Compensation and the State

On an application for judicial review of an administrative decision, a claim for compensation may be made.  If the applicant would have succeeded in a civil claim against the authority, damages may be awarded.  Proceedings for compensation can be brought separately in some cases.

The State does not enjoy general immunity from being sued for civil wrongs.  Formerly there were certain restrictions on suing the State, but these were found to be unconstitutional.  These former special immunities that once existed for public bodies from being sued have been removed.

If a particular course of action that would otherwise be a civil wrong is required by legislation, e.g. undertaking certain works then if the inevitable consequence is that it causes loss or damage, then the authority generally is not liable provided the acts is not done negligently. Therefore, for example, what might otherwise be a nuisance would be generally immune from a claim for compensation on this principle.

Generally, the official action must be specifically mandated by legislation.  For example, the construction of road works may be immunised for the nuisance they cause. However unnecessary acts, such as the incidental storage of materials in a particular place in connection with the works may not be exempt and may continue a nuisance or negligence.

Not Ordinarily Liable

Generally, persons and government departments acting bona fide in accordance with the powers, are immune from legal action for the consequences of their decisions.  Generally, officers have immunity from liability for their actions.

In many cases where the authority has the power to require matters to be cleared up or rectified on public health or amenity grounds, there is no right to compensation.  For example, where a local authority requires the removal of a dangerous building, a wall, prevention of water pollution, demolition of a dangerous house, most planning refusals and numerous other circumstances, do not generally carry a rise of compensation.

There are numerous grounds permitted by statute by which public bodies may act in ways which diminish private rights and interests without having any liability to pay compensation.  Where however property rights are taken or there is some interference, for example, the construction of an easement, flood barriers, etc. compensation will generally be provided and the Constitution most likely requires it.

State Powers and Liability

Generally, public bodies are not liable for negligence in relation to the exercise and non-exercise of the powers. In some cases, the Courts have held that where third parties have relied on public authorities in the exercise of their functions, they may be liable in negligence.

In some cases where a member of the public reasonably relies on the exercise of statutory functions and this is foreseeable by the authority, the local authorities may be liable to compensate where they have acted negligently.

There are limited circumstances only in which a member of the public may recover on the basis of the negligent exercise of a power.  It may apply where powers are specifically granted to protect members of the public and it is foreseeable that they will rely on and suffer loss if the powers are exercised negligently.  Discretionary decisions will rarely give right to a right of compensation.

Specific Statutory Immunities

Road authorities are not liable for injuries and damage caused by failure to keep the roads in good condition.  In contrast, they are liable for so-called misfeasance where works are done negligently and an accident is thereby caused.

Certain other immunities are granted by legislation.  Postal and telecommunications services provider are immunised from liability for loss and damage caused in the operation of the postal service by reason of failure to operate or maintain the postal service or by the interruption, suspension, restriction of a postal service.

Fire authorities discharging their fire safety, firefighting and fire prevention functions are immunised from liability to pay compensation in respect of injury to persons or property caused or contributed by failure to perform their functions.

The police authorities would generally be assumed to be immune from liability for the proper exercise of their functions.  Most regulatory agents are immune from claims in relation to the activity.

The Financial Regulator / Central has substantial immunity from liability for failures in the performance of their functions.

The Health and Safety Authority has similar immunity arising from lost cause or contributed to by the failure to comply with any of their functions or obligations.

Basis for Liability

A public authority is not liable to compensate for the consequences of its actions even if they are found to be invalid unless:

  • they constitute an existing basis of claim,
  • the act was done maliciously and deliberately knowing there was no power in which event  it may constitute the separate civil wrong of abuse of office,
  •  it is a breach of statutory duty or
  • constitutes a breach of personal rights or legitimate expectation.

The State may be liable and public authorities may be liable for negligence, false imprisonment, nuisance etc.

Abuse of a public office is rarely found.  It would be necessary to prove the official acted deliberately with the knowledge that it was abusing and outside its jurisdiction.  In practice, it is difficult to show and prove that the public authority or official acted deliberately with knowledge of lack of authority.

Sometimes a statutory duty in legislation creates a right of compensation where a person suffers financial or suffers loss by breach of the duty.  This is a question of interpretation of the intention of the legislation.

If the duty is to the public at large there is unlikely to be any right of compensation for breach of duty.  The Courts interpret whether the legislation is intended to create such a right of compensation.  If this is so then the State may be liable for breach of it.

European Union legislation obliges the State to enact certain laws.  A Member State may be liable to compensate for loss directly incurred by reason of the failure, properly to implement a Directive affording individuals enforceable rights.

Constitutional Rights

Certain fundamental rights are deemed constitutional rights. They must be protected by the State in legislation and cannot be changed by legislation.  The Courts have allowed compensation for breaches of constitutional rights additional to those provided for conventional torts / civil wrongs

Damages have been awarded for breach of rights that would not traditionally have been protected.  Damages have been awarded for breach of the right to fair procedures where monetary loss can be established.  A person who has suffered loss or damage by breach of a constitutional right is entitled to seek redress or compensation against those who have breached their right.

There have been several cases where compensation has been granted for breach of constitutional rights outside the scope of existing tort law in cases against the State.

Private Individual Rights

Generally, there is no right to compensation for invalid administrative action.  Where however the action interferes with a person\’s private rights or constitutes a civil wrong, there may be a right of compensation.

The Constitution protects property rights. It prohibits an unjust attack on property rights but provides that the State may regulate property rights.  The Courts sometimes will review whether the State has acted in a constitutionally permitted way.

The Constitution will generally require that compensation be paid and be determined independently.  In some cases where the law did not mention compensation, the courts have implied that compensation must be paid.

Employees of the public service and public servants have much the same obligations as private employees.  For example, if they cause injury in the course of their employment the State may be sued for their actions.

States and public authorities are liable under contracts and undertakings.  A change of government does not entitle the State to renege on contractual obligations it has undertaken.

Where the State wrongfully induces persons to pay taxes and other sums on foot of a wrongful interpretation of legislation the persons will generally be entitled to a refund by way of restitution style.


Administrative authorities should maintain a balance between the effects that have on individuals in terms of the liberties and interests and the objective to be achieved.  Where, for example, persons have been deprived of the livelihood on relatively trivial ground or where a penalty is wholly disproportionate to the matter the legislation is directed towards it may be invalid. Where relatively minor breaches may e severe consequences, they may be held to be disproportionate.

Proportionality arises under the European Convention on Human Rights in decision making.  The Convention requiresies  that  administrative bodies must exercise their functions in a manner compatible with the State’s obligations under the Convention\’s provisions.


Administrative Circulars / Longstanding Practices

There is a higher probability of a legitimate expectation being established where a personal assurance or promise has been given which does not circumscribe legal powers.  The alleged policy or basis must have been clearly shown to be communicated to the person concerned.

It is more likely that the right to a fair hearing or procedural right will be held to b reqquied than that a substantial benefit is required. In some casez, however, a change of policy would be so unfair as to amount to an abuse of power.  In this case, the Court may hold it to be  void.

Where a lawful promise induces a legitimate expectation of a benefit as opposed to the benefit of a procedure, the Court may decide that the frustration of the expectation is so unfair that to take a different course would amount to an abuse of power.  The courts balance the interests of the member concerned and the decision maker.

Administrative circulars may create legitimate expectation.  The Revenue Commissioners may grant advance rulings or give statutory concessions.  The Revenue Commissioners now publish many of their practices in their tax briefing notes.  Questions will arise as to how specifically details of the prior ruling was.  Generally may not make any difference.


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