The High Court awarded Edmund and Joan Kelleher €43,678 after finding that their solicitor negligently failed to contact the Health Authority about food hygiene concerns or advise them to make that inquiry before completing a restaurant purchase in Mallow.
The judgment, delivered by Mr Justice Clarke on 16 July 2010, concerned the Kellehers’ 2001 purchase of a restaurant premises at No. 1 Parkwest for IR£120,000. They intended to let it to an operator. Mr Kelleher had specifically asked the solicitor, Don O’Connor, to ensure the premises complied with food hygiene rules.
The restaurant later faced restrictions after Health Authority concerns emerged. Its permitted seating fell from what had been about 40 to 24, and limits were placed on the food it could serve. The court heard that the underlying problems were largely incapable of remedy within the premises.
The judge found that Mr O’Connor was negligent in failing to advise the inexperienced investor-purchasers to consult Health Authority officials, or to make contact himself. Had that happened before completion, the court concluded, the Kellehers would have learned about the problems and would not have proceeded with the purchase. This was the only identified negligence that the court found caused their loss.
The court also found negligence in failing to pursue a vendor’s reply that evidence of registration was unavailable. But the restaurant was registered without limitations at the time of sale, so further inquiry would not have disclosed a problem. Although food hygiene matters should ordinarily have been raised before contract, the timing made no difference in this case. The court likewise found no causal link between the seller closing the restaurant before completion and the later difficulties.
The judgment rejected the claims concerning planning permission and the lease’s user clause. It found that the planning permission allowed restaurant use and that the long-standing restaurant use made a successful user-clause claim untenable on the evidence before it.
For damages, the court treated the case as one where a properly advised buyer would have made no transaction. It assessed the property’s value after purchase, before additional works, as IR£15,000 below the price paid. It added an estimated IR£5,000 in sale costs, producing a basic loss of IR£20,000 in 2001. The judge declined to add the larger losses claimed after the buyers retained the impaired property and spent money on alterations, finding no adequate evidence that continuing was a reasonable way to limit their loss. Interest was allowed at the Courts Act rate from 2001. The court entered judgment for €43,678 in damages for negligence and breach of contract.