Frank Towney Ltd & Ors -v- South Dublin Co Council, [2005] IEHC 93 (2005)

Docket Number:Date of Delivery:
Party Name:Frank Towney Ltd & Ors, South Dublin Co Council
Judge:Peart J. / Quirke J. / Abbott J. / Gilligan J. / McKechnie J. / Herbert J. / Clark J. / Clarke J. / Finlay Geoghegan J.
 
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JUDGMENT BY: Peart J.

Neutral Citation No. [2005] IEHC 93 THE HIGH COURT Record Number: 1989 No. 174P

Between:

Frank Towey Limited, Patrick Farrelly, Barrett Haulage Limited,

And By Order: Sibra Building Company Limited

Plaintiffs

And

The County Council of the County of South DublinDefendant

Judgment of Mr Justice Michael Peart delivered on the 16th day of March 2005:

The Parties:

For the purpose of this judgment the plaintiffs who seek relief are Frank Towey Limited ("Towey") and Sibra Building Company Limited ("Sibra"). For the most part I shall refer to these parties collectively as "the plaintiff". It may become necessary to distinguish between them, and if so I shall in such instances make that clear by using "Sibra" or "Towey" as appropriate. These proceedings no longer involve the second and third named plaintiffs.

Sibra is the freehold owner of the licensed premises known as "The Foxhunter", at the centre of this claim ("the premises"), and which are situated on the south side of what used to be called the Palmerstown Road, near Lucan, Co. Dublin, before it became the Palmerstown By-Pass. This location is now on the south carriageway of the N4 Dublin to Galway Dual Carriageway.

There is for all practical purposes a common shareholding between Towey and Sibra.

Towey trades in the premises, and holds the leasehold interest therein from Sibra under an Indenture of Lease dated 13th July 1993 expressed therein to be for a term of ten years from the 1st July 1993 at a rent of £20,000 per annum, reviewable every five years. That Lease has expired and while no new lease has been entered into, Towey remains in occupation under the same terms as the expired Lease.

There has been evidence that Sibra contracted to purchase the premises by Contract for Sale dated 20th June 1984 from the previous owners whom I shall refer to as "Langan". The sale was closed on the 21st December 1984.

There has also been evidence that Towey has in fact been in occupation of and trading from the premises from that time, and that what was clearly a somewhat informal relationship of landlord and tenant between Sibra and Towey was "formalised" in 1993 by the execution of the Lease referred to.

The defendant is the roads authority for the relevant area.

The historical background to the proceedings:

It appears that prior to the commencement of these proceedings in 1989, in which certain injunctions and damages for breach of contract are sought against the defendant, there had been discussions between Langan and the County Council which culminated in a certain "agreement" regarding what access openings the Council would include in the median of the dual carriageway, so as to permit access to the premises to traffic comings eastwards towards Dublin city by crossing the dual carriageway, and which would also permit patrons to exit the premises by crossing the westbound carriageway so as to make a right turn towards Dublin city. I will return to the nature of those discussions and the "agreement" concluded in due course.

It is contended by the plaintiff that at the time of the negotiation of the purchase of the premises from Langan around 1984, a letter dated 4th August 1983 from P.J.Bannon (of Harrington Bannon, Estate Agents) on behalf of Langan to Dublin County Council, and the letter dated 26th August 1983 in reply thereto and which confirmed that the items 1-6 contained in the letter dated 4th August 1983 "are as agreed with you on site", were handed over by Langan.

In evidence, Frank Towey junior (a son of Frank Towey senior, who was in negotiations for the purchase), stated that it was made clear by Langan to his father that these letters were very important and that "we should not lose sight of them". These openings were regarded by Langan and Towey as important to the business run in the premises, as without them eastbound traffic would have no direct access to the premises and business would be diminished accordingly, and it is certainly to be reasonably inferred from the evidence of Frank Towey that since the price agreed for the purchase in 1984 was based on turnover, as is usually the case with the sale of a licensed premises, the price paid for the purchase was influenced by the reassurance they took from this exchange letters which had followed upon negotiations between Langan and The County Council regarding the openings in the median of the dual carriageway, and that had they known that there would be a closure of the median openings, and in particular opening No. 2 opposite the premises, they would have paid less in order to reflect an anticipated and consequential drop in sales.

Following these negotiations it appears that the dual carriageway contained 4 openings in the vicinity of the premises. In due course openings 1, 3 and 4 were closed on road safety grounds, but it was opening No. 2 which was of critical importance to the plaintiff since it was that opening which provided direct access across the dual carriageway for patrons wishing to enter and the premises by means of crossing the dual carriageway. It does not appear that the plaintiff made any move to prevent or persuade the defendant not to close openings 1, 3 and 4, when the Council did so, since it was opening No. 2 which was of major significance to them.

In 1989, it appears that the County Council commenced to close the remaining opening No.2 and this led to the commencement of these proceedings for the purpose of seeking injunctive relief. At that stage certain undertakings were given by the defendant not to close the last remaining opening pending the determination of the proceedings. Much time has elapsed since then. In addition, in the intervening period, the Road Traffic Act, 1994 ("the 1994 Act") has passed into law, s.38 of which entitles a road authority, such as the defendant in these proceedings, to provide such traffic calming measures as the consider to be in the interests of safety and convenience of road users, subject to compliance with the requirements contained in the section.

Superintendent William Collins gave evidence which would certainly leave no room for doubt that in his opinion the existence of the remaining opening in this median poses extreme danger for traffic and should be closed under the powers provided for in that section.

In these circumstances, the defendant contends that whatever may or may not have been agreed with Langan in 1983 concerning the existence of a permanent opening in the median to facilitate entry to and egress from the premises, they are now statutorily entitled to close it in the interest of safety, and that accordingly injunctive relief should not be granted, and the undertaking given in 1989 ought to be discharged so that work can be commenced to close the opening. The defendant denies that there is any privity of contract between it and the plaintiff, and that the plaintiff is not entitled to damages for any alleged breach of contract, even if one existed with Langan as a result of the negotiations and correspondence in August 1983 (which is of course denied).

The plaintiff now contends that the rights arising from the negotiations in 1983, leading to the two letters to which I have referred amount to an easement for the benefit of the premises. It is further submitted on behalf of the plaintiff that since it is beyond argument that this easement is not the subject of any deed or grant, it is equitable in nature and operates by way of a proprietory estoppel against the defendant.

It is alternatively argued that the contents of the "agreement" amount to a restrictive covenant the benefit of which passes to the current owners without any deed.

It is further submitted that the rights created by the exchange of letters following the 1983 negotiations with Langan constitute a chose in action in respect of which there has been an equitable assignment by the vendor to the plaintiff.

In these circumstances, the plaintiffs claim in the first instance an entitlement to injunctive relief to restrain the closure of the opening, but in view of the plea that the defendant is entitled under the 1994 Act to close the opening, the plaintiff seeks damages in the event that the opening is found to be in the interests of public safety and convenience to close it, since to do so would cause a breach of rights to which the plaintiff are entitled and in respect of which they say they can prove a loss into the future.

The legal issue to be first determined:

The question to be determined prior to embarking on any examination of any claim to injunctive relief, or more likely the claim for damages, is to ascertain the precise nature of any arrangements or agreement entered into by the County Council with the plaintiff's predecessors in title, Langan, in 1983. Once that is ascertained, the Court will have to determine whether, in the absence of anything expressed, in relation to any such rights as may accrue from those arrangements, the plaintiff has any entitlement in equity to the benefit of them, such as would entitle them to claim damages from the County Council who wish to exercise a statutory entitlement to close the opening.

The terms of the agreement in 1983:

Before turning legal submissions in relation to equitable easements, proprietory estoppel, the equitable assignment of a chose in action, and restrictive covenants, it is necessary to look at the evidence which has been given as to the terms of the agreement made in 1983 by the County Council with Langan. Fortunately, some of the personnel involved at that time are still available to recall, as best they now can, what was the agreement, and the Court also has the benefit of the correspondence which was exchanged after the oral negotiations were completed.

The meeting on site on 26th July 1983:

There is a memo under ref: RF/AK, which is a reference to Mr Ronald Fox of Harrington Bannon, which firm was acting on behalf of Langan in the discussions with the...

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