The High Court granted the plaintiffs summary judgment for €4,384,550 against Duke Capital Limited and Ethika Properties Limited, finding them jointly and severally liable for unpaid consideration under an amended share-purchase agreement.
The judgment, delivered by Mr Justice Brian O’Moore on 18 August 2020, also found Ethika liable for €41,454.54 in legal fees. Duke’s liability for those fees was remitted for a plenary hearing. The court left costs, interest and the final form of the order for a further hearing.
The claim arose from a 2017 agreement under which seven of the eight plaintiffs agreed to sell shares in two companies to Duke. Ethika guaranteed Duke’s obligations under that agreement. A May 2019 amendment required Duke to pay €6,615,450 on completion, €734,550 within two months and €3.65 million by 17 May 2020. The completion payment was made, but the other two sums, totalling €4,384,550, were not. Ethika was not a party to the amendment and did not give a further guarantee.
The plaintiffs also relied on an oral agreement that Ethika would pay their legal fees for the share-purchase transaction. The court cited a July 2017 email stating that Ethika would pay the fees. The defendants did not challenge the reasonableness of the €41,454.54 claimed.
The defendants filed no replying affidavit. Their counsel sought an adjournment on 28 July to allow settlement discussions to continue, but did not seek time to file evidence contesting the claim. The judge refused the adjournment, noting it was sought late and the plaintiffs did not wish to continue discussions. On the uncontradicted affidavit evidence, he concluded there was no issue requiring a plenary hearing on the main claim.
The judge considered a possible defence that the 2019 amendment had released Ethika from its guarantee. He said the evidence did not establish that Ethika, as a company, had been consulted on or agreed to the variation. But he accepted the plaintiffs’ alternative submission that the variation was incapable of prejudicing Ethika: the deferred consideration was lower, and the additional €734,550 was more than offset by discharge of a €1.5 million promissory note that Ethika had guaranteed. He therefore found the variation did not prevent summary judgment against Ethika.
A separate dispute among the plaintiffs concerned whether any order should allocate sums to each plaintiff individually or award the total to them collectively. The judge said the requested relief had not been amended and ordered that competing proposed forms of order be circulated before the further hearing, which he proposed for 3 September 2020.