The High Court has ruled that a charge for an unpaid derelict-sites levy was overreached when a mortgagee sold land under a statutory power of sale, leaving the purchaser not liable for the levy.
Mr Justice Garrett Simons gave the judgment on 18 July 2023 in an appeal from a Circuit Court decision dismissing Michelle Maher’s proceedings against Dublin City Council. The High Court’s conclusion resolved the statutory interpretation issue. The precise form of the final order remained to be settled.
The dispute concerned land sold in Dublin in September 2014 for €176,600. The mortgage securing the sale had been created in October 2007 and registered later that month. Dublin City Council demanded a derelict-sites levy from the then owner the following year. Because it was not paid within two months, the levy became a charge on the land. The charge was registered in May 2013, and the land had been removed from the derelict-sites register in August 2008.
Before the sale, the purchaser’s solicitor asked the council whether the purchaser would have to pay the outstanding levy. The council did not give a clear answer. In 2015, after the sale, it demanded payment from the purchaser, maintaining that the statutory overreaching rules could not apply to a charge under the Derelict Sites Act 1990. The purchaser paid €50,153.42 under protest, including penalty interest, and brought proceedings.
The case was first brought in the High Court, then remitted by consent to the Circuit Court in 2020. After the Circuit Court dismissed it in July 2022, the purchaser appealed. The High Court appeal hearing took place on 11 July 2023. The purchaser’s solicitor was the sole witness, and the judgment records no material factual dispute. The council accepted that correspondence took place but disputed that it amounted to an unequivocal representation capable of grounding an estoppel.
The High Court held that the levy charge had the ordinary characteristics of a charge on land. Nothing in the Derelict Sites Act showed that it displaced established conveyancing rules or gave the charge priority over an earlier mortgage. As the mortgage was created and registered before the statutory charge arose, it had priority. The mortgagee’s sale therefore overreached the charge, and the purchaser was not liable for the outstanding levy.
The judge did not decide the alternative estoppel argument. He said the purchaser was provisionally entitled to a declaration broadly along the lines sought, and that a formal repayment order should not be necessary because the council was a public authority. He reserved the precise form of the order and listed the matter for final orders on 24 July 2023.