The High Court has halted a €1.4 million damages action over the former Richmond Hospital in Dublin and directed the landlord and the Commissioners of Public Works to resolve their dispute through arbitration.
Rory O’Meara sued over the condition of the property following leases entered into when the State needed additional courtroom space. The dispute arose after the Criminal Courts of Justice at Parkgate Street had subsequently been built.
The relevant lease was dated November 18, 1996, with O’Meara as landlord and the Commissioners of Public Works as tenant. He claimed damages of about €1.4 million for an alleged failure to repair the premises and for what was described as waste, a legal term covering certain damage or deterioration to property.
The Commissioners asked the High Court to stay, or pause, the court proceedings and refer the dispute to arbitration under clause 9 of the lease.
Mr Justice Charleton found that the clause was deliberately broad. It required all disputes arising in connection with the lease or its subject matter, apart from specified exceptions, to be decided by an arbitrator. The judge rejected an argument that the tort claim for waste had to remain before the High Court while the contractual repair dispute went to arbitration.
He also held that the Arbitration Act 2010 governed the dispute even though the lease had been signed in 1996. The decisive point was that arbitration had not commenced before the 2010 Act became operative. Existing contracts with arbitration clauses were therefore subject to the newer legislation when arbitration began afterwards.
The landlord also raised the possible interpretation of section 65 of the Landlord and Tenant (Amendment) Act 1980, which limits certain damages for breaches of repair obligations. Charleton J. found no legal issue of sufficient complexity or importance to prevent arbitration.
The proceedings were therefore stayed and the landlord-tenant dispute referred to arbitration. The High Court did not decide whether the Commissioners had actually breached the lease or caused the alleged €1.4 million loss.