The High Court ruled that John Harmon remained bound by four contracts to buy holiday homes at Kilkea Castle after the seller failed to achieve the sales target that would have allowed him to be released.
Arnosford Limited had agreed to sell Harmon lodges numbered 11, 12, 13 and 15 at Kilkea, Co Kildare, for €478,275 each, including VAT. The contracts were signed in February 2007, with a planned closing date of 30 September that year. Harmon also contracted to buy lodge No. 9, which was completed on 31 July 2007, although the VAT was not paid until May 2009.
The dispute centred on a telephone conversation between Harmon and Arnosford project manager Paul Browne on 27 July 2007. Harmon said he understood that he would be released from the four remaining contracts once 14 independent sales had been achieved, without a deadline. Arnosford’s position was that the release depended on reaching that target by the end of the 2007 autumn and winter sales campaign, expected to run into January 2008.
In a letter dated 30 July 2007, Browne recorded that Arnosford would extend the closing date and would not seek to enforce the contracts while it pursued 14 independent sales. The letter said that once the sales were achieved, Harmon’s four contracts could be cancelled. The company did not reach the target and later sought to complete the sales.
The court accepted Browne’s account of the arrangement. It also relied on a contemporaneous note by Harmon’s former solicitor, which the judge found recorded a discussion after the letter was received and accurately reflected Harmon’s position at that time. The judge rejected Harmon’s account that the arrangement was open-ended and found that the letter’s reference to sales anticipated by January 2008 set the relevant timeframe.
The court held that completing the purchase of No. 9 did not release Harmon from the other contracts. Arnosford had agreed not to enforce them if 14 independent sales were achieved by the end of the sales campaign, but that condition was not met. The judge said the postponement of the closing date did not create a collateral contract and concluded that Harmon remained bound by the original agreements.
The court therefore held that Arnosford was entitled to the relief it claimed. The judgment does not specify the terms of any resulting order beyond that conclusion.