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1. The Plaintiffs are the proprietors and persons responsible for administering five private and independent hospitals within the State, that is to say:-

2. The Defendant is the Voluntary Health Insurance Board (hereinafter referred to as the "V.H.I.") which is a statutory corporation established by the Voluntary Health Insurance Act, 1957 for the principal purpose of providing private medical insurance within the State with the benefit of and subject to certain powers and responsibilities conferred and imposed upon it by virtue of the Voluntary Health Insurance Act, 1957 (hereinafter referred to as the "1957 Act") and the Voluntary Health Insurance (Amendment) Act, 1996 (hereinafter referred to as the "1996 Act").

3. It is claimed on behalf of the Plaintiffs and acknowledged on behalf of the Defendant that V.H.I. occupies a position of dominance within the market for the provision of private medical insurance within the State and that the State comprises a substantial part of the European Community and it is claimed on behalf of the Plaintiffs that approximately 90% of the income of the Plaintiffs' hospitals derives from patients whose bills are paid in whole or in part by V.H.I. so that the Plaintiffs' hospitals are dependent for almost the entire of their income upon patients who are indemnified by V.H.I. and in turn it is admitted by V.H.I. that a substantial portion of the income of the Plaintiffs' hospitals derives from such patients.

4. It is claimed on behalf of the Plaintiffs that by reason of its dominance in the market for the provision of private medical insurance, V.H.I. has the ability to control the ancillary market for the provision of private health services and is in a position to control the way in which operators within the private health service market behave with the effect that V.H.I. occupies a position of dominance within that ancillary market.

5. The Plaintiffs claim that V.H.I. has abused its position of dominance in the medical insurance market and in the ancillary market for the provision of private health services in the following manner, that is to say:-

6. It is claimed on behalf of the Plaintiffs that the foregoing conduct on the part of V.H.I. comprises an abuse by V.H.I. of its position of dominance contrary to the provisions of Section 5 of the Competition Act, 1991 (hereinafter referred to as the "1991 Act") and Article 86 of the Treaty establishing the European Economic Community (hereinafter referred to as the "Treaty").

7. It is further claimed on behalf of the Plaintiffs that V.H.I., by engaging in such conduct, has acted unreasonably, unfairly and inequitably contrary to the duties and obligations imposed upon it by the 1957 Act and the 1991 Act.

8. The proceedings herein have come before me by way of an application by the Plaintiffs for an interlocutory injunction which at the conclusion of the hearing was sought by Counsel on behalf of the Plaintiffs in the following terms, that is to say, an interlocutory injunction to subsist until the trial of the proceedings herein or further Order of the Court "....restraining the Defendant from replacing the scheme of maintenance, technical and ancillary prices or charges operated by the Defendant in relation to the Plaintiffs and paid by the Defendant to the Plaintiffs for the provision of medical services during the period between 1996 and the 2nd April, 1998".

9. The Defendant, whilst admitting that it occupies a position of dominance within the medical insurance market, strongly rejects the contention that it has in any way ever abused that position at any time. More specifically, V.H.I. contends that it has at all times throughout all of its dealings with the Plaintiffs acted in a manner which was wholly proper and which was in accordance with its obligations and duties, both statutory pursuant to the Acts of 1957 and 1996 whereby it was established and regulated and commercial, having regard in particular to the interests of its subscribers, on whose behalf it is obliged to obtain medical services of the highest possible quality at the most competitive prices available.

10. A large volume of evidence was adduced grounding the arguments advanced on behalf of both parties throughout the five days whilst this application was being heard.

11. The relief sought by the Plaintiffs however is interlocutory in nature so that it is inappropriate for me, in dealing with this application, to seek to determine the issues between the parties.

12. The application of the plaintiff's criterion on a motion for interlocutory relief would involve the Court in a determination of an issue which properly arises for determination at the trial of the action. In my view, the test to be applied is whether a fair bona fide question has been raised by the person seeking the relief. If such a question has been raised, it is not for the Court to determine that question on an interlocutory application: that remains to be decided at the trial. Once a fair question has been raised, in the manner in which I have indicated, then the Court should consider the other matters which are appropriate to the exercise of its discretion to grant interlocutory relief. In this regard, I note the views expressed by Lord Diplock, with the concurrence of the other members of the House of Lords at p. 407 of the report of American Cyanamid v. Ethicon Limited . I merely say that I entirely agree with what he said."

13. Applying the foregoing statement of law, it follows that it falls to me to determine "......whether a fair bona fide question has been raised by......" the Plaintiffs and if such a question has been raised it is not for me to determine that question on this application.

14. I am bound to say that having heard the evidence which was adduced at the hearing of this application and the arguments advanced on behalf of the parties, I have little doubt that the Plaintiffs have raised a fair bona fide question for determination but I am fortified in that view by an admission fairly made by Counsel on behalf of the Defendant who indicated near the conclusion of the evidence adduced on behalf of the Plaintiffs that he now accepted that a fair and substantial question had been raised by the Plaintiffs although he was quick to add that it was his firm conviction that the substantive claim advanced on behalf of the Plaintiffs would be defeated with facility at the trial of the action.

15. As I have already indicated, I am satisfied that the Plaintiffs have raised a fair bona fide question, or series of questions, for determination at the trial of this action including inter alia the following:-

16. In the light of the foregoing it now falls to me to consider other matters which are appropriate to the exercise of this Court's discretion to grant interlocutory relief.

17. Having regard to the adoption by O'Higgins C.J. in Campus of the views expressed by Lord Diplock in American Cyanamid -v- Ethicon Limited , [1975] AC 396, it is convenient to set out herein the principles laid down (at p. 407 of the report) in that case relative to the grant of interlocutory injunctions. It is couched in the following terms:-

18. The foregoing views expressed by Lord Diplock as to the exercise of the Court's discretion to grant interlocutory relief has been adopted by the Courts within this jurisdiction on numerous occasions and indeed have been cited with approval in several well known cases; see Campus Oil -v- Minister for Industry (No. 2), [1983] IR 88 at p. 107 and Irish Shell -v- Elm Motors Limited , [1984] ILRM 595 and the judgment of Blayney J. in Ferris -v- Ward , (unrep., delivered on 7th November, 1995).

19. It follows from the foregoing that in considering such applications if the Court decides that a fair bona fide question has been raised by the applicant then the Court should go on to consider the "balance of convenience" in the manner which has been described quite precisely in the passage from American Cyanamid cited above.

20. In the light of the foregoing it seems clear that in general when considering applications for interlocutory relief, the Court should adopt the following sequence of consideration, that is to say:-

21. It follows further from the foregoing that if, on the evidence, (a) damages would provide an adequate remedy for the applicant in the event of his succeeding at the trial or (b) the respondent could not be adequately compensated under the applicant's undertaking as to damages if the respondent were to succeed at the trial then ".....no interlocutory injunction should normally be granted, however strong the (applicant's) claim appeared to be at that stage" (see American Cyanamid at p. 409).

22. Having determined, as I have done, that the Plaintiffs have raised a fair substantial bona fide question for determination, it is clear that I must now consider the question as to whether or not, if the Plaintiffs succeed in establishing their right to a permanent injunction, they will be adequately compensated by an award of damages for any losses which they will have sustained as a result of their being required to accept remuneration for their services at the levels set by V.H.I. under the new scheme introduced by V.H.I. with effect from the 2nd April, 1998.

23. It has been contended on behalf of the Plaintiffs that they cannot be adequately compensated by an award of damages for the losses described above because:-

24. It was argued on behalf of the Plaintiffs that on the evidence the Plaintiffs face imminent bankruptcy by reason of a potential civil wrong which if permitted, even in the short term, will inevitably result in the closure of some or all of the hospitals concerned in the near future.

25. It was contended that having regard to the nature and character of the hospitals concerned and the services which they provide, closure in such circumstances will be final and irreparable and will not be capable of being remedied by a subsequent award of damages.

26. It was contended on behalf of the Defendant that even if the Plaintiffs succeed at the trial in establishing their right to a permanent injunction, they will be adequately compensated by an award of damages for any loss which they may have sustained by reason of the introduction by V.H.I., with effect from the 2nd day of April, 1998, of a new scheme and level of charges and prices.

27. It was argued on behalf of the Defendant that no evidence was adduced by or on behalf of the Plaintiffs which could reasonably give rise to the inference that any of the Plaintiffs are in danger of bankruptcy within the period of time between the date of the hearing of this application and the date when this substantive issue in the case will be determined by way of a full trial (which the parties estimate can be commenced no earlier than six weeks but probably no later than six months from the date of the hearing of this application).

28. Furthermore, the Defendant contends that any losses sustained by the Plaintiffs during such a period can be calculated with facility having regard to the ready availability of documentation disclosing the levels of remuneration, charges and prices applicable prior to 2nd April, 1998 and similar charges applied by the Defendant thereafter.

29. The first question which I must determine is whether or not the Plaintiffs have established, by way of evidence, a real and substantial doubt as to the adequacy of damages as a remedy, should they succeed in establishing their right to a permanent injunction in these proceedings. In making that determination I am satisfied that I must consider two questions, that is to say:-

30. The evidence adduced at the hearing disclosed inter alia that for some considerable time V.H.I. has been endeavouring to meet the wishes of its subscribers to provide for such subscribers a full indemnity (hereinafter referred to as "fully covered care") in respect of the cost of health care including hospital maintenance and treatment. V.H.I. sought to achieve its objectives by negotiating with various private and public hospitals with a view to agreeing levels of charges, prices and remuneration payable by V.H.I. to the hospitals for the medical services provided by those hospitals.

31. Although historically most hospitals had been prepared to agree with V.H.I. appropriate rates for the provision of "fully covered care", in early 1996 many private hospitals (including each of the Plaintiffs) were unwilling or unable to agree appropriate rates, charges and prices to enable them to provide "fully covered care".

32. With effect from early 1996 the Plaintiffs (and various other hospitals) came into a category known by V.H.I. as "partially participating" hospitals.

33. V.H.I. continued to negotiate with its "partially participating" hospitals with a view to persuading such hospitals to agree appropriate rates, charges and prices to enable agreement to be reached for the hospitals concerned to provide "fully covered care" and throughout the duration of those negotiations V.H.I. paid benefits to its members for attendance at "partially participating" hospitals at daily maintenance rates equivalent to those which had been paid to the same hospitals for providing "fully covered care" in 1995 together with payment for additional items known as ancillaries at a rate 7.4% less than had previously been paid in respect of such items.

34. The negotiations between V.H.I. and the "partially participating" hospitals continued throughout 1996 and 1997 and a number of hospitals reached agreement with V.H.I. on appropriate rates and charges and duly agreed to provide "fully covered care". No agreement, however, was reached between V.H.I. and the Plaintiffs in respect of the provision of "fully covered care" and throughout 1996 and 1997 V.H.I. continued to make appropriate payments at the rates referred to above which had been paid to all "partially participating" hospitals since early 1996. Such payments were insufficient to fully cover the costs of the "partially participating" hospitals for the provision of the medical services in question and the hospitals recovered the shortfall by means of a system known as "balance billing" whereby the hospitals invoiced patients (invariably V.H.I. subscribers) in respect of the difference between the rates deemed by the hospitals to be sufficient to cover their costs and the rates actually paid by V.H.I.

35. In early 1998 V.H.I. advised the Plaintiffs of its intention to notify its subscribers that it had not reached agreement with the Plaintiffs for the provision of "fully covered care" and of its intention to implement its new rates of remuneration, charges and prices for "fully covered care" with effect from the 2nd April, 1998 and a new rate in respect of "partially participating" hospitals with effect from the same date.

36. Since no agreement had been reached between V.H.I. and the Plaintiffs, a letter was sent by V.H.I. to all of the Plaintiffs dated 27th April, 1998 setting out particular rates of remuneration, charges and prices which it stated it was prepared to pay to "partially participating" hospitals with effect from 2nd April, 1998 (although this is not totally clear) and such rates are apparently significantly less advantageous to the Plaintiffs than those which were applied by V.H.I. to "partially participating" hospitals between early 1996 and April of 1998.

37. The foregoing analysis, whilst perfectly logical and skilfully argued, does not however address the question as to whether or not the Plaintiffs have established by way of evidence a real risk that their hospitals face closure by reason of the introduction by V.H.I. of its new scheme for the period between the date of the implementation of the scheme (April 1998) and the date when the Plaintiffs' entitlement to a permanent injunction will be determined. All appropriate pleadings have now been delivered in this case and both parties have expressed a wish to have the substantive issue tried at the earliest possible date. Apparently the only outstanding matter in the case relates to the discovery by the Plaintiffs of some documentation which may be in the possession or power of procurement of the Defendant. The Defendant has undertaken to discover such documentation within two weeks from the date of Order. It was agreed between the parties that there is no reason why the trial of the substantive issue herein should not commence in October or November of 1998 and it is possible (perhaps now unlikely) that the trial could commence as early as June or July of 1998. Certainly I consider it to be highly probable that the Plaintiffs will be enabled to have a full trial of the substantive issue in this case before December of 1998 and I believe that the parties are in full agreement as to that fact.

38. In the circumstances then, I have to consider whether or not I am satisfied on the evidence that the hospitals owned by the Plaintiffs or any of them are likely to face closure by reason of the introduction by V.H.I. of its new scheme between April of 1998 and December of 1998 and I am bound to say that on the evidence I am not so satisfied.

39. Comprehensive, careful and helpful evidence was adduced on behalf of the Plaintiffs inter alia by Mr. Michael Heavey who is the Chief Executive of the Independent Hospital Association of Ireland and his testimony on Affidavit included testimony adduced in reply to some of the Affidavits which had been adduced by way of evidence on behalf of V.H.I.. Similar detailed and helpful evidence was adduced on behalf of the Plaintiffs by Mr. John Fingleton who is a distinguished economist and further careful and considered evidence was adduced on Affidavit by Sister Mary Hassett who is one of the Trustees of Mount Carmel.

40. Whilst all of the foregoing three witnesses on behalf of the Plaintiffs deposed to the fact that the proposed new scheme introduced by V.H.I. was likely to put the future of the Plaintiffs' hospitals in jeopardy and would undoubtedly require the Plaintiffs to trade at a loss and whilst Mr. Fingleton deposed to the fact that it was possible that "..... those hospitals that operated with excess capacity in 1995 and 1997 could be driven into bankruptcy under this new pricing structure". It may be of significance that none of the deponents felt able to express the conviction that, by reason of the introduction of V.H.I.'s new scheme, any of the hospitals are faced with immediate closure or will be required to close within any particular period of time.

41. Sister Mary Hassett deposed to the fact that the scheme introduced by V.H.I. would "....have a devastating effect upon Mount Carmel Hospital...." and went on to explain that the hospital has been running at a loss for a number of years and Mr. Fingleton deposed to the fact that "....Mount Carmel has sustained losses in 1994, 1995 and 1996 and losses in several prior years....." but this could lead to the conclusion that Mount Carmel is able to sustain losses at least in the short term and there is no averment in any Affidavit sworn on behalf of the Plaintiffs which indicates the contrary.

42. Mr. Fingleton's evidence indicated that ".....Garden Hill in Sligo returned a modest surplus in the year ended August 1997" and whilst he also indicates that ".....St. Joseph's in Raheny has experienced financial difficulties...." he did not express the conviction that closure is imminent in the short term in respect of any of the hospitals owned by the Plaintiffs.

43. Mr. Connolly on behalf of the Plaintiffs points to the averments of Mr. Heavey in relation to Galvia to the intent that "Galvia will therefore have to operate at a loss. It cannot do so indefinitely. The consequences for Galvia are therefore very stark" and to his observations in relation to Sligo to the intent that:-

44. However, the foregoing averments of Mr. Heavey must be read in the context of the views expressed on Affidavit by Mr. Fingleton who, it must be remembered, is an economist retained on behalf of the Plaintiffs who, arguing in favour of the Plaintiffs' contentions, indicated inter alia that:-

45. I do not suggest that the foregoing is by any means a satisfactory situation for the Plaintiffs and this is particularly the case having regard to the vitally important functions which they perform so capably and so conscientiously but it is not consistent with the imminent closure of these worthwhile and vital institutions.

46. The only evidence adduced on behalf of the Plaintiffs which would suggest that the hospitals owned by the Plaintiffs face closure by reason of the introduction of the V.H.I.'s scheme with effect from 2nd April, 1998 is the averment contained at paragraph 65 of Mr. Heavey's Affidavit sworn on the 14th April, 1998 wherein he states:-

47. Reading that paragraph in conjunction with the succeeding two paragraphs, I have the clear impression that the averment concerned is intended to deal in a general way with the requirements for interlocutory relief and that is not unusual when Affidavits are sworn grounding applications for relief of the type sought herein. Such averments are perfectly proper and I have no doubt that the averment concerned was conscientiously made by Mr. Heavey in this case. However, I do believe that it is supported by any evidence which has been adduced at the hearing of this application.

48. It appears to me that if the hospitals owned by the Plaintiffs or any of them were facing such imminent closure as is suggested, then the Boards of Directors of the Plaintiffs affected would by now have met (possibly in crisis) or, at very least, financial institutions would have been approached with the view to providing support sufficient to enable the survival of the institutions concerned or some other measures signifying crisis would have been taken.

49. Counsel on behalf of the Plaintiffs has referred to correspondence between the Plaintiffs and V.H.I. which predicted dire consequences (including closure) for the Plaintiffs if the new scheme were to be introduced and contends that this correspondence, when read together with the evidence on Affidavit to which I have already referred, gives rise to an inference that the hospitals owned by the Plaintiffs are likely to face closure by reason of the application of the new scheme between April of 1998 and the date of trial of the substantive issue.

50. I am afraid that I cannot draw such an inference. I am satisfied that if any of the hospitals concerned were facing closure by reason of the application of this scheme for the period concerned, then some evidence would have been adduced in support of that contention.

51. Mr. Gleeson on behalf of the V.H.I. relies, inter alia, upon the judgment of Finlay C.J. in Curust Financial Services Limited & Anor. -v- Loewe-Lack-Werk Otto Loewe GmbH & Company KG & Anor ., [1994] 1 IR 450 in support of his contention that no adequate evidence was adduced on behalf of the Plaintiffs which could reasonably give rise to a finding that some or all of the Plaintiffs' hospitals face imminent closure by reason of the introduction of a new scheme.

52. Mr. Connolly on behalf of the Plaintiffs argues that Curust is distinguishable on its facts from the instant case.

53. For my part I am satisfied on the evidence that the nature and character of the Plaintiffs' hospitals are such that if they, or any of them, are forced to close by reason of the introduction by V.H.I. of the new scheme then the damage to the hospitals will be such as to be incapable of remedy by way of an award of damages.

54. Mr. Gleeson on behalf of the Defendant argued that the "proofs" required to sustain this aspect of the Plaintiffs' case as to the adequacy of damages are set out in the following passage from the judgment of Finlay C.J. in Curust:-

55. I express no particular view as to whether or not the foregoing passage identifies "proofs" in relation to the issue concerned. It is, however, authority for the proposition that where it is argued that damages will not be an adequate remedy by reason of the real risk of the financial collapse of a commercial concern then there is an onus upon such a commercial concern to establish such a risk "as a matter of probability".

56. In the instant case, whilst there are strong commercial aspects to the Plaintiffs activities there are also substantial social and charitable aspects to their activities and objectives. Accordingly, there are some differences between the facts of Curust and the facts of the instant case and I think it can be validly argued that perhaps slightly different considerations arise which might justify the imposition of a slightly different onus but my principal concern in this case is that no evidence of any kind has been adduced on behalf of the Plaintiffs which would reasonably justify (either by way of inference or otherwise) the conclusion that there is a real and serious risk that any of the hospitals owned by the Plaintiffs will face closure by reason of the introduction of the V.H.I.'s new scheme between April 1998 and the date of the trial of the substantive issue herein.

57. The evidence adduced on behalf of the Plaintiffs in support of their contention that if they are ultimately successful in obtaining a permanent injunction it will be impossible for the Court to accurately measure the appropriate level of damages which are recoverable appears to be confined to the averment contained in paragraph 67 (which I think should read "paragraph 66") suggesting that it would be impossible to quantify damage done to the Plaintiffs by having to "balance bill" patients.

58. I do not understand that particular contention. Certainly the increase in the amount of "balance billing" can be readily calculated and should present no difficulty.

59. If it is suggested that the introduction of "balance billing" will cause patients to choose other hospitals for the provision of medical services then that is not wholly accurate because the Plaintiffs have been engaging in "balance billing" since 1996 so that the change noticed by patients will be an increase in the level of "balance billing" together with the effect of notification by V.H.I. that the Plaintiffs cannot provide "fully covered care". (A fact of which patients might not necessarily have been aware).

60. Perusal of the correspondence which has been exchanged between the parties during the course of negotiations prior to April 1998 discloses that the Plaintiffs keep records relative to patient treatment, on-going requirements and various matters required to assess budgetary requirements. Furthermore, it is clear from the correspondence that comparative figures are available and careful projections have been made relative to the numbers of patients treated in the past and the numbers likely to require treatment in the immediate future, together with the nature and extent of such treatment.

61. Having regard to the availability of such statistics and in particular having regard to the fact that the rates paid by V.H.I. prior to April 1992 are a matter of historical record whilst the rates paid immediately after April 1998 in respect of the same services would be similarly a matter of record, I cannot discover any difficulty in the calculation of the Plaintiffs' losses arising from the application of the new scheme.

62. In the circumstances therefore I am satisfied that if the Plaintiffs are ultimately successful in establishing their right to a permanent injunction in the terms sought herein, it will be possible for the Court to measure the appropriate damages recoverable at common law for any loss which the Plaintiffs will have sustained by reason of the introduction of the new scheme from the date of its implementation to the date of the trial and that this measurement should not cause any greater difficulty than would arise in the assessment of damages in cases which come before the Courts every day.

63. It follows from the foregoing that I am satisfied that if the Plaintiffs succeed at the trial in establishing their right to a permanent injunction, they can be adequately compensated by an award of damages.

64. No doubt arises as to the capacity of V.H.I. to pay any damages which may be awarded against them and indeed that fact was properly conceded on behalf of the Plaintiffs.

65. In the light of my finding above it is unnecessary for me to consider the adequacy of the Plaintiffs undertaking as to damages or any other matters affecting the "balance of convenience".

66. It follows that the relief sought by the Plaintiffs must be refused.