The High Court ruled that a 2002 contract to sell a Galway petrol station and dwelling house was void because the vendor’s wife had not given prior written consent. It declined to sever the dwelling from the business premises and left open whether the purchaser should receive damages.
Michael McMahon had sought specific performance of his agreement with Patrick O’Loughlin, or damages for breach of contract. The agreement covered the station and house for £450,000 (€571,382). O’Loughlin said the sale was conditional on McMahon taking over supply arrangements with Irish Shell and argued there was no enforceable contract.
The court found that McMahon had notice of a Shell arrangement, but that the 1999 sales agreement and equipment loan agreement were not provided to him until after the contract was signed. The signed contract included a condition that the purchaser would not assume continuing contracts or obligations. The court rejected the argument that this condition applied only to employment obligations. It found that, despite shortcomings in the purchaser’s enquiries, he was entitled to rely on that condition and the vendor’s reply to a requisition about fixtures and fittings. The judge said that, without the missing prior consent, McMahon would have been entitled to rely on the contract.
The court accepted evidence from O’Loughlin and his wife, Eileen, that she signed the contract after 19 April 2002, rather than giving prior consent. It concluded the Family Home Protection Act 1976 had not been complied with. The judge also found that severing the dwelling from the petrol station would involve practical and planning difficulties, and said neither party should be forced into possible further litigation. The court therefore treated the entire contract as void.
The judgment did not award damages or finally dispose of that claim. The court said it would hear further submissions on whether damages should be awarded in the circumstances and, if so, how they should be assessed. The source records no determination of that issue.