The High Court awarded O’Brien’s Irish Sandwich Bars Limited €35,516.87 in damages in a dispute with former franchisee Ann Marie Byrne, finding that her continued sandwich-bar trading after the franchise agreements ended breached their non-compete terms. The court dismissed Byrne’s counterclaim for damages.
The judgment, delivered by Miss Justice Laffoy on 17 December 2008, concerned two franchise agreements covering premises at 63 Dame Street and the Dublin Tourist Office on Suffolk Street. Byrne traded there as O’Brien’s until October 2007, then began operating as Finn MacCools Café. The court found that the businesses continued to provide a similar service and that Byrne knew she was breaching the agreements.
The agreements restricted competition for one year after termination, within one mile of the relevant premises and at the premises themselves. Byrne argued that the restrictions were unreasonable restraints of trade and contrary to competition law. The judge rejected those arguments on the evidence, concluding that the restrictions were lawful.
O’Brien’s had sought a range of injunctions under the agreements, as well as damages. Byrne had already given permanent undertakings covering use of O’Brien’s trademarks and intellectual property and removal of its signs. The judge declined the other orders sought under the agreements, finding some unnecessary, overtaken by events or insufficiently clear. She also declined the requested competition injunctions because the one-year restriction period had expired; Byrne had offered undertakings in any event.
The damages award represented management and marketing fees O’Brien’s said it lost between October 2007 and July 2008 because of Byrne’s competing trade. The judge considered the €35,516.87 claim reasonable. She refused additional orders for an account of Byrne’s profits or further fees, concluding that any further loss should be pursued as damages and proved in the ordinary way.
Byrne’s counterclaim alleged, among other matters, that O’Brien’s had delayed a sale of her Dame Street interest and caused reputational harm through publicity about an interim injunction. The judge said the sale dispute belonged to separate specific-performance proceedings, which were not before her. She noted that O’Brien’s press release inaccurately described the interim order as an interlocutory injunction, and questioned the company’s motivation and ethical standards in issuing it. But she found Byrne had not established a legal basis for damages. The article that prompted part of the complaint was materially accurate apart from misnaming her, and there was no evidence that O’Brien’s had instigated it.
The court’s final orders were damages of €35,516.87 for O’Brien’s and dismissal of Byrne’s counterclaim.