Walsh v Kearney
| Jurisdiction | Ireland |
| Judge | Mr. Justice Quinn |
| Judgment Date | 11 February 2020 |
| Neutral Citation | [2020] IEHC 52 |
| Docket Number | [2012 No. 843 P] |
| Court | High Court |
| Date | 11 February 2020 |
AND
[2020] IEHC 52
Quinn J.
[2012 No. 843 P]
THE HIGH COURT
Damages – Breach of contract – Costs – Plaintiffs seeking damages – Whether the plaintiffs had consented to the works the defendant undertook
Facts: The plaintiffs, Mr Walsh, Mr O’Brien, Mr Field and Mr Brady, owned a building at No. 56 MacCurtain Street, Cork, having acquired the long leasehold interest on 19th April 2005. By a lease dated 5th June, 2006, they leased the ground floor of the building to the defendant, Mr Kearney, for a term of 25 years from 1st June, 2005. In reliance on arrears of rent, the plaintiffs effected a peaceable re-entry of the ground floor on 2nd December, 2009. The plaintiffs claimed that the condition of the building at the time when they re-entered it was such as to necessitate extensive repair works to be undertaken. They claimed also that the condition of the premises was caused by alterations made by the defendant to the ground floor without their prior consent. They claimed damages in respect of the costs of repair incurred by them and other costs including loss of rental income until the building was fit to be re-let in July, 2010. The defendant claimed that the plaintiffs had consented to the works he undertook and denied that his works had the effect claimed by the plaintiffs or were the cause of the cost which the plaintiffs incurred in their remedial works after re-entry. He counterclaimed for the value of chattels which he claimed were his property and were on the premises at the time of the re-entry and which the plaintiffs wrongfully failed to return to him. He also counterclaimed for the costs of the works undertaken by him but that element of the counterclaim was not pursued at the trial.
Held by the High Court (Quinn J) that: 1) €279.50 for the replacement of locks was incurred as a necessary consequence of the validly effected re-entry and would be allowed in full; 2) €326.88 for the repair of the alarm flowed as a consequence of the re-entry; 3) €1,996.50 for the new fire certificate application arose as a consequence of the defendant’s actions and would be allowed in full; 4) €907.50 for the design of a new support structure arose as a consequence of the defendant’s actions and would be allowed in full; 5) €300 for the extra replacement of fire extinguishers related to necessary works and would be allowed; 6) €13,915 for the building works to the property would be allowed in full; 7) €4,029.25 for the fire exit works had been properly incurred and would be allowed in full; 8) €7,609.59 for the legal fees in respect of the Circuit Court licencing application had been properly incurred and would be allowed in full; and 9) for the loss of rental income (six months) December 2009 to May 2010, one half of the amount claimed in respect of rent, which was one quarter of the then prevailing annual rent, namely €16,250, would be allowed. Quinn J held that, in circumstances where the defendant abandoned possession of the premises without either a surrender or any orderly communication with the plaintiffs, he could not later assert that the plaintiffs acted unlawfully in relation to the contents; if the defendant had sought to make an orderly departure from the premises by agreement with the plaintiffs, it would have been a matter for him to ensure that appropriate arrangements, including removal of chattels if necessary, were in place and this he failed to do.
Quinn J held that he would order that the defendant pay to the plaintiffs damages for breach of contract in the amount of €45,614.22.
Damages awarded. Counterclaim dismissed.
The plaintiffs are businessmen who own a building at No. 56 MacCurtain Street, Cork, having acquired the long leasehold interest on 19th April 2005. By a lease dated 5th June, 2006, they leased the ground floor of the building to the defendant for a term of 25 years from 1st June, 2005.
In reliance on arrears of rent, the plaintiffs effected a peaceable re-entry of the ground floor on 2nd December, 2009. The plaintiffs claim that the condition of the building at the time when they re-entered it was such as to necessitate extensive repair works to be undertaken. They claim also that the condition of the premises was caused by alterations made by the defendant to the ground floor without their prior consent. They claim damages in respect of the costs of repair incurred by them and other costs including loss of rental income until the building was fit to be re-let in July, 2010.
The defendant claims that the plaintiffs had consented to the works he undertook and denies that his works had the effect claimed by the plaintiffs or were the cause of the cost which the plaintiffs incurred in their remedial works after re-entry. He counterclaims for the value of chattels which he claims were his property and were on the premises at the time of the re-entry and which the plaintiffs wrongfully failed to return to him. He also counterclaimed for the costs of the works undertaken by him but that element of the counterclaim was not pursued at the trial.
On 19th April, 2005 the plaintiffs purchased the long leasehold interest in the building for €1.5million. One of the plaintiffs, David Brady had previously carried on business from a portion of the premises.
When the plaintiffs purchased the building the ground floor had been trading as a bar known as the Agora Bar.
The first floor had been occupied as office space and the second floor as an apartment. The first and second floors have been the subject of refurbishment works from time to time, but the issues giving rise to these proceedings relate to works undertaken at the ground floor level.
The plaintiffs granted possession of the premises to the defendant as of 1st June, 2005. They also agreed to transfer to him the Ordinary Seven Day Publicans On Licence attached to the ground floor.
The plaintiffs agreed that the defendant could convert the Agora Bar into an off licence/wine shop which he was planning to open, to be known as the Naked Grape.
The lease of the premises was executed on 5th June, 2006. The term was 25 years from 1st June, 2005. The initial yearly rent was €40,000, increasing by €5,000 per annum for each of the first five years, and rent reviews every five years thereafter.
In many respects the terms of the lease were standard in that it included covenants for the payment of rent, insurance premiums, to discharge outgoings and to comply with relevant enactments and fire requirements. It included covenants concerning maintenance and repair of the building, prohibiting alterations without consent, prohibiting change of use, assignment or underletting without prior consent, prohibiting obstruction of doorways windows or other openings, covenants requiring compliance with planning acts and covenants indemnifying the landlord in respect of any claims arising from the state of repair or condition of the building.
A number of the clauses in the lease are of central importance to the determination of these proceedings.
Clause 3.3 concerns “enactments” and provides as follows:
“At all times during the said term to observe and comply in all respects with the provisions and requirements of any and every enactment for the time being in force or any orders or regulation thereunder for the time being in force or any orders or regulation thereunder for the time being in force …”
Clause 3.4 provided as follows:
“At all times during the said term to comply with all the recommendations or requirements or the appropriate Authority whether notified or directed to the Landlord or the Tenant in relation to fire precautions and to indemnify the landlord against any costs or expenses in complying with any such requirement or recommendation …”
Clause 3.6 provided as follows:
“To keep clean and tidy and to repair and keep in good order, repair and condition from time to time and at all times during the term hereby created the interior of the demised premises …”
Clause 3.12 concerned alterations and modifications and provided as follows: -
“Not to erect or suffer to be erected any buildings or erections on the demised premises save as here in before provided nor without the previous consent in writing of the Landlord to cut alter maim or injure or permit to be cut altered maimed or injured any of the ceilings roofs walls floors or timbers of the demised premises or alter or change or permit to be altered or changed the plan elevation or architectural decorations thereof or alter any of the Landlord's fixtures fittings and appliances in and about the demised premises or make or permit to be made any external alterations or additions whatsoever.”
Clause 3.18 provides as follows:
“Not to use or permit the demised premises or any part thereof to be used for any purpose other than as an Off Licence and Shop and for no other purpose save with the Landlord's written consent which consent shall not be unreasonably refused.”
Clause 3.20 provides as follows:
“Not to assign transfer or underlet or part with the possession or occupation of the demised premised or any part thereof or suffer any person to occupy the demised premises or any part thereof as a licensee but so that notwithstanding the foregoing the landlord shall not unreasonably withhold its consent to an assignment of the entire or underletting of the entire or part of the demised premises subject to the following provisions as such then as may be appropriate [namely requirements regarding information and costs and appropriate covenants of the part of an under lessee].”
Clause 3.30 contained provisions regarding the “yielding up” obligations...
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