The High Court granted summary judgment on claims arising from a Killarney development’s building agreement, but adjourned a separate €1 million claim for a plenary hearing after finding that the defendants had an arguable defence.
In a judgment delivered on 8 June 2010, Mr Justice Charleton considered two linked proceedings concerning development at Coolegrean. The first involved Galvin Developments (Killarney) Ltd as plaintiff and Souter Enterprises Ltd, trading as Coolegrean Developments, as defendant. The second involved Jeremiah Galvin, Colm Galvin and Denish Galvin, together with Galvin Developments (Killarney) Ltd, as plaintiffs against Souter Enterprises Ltd, John Shee and Joseph Hanrahan.
The development’s first phase included a nursing home and retirement units. The nursing home was completed and sold to investors on 31 December 2008. A planned second phase of housing was never built. The court said the financial difficulties between the parties arose from limited market interest in the retirement units.
Under the building agreement, the plaintiff in the first proceeding sought €1,394,640 plus VAT for amounts due under architects’ interim certificates, and €82,484.39 plus VAT in retention money. The defendants argued that the certificates were invalid, that required project funding had not been provided, that building continued recklessly after the economic downturn, and that €167,609 should be set off against the claim.
The judge rejected the challenges to the certificates, funding and continuation of the work, finding no reasonable prospect of success on those defences. He held that €82,484 in retention money was due, noting that the defects liability period had passed and no defects had been notified. He sent the set-off dispute to a plenary hearing because the parties disagreed about the nature of the alleged liability and oral evidence was needed. The court found liability for €1,394,640 plus VAT under the certificates and ordered payment of €82,484 plus VAT in retention money.
The second proceeding sought €1 million said to be due under a co-ownership agreement following the nursing home sale. The defendants argued that repayment was connected to the disposal of 25% of the residential units in the unbuilt second phase. The judge found that this defence had a reasonable prospect of success and adjourned that proceeding for a plenary hearing. He did not decide the €1 million claim finally.