The High Court has refused to continue an injunction preventing a receiver from selling a commercial development site on Dublin’s quays, pending trial of a dispute over a settlement agreement between property developer Pat Ryan and Dengrove DAC.
Mr Justice Twomey ruled on 29 September 2020 that the balance of justice favoured allowing the receiver to sell. The decision was interlocutory: it did not determine whether Dengrove was entitled to appoint the receiver or whether the settlement agreement remained legally effective.
The dispute concerns sites at 1-4 City Quay and 23-25 Moss Street, and at 5-6 City Quay, 2-3 Gloucester Street and 26-30 Moss Street, collectively called the Site in the judgment. Ryan and other developers acquired the properties through partnerships with funding from Anglo Irish Bank. Dengrove later acquired rights to the loans and security.
Under an October 2019 settlement, the partnerships were to sell the Site on the open market, with Ryan receiving 20.8% of net proceeds and a €356,700 contribution sum. The remaining proceeds were to go to Dengrove to discharge secured borrowings. The agreement set a 24 April 2020 deadline and said it would cease to have legal effect if the sale process was not completed by then, subject to possible written extensions. No extension was sought, and the Site had not been sold by the deadline. Dengrove appointed a receiver on 25 June 2020.
Ryan obtained an ex parte injunction on 3 July restraining the sale. He argued that a receiver sale could produce a lower price than a sale controlled by the partnerships. Dengrove sought to have the injunction discharged. The court accepted that there was a fair issue for trial about whether the receiver’s appointment was lawful, including in light of the pandemic and the settlement’s deadline. It did not resolve that issue at this hearing.
The judge said Ryan had provided no valuation evidence or estimate of the loss he might suffer. Evidence from a jointly appointed auctioneer raised concerns that a receivership sale might reduce the return, but the court found no evidence that the receiver would not sell on the open market. It also considered that any undervalue could be assessed and compensated through damages, and found insufficient evidence that Dengrove could not meet such an award.
The court also treated the commercial nature of the Site, the long-standing secured debt, and Ryan’s non-disclosure of relevant independent legal advice when seeking the ex parte order as factors weighing against continuing the injunction. The ruling permits the receiver’s sale to proceed while the underlying dispute remains for trial.