The High Court assessed €464,000 in damages for Ranzett Ltd. and its guarantors after finding that ADM Londis plc’s abrupt termination of a franchise at the Black Bull premises in Drogheda caused the business to close and contributed to the loss of its lease. The damages were to be set off against an earlier €561,283.91 award to Londis. The court left the amount, if any, for the loss in value of leased equipment open pending possible further evidence.
In a supplementary judgment delivered on 15 July 2014, Mr Justice Gerard Hogan considered damages following his earlier ruling that Londis had breached its contract by failing to give proper notice, abruptly ending the agreement, closing the trading account and de-branding the premises on 4 December 2008. The earlier judgment had also awarded Londis €561,283.91 for unpaid invoices, including a further €161,283.91 against Ray Dolan and Annaliese McConnell as guarantors. The company had already been ordered to pay €400,000 but had since been dissolved.
The judge considered losses arising from the destruction of the business and forfeiture of its lease, unsold stock and specialist equipment. He found that Ranzett was heavily under-capitalised and faced a difficult trading future. But he concluded that, had Londis allowed time to find another supplier, the defendants could probably have continued trading temporarily and had an opportunity to sell or assign the lease and dispose of equipment in an orderly way. The judge considered that the company would probably have gone into liquidation within two years as Londis pursued its debts.
Without expert valuation evidence, Mr Justice Hogan assessed the business and lease losses using 10 times a projected weekly turnover of €42,000, awarding €420,000. He also awarded €44,000 for approximately €65,000 of stock that Dolan could not sell after the store closed. The judge reduced that part of the claim by about one third, finding Dolan was objectively at fault for not immediately allowing Londis to repossess stock on the morning of 4 December 2008.
The judge did not set a value for the specialist equipment, which Friends First had repossessed and sold. He gave the parties an opportunity to provide evidence of its open-market value in 2009 or 2010. If that value exceeded the amount Friends First obtained, the difference could be awarded as further damages and set off against the remaining balance due to Londis.