The High Court has ordered KC Capital Property Group Limited to provide €771,410, exclusive of VAT, as security for Keegan Quarries Limited’s costs of defending a claim over concrete used at a Dublin office development. The proceedings are stayed until the security is provided, which must happen within three months of the judgment dated 26 April 2024.
The order concerns security for costs, not the merits of KC Capital’s claim. Mr Justice Max Barrett said Keegan Quarries had established a prima facie defence for the purpose of the application, while making clear that he was not deciding whether that defence would ultimately succeed at trial.
KC Capital alleges that concrete supplied for the Greenside Building at 45-47 Cuffe Street, Dublin 2, did not meet the specified compressive strengths. It claims the concrete was defective and that delays and additional costs caused it losses estimated at more than €13 million, while reserving its position on any loss in the building’s value. Keegan Quarries supplied the concrete under a contract with the original contractor, Grant Fit Out Limited; the judgment records that KC Capital and Keegan Quarries had no direct contract.
Keegan Quarries denies liability. Its defence includes claims that it supplied the mixes ordered by Grant Fit Out, that its testing showed the concrete met those orders, and that other parties’ actions or construction design and workmanship may have caused the problems. The court did not decide those disputed matters.
Under the security-for-costs test described in the judgment, Keegan Quarries had to show a prima facie defence and reason to believe KC Capital would be unable to pay its costs if ordered. The judge found both requirements met. He considered that KC Capital was a special purpose company funded, apart from an initial €100 investment, by borrowing, and that its ability to pay a future costs order depended on uncertain property-market conditions and continued lender support. He found no special circumstances sufficient to refuse security.
The judgment records a dispute about access to and inspection of the concrete, which was being demolished and removed when the proceedings began. It also notes that Keegan Quarries said KC Capital had impeded inspections. The security ruling does not resolve that dispute or decide the underlying claim.