The High Court has ruled that a lease held by Ballinacarrig Park Club Limited survived the forfeiture of a superior lease, and that the club could issue subleases to mobile-home owners at the park in Brittas Bay, Co Wicklow.
Mr Justice Hedigan refused Malachy Mc Daniel Stone’s claims for possession and damages. He found that Stone had wrongfully obtained an injunction preventing the club from issuing subleases. The court said an inquiry would be needed into damage caused by the injunction.
Stone had leased the park to Red Valley Limited for 35 years from January 2000. Red Valley sublet it through Austrent Limited to Ballinacarrig Park Club Limited. After a rent increase was not paid and a bank guarantee expired in 2009, Stone served a forfeiture notice on Red Valley in March 2010. The notice expired the following month. Red Valley and Austrent did not contest his entitlement to re-enter the lands, but the club argued that its own lease remained in force.
The club’s lease included a condition granting it the benefit of existing landlord and tenant legislation. The judge held that this brought section 78 of the Landlord and Tenant (Amendment) Act 1980 into play, allowing the club’s lease to survive the forfeiture of the Red Valley lease. He also held that Stone was estopped by deed from denying the club’s right to issue subleases.
The club proposed 24-year subleases to mobile-home owners, with annual break options and no bank guarantee. Stone obtained an interlocutory injunction in December 2010 restraining the subleases while the case was pending. The judgment records that about 120 residents had cancelled standing orders by then, while 50 continued paying. The judge rejected Stone’s allegation that the subleasing plan was a sham to avoid rent, finding the club was genuinely trying to address the park’s financial difficulties.
The judge also rejected Stone’s attempt to forfeit the club’s lease for non-payment of rent, finding that his injunction had prevented the club from generating income to pay it. He did not grant possession or damages as claimed. The judgment leaves the amount of any damage caused by the injunction to a later inquiry.