The High Court has ruled that Gradual Investments Limited is entitled to €200,791.78 from shop tenant Des Kennedy after finding that breaches of his lease ended a rent-abatement agreement. The court also awarded interest at 2% from 2 July 2020, subject to further argument, and listed the case for final orders and costs on 21 November 2024.
Mr Justice Rory Mulcahy’s judgment concerns a convenience store and post office in Stepaside, Dublin. The parties agreed that Kennedy paid less than the lease’s annual rent of €137,000 during 2014 to 2018, but disputed when reduced rent had been agreed and whether conditions for those reductions were breached.
The judge rejected the landlord’s claim for the difference between the reduced and full rent during the first abatement agreement. He found that the final €1,500 arrears payment was sent within seven days of a written demand, and that the landlord had not established a qualifying default under that agreement.
However, Kennedy owed €25,800 under a separate 2014 agreement to settle arrears, the judgment says. The court also found there was no agreement to accept reduced rent in 2015, when Kennedy underpaid by €57,000.
For the period covered by the second abatement agreement, the judge found that Kennedy had carried out substantial refurbishment works in 2017 without the landlord’s prior written consent. He also found that wine shelving exceeded the lease’s limit on space used for alcohol sales. In addition, service charges demanded in writing in 2016 and 2018 were not paid within seven days. Those breaches rendered the second abatement agreement void, making €117,991.78 in foregone rent payable.
The judge rejected Kennedy’s arguments that the landlord had waived its rights or was estopped from claiming the sums. He also rejected the argument that the clause restoring full rent after a breach was an unenforceable penalty. The lease’s interest provision, by contrast, was a penalty clause; the judgment proposed substituting the Courts Act rate of 2%, with Kennedy given an opportunity to argue for another rate.
The judgment fixes the amount due at €200,791.78, plus interest at 2% from 2 July 2020. The court did not make final orders or determine costs in the judgment; those matters were listed for 21 November 2024.