The High Court dismissed Atlantic Distributors Limited’s claim against consulting engineer Sean Brennan for contribution or indemnity over damages awarded to homeowners in a separate case. Mr Justice Hedigan ruled on 28 June 2011 that an earlier decision finding unreasonable delay in serving a third-party notice could not be reopened.
The dispute arose from a house at No. 21 The Woods, Cappahard, Tulla Road, Ennis. The judgment says Atlantic built the property and Mr Brennan designed its foundations and issued a Certificate of Structural Integrity in June 2001. The owners, Michael and Olivia Flynn, sued Atlantic in 2006, alleging failure of the raft foundation had caused serious structural defects.
Atlantic sought to bring Mr Brennan into the Flynn proceedings as a third party. In February 2010, Clarke J set aside the order allowing the third-party notice and struck it out, finding it had not been issued and served as soon as reasonably possible and that Mr Brennan had been prejudiced by the delay. The Flynn case then proceeded to an assessment of damages, and on 2 March 2010 the High Court awarded the owners €297,647.17 against Atlantic. The assessment included €38,000 paid by the National House Building Guarantee Scheme.
Atlantic later brought separate proceedings seeking contribution or indemnity for sums incurred in the Flynn case. It argued that Mr Brennan had been told of the defects and the intention to join him as early as January 2007, giving him time to inspect the property. It also said it delayed pursuing the third-party claim while trying to resolve the owners’ complaints through Homebond. Mr Brennan denied receiving the January 2007 letter and argued that the prior ruling had already determined the delay issue.
Justice Hedigan said the January 2007 letter did not assist Atlantic: if Mr Brennan had been notified then, the delay was longer than the period previously considered. The judge also rejected the argument that the house still being standing amounted to an exceptional circumstance overcoming the failure to serve the notice promptly.
The court held that the reasonableness of the delay had already been determined by Clarke J and could not be reopened in the separate action on the basis of res judicata. Justice Hedigan said he was bound by that decision and granted the relief sought by Mr Brennan, dismissing Atlantic’s proceedings. The judgment does not determine the underlying foundation allegations anew.