Emcon Systems Ltd v O'Kane Engineering Ltd

• Jurisdiction: Ireland
• Judge: Mr. Justice Gerard Hogan
• Judgment Date: 23 March 2015
• Neutral Citation: [2015] IECA 57
• Court: Court of Appeal (Ireland)
• Date: 23 March 2015

[2015] IECA 57

THE COURT OF APPEAL

Kelly J.

Irvine J.

Hogan J.

Appeal No. No. 10 Exp/2014

Emcon Systems Ltd v O'Kane Engineering Ltd

BETWEEN/

EMCON SYSTEMS LIMITED

PLAINTIFF/RESPONDENT

AND

O'KANE ENGINEERING LIMITED

DEFENDANT/APPELLANT

Credibility – Supply of goods – Contracts – Appellant seeking to appeal against the decision of the High Court granting summary judgment to the respondent – Whether the High Court ought to have adjourned the matter for plenary hearing

Facts: The plaintiff/respondent, Emcon Systems Ltd, was retained by the defendant/appellant, O'Kane Engineering Ltd, as the sub-contractor to supply and install a specialist emergency lighting system for part of the Royal Hospital, Kilmainham, Dublin 7. This was a major project and the ultimate employer was the Office of Public Works (OPW). The defendant maintained that the plaintiff had not produced or proved invoices in relation to the supply of the goods to its satisfaction in accordance with the terms of the contract. O'Kane Engineering maintained that there were issues in relation to the amounts of individual items of this specialist lighting equipment that were actually supplied by the sub-contractor: it contended that not all of the invoices had been accounted for. In November, 2014, the High Court granted summary judgment to the plaintiffs in the sum of €71,890. The defendant appealed to the Court of Appeal against the decision of the High Court arguing that the High Court was in error in arriving at its conclusion and that it ought to have adjourned the matter for plenary hearing.

Held by Hogan J that the case was one where the arguability of the suggested defence must be assessed by reference to underlying considerations of credibility, principally because the plaintiff exhibited correspondence from the ultimate employer, the OPW, which attests to the satisfactory manner by which it, qua sub-contractor, supplied the lighting systems. Hogan J noted that if the ultimate employer was satisfied with the performance of these works and stated, without contradiction, that the ultimate price was agreed between all the parties, then, it might be asked, on what basis would the defendant contractor be entitled to withhold payment to the plaintiff sub-contractor? Hogan J held that it was for that very reason that the case came within the category of cases identified in Aer Rianta CPT v Ryanair Ltd [2001] IEHC 94 where the arguability of a potential defence is entirely negatived on credibility grounds. Hogan J held that if, as in Banque de Paris v de Naray [1984] 1 Lloyds' Rep 21, the defendants' account of what transpired at a critical meeting had been entirely negatived by independent evidence the veracity of which was accepted or where, as in First National Commercial Bank v Anglin [1996] 1 IR 95, the indisputable chronology recorded by particular documents made the defendant's suggested defence untenable, then the same may equally be said by analogy in respect of the proposed defence which O'Kane Engineering sought to advance in the light of the OPW correspondence. Hogan J held that, in effect, the suggested defence based on unreconciled invoices and disputes as to quantities was rendered unreal by the unequivocal statement made by the ultimate employer that the plaintiff sub-contractor discharged its obligations in a perfectly satisfactory way and that there had been agreement in relation to all matters on the part of the employer, contractor and sub-contractor. In Hogan J's view, this was accordingly one of the type of cases where the proposed defence cannot be realistically assessed to be credible in the particular sense envisaged by Aer Rianta.

Hogan J held that since he was of the view that O'Kane Engineering had not raised an argument which could realistically be regarded as credible, he would accordingly confirm the decision of the High Court; it followed that the order for summary judgment which was already made by the High Court was affirmed.

Appeal refused.

1 JUDGMENT of Mr. Justice Gerard Hogan delivered on 23rd day of March 2015

2 1. This is an appeal by the defendant, O'Kane Engineering Limited, ("O'Kane Engineering") against the decision of the High Court (Cross J.) delivered on 11 ^th November 2014 as granted summary judgment to the plaintiffs in the sum of...