John O'Mahony (Mayo, Fine Gael)
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63. To ask the Minister for Education and Skills if his Department have ever seen a statement from the auditors of Bus Éireann stating that Bus Éireann do not make a profit from the school transport scheme; and if he will make a statement on the matter. [47360/13]

Ciarán Cannon (Galway East, Fine Gael)
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Parliamentary questions linked to the substance of the High Court case taken by Student Transport Scheme Ltd against my Department, including the arrangements between my Department and Bus Éireann, have been raised on a number of occasions in the House recently.

For this reason, I feel it is appropriate to give a background to the conduct of the particular case. In doing this I will not stray into the area of issues that were raised before the Court and which were appropriately dealt with in that forum. Nor will I comment on matters which may be the subject of an appeal to the Supreme Court.

Student Transport Scheme Ltd is a company first incorporated in June 2011; it initiated the legal action against my Department in October 2011. Bus Éireann was joined as a Notice Party in the proceedings at the direction of the High Court. The records with the Companies Registration Office show that the sole shareholders of Student Transport Scheme Ltd are Mr Tim Doyle and Mr Brian Lynch who hold 101 and 99 shares of €1 each respectively, or a paid-up share capital of €200. The company was represented in the legal action by Brian Lynch & Associates, Solicitors.

Given the fact that the company had effectively no assets, my Department judged it prudent to seek an Order from the High Court for security for costs. This process preceded the actual hearing of the court case. In January 2012, the High Court gave the Department an order for security of costs. The effect of this was to provide the tax payer with security in the event, as actually occurred, that the Department won the court case and received an order in its favour in respect of its costs. In the absence of such security the taxpayer was at risk in relation to the costs of the action.

The essential thrust of the legal action was to seek an Order from the High Court setting aside the existing arrangements for the provision of national school transport services. The case was heard over a six day period in the Commercial High Court spanning the period from 10th July to 18th July 2012. During this period Counsel, on behalf of all parties (the company, the Department and Bus Éireann) advanced the detail of their respective cases and the legal arguments to the Court. The High Court Judgement was given in October 2012. The detail of this Judgement is available on the Courts Service website and other than to make the point that the Court found decisively in favour of the Department, I do not propose to comment further on the detail of the case.

It is worthy of note that the court case was litigated in an unusually belligerent manner by the applicant. The Department is in receipt of very extensive correspondence accusing the Department of illegality, obstruction of a solicitor, tampering with evidence, perverting the course of justice and drawing purported parallels between my Department and a fiefdom of thugs in Limerick City. At trial, Senior Counsel for the company apologised for the excessive zeal of this correspondence.

Subsequent to the Court Judgement in favour of the Department the company, through their solicitor, Brian Lynch & Associates initiated an appeal to the Supreme Court. In addition the company, again through their solicitor Brian Lynch & Associates commenced an action against two named officials of the Department, the Chief State Solicitor and a named official of the Chief State Solicitor's Office. This action alleged contempt and sought committal of the public servants in question.

The Department and Bus Éireann also sought security for the legal costs in relation to the appeal to the Supreme Court. The underlying purpose of seeking this security was to safeguard the taxpayer against the costs to be incurred in defending this appeal. In the event the issues of contempt/committal and security for costs came before the Supreme Court in February 2013. The Supreme Court dismissed the contempt/committal issue. The Supreme Court also awarded the Department and Bus Éireann security for their costs in an amount to be decided by the Master of the High Court in the event of the appeal against the High Court judgement proceeding.

The litigation in this case continues to be conducted in a most unusual, threatening and aggressive manner. Brian Lynch & Associates on behalf of the company, and Mr. Tim Doyle, as managing director of the company between them have written many hundreds of letters to Ministers, Deputies, the Department, Bus Éireann, the Office of the Chief State Solicitor and to individual officials and retired officials of the Department. Elements of this correspondence allege corruption, refer to an ongoing investigation of corruption by Brian Lynch & Associates, and repeatedly raise issues and contentions which were either the subject of the failed High Court challenge and/or are proper to any appeal to the Supreme Court.

It should also be pointed out that earlier correspondence to Bus Éireann contained references to bias, bribery and bullying and these allegations are now the subject of separate defamation proceedings initiated by Bus Éireann against Mr Tim Doyle.

I consider it necessary to bring the foregoing information to the attention of Deputies. It is important that litigation be conducted in the appropriate objective forum, namely the Courts, and that Ministers refrain from comment on matters which are the subject of further legal proceedings. Myself and my officials have sought to respect this principle in our approach to the litigation. The Office of the Chief State Solicitor has corresponded repeatedly with Brian Lynch & Associates pointing out that issues in relation to the proceedings should be dealt with in the appropriate process and will not be debated in the course of correspondence by either my Department or that Office.

Subject to provision of the appropriate security for costs as directed by the Supreme Court and as determined by the Master of the High Court, my Department will deal fully with the relevant issues and contentions raised by Brian Lynch & Associates in the context of the Supreme Court appeal.