L. O hArgain v Beechpark Estates Ltd
| Jurisdiction | Ireland |
| Judge | Judge McWilliam |
| Judgment Date | 27 March 1979 |
| Neutral Citation | 1978 WJSC-HC 1952 |
| Date | 27 March 1979 |
| Docket Number | NO 101/1978 |
| Court | High Court |
1978 WJSC-HC 1952
THE HIGH COURT
Judgment delivered 27th March 1979. Judge McWilliam
This case comes before me by way of case stated by the Appeal Commissioners for a decision whether they were entitled to hold that property at Blanchardstown in the County of Dublin known as Scaldswood Farm was never trading stock of a trade of dealing in or developing land carried on by Beechpark Estates Limited (hereinafter called the Company) or trading stock of a business which was deemed by Section 17 of the Finance ( Miscellaneous Provisions) Act, 1968, to be such a trade.
The history of the property and of the Company appears from the case stated to be as follows. In 1954 P. J. Neylon and John Molloy entered into a partnership to purchase about three and a half acres of Scaldswood Farm from a grand-uncle of John Molloy for the purpose of development by granting building leases. They also, at about the same time, purchased about two acres at Castleknock, in the same locality, from an uncle of John Molloy for the same purposes. No question arises with regard to these two holdings which are admitted to have been acquired and retained for the purposes of a trade of dealing in or developing land. In the following year John Molloy's grand-uncle offered the remainder of Scaldswood Farm to his nephew for the sum of £10,000 payable by ten yearly instalments but reserving a right of residence for himself on the lands. John Molloy was not interested in farming and did not have sufficient money to pay the purchase price and he arranged with P. J. Neylon that they should purchase the lands jointly, each paying half of the yearly instalments of £1,000 but that P. J. Neylon should deal with the farming activities. They were advised by their accountant that the most convenient way of carrying out the arrangement would be by forming a company to own the land, they being equal shareholders. The Company was incorporated on 14th June, 1955, and went into occupation of the farm, presumably by the activities of the two shareholders. In July, 1955, P. J. Neylon and John Molloy transferred to the Company the two acres at Castleknock which they had acquired from John Molloy's uncle. On 15th December, 1955, the Company acquired adjoining land of about two and a half acres and both holdings were developed by the Company. In December, 1955, the holding at Blanchardstown originally acquired from John Molloy's grand-uncle was transferred to the Company which developed part of it and, in 1960, reconveyed the remainder of it back to P. J. Neylon and John Molloy. The memorandum of association of the Company contained, at paragraphs (a), (d), and (e), objects which might be described as building or development objects but the sole reference to farming in the memorandum was contained towards the end of paragraph (e) in the following words - "and by planting, paving, draining, farming and .cultivating land or letting the same on building...
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