Kui v Nolan and Another

• Jurisdiction: Ireland
• Judge: Mr Justice Liam Kennedy
• Judgment Date: 21 January 2025
• Neutral Citation: [2025] IEHC 17
• Court: High Court
• Docket Number: Record No. 2024/6528HP

Between

Gianina Kui

Plaintiff

and

John Nolan and Ann O'Reilly

Defendants

[2025] IEHC 17

Record No. 2024/6528HP

THE HIGH COURT

Interlocutory reliefs – Fair question to be tried – Balance of justice – Plaintiff seeking interlocutory relief pending trial – Whether the plaintiff had demonstrated a fair question to be tried

Facts: There was a partnership dispute regarding a dental practice in Tallaght named the Aylesbury Clinic. The parties were the three partners, with the plaintiff, Ms Kui, having a 50% interest and the defendants, Mr Nolan and Ms O’Reilly (a married couple), holding the other 50%. The defendants said that they suspended and then expelled the plaintiff as a partner. The plaintiff disputed the defendants’ entitlements to take such steps and the motivation for and the manner and legitimacy of those actions. The plaintiff successfully resisted the defendants’ first attempt to deny her access to the clinic, but was later, more permanently, denied access. She sought interlocutory relief pending trial, namely orders: (i) restraining the defendants from excluding the plaintiff from the clinic; (ii) directing the defendants to allow access to patient and other records required by the plaintiff to carry on her dental practice; and (iii) restraining the defendants from purporting to sell the practice.

Held by the High Court (Kennedy J) that, applying Merck Sharp & Dohme Corp v Clonmel Healthcare Ltd [2019] IESC 65, a permanent injunction could be achieved at trial. He held that there was a fair question to be tried and the claim met the O’Gara test (O’Gara v Ulster Bank DAC [2019] IEHC 213). Even if the higher Maha Lingam v Health Service Executive [2005] IESC 89 standard applied, he would be satisfied that it was met. He found that the plaintiff had demonstrated a strong case that the “suspension” and “expulsion” were unlawful and that the defendants attempted to override her rights, illegally excluding her from the practice and the clinic, her place of work, causing her ongoing harm so as to achieve a collateral objective, overriding her objection to the proposed sale of the practice. As Okunade v Minister for Justice, Equality and Law Reform [2012] 3 I.R. 152 confirmed, he needed to balance the consequences for the plaintiff if an interlocutory injunction was refused but she succeeded at trial against the consequences for the defendants in the converse scenario. He held that the balance of justice favoured the plaintiff in circumstances in which she had effectively been charged with day-to-day responsibility for the clinic for five years, had built up relationships with clients and had developed a substantial practice whereas the defendants “departed” the clinic several years ago. He concluded that more satisfactory patient care and greater continuity would be maintained by allowing the plaintiff to continue to serve her patients at the clinic if those patients wished to avail of their services. In considering the balance of convenience, he found the analysis of Clarke J in A.I.B. Plc v Diamond [2012] 3 IR 549 apposite. He held that refusing interlocutory relief could deprive the plaintiff of her property and contractual rights in circumstances which could be extremely prejudicial to her (whereas the prejudice to the defendants would be far less if they were ultimately vindicated at trial).

Kennedy J granted orders in the terms sought, save that, in view of the undertaking proffered in the course of the proceedings, there was no need for an order to restrain the sale of the practice pending the resolution of the proceedings.

Relief granted in part.

JUDGMENT ofMr Justice Liam Kennedydelivered on the 21 ^st day of January 2025

1 . These proceedings concern a partnership dispute regarding a dental practice in Tallaght (“the Practice”) now named the Aylesbury Clinic (“the Clinic”). The Parties are the three partners, with the Plaintiff having a 50% interest and the Defendants (a married couple) holding the other 50%. The First Defendant is the managing partner. Relationships have deteriorated between the Parties, and the rift widened following the Plaintiff's rejection of an offer by a third party, MiDentalCare, to buy the Practice, an offer which the Defendants favoured. The Defendants say that they suspended and then expelled the Plaintiff as a partner. The Plaintiff disputes the Defendants' entitlements to take such steps and the motivation for and the manner and legitimacy of those actions.

2 . The Plaintiff successfully resisted the Defendants' first attempt to deny her access to the Clinic, but was later, more permanently, denied access. She seeks interlocutory relief pending trial, namely access to the Clinic and the Practice's records to continue to treat her patients — including vulnerable patients — and to restrain the Defendants from disposing of the Practice pending trial. This judgment solely determines the orders required pending trial. It does not determine the merits of any substantive claims, counterclaims or defences.

3 . Following a short service application on 11 November 2024, affidavits were exchanged, and the application was listed for 5 December 2024. On that occasion, according to the Plaintiffs, counsel for the Defendants were unprepared to have the matter heard and proposed the exchange of submissions. Sanfey J. directed the exchange of submissions in advance of a hearing on 20 December 2024. In doing so (and presumably with a view to excluding reliefs which would need to await the determination of the proceedings), Sanfey J. also suggested that the interlocutory reliefs be narrowed, and the Plaintiff duly narrowed the interlocutory reliefs to, in brief, orders: (i) restraining the Defendants from excluding the Plaintiff from the Clinic; (ii) directing the Defendants to allow access to patient and other records required by the Plaintiff to carry on her dental practice; (iii) restraining the Defendants from purporting to sell the Practice.

4 . It is undisputed, at least for this application, that:

• a. The Plaintiff and the First Defendant are qualified dental surgeons. The Second Defendant is a dental nurse. The three parties entered into the partnership agreement (“the Agreement”) for the purposes of commencing the Practice with effect from 1 January 2019 with the Clinic serving as its premises. They leased the Clinic for 10 years and the lease dated 8th November 2019 identified each of them as tenants and signatories.

• b. The Defendants were not as actively involved in the Practice as originally envisaged. Its growth was impacted by, inter alia, the COVID lockdown, and their active involvement in terms of treating patients seems to have ended entirely or almost entirely in early 2020 (in the case of the Second Defendant) and in 2022 or 2023 (in the case of the First Defendant) with the Plaintiff apparently running the Clinic and the Practice largely singlehandedly in terms of treatment of patients until her “expulsion” in October 2024.

• c. Differences developed between the parties concerning the finances, development and operation of the Practice. They explored the possibility of the Plaintiff buying out the Defendants, but no agreement was reached. They also explored the possible sale of the whole Practice to a MiDentalCare, but the Plaintiff rejected the eventual offer and those negotiations ended shortly before the events which triggered the current application.

• d. Both sides say that the other is in breach of the Agreement in various respects. Following the collapse of the negotiations for the sale of the Practice, the Defendants purported to suspend and then expel the Plaintiff as a partner and to exclude her from the Clinic.

The Indorsement of Claim

5 . The most important reliefs sought by the Plaintiff in the Indorsement of Claim can be summarised as follows; (a) Declarations that the Defendants remain bound by the Agreement and that the Plaintiff remains a partner; (b) Orders restraining the Defendants from breaching the Agreement, excluding the Plaintiff from the Clinic or representing to any persons that the Plaintiff is no longer a partner and/or entitled to practice dentistry at the Clinic and/or that the Partnership has been dissolved; or selling Partnership assets and/or the Clinic; (c) Orders directing the Defendants to allow access to patient and other records and to account in respect of all matters concerning the Partnership; (d) Orders prohibiting the Defendants from advising patients to seek treatment with alternative practitioners (save in emergencies) or from destroying patient and other Partnership records; (e) Orders, if necessary, directing; the dissolution of the Partnership (under the Partnership Act 1890, s. 35); accounts, valuations, and enquiry; and damages for breach of contract, breach of duty, negligent infliction of economic loss and reputational damage.

The Correspondence

6 . The following is the key correspondence between the Parties or their representatives:

• a. By letter dated 16 August 2024 the Defendant's solicitors wrote to the Plaintiff referring to her rejection of the offer of €300,000 for the Practice from MiDentalCare and stated that her “ongoing failure to comply with [her] duties and obligations to the Partnership” could no longer continue. While noting that MiDentalCare's offer had been withdrawn it also noted that they remained interested in purchasing the Practice and that the Defendants were continuing to engage with them if the Plaintiff was to immediately accept the offer, stating that “ No further delays by you will be tolerated”. The letter concluded with an ultimatum that unless the Plaintiff cooperated in the sales process and took all necessary steps to complete the sale and dissolve the Partnership, the Defendants had instructions to commence proceedings within 7 days in which they would

  “seek to recover the loss suffered by our clients...