Mackin (plaintiff) v Deane
| Jurisdiction | Ireland |
| Judge | Ms. Justice Finlay Geoghegan |
| Judgment Date | 20 May 2010 |
| Neutral Citation | [2010] IEHC 192 |
| Court | High Court |
| Date | 20 May 2010 |
[2010] IEHC 192
THE HIGH COURT
BETWEEN
AND
LAW SOCIETY GENERAL CONDITIONS OF SALE CONDITION 40(A)
LAW SOCIETY GENERAL CONDITIONS OF SALE CONDITION 36
KEANE EQUITY & THE LAW OF TRUSTS IN THE REPUBLIC OF IRELAND 1988 254
LAW SOCIETY GENERAL CONDITIONS OF SALE CONDITION 40
WINDHAM v MAGUIRE & MORAN UNREP CLARKE 16.7.2009 2009 IEHC 359
DUFFY v RIDLEY PROPERTIES LTD & STOKES 2008 4 IR 282 2008/15/3221 2008 IESC 23
SPECIFIC PERFORMANCE
Property
Contract - Agreement for sale and purchase of property - Compliance with planning permission- Breach of contract - Rescission - Return of deposit - Implied right to inspect - Unwillingness to permit inspection - Duty to cooperate - Whether plaintiff ready, willing and able to complete sale when completion notice served - Whether property in compliance with planning permission at date of service of notice of completion - Whether defendant entitled to rescind - Whether defendant entitled to return of deposit - Whether implied entitlement of purchaser to inspect property when built - Duffy v Ridley Properties Ltd [2008] IESC 23 [2008] 4 IR 282 followed - Windham v Maguire [2009] IEHC 359 considered - Plaintiff's claim and defendant's counterclaim dismissed (2008/10888P - Finlay Geoghegan J - 20/5/2010) [2010] IEHC 192
Mackin v Deane
Facts: The plaintiff was a builder and the defendant an experienced property developer. The plaintiff sought an order for specific performance of an agreement for the sale of a property. The defendant counterclaimed inter alia that he had rescinded the Contract by letter. The issue arose as to whether the plaintiff was ready to complete the sale when the completion notice was served and whether the house was built in compliance with planning permission and whether the attic had been converted to habitable accommodation. The issue further arose as to whether the plaintiff would be denied an order for specific performance by reason of his unwillingness to permit an inspection requested and whether the defendant was entitled to rescind the Contract.
Held by Finlay Geoghegan J. that the house was not in compliance with the planning permission at the date of the service of the Notice of Completion and the plaintiff was not ready, willing and able to complete the Contract at that date and was not entitled to an order for specific performance. The Court found much of the evidence of the witness as well as the plaintiff and defendant had given untrue evidence. There was no express right to rescind and even if there was an implied right to inspect, that the implied right could only be to inspect within a reasonable period of time. The defendant had not established that he had validly rescinded the Contract and his claim for the return of the deposit failed. The Court would grant orders dismissing the claim of the defendant and the counterclaim of the defendant.
Reporter: E.F.
1. The plaintiff is a builder and the defendant an experienced property developer. The plaintiff primarily seeks an order for a specific performance of an agreement in writing dated 12 th July, 2007, for the sale and purchase of the property known as the mews to No. 13, Morehampton Road, or 13A Morehampton Road, Donnybrook, Dublin 4, in consideration of €2,365,000 ("the Contract"). The defendant denies the plaintiff's entitlement to an order of specific performance and counterclaims that he has rescinded the Contract by letter dated 20 th November, 2009, and claims to be entitled to the return of the deposit paid of €25,000, together with interest and costs.
2. The proceedings were admitted to the Commercial List by order of the High Court (Kelly J.) of the 26 th January, 2009. In accordance with Commercial List practice, witness statements had been exchanged. By agreement of the parties, the statements were treated as the evidence in chief of the witnesses, subject to some additional direct oral evidence, and the witnesses were cross-examined. It is regrettable that, having considered carefully the witness statements and the evidence given by each of the witnesses, and having observed their demeanour in the witness box, I have formed the view that the plaintiff, the defendant, the plaintiff's engineer, Mr. Cagney, and the defendant's witness, Mr. Cooke, each gave evidence to the Court which I find, in part, to be untrue. Each also gave some evidence which I accept as being true. The remaining two witnesses, Mr. McSweeney, architect for the plaintiff, and Mr. Furey, engineer for the defendant, appeared to be truthful witnesses.
3. There are a number of factual matters in dispute between the parties. Not all of these are relevant to the issues which I have to determine on the plaintiff's claim and the defendant's counterclaim. The following are my findings of the relevant facts, some of which were not in dispute.
4. The plaintiff owns the mews property known as No. 13A Morehampton Road. In 2006, and possibly earlier, the plaintiff was carrying out the construction of a house known as 17A Morehampton Road or the mews property to 17 Morehampton Road, owned by his brother, Sean Mackin. The plaintiff subsequently also carried out building on mews properties at numbers 11 and 15 Morehampton Road.
5. The defendant is an experienced property developer. The plaintiff gave evidence of a number of significant other properties developed by the defendant which was not disputed. Prior to the contract at issue in these proceedings, the defendant had purchased or agreed to purchase from the plaintiff's brother, Sean Mackin, the properties at 17 and 17A Morehampton Road.
6. In October, 2006, the plaintiff and defendant negotiated the sale and purchase of 13A Morehampton Road. The house was not yet built. Mr. Brian McLoughlin, an estate agent, who did not give evidence, was involved in the negotiations. In October 2006, there was an oral agreement between the plaintiff and the defendant for the sale and purchase of 13A Morehampton Road in consideration of €2,365,000 with a deposit of €25,000. The oral agreement between the plaintiff and the defendant, which was not in dispute in the proceedings, was that the agreement for sale related to a house to be built to a similar specification to the mews at 17A Morehampton Road which was then built or substantially built. It was to have a similar internal and external layout to 17A Morehampton Road and similar type finishes.
7. A written agreement for the sale and purchase of 13A was prepared and the Contract was signed by the defendant in January 2007, and by the plaintiff in July 2007, and is dated 12 th July, 2007. The Contract lists, in the Documents Schedule, a copy decision of An Bord Pleanla with a Planning Register Reference Number 4053/02, granted on 19 th August, 2003. Condition No. 2 of that decision, which granted permission for a proposed development of a house in accordance with the plans which had been lodged, provided "the attic space shall be used for storage only and shall not be used for or converted to habitable accommodation". The plans to which the permission related are of a two-storey house with a designated attic space inside a dormer roof with Velux windows. The plaintiff lodged a subsequent application with Dublin City Council with almost identical plans for the same property, save that the location of the house on the site was brought forward by one metre so that the proposed house at 13A lined up with the existing properties to the rear of Morehampton Road. This appears to have been lodged in November 2009. On 11 th May, 2007, permission was granted with reference number 6134/06. This permission was subject to the conditions in permission 4053/02, including condition number two relating to the attic set out above. Permission 6134/06 was not expressly referred to in the Contract.
8. Special Conditions 10 and 11 of the Contract provide respectively:
" 10. The purchaser shall be furnished with a Certificate of Compliance with Planning Permission and Building Regulations as per the draft enclosed herewith. No amendments will be tolerated in respect thereof.
11. The contract is subject to all but ( sic) [built] works as agreed between the parties been ( sic) [being] completed in satisfaction to both parties. Completion shall take place fourteen days after the Vendor has notified the purchaser that the works have been completed in full. In the event that there is any dispute as to completion of the works, the Vendor's Engineer shall be regarded as an Expert and his opinion shall be final."
No draft of the Certificate of Compliance was attached to or enclosed with the Contract.
9. The plaintiff and the defendant were in agreement in their evidence that the works agreed (and to which Special Condition 11 refers) were that the house at 13A would be built to the same specifications and with the same fit out as 17A. This included, in the attic, a room finished for use as a bedroom and en suite bathroom. I do not accept the evidence of the defendant that he was unaware of the planning permission with the condition relating to the attic when he entered into the Contract. It appears to me totally improbable that an experienced developer would have signed a contract to purchase a house for approximately €2.35 million without having made some enquiries about planning permission. He had also previously purchased a similar house at 17A with what is stated to be similar planning permission with a restrictive condition relating to the attic. I find, as a fact, that the works which were agreed between the plaintiff and the defendant, and to which Special Condition number 11 relates, included, to the knowledge of both the plaintiff...
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...but not answered by Clarke J. in Windham v. Maguire & Anor [2009] IEHC 359, and mentioned by Finlay Geoghegan J. in Mackin v. Deane [2010] IEHC 192, as to the consequence of a party becoming unable to close in the currency of a notice which was valid at the date of service. The corresponden......