The Supreme Court reduced by €150,000 the €420,682 found due to Canestar Limited in a dispute with Fermoy Fish Limited, after ruling that Canestar had not met a contractual sales target required to trigger that payment. The court left the High Court’s other findings in place and reserved the costs issue for further submissions.
The appeal concerned agreements under which Fermoy Fish sold business assets to Canestar and Canestar and Dan O’Regan undertook to manage customer accounts for Fermoy Fish. The dispute followed the non-payment of €484,896 collected by Canestar on Fermoy Fish’s behalf. The High Court had found Canestar entitled to €420,682 after taking account of sums due to both sides.
Justice Dunne, giving the Supreme Court’s judgment on 9 December 2015, held that Canestar and Mr O’Regan owed Fermoy Fish a fiduciary duty in managing the accounts. Canestar had used money received for Fermoy Fish to pay its own creditors and make payments to Mr O’Regan. The court said this established a breach of fiduciary duty, correcting the High Court’s conclusion on that issue.
But the Supreme Court made no damages award. Fermoy Fish had not provided evidence at trial quantifying its loss from the late or missing payments, and the issue could not be remitted for assessment. The court also rejected Fermoy Fish’s argument that the breach entitled it to withhold consultancy fees and other expenses. It upheld the trial judge’s refusal to award interest, finding no basis to interfere with that exercise of discretion.
The €150,000 reduction concerned the equipment payment under the asset sale agreement. That payment was conditional on aggregate sales reaching €2.3 million in the first seven months. The Supreme Court said the evidence accepted by the trial judge showed sales of €2,299,257 by the relevant date, a shortfall of €743. The court held that the agreement’s clear condition had not been met and that the trial judge could not set it aside as unfair.
The Supreme Court declined to disturb the High Court’s findings allowing €80,000 for packaging and €122,000 for frozen fish, or its rejection of Fermoy Fish’s €40,917 claim for salary and expenses relating to quality control work. The appeal was allowed to the extent of reducing the amount due to Canestar by €150,000. The court will hear further submissions on the High Court costs order.