The High Court has thrown out a long-running claim for damages taken by a poultry farmer who argued he had suffered as a result of refusing to engage in what he believed was ”systematic” tax fraud in the poultry sector.
The legal action, seeking €32m in damages, was taken by former broiler chicken grower and ex-chair of the Irish Farmers' Association (IFA) poultry committee Alo Mohan.
The action against the Revenue Commissioners and the attorney general was initiated in 2020.
A judgement delivered by Justice Barry O’Donnell stated on Tuesday that, in broad terms, Mr Mohan’s action was taken against the Revenue Commissioners which he saw as effectively penalising him for refusing to take part in what he believes constituted VAT fraud.
The application before the courts this week was a bid by Mr Mohan to amend his statement of claim.
This is the document that set out details including as the nature of his court action, the grounds on which he intended to pursue this action and the damage he would argue that he suffered.
VAT fraud alleged
The judgement noted that Mr Mohan’s allegation centred around the assertion that the poultry sector had for decades used co-operative intermediaries between farmers and processors to secure price increases funded through Revenue VAT reclaims.
It was claimed that poultry farmers operated under the flat-rate VAT regime and that poultry co-ops were VAT registered, allowing these intermediary co-ops to secure “price increases” not from poultry processors, but from raising input costs such as feed and passing back refunded VAT to its farmer members.
Mr Mohan told the High Court that his own accountant had advised him since 2007 that participation in this “fraudulent” co-operative tax structure could amount to committing a crime.
The farmer claimed that the termination of a valuable contract with a poultry processor in 2016 and the apparent refusal of other processors to deal with him “are attributable to actions of the State”.
The State’s role in the alleged tax fraud involved both oversight of and complicity in the country’s VAT regime, he argued.
Mr Mohan also contended that documentation he received from the European Commission “supports his claim that Ireland accepted an overcompensation risk in 2016 and 2017”.
It was Mr Mohan’s view that he was entitled to compensation of around €32m.
Judgement
The issues Mr Mohan sought to raise were deemed by Justice O’Donnell to be “extraordinarily extensive in terms of subject matter and timescale”.
The judgement did not deal with these issues on a point-by-point basis, but instead provided a high-level explanation of its decision to throw the case out.
The draft amended statement of claim contained hundreds of pages that bore very little linkage to “properly formulated legal claims”, according to the judgement.
Had Mr Mohan’s pleading been permitted to proceed, the judge envisioned an “entirely unmanageable” pre-trial situation and “in all likelihood, an equally unmanageable trail”.
It was deemed that document submitted by Mr Mohan was so “poorly pleaded” and prolix – a legal term for convoluted– that it would prove impossible for the defence to understand what case it was expected to face, which could cause “extreme unfairness and prejudice” if the matter had went to trial.
The pleading contained over 80 allegations of misfeasance in public office, as well as details claiming Garda misfeasance.
It also outlined Mr Mohan’s intent to seek a court order for the release of documents dating even further back than 1991 from entities not party to the case, including the Department of Agriculture, cabinet, co-ops and FBD Insurance plc.
The judge stated that what the totality of Mr Mohan’s proposed submission amounted to was “more in the nature of a full-scale tribunal of inquiry process with extremely broad terms of reference rather than a legal case”.
Fighting the case alone
Mr Mohan had engaged legal representation at earlier stages of the case, but, ultimately, represented himself when his draft amended statement of claim was heard in the High Court.
The judge noted that those engaged in legal disputes are entitled to ignore legal advice provided to them and that the courts tend to afford these laypersons a degree of flexibility that reflects their lack of knowledge on matters of law and legal procedure.
However, it was added that this entitlement does not exempt an individual from the requirement to conduct proceedings properly and that this flexibility cannot come at the expense of other parties to a case.
Mr Mohan’s demeanour was noted by Justice O’Donnell to have been “courteous and articulate”, leaving no doubt that his complaints were heartfelt and genuine in his view.
It was further noted that the right to represent oneself may very often be a decision that “very far from wise” as the judgement drew parallels between taking a case on oneself and carrying out a medical procedure on oneself in the absence of a professional.
It was stated that it is not court’s task to attempt to breakdown lengthy pleadings in a bid to shorted or reformulate them as this would result in the court effectively redrafting one party’s pleading.
The judge said that the court had afforded Mr Mohan ample opportunity to correct any areas of his pleading he saw fit, but it would not engage in dialogue or “extensive back and forth” in a bid to obtain a version of his pleading that would comply with court requirements.
The court denied Mr Mohan’s attempt to amend his statement of claim and struck out the proceeding for “failing to disclose a reasonable cause of action”.
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