The Court of Appeal has dismissed Peter McCaughey’s appeal against a High Court ruling that a settlement agreement released his claims to exit and loyalty payments from IJM Timber Engineering Limited (IJM).
The appeal concerned the interpretation and enforcement of a settlement signed in January 2020 by Peter, his brother Martin McCaughey, IJM and McCaughey Homes Limited (MHL). The agreement provided for IJM and MHL, including their assets, to be put up for sale. It also included broad terms settling claims between the parties.
The dispute arose over two resolutions passed at an IJM extraordinary general meeting in December 2017. One provided for an exit payment to Peter based on turnover; the other provided for a €1.5 million loyalty payment if he remained with the company, as well as 500,000 shares. The settlement expressly provided for cancellation of those shares. Martin argued that its wider terms also released Peter’s claims to the two payments. Peter maintained that those entitlements remained in force.
Martin brought a motion to re-enter the earlier proceedings to enforce the settlement. The High Court allowed that procedure and, after considering affidavit evidence and submissions, ruled that the agreement had compromised the payment claims. Peter appealed both the procedure and the interpretation of the agreement.
In a judgment delivered by President David Barniville, with Justices Faherty and Ní Raifeartaigh agreeing, the Court of Appeal found no basis to overturn the High Court. It held that re-entry was an appropriate way to resolve the dispute and that Peter had not shown prejudice. The court noted that he could have sought cross-examination or pursued separate proceedings for rectification or rescission; he and IJM later brought separate proceedings after the High Court decision.
On the agreement’s meaning, the appeal court agreed that its broad settlement clauses covered claims between all four signatories, including Peter’s payment claims against IJM. It upheld the High Court’s assessment of the agreement as a whole and its context, including the plan to sell the companies and distribute proceeds. It also rejected Peter’s complaint that the High Court had improperly relied on IJM’s financial statements and a BDO valuation without expert accounting evidence.
The appeal was dismissed in its entirety. The court gave a provisional view that Martin should receive his appeal costs. Peter was given seven days from electronic delivery of the judgment to challenge that view or seek another order; absent an application, costs would be ordered in accordance with it.