Begley v Damesfield Ltd
| Jurisdiction | Ireland |
| Judge | Ms. Justice Baker |
| Judgment Date | 23 March 2018 |
| Neutral Citation | [2018] IEHC 221 |
| Docket Number | [2013 No. 9888 P] |
| Court | High Court |
| Date | 23 March 2018 |
[2018] IEHC 221
THE HIGH COURT
Baker J.
[2013 No. 9888 P]
AND
AND
Contract – Damages & Restitution – Breach of contract – Doctrine of caveat emptor – Breach of the covenant for quiet enjoyment – Implied terms
Facts: The plaintiff sought an order for damages for nuisance, breach of contract and breach of covenant for quiet enjoyment, arising from breach of principle of non-derogation from grant. The plaintiff also sought a mandatory order for directing that the defendants should take steps to make the waterway navigable. The plaintiff claimed the that first and second defendants were in breach of an implied term in the contract for sale of marina berths, which specified that the berths would be capable of being accessed by cruiser-type vessels. The first and second defendants denied the existence of any implied term and relied on the doctrine of caveat emptor. The plaintiff argued that there existed an implied right of access over the adjoining waterways by way of easement of necessity; however, the defendants objected that no easement could be implied into the lease, and that the express terms contained all agreed reservations, easements and conditions.
Ms. Justice Baker awarded damages to the plaintiff against the first and second defendants for breach of contract measured at the notional current value of the berths. The Court held that there was breach of contract on the part of the first and second defendants but the claim against the third defendant had not been established. The Court noted that the rule of caveat emptor had been displaced in the present case as the plaintiff had closed the sale after being given assurances by the first and second defendants that the issues pertaining to the poor accessibility of the berths would be rectified. The Court adjourned the matter in order for the plaintiff to explore the offer of exchange of his berths with alternative berths subject to fulfilment of certain conditions by the plaintiff.
The plaintiff seeks damages arising from the purchase of two berths numbered 56 and 57 at the Jolly Mariner Marina Village, Brick Island, Coosan Road, Athlone, County Westmeath. The Marina Village was part of a development of mixed residential, retail, and marina units developed by the first defendant on lands and waterways to which the second defendant had title. The third defendant is the management company of the development.
The berths are 12 metres in length and were intended for use as mooring spaces for cruiser vehicles of the type generally used on the River Shannon. The plaintiff owns a 11.5 metre cruiser and other small pleasure crafts, and claims that his vessels cannot access the marina berths on account of the presence of a large rock outcrop close to the pontoon bedrock.
The plaintiff's claim is for damages for breach of contract and for breach of the covenant for quiet enjoyment, arising from breach of the principle of non-derogation from grant and in nuisance. Whilst the plaintiff has sought an order that the waterway be made navigable for the purposes of accessing the berths and an order compelling the defendants to remove the rocks for that purpose, this objective is not capable of being achieved by any reasonable or possibly lawful means.
The action was fully defended.
The berths were purchased by the plaintiff, Mr Begley, in conjunction with two apartments, numbers 47 and 49. No issue arose regarding the sale of the apartments.
By agreement in writing in the Law Society of Ireland standard combined contract for sale and building agreement (2001 edition) made on 14 October 2005, the second defendant, Mr Lally, agreed to sell, the first defendant agreed to build and Mr Begley (and his work colleague in the case of apartment 49) agreed to purchase the two apartments and marina berths as identified on the plan contained in the booklet of title. The total purchase price for the apartment and berth was €365,000 in the case of apartment 47 and berth 57, and €380,000 in the case of apartment 49 and berth 56.
The sale of the apartments closed without difficulty. The agreed apportionment of the purchase price was €40,000 in respect of each berth.
At the time the contracts were made, the development had not yet commenced and the purchase was made ‘off the plans’. The contracts for sale included a standard special condition that the contractor was under no obligation to complete the development and reserved the right to alter the size, shape, and location of the development.
Mr. Begley was aware that the location of the berths could be varied in the course of construction.
The sale of the berths closed almost two years after the contract for sale and Mr. Begley accepts that he knew before he closed the sale of the presence of visible rocks close to the berths likely to cause difficulty in access and egress.
The title to the area in which the marina berths were built is a lease made on 2 July 2003 between Waterways Ireland Limited as lessor and Aidan Kelly and Michael O'Sullivan as lessees by which part of the River Shannon measuring 1.813 hectares and edged purple on the map attached thereto was demised for the term of 900 years from 2 July 2003 at a nominal rent of €1.27 per annum. The lease was made in consideration of the payment of a fine of €82,532.98. Mr. Lally, took an assignment of the lease by deed of 11 February 2004.
The marina berth purchase lease was a sublease made on 20 September 2007 craved out of the Waterways Ireland lease for the term of 890 years from 1 January 2005, at a peppercorn rent.
Mr. Lally was the lessor, Damesfield joined in the lease as developer and for the purpose of the estate scheme, and the third defendant, the management company, joined on account of the management company agreement made on 3 June 2005 between Mr. Lally, the developer, and the management company, which inter alia provided for the assurance of the common areas and reversions on the leases of the apartments and berths to the management company in the normal way.
The marina purchase lease contained the standard covenants in an estate scheme and granted the easements rights and privileges contained in its third schedule. No express easement was granted over that part of the River Shannon to which Mr. Lally held the leasehold title, and express easements were granted over the pontoons, footpaths, steps, walkways, and other hard structures in the development.
The lease contained a number of covenants on the part of the lessee specific to marina and navigation use. There was a covenant to ensure that a competent person was on board when the vessel was occupied, whether it was underway or not, and a covenant to approach and leave the marina at a speed of not less than 5 knots. There were covenants regarding bilge water, and holding tanks. The lessor covenanted to kept the marina ramps, roadways, lights, and services in good condition, and to provide services and facilities for ‘running the marina’ as the lessor should think fit, and no express covenant was made to keep place or maintain the surrounding waterways so that they remained navigable.
The management company agreement made on 3 June 2005 between Mr. Lally as vendor, Damesfield as developer, and the management company contained an agreement to sell to the management company for nominal consideration the reversions on the leases of the residential units and marina berths and the common areas, the sale to be effected 28 days after the completion of the sale of the last unit or in any event within 21 years from the date thereof. The management company agreement is in standard form and has not yet been completed. While it is not clear how many units remained unsold, it is clear that the management company has no entitlement under the management company agreement to call for the title to the reversion and the common areas, and although the management company has called for a transfer pursuant to the obligations contained in the Multi-Unit Development Act 2011, no assurance has yet been effected.
The evidence of the plaintiff's expert Mr. Patrick Ginty of Tygro Consulting Engineers Limited is that the rock outcrop in many, albeit not all, conditions projects above the water surface and is situate approximately 27 metres from the end of the jetties. The rock is limestone bedrock. The water levels in the River Shannon vary considerably over a year depending on the amount of rainfall, outflow from Lough Rea, currents and other factors that influence those levels. Even at the typically high water level, access to the berths was likely to be obstructed by the rocks for all but vessels with a very shallow draft. The river is relatively fast flowing and the variable currents make it difficult to access or egress the berths even by an experienced mariner and even in high water conditions.
The evidence of the expert who gave evidence for the first and second defendants was that at some water levels there was sufficient water to access the berths.
However, I am persuaded by the evidence of the plaintiff's expert and by Mr. John Leffroy, a boat surveyor who lives locally and is familiar with the conditions on the River Shannon at the location, that the berths are compromised and not suitable for use by a craft of the type generally moored on a 12 metres berth, and that one would ‘be relying on luck’ as Mr. Leffroy said, to access the berths without damaging the vessel. Limestone is very damaging to fiberglass and most boats of the type at issue are fiberglass and would be vulnerable to...
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Begley v Damesfield Ltd
...against that order. The full background to the proceedings is set out in the judgment of the trial judge ( Begley v. Damesfield Ltd [2018] IEHC 221). 2 The respondent brought a claim in respect of two berths at the Jolly Mariner Marina Village, Brick Island, Coulson Road, Athlone, Co Westme......