The High Court has ruled that Triglen Holdings Limited, trading as Russell Court Hotel, can set off a debt claimed by security firm P & B Security Services Limited against its potential liability under an indemnity. The court estimated that the indemnity claim exceeded the €51,435.78 debt, but did not make a final order in the judgment.
P & B, now in liquidation, had brought proceedings seeking payment for security services. The case reached the High Court on appeal from the Circuit Court. At the appeal hearing on 21 February 2019, both sides agreed that the issue was whether Triglen could withhold payment based on the indemnity.
A letter signed by a P & B director on 1 May 2010 indemnified the hotel operator for specified personal injury claims alleging that injuries at the hotel arose from acts, negligence or failures by P & B in providing security. It also said Triglen could withhold payment for security services and set off sums paid to claimants against amounts owed to P & B.
The court heard evidence that at least four personal injury claims were pending against Triglen, alleging negligence and assault by P & B employees. Triglen’s witness said he had recently settled another personal injury case for €25,000 without a contribution from the hotel’s insurers, and suggested the four pending claims could each have a similar value. The court noted that P & B’s counsel did not challenge evidence that the claims could exceed €100,000 in total. These were estimates of contingent liabilities, not findings on the merits or eventual value of the personal injury claims.
P & B argued that the debts were not mutual because the indemnity gave it a different role from that of a security services provider. The judge rejected that argument, finding a sufficient connection between the security services contract and the indemnity. Applying insolvency rules requiring a just estimate of contingent claims, the court concluded the estimate exceeded P & B’s claim of €51,435.78 and held that Triglen was entitled to set-off.
The judgment did not state the final form of the order. The judge said counsel would be heard on that issue and gave an initial view that the order required was dismissal of P & B’s application for liberty to enter final judgment, because its claim was less than the amount Triglen could set off.