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Mr X and Health Service Executive (FOI Act 2014)

Case Number: 170077

Issue: Whether the HSE was justified in its decision to withhold access to certain records relating to the proposed sale of lands at Merlin Park Hospital by the HSE to Galway Hospice, on the grounds that the records are exempt under sections 35 and 36 of the FOI Act

Review: Conducted in accordance with section 22(2) of the FOI Act by Elizabeth Dolan, Senior Investigator, who is authorised by the Information Commissioner to conduct this review

Background

On 10 October 2016, the applicant made an FOI request for "a copy of the agreement entered into between the HSE and Galway Hospice in relation to the sale/lease of land at or adjacent to Merlin Park Hospital" and "the completed Business Proposal, Business Case and Property Transaction Application Form in relation to the sale/lease of land by HSE to Galway Hospice at or adjacent to Merlin Park Hospital" .

On 7 December 2016, the HSE granted access to certain information and refused access to the remaining information on the ground that it was exempt under section 35 (confidentiality) and section 36 (commercial sensitivity) of the FOI Act. On 16 December 2016, the applicant applied for an internal review of the decision in respect of the withheld records. As the applicant did not receive an internal review decision, he applied to this Office for a review on 13 February 2017. The HSE then issued an internal review decision by letter dated 14 February 2017. It affirmed its original decision, under section 36(1)(c) of the FOI Act.

In conducting my review, I have had regard to the HSE's decision on the matter; the HSE's communications with the applicant and with this Office; the applicant's communications with the HSE and with this Office; the content of the withheld records, provided to this Office by the HSE for the purposes of this review; and the provisions of the FOI Act.

Scope of this Review

The information which the HSE has withheld is contained in the following records: 1/1, 1/2, 1/6, 2/18 and 2/27. It consists of details relating to the agreed price per acre of the land and the agreed total purchase price of the land. The question for me is whether this information is exempt under section 35 or 36 of the FOI Act.

Preliminary Matters

Before I consider the exemptions claimed, I wish to make the following points.

First, section 22(12)(b) of the FOI Act provides that when I review a decision to refuse a request, there is a presumption that the refusal is not justified unless the public body "shows to the satisfaction of the Commissioner that the decision was justified". Therefore, in this case, the onus is on the HSE to satisfy me that its decision is justified.

Secondly, my jurisdiction under section 22 of the FOI Act is to make a new decision, in light of the facts and circumstances as they apply on the date of the review. This approach has been endorsed by the Courts.

Finally, subject to the other provisions of the FOI Act, section 13(4) requires FOI bodies and this Office to disregard an applicant's reasons for an FOI request. Therefore I can only consider the applicant's reasons insofar as they might be construed as a public interest argument.

Analysis and Findings

Section 36(1) - Commercial Sensitivity

The HSE claims section 36(1)(c) in respect of the withheld information. Section 36(1) provides, insofar as is relevant:
"Subject to subsection (2), a head shall refuse to grant an FOI request if the record concerned contains -
... (c) information whose disclosure could prejudice the conduct or outcome of contractual or other negotiations of the person to whom the information relates."
However, section 36(1) does not apply if the public interest would, on balance, be better served by granting rather than refusing the request (section 36(3) refers).

Submissions

The HSE says that the transaction concerned is not complete and is subject to a number of caveats, including receipt of planning permission. It submits that any disclosure of the details might prejudice the conduct and outcome of the negotiations. It says that if the sale falls through, having this agreed price in the public domain may prejudice any future sale of the land. The HSE says that on the one hand, the public interest in favour of release is demonstrating that the HSE is acting in accordance with the HSE Protocol for the Acquisition and Disposal of Property ("HSE Property Protocol") and achieving value for money. On the other hand, it argues that the public interest against release is that it could impact on the outcome of the negotiations and impact on the HSE achieving best value for money. The HSE concludes that on balance, the wider public interest would be best served for the HSE to continue to treat the offers and bids as confidential until contracts are signed, as this will assist in getting the best commercial outcome for the HSE and therefore for the State.

The applicant says that the land concerned was purchased with public money. He points to the fact that section 3.7 of the HSE Property Protocol states that the method used (for the disposal of assets) should be both transparent and likely to achieve a fair market-related price. He queries a certain valuation of the land, as disclosed in a record which the HSE released to him. He submits that there is evidence of possible attempts to influence the proposed sale price so that it would be less than the fair market-related price. He says that the time for public scrutiny of the proposed sale is now; not after the sale is completed.

The applicant submits that it is the overriding public interest, in accordance with section 11(3) of the FOI Act, that the proposed sale price be released. He says that only this will allow the truth to be established about the following matters: whether there was an incorrect valuation of the land; whether there was interference in the proposed sale price; and whether there was favourable treatment of any purchaser.

As regards the applicant's submission on the HSE Property Protocol, the HSE says that all details of the agreement concerned are in the public domain except for the purchase price, which will be known when the contract is agreed.

Analysis & Finding

Section 36(1)(c)

The Commissioner expects that a person seeking to rely on section 36(1)(c) would be able to show that contractual or other negotiations were in train or were reasonably foreseen which might be affected by the disclosure and explain how exactly the disclosure could prejudice the conduct or the outcome of such negotiations. Where an FOI body is relying on this exemption for the refusal of a record, it must go on to consider the public interest and whether section 36(3) applies in relation to the record concerned.

The HSE is transacting to sell lands at Merlin Park Hospital to Galway Hospice. I accept that it is reasonable to foresee future negotiations about the sale of those lands if this particular transaction does not conclude in a sale. I further accept that disclosing details relating to the agreed purchase price at this point in time could prejudice the HSE's competitive position and therefore the conduct or outcome of any future negotiations. I find that section 36(1)(c) applies to the withheld information.

Section 36(2)

Section 36(2) provides for the release of information to which section 36(1) is found to apply in certain circumstances. I am satisfied that none of the circumstances identified at section 36(2) arises in this case.

Section 36(3)

Section 36(3) of the FOI Act requires me to consider whether, on balance, the public interest would be better served by granting than by refusing the request.

On the one hand, section 36(1)(c) itself reflects the public interest in protecting commercially sensitive information. On the other hand, the FOI Act recognises, both in its long title and in its individual provisions that there is a significant public interest in government being open and accountable. As the applicant notes, section 11(3) of the FOI Act provides that public bodies shall, in performing any function under the FOI Act, have regard to a number of matters, including the need to achieve greater openness in their activities and to promote adherence by them to the principles of transparency in government and public affairs.

I take the approach that in attempting to strike the balance between openness on the one hand and the need to protect commercially sensitive information on the other, it is legitimate to consider two things: the positive public interest which is served by disclosure; and the harm that might be caused by disclosure.

In relation to the positive public interest in disclosure, I recognise that there is a public interest in transparency and accountability around the use of public property and public assets. In relation to the harm which might be caused by disclosure, I have already identified the potential prejudice to the HSE's negotiating position.

In deciding where the public interest lies in respect of the information concerned, I would make the following observations. First, at this point in time the sale concerned has not concluded. I believe that section 36(1)(c) acknowledges a public interest in allowing FOI bodies such as the HSE the opportunity to negotiate in order to achieve optimum outcomes. Secondly, the HSE has already disclosed the majority of the records sought by the applicant, except for details relating to the price of the land. I consider that this disclosure goes some way towards meeting the public interest in transparency around this particular transaction. Thirdly, I may only take into account the applicant's reasons for seeking the withheld information to the extent that they identify a public interest. I believe that taken overall, the public interest which the applicant's submissions identify relate to the principle of transparency which is reflected in section 11(3) of the FOI Act. I have recognised above that this is a public interest which I must weigh in the balance. In relation to the HSE Property Protocol, my role is to apply the provisions of the FOI Act; not to supervise the HSE's compliance with its own protocols. In any event, I am considering transparency (which that protocol refers to) in the context of the FOI Act.

On balance, I believe that the public interest would not be better served at this time by granting access to the withheld information. I find that the HSE is justified in refusing access to the withheld information, under section 36(1)(c) of the FOI Act. Having found that the records are exempt under section 36 of the FOI Act, there is no need for me to consider section 35.

Decision

Having carried out a review under section 22(2) of the FOI Act, I affirm the HSE's decision under section 36(1)(c) of the FOI Act.


Right of Appeal

Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated not later than four weeks after notice of the decision was given to the person bringing the appeal.



Elizabeth Dolan
Senior Investigator