The Leopardstown Club Ltd v Templeville Developments Ltd

• Jurisdiction: Ireland
• Judge: O'Sullivan J.
• Judgment Date: 04 May 2006
• Neutral Citation: [2006] IEHC 133
• Court: High Court
• Date: 04 May 2006

[2006] IEHC 133

THE HIGH COURT

[No. 1082S/2004]

LEOPARDSTOWN CLUB LTD v TEMPLEVILLE DEVELOPMENTS LTD & SMYTH

BETWEEN

THE LEOPARDSTOWN CLUB LIMITED

PLAINTIFF

AND

TEMPLEVILLE DEVELOPMENTS LIMITED AND PHILIP SMYTH

DEFENDANTS

WILEY LANDLORD & TENANT LAW PAR 12.09

LANDLORD & TENANT LAW (AMDT) ACT (IRL) 1860 (see DEASYS ACT) S48

MAC CAUSLAND & KIMMITT v CARROLL & DOOLEY 1938 72 ILTR 158

RIORDAN v CARROLL 1996 2 ILRM 263

DOWLING SET OFF AGAINST RENT ASSIGNMENT & SUBLETTING IN BREACH OF COVENANT NILQ VOL 39 NO 3 258

BRITISH ANZANAI (FELIXSTOWE) LTD v INTERNATIONAL MARINE MANAGEMENT (UK) LTD 1980 1 QB 137

AER RIANTA v RYANAIR 2001 4 IR 607 2002 1 ILRM 381

BANQUE DE PARIS v DE NARAY 1984 1 LLOYD'S REP 21

AGRA TRADING LTD v MIN FOR AGRICULTURE UNREP BARRINGTON 19.5.1983 1983/7/1744

CRAWFORD v GILLMOR 1891 LR IR 238

LANDLORD AND TENANT

Lease

Covenant as to payment of rent - Rent arrears- Summary summons for liquidated amount -Defence and counterclaim - Set-off of unliquidated amounts - Whether defence available under terms of lease - Whether bona fide defence - Whether case appropriate to summary judgment - Aer Rianta cpt v Ryanair Ltd [2001] 4 IR 607 applied - Order of Master set aside; leave to defend and adjournment for plenary hearing granted (2004/1082S - O'Sullivan J - 4/5/2006)[2006] IEHC 133 The Leopardstown Club Ltd v Templeville Developments Ltd

Facts: The Defendant tenants appealed against a decision for summary judgment of the Master of the High Court for arrears of rent due, interest and costs pursuant to a lease. The Plaintiff contended that no link was made between the claims asserted on affidavit and any loss suffered.

Held by O’ Sullivan J., setting aside the Order of the Master and giving the defendants leave to defend the proceedings, that while the linkage between the complaints and the complained losses was not compelling, the defendant had an arguable case and the issues were not capable of being readily determined.

Reporter: E.F.

1 JUDGMENT of O'Sullivan J. delivered the 4th of May, 2006

2 This is an appeal by the first and second defendants as tenant and part guarantor of rent due to the plaintiff under lease dated 5th June, 1998, against a summary judgment of the Master of the High Court for arrears of rent, interest and costs. At the time the matter came before the Master there were no replying affidavits, the defendants being out of time limited for that purpose. The matter has been heard by way of rehearing before me and there are extensive replying affidavits and responses thereto.

3 The defendant accepts the calculation and prima facie entitlement of the plaintiff to the rents but have referred to a number of complex ongoing disputes arising out of their occupation of a significant portion of the plaintiff's property at Leopardstown, Co. Dublin. Accordingly the defendants assert defences by way of set off and also a counterclaim and seek to have the plaintiff's claim remitted for plenary hearing.

4 I propose, first, to set out as briefly as possible the nature of the disputes referred to by the defendants and then to indicate, again as briefly as possible, the submissions made by counsel on behalf of the parties.

Background

5 The plaintiff owns and operates a racecourse over a large tract of land at Leopardstown, Co. Dublin. By lease of 5th June, 1998, the first defendant occupied part of these lands upon which are constructed, inter alia, a large and complex sports facility, several outdoor tennis courts and indoor tennis courts underneath two air filled domes and ancillary buildings. They also enjoy, in common with the plaintiff, the right to have their patrons park their cars in two identified car parks at all times and on "race days" (somewhere between twenty and thirty days per annum) on further car parks designated by the defendant and on non-race days on the residue of a parcel of land referred to in these proceedings as "the yellow hatched lands" which lie between the buildings referred to and the south eastern motorway. The first defendant's entitlement to occupy the yellow hatched lands was made subject to part occupation thereof of the south eastern motorway and the arrangements between the parties made on 5th June, 1998, anticipated the provision by the plaintiff of a "new site" to be provided by the plaintiff in replacement of any of the first defendant's entitlements under the lease of 5th June, 1998, which would be affected by the motorway.

6 Because in June 1998 the anticipated CPO had not yet been served, the parties were unable at that time to identify particular areas which would be affected by it. Accordingly the arrangements then made were temporary in nature the general intention being that suitable alternative facilities would be granted to the first defendant to replace those lost to the CPO.

7 Events have moved on, the CPO has been served and the road has been built and indeed there were injunction proceedings dealt with by myself on 10th December, 2003, when I granted the first defendant (as plaintiff in those proceedings) an injunction restraining the building of a ramp intended for construction in connection with the then proposed motorway, portion of which trespassed onto lands over which the first defendant had rights. The injunction was granted in the context of a then anticipated imminent arbitration dealing with a number of disputes. It proved impossible, subsequent to the granting of the injunction, for the parties to agree the questions to be referred to arbitration and as a result of the delay the injunction was ultimately discharged by Murphy J. on 30th July, 2004, the ramp has subsequently been completed. The difficulties and delays continued and today in a separate judgment I have ruled on issues relating to the arbitrator's jurisdiction.

8 The foregoing is relevant in the instant context, however, because the claims (and losses) which have been referred to arbitration are relied upon by the first defendant by way of defence to the plaintiff's claim for rent. I will now set out these briefly so that the legal submissions of the parties can be more fully understood.

The Defendants” Claims

9 These are set out in a fifty four paragraph affidavit of the second defendant who is a director of the first. This elicited a seventy six paragraph response from Matthew O'Dwyer, General Manager of the plaintiff. There is a further twenty nine paragraph affidavit from Mr. Smyth, responded to by a thirty one paragraph affidavit from Matthew O'Dwyer and a third thirteen paragraph affidavit from Philip Smyth. There are voluminous exhibits to these affidavits and the hearing before me took substantial parts of two days in court devoted to legal submissions the affidavits being in the main read by myself outside of this hearing by arrangement with the parties. There is a claim that construction vehicles trespassed onto the first defendant's area for two days in January 2002, that there was a loss of thirty one car park spaces obliterated by the construction of a ramp, portion of which was trespassing on the defendant's portion of the yellow hatched area (after allowing for the CPO "take"), damage to an airlock at the corner of one of the two domes covering indoor tennis courts, and further damage to the sub-floor and foundations supporting this dome by the team engaged in constructing the ramp. A further claim complains that portion of the land occupied by this dome was wrongly conveyed by the plaintiff to the acquiring road authority and a further complaint relates to the inadequacy of the "new site" offered by the plaintiff to replace the facilities lost because of the CPO. The first defendant contends that because 5.5 acres of parking were taken for the new road the new site should have included, but did not, an area of this amount for parking. This issue has been referred to arbitration. There are mutual claims by the parties in relation to the other's alleged delay in progressing the arbitration but these were not particularly relied upon in Court.

10 The first defendant relies upon the background that, with its cooperation, the plaintiff has made a compensation claim to the road acquiring authority which yielded "almost €30 million" — the cooperation being a waiver by the defendant of its own claim for compensation in favour of merging it with the plaintiff's. A further complaint relates to an allegation that a sign at the entrance to the complex from the road does not conform to an agreement that the defendants” sports facility would be referred to at the top whereas its name appears at the bottom where it is difficult to read because of obstruction from foliage. Efforts to arrange a further sign have been deliberately frustrated according to the defendant. So also in relation to arrangements for a shuttle bus service from the front gate of the sports facility on race days, the allegation being that the plaintiff has deliberately refused to engage in negotiations which would minimise inconvenience to the first defendant.

11 In response to these complaints Matthew O'Dwyer's second affidavit (his first being in support of the claim for summary judgment for rent and interest) points out that the first defendant has been in continued occupation of the premises demised to it under lease and despite this the plaintiff has not received rent for three years. The defendant has continued to operate its sports and fitness business and no liquidated sum is due to it. All of the disputes are hotly contested and the relationship between the parties it is stated has reached a very low ebb. The vast bulk of the issues have been referred to arbitration. A background of non-cooperation by the first defendant is set out including an allegation that the first defendant initially delayed...