The High Court has dismissed Redfern Limited’s action over a proposed redevelopment of The Square shopping centre in Tallaght, finding that a 2005 agreement at the centre of the dispute was unenforceable by the time of the events relied on in the claim.
In a judgment delivered on 29 June 2010, Mr Justice Brian J. McGovern held that Redfern and Larry O’Mahony and Thomas McFeely had intended their August 2005 agreement to create legal relations. The agreement envisaged the parties sharing ownership of Alburn, a company through which they planned to redevelop The Square, and transferring to Alburn the company that held a car-park licence needed for the project.
The proposed deal was not completed by its extended deadline of 20 October 2005. The judge held that time was of the essence and the agreement had lapsed. He also found that a later agreement signed in August 2006 between Noel Smyth, acting for Alburn, and the two businessmen was a legally binding arrangement that rescinded the earlier Redfern agreement, although the later deal was itself not completed.
The dispute intensified after O’Mahony and McFeely arranged for Liam Carroll and his company Tafica Limited to refinance debt owed by Aifca Limited, which held the car-park licence. Redfern alleged that the defendants breached the earlier agreement and that Carroll and Tafica procured a breach, seeking damages including exemplary damages. Redfern had withdrawn its request for specific performance by the start of the hearing.
The judge found that the parties’ conduct included breaches of good-faith obligations while the agreement was in play. He also identified factors that frustrated it, including the need to acquire a separate cinema licence at substantial cost, a council order restricting the two businessmen’s role in Alburn, and later bank finance being conditional on their exclusion from the development. The court did not decide whether the proposed transfer of shares in the licence-holding company would have amounted to an unlawful distribution.
Although the judge found Carroll had joined the refinancing arrangement knowing it could displace or obstruct Smyth’s development plans, he concluded the Redfern agreement was no longer subsisting when the Aifca agreement was made. Redfern therefore failed to establish breach of contract or procurement of a breach. The judge did not consider damages and dismissed the action.