Powderly v McDonagh & Anor, [2006] IEHC 20 (2006)

Docket Number:2004 738S
Judge:Kelly J.
 
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THE HIGH COURT

COMMERCIAL[2004 No. 738 S]BETWEENTHOMAS POWDERLYPLAINTIFFAND

PATRICK McDONAGH AND ANN McDONAGHDEFENDANTSJUDGMENT of Mr. Justice Kelly delivered the 31st day of January, 2006

Introduction

In 1999 the defendants purchased Corbalton Hall, Skryne, Co. Meath. This is a period house constructed between 1790 and 1801 under the design and supervision of the architect Francis Johnston.

They decided to carry out substantial renovation work on the house. It is a protected structure. The plaintiff contends that the defendants intended to spend approximately 25 million on the renovation works. Whether that figure be accurate or not it is quite clear that, even by today's standards, the works in question were going to be very costly and indeed have proved to be so to date.

The defendants commissioned an architect and quantity surveyor to advise them and they in turn made contact with the plaintiff who was retained as the main contractor for the works.

Despite the large sums of money involved it is remarkable that no written contract was executed to govern the relationship between the plaintiff and the defendants.

The defendants believed that the principal works to be undertaken by the plaintiff would be governed by the articles of agreement and conditions of contract published by the Royal Institute of Architects of Ireland (1996 Edition) for use when quantities do not form part of the contract. Indeed support for that understanding is to be found in a letter dated 11th July, 2002, from the defendants' then architect to the plaintiff which confirmed the intention of the defendants to enter a formal contract with the plaintiff for a sum of 5.95 million including V.A.T. The letter pointed out that formal contract documents would be assembled and tabled for signing by all parties as soon as possible thereafter. Whilst the letter does not mention the form of contract to be entered into it clearly envisaged a formal written agreement being executed. In the event, no such agreement was executed. Furthermore, according to the plaintiff's evidence, he was retained the previous August and was actually on site and working since 10th September, 2001.

The lack of a formal written contract governing the relationship between the plaintiff and the defendants has not assisted in the resolution of the disputes which have now occurred.

At this stage it appears that the plaintiff has been paid in excess of 9.8 million. His contract has been terminated by the defendants. They believe that they have overpaid him and that a reasonable estimate of the value of the works carried out to date is 7.845 million.

The plaintiff disagrees and brings these proceedings for the recovery of 2,803,763.99 which he says is due to him from the defendants.

These proceedings

On 22nd June, 2004 these proceedings were commenced by summary summons.

It was not until 25th April, 2005 that a motion was brought before the Master seeking leave to enter final judgment. That motion was made returnable for 8th June, 2005. It was adjourned and on 22nd June, 2005 the defendant brought a motion to the Court seeking to stay the proceedings pursuant to the provisions of s. 5(1) of the Arbitration Act 1980. That motion was made returnable for 11th July, 2005.

On 20th July, 2005 the plaintiff brought a motion returnable for 25th July, 2005 seeking to have the proceedings entered into the Commercial List.

Notwithstanding the delay in bringing such an application I admitted the proceedings and gave directions concerning an exchange of affidavits so as to enable the application to stay the proceedings be heard at the earliest opportunity.

I heard the motion seeking a stay of the proceedings on 17th October, 2005 and refused the order sought. I did so because I was not satisfied that the defendants had demonstrated the existence of any binding agreement to arbitrate their differences.

On that occasion I also gave directions for the exchange of the necessary affidavits to enable the motion for judgment to be heard. The motion was heard by me last month and this is my judgment upon it.

The claim for summary judgment

The plaintiff does not seek to recover by way of summary judgment the entire of the money in respect of which the proceedings have been brought.

The full sum of 2,803,763.99 claimed in the summary summons is broken up into three parts.

The first is a sum of 1,333,720.85 which is allegedly due on foot of an architect's certificate of 10th May, 2004.

A sum of 1,134,767.62 is claimed in respect of works allegedly carried out by the plaintiff for the defendants during the period 1st March, 2004 to 11th May, 2004. (Apparently incorrectly claimed in the summons as being due in respect of the period 1st April, 2004 to 11 May, 2004).

The third part of the claim is for 335,275.52 in respect of a sum allegedly due for retention monies retained by the defendants which, following the termination of the contract, is allegedly due to the plaintiff.

There was an extensive exchange of affidavits with many issues debated. As a result of that exchange it is accepted by the plaintiff that a significant portion of his claim cannot attract summary judgment and will have to be remitted to plenary hearing. However, in respect of two elements of the claim he contends that the defendants have not demonstrated any triable issue by way of defence and that summary judgment should be granted to him.

The first sum in respect of which summary judgment is now sought is one of 645,886.62. That is said to be due on foot of the architect's certificate issued on 10th May, 2004. The total sum specified in that certificate is the 1,333,720.85 which I have already described as being the first part of the plaintiff's claim. However, that sum is inclusive of 687,834.23 payable to sub contractors. The defendants have informed the plaintiff that they have in fact discharged all of the monies due to those sub contractors. He accepts that this is so, although he contends...

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