Firm awarded €2.4m damages over land sale
Friday, March 11, 2011
A HIGH Court judge has awarded €2.4 million in damages to an investment firm against three men concerning the purchase of land on which the Showgrounds Shopping Centre in Clonmel was built.
The judge directed that his judgment be sent to the Charity Commissioners because of a €1.5m pay-out during the transaction.The proceedings stemmed from a contract entered into by Mount Kennett Investments with the defendants — the "vendors" and separately Patrick O’Meara, Anthony Fitzpatrick and John Tobin for the purchase of the lands. Mr Justice Clarke said the contractual entitlements Mount Kennett had under its contract with the vendors were transferred to Greenband, which claimed damages in lieu of specific performance and damages for delay. Mount Kennett maintained proceedings for specific performance of the contract in question against the vendors and in November 2007 Mr Justice Smyth determined Mount Kennett was entitled to an order for specific performance of the relevant contract. However, the contract was not performed or at least not in the way contemplated by the decree of specific performance. The vendors contracted to sell a fee simple interest in the site to Mount Kennett but, at the time they entered into that contract, had only a contractual entitlement to buy the property themselves, which depended on consent from the Commissioners of Charitable Donations and Bequests. Mr Justice Clarke said there was a leasehold interest in the property. This was held by Clonmel Leisure Group in which the vendors had an interest along with a fourth shareholder, Pat Buckley. The Charity Commissioners did not consent to the sale. Subsequently Mount Kennett became entitled to acquire the freehold and secure the consent of the commissioners. The judge said Greenband paid more to acquire the fee simple title in the lands than had been subject of the original contract and the price ultimately paid was €5m. The judge said that after the commissioners approved the sale to Greenband it appeared that the Show Society paid out €1.5m to the vendors and Mr Buckley on foot of a handwritten document that expressed that the sum be paid in relation to unspecified claims. The judge said the society was not entitled to use its money except for purposes associated with its charitable objects.