In his judgement delivered this Wednesday, Justice Donal O’Donnell left the €304,320 in damages previously awarded to farmer John Hanrahan by the High Court virtually unchanged, finding that the Department had to pay him €299,320 plus interest for failing to return 223 cattle seized from his farm.

The dispute had been before the courts since 2006, when the Department seized cattle from Mr Hanrahan but committed to returning them to him by 11 April that year.

Instead, the courts have found that the Department had sold the animals, breaching its contract with the farmer.

Unrealistic

While these facts were not disputed, both parties had lodged appeals over the sum of money awarded in damages after Mr Hanrahan claimed more than €800,000 in the High Court trial, while the Department put his loss at less than €2,000. The Supreme Court judgement described both claims as “unrealistic”.

Justice O’Donnell acknowledged the difficulty in assessing damages where “there were no relevant books, records or even tax returns establishing the profitability or otherwise of the farm during the relevant period”.

However, he upheld the High Court’s decision to estimate the farm’s losses based on both the value of the missing cattle, and the loss in profit in the following years according to Teagasc data for comparable farms.

Double recovery

The Department of Agriculture argued that Mr Hanrahan could not be compensated for both as this would amount to “double recovery”.

However, Justice O’Donnell found that in this case, Mr Hanrahan had suffered a capital loss of €141,320 related to the value of the cattle; and also a €145,000 loss in profits while he struggled to rebuild his herd.

Crucially, the judge found that the High Court should not have discounted an independent valuation of the animals at more than €160,000, even though the “fire sale” of the cattle by the Department yielded only €55,250.

The loss involved may be both the loss of the capital value of the asset and the loss of profits

Justice O’Donnell highlighted the High Court’s finding that Mr Hanrahan “did not have the money or ability to borrow money from the banks to purchase immediately animals similar to those that ought to have been returned.

“In principle it is clear that where a profit-making asset is lost and not replaced for some time (and that course is a reasonable one to adopt) then the loss involved may be both the loss of the capital value of the asset and the loss of profits which would have been earned in the intervening period,” the judge said.

The case also involved detailed examinations of the cost of breeding replacement heifers as well as the impact on the farm’s labour, milk quota and winter milk bonus accounts during the years following the seizure of the animals.

Between restoring €20,000 to the valuation of the cattle and rejecting €25,000 previously awarded in damages for “stress, upset and inconvenience”, Justice O’Donnell finally reduced the previous award by a net €5,000.

Read more

Man pleads not guilty to theft of €107,300 worth of livestock