Ors v The National Asset Management Agency & Ors

Factual and Procedural Background

The proceedings concern a judicial review under section 193 of the National Asset Management Agency Act 2009 initiated by multiple companies collectively referred to as the Applicants against the National Asset Management Agency ("NAMA") and National Asset Loan Management Limited ("the Respondents"). The Applicants challenged decisions made by NAMA on 8th December 2011 and 25th January 2012 relating to enforcement actions, including the appointment of receivers over certain assets.

KBC Bank Ireland plc ("KBC") was joined as a notice party on its own application on 26th January 2012 to protect its commercial interests arising from a syndicated loan facility associated with the Applicants' Spencer Dock Development. The proceedings were dismissed on 31st July 2012, and this judgment concerns KBC's application for costs following that dismissal.

Subsequent to the substantive judgment, winding-up orders were made against the first to seventh named Applicants, with joint official Liquidators appointed. The Respondents and the Liquidators reached a compromise regarding costs, but no such agreement was reached with the remaining Applicants or KBC.

Legal Issues Presented

1. Whether KBC, as a notice party joined to protect its own economic interests but against which no relief was sought, is entitled to an order for costs against the Applicants following dismissal of the Applicants' judicial review claims.
2. The appropriate application of the principle that "costs follow the event" in the context of notice parties who voluntarily join judicial review proceedings.
3. How the extent of a notice party's interest in the issues and reasonableness of its participation affects entitlement to costs.

Arguments of the Parties

Notice Party's (KBC) Arguments

• KBC argued that although no relief was sought against it, its commercial interests were adversely affected by the judicial review challenge to NAMA's decisions.
• It was reasonable for KBC to join the proceedings to protect its interests, and as the successful party in resisting the Applicants' claim, it should be entitled to costs.
• Reliance was placed on the judgment in Usk and District Residents Association Limited v. The Environmental Protection Agency and Greenstar Holdings Limited [2007] IEHC 30, which supported a prima facie entitlement to costs for successful notice parties.
• KBC emphasized the normal rule under the Rules of the Superior Courts that costs follow the event, and no exceptional grounds existed to depart from this rule.

Applicants' Arguments

• The Applicants contended that the principle that costs follow the event should not automatically apply to notice parties like KBC who were joined at their own request and against whom no relief was sought.
• The Applicants' solicitors had requested KBC to "step back" from the proceedings to avoid unnecessary costs, asserting that the Respondents adequately protected KBC's interests.
• Applying the principles from Veolia Water UK plc. and Ors. v. Fingal County Council (No. 2) [2006] IEHC 240; [2007] 2 IR 81, the Applicants submitted there should be no order for costs because they were successful on most issues and the issue relevant to KBC was minor and unresolved.
• They emphasized that the majority of the hearing time related to issues on which the Applicants succeeded, further supporting their position against a costs order in favor of KBC.

Joint Official Liquidators' Arguments

• The Liquidators of the first to seventh Applicants supported the submissions made by the remaining Applicants opposing the costs application by KBC.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court began by acknowledging the starting position that a successful party in judicial review proceedings is ordinarily entitled to costs. However, it distinguished between necessary parties and notice parties who join voluntarily to protect their own interests.

The Court analyzed the factual differences between KBC and the respondents, noting that KBC was not a necessary party and no decision of KBC was challenged. KBC's participation was solely to protect its commercial interests.

Relying on the Usk judgment, the Court recognized that entitlement to costs for notice parties depends on all circumstances, including the extent of the party's interest in the issues and the reasonableness of its participation.

The Court reviewed the substantive issues in the proceedings, noting the Applicants were successful on four principal public law issues concerning NAMA, on which KBC had no interest. KBC's distinct contribution related to a sixth issue that was not determined and took little hearing time.

Applying the principles from Veolia Water, the Court found that the Applicants' success on most issues and the limited role of KBC did not justify an order for costs in KBC's favor against the Applicants.

The Court also considered the prior costs order made on the leave application but found it consistent with the present decision, as the costs awarded then were only costs in the cause and did not extend to substantive proceedings.

Holding and Implications

The Court DENIED the application by KBC for an order for costs against the Applicants in respect of the substantive judicial review proceedings.

The direct effect is that no costs are awarded in favor of KBC against the Applicants for the substantive proceedings, reflecting the Court's view that KBC was not a necessary party and its participation was limited and commercial in nature. No new precedent was established beyond applying existing principles concerning costs in judicial review and the role of notice parties.