Damages of £700,182 had to be agreed by the Department of Justice in a case taken by a former prison officer injured in a workplace accident, even though he was prepared to settle for £300,000 plus costs earlier in the case, the report states.
The Department ignored the "repeated advice" of its senior counsel, who told officials that, based on the evidence available to him, the court was likely to find in the former prison officer's favour.
Despite this the Department refused to concede liability and on the advice of the Attorney General responded with an offer of less than £200,000.
This was rejected by the plaintiff and the Department conceded liability on the third day of a High Court hearing. Following a High Court award of £796,654, which the Department considered appealing to the Supreme Court, its officials held negotiations with the former prison officer, who settled for £550,000 plus costs of £150,182 in July 1988. "As the State costs came to £37,790, the overall cost of this case was £737,972," states the report.
Mr Purcell noted in his audit that the senior counsel had "on every occasion" argued that a substantial settlement "on the best terms" should be considered. He pointed out that there were no defence witnesses in court who could contradict the former prison officer's statements on the circumstances of the accident. The defence evidence available tended to support the plaintiff's case, states the report.
"The medical expert retained on behalf of the defence was not present in court. The defence rehabilitation expert, who was present, advised that he could not contradict the plaintiff's claim that he would never be employed again in any capacity," the report notes.
Senior counsel also advised that the Department's termination of the prison officer's employment some nine months previously on the grounds of permanent ill-health "would have a disastrous effect on damages, particularly for his claim for loss of earnings into the future".
The senior counsel told the Department that an actuarial report it prepared on the prison officer's loss of income did not differ in any significant way from the plaintiff's.
Asked to comment, the Department's accounting officer stated that while the senior counsel believed the court was likely to find in favour of the former prison officer, "this was not accepted by the Department, as there were areas of concern".
The accounting officer for the Attorney General added that information about the termination of the plaintiff's employment on medical grounds and actuarial and medical reports were received by officials only just before the case began. He said that the "last-minute" provision of information from the local State Solicitor meant that "those in a position to sanction a settlement were not up to date with the dramatic escalation in the value on the case".