The Supreme Court has upheld a High Court judgment assigning 60% of responsibility to the lessee and 40% to the lessor after petrol leaked from underground equipment at the Singland service station on Dublin Road, Limerick.
The appeal concerned where liability lay between McMullan Brothers Limited, the lessor, and Patrick McDonagh, the lessee. The court did not decide the extent of damage to the restaurant and supermarket on the site, which were forced to close along with the petrol station. The judgment noted that separate litigation involving the businesses was ongoing.
The leak was discovered on 13 January 2003. The trial judge found it probably occurred after borehole surveys on 4 December 2002, when no leak was detected. He concluded that a corroded aluminium alloy cap had stopped a valve from holding petrol in a pipe, allowing it to leak into surrounding ground.
The lessee argued that the lease did not make him responsible for repairs, that a 2000 letter had shifted responsibility to the petrol-station operator, and that the lessor should bear a greater share of blame. The lessor cross-appealed, arguing it should have no share of liability.
The Supreme Court rejected the arguments on the lease and the letter. It held that the lease placed a general repair and maintenance obligation on the lessee, while the equipment schedule referred to in the lease had been left blank. The letter confirmed consent to existing business arrangements, including the operator’s role in running the pumps, but did not waive the lessee’s repair obligations or establish an estoppel.
However, the court upheld the trial judge’s finding that the lessor also bore responsibility. Evidence showed that the lessor had inspected, repaired and replaced equipment at the site for years, without billing the lessee or telling him of the cap’s vulnerability. The trial judge found that the lessor’s knowledge of debris and water in the chamber, and its maintenance history, supported a share of liability.
The Supreme Court said there was sufficient evidence for the trial judge’s apportionment and no basis to interfere on appeal. It upheld the High Court judgment in full, leaving the 60/40 division intact. The appeal concerned responsibility between the lease parties; the judgment did not quantify compensation for the wider losses.