The factual background is important. An internet provider entered into a settlement with several record companies The regulator was worried that implementation of the agreement would have data protection consequences. An enforcement notice was issued against the internet provider. No notice was issued against the record companies, but one can easily understand their concern. The issue I address in this post is whether the reasons were so inadequate as to invalidate the enforcement notice.
As Clarke J. put it, three questions arise in respect of reasons:
As to the first point, Clarke J. suggested that a general right to reasons follows from the right to seek judicial review or take an appeal. Without reasons, an assessment of the lawfulness of the decision is not possible:
6.11 It follows that in reasons cases there may well be three questions raised:- 1. Do reasons have to be given and if so what type of reasons; 2. Where can the reasons be found, and by reference to what evidence or materials can the Court objectively ascertain the reasons; and 3. When the reasons given, if any, have been ascertained, are those reasons sufficient to meet the requirements established in the case law?
6.5 It follows that a party is entitled to sufficient information to enable it to assess whether the decision is lawful and, if there be a right of appeal, to enable it to assess the chances of success and to adequately present its case on the appeal. The reasons given must be sufficient to meet those ends.Further, the suggestion in the previous case was that in some circumstances, reasons would be unnecessary. Clarke J. explained that this might be true of adjudicative proceedings, where the parties are present throughout, the facts have been thoroughly aired, and everyone understood the possible bases of the final decision, but that the principle has to be applied cautiously:
6.9 Where, for example, an adjudicator makes a decision after a process in which both sides have made detailed submissions it may well, as Fennelly J. pointed out in Mallak, be that the reasons will be obvious by reference to the process which has led to the decision such that neither of the parties could be in any reasonable doubt as to what the reasons were. But it seems to me that, in a case where any party affected by a decision could be in any reasonable doubt as to what the reasons actually were, it must follow that adequate reasons have not been given.On the second point, Clarke J. urged caution in looking outside the formal record:
6.8 While the comments made in Christian related to the specific circumstances of that case and derived from the context of a development plan, it seems to me that there is a more general principle at play. Legal certainty requires, as was pointed out in Christian, that it must be possible to accurately determine what the reasons were. There should not be doubt as to where the reasons can be found. Clearly, an express reference in the decision itself to some other source outside of the decision document meets that test. Where, however, it is suggested that the reasons can be found in materials outside both of the decision itself together with materials expressly referred to in the decision, then care needs to be taken to ensure that any person affected by the decision in question can readily determine what the reasons are notwithstanding the fact that those reasons do not appear in the decision itself or in materials expressly referred to in the decision. (Emphasis added)Here, the reasons were plainly inadequate, indeed non-existent, thereby invaliding the enforcement notice:
7.4 The reasons must be adequate to meet the record companies' needs in that regard. As pointed out, it may well be obvious to the parties involved in an adversarial process as to what the reasons for the decision of an adjudicator were in the light of the case made to that adjudicator and the adjudicator's decision. However, where a legally binding measure is sought to be put in place which affects parties beyond those who were part of the process leading to the adoption of the measure concerned, then there is a greater onus on the decision-maker to ensure that the reasons are transparent not just to those who were involved in the process, but to anyone else who might be affected as well. In the planning process, for example, all documents relevant to that process would normally be available to any interested party. If the reasons for a planning decision require reference to the process leading to that planning decision, then it is reference to a process which is transparently open to all. However, where, as here, the process affected the record companies but only directly involved Eircom and the Commissioner, it will inevitably be more difficult to satisfy the requirement for reasons from a consideration of the process.(Emphasis added)Clarke J. was not impressed by the suggestion that the record companies 'well knew' the alleged data protection flaws in the settlement agreement:
It may well, of course, be the case that a party who is affected by a legally binding measure may be able to infer why the measure was put in place. However such matters should not be left to inference at least in cases where there is an express statutory requirement that reasons be included in the document putting the measure in force and where the reasons might be open to any reasonable doubt. Legal certainty requires that the reasons can be determined with some reasonable measure of precision. The fact that a party may, in many circumstances, be able to make a good fist of inferring the reasons does not meet the legal obligation of a statutory decision maker to ensure that the reasons can be determined with adequate certainty.In a subsequent post, I will address an interesting procedural issue: given that the internet provider had a right of appeal against the enforcement notice, was it inappropriate for the record companies to seek judicial review?