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Cite as: [1998] IEHC 122

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Beshoff Brothers Ltd. v. Select Service Partner Ireland Ltd. [1998] IEHC 122 (28th July, 1998)

THE HIGH COURT

No. 1998/8102 P

BETWEEN

BESHOFF BROTHERS LIMITED

PLAINTIFF

AND

SELECT SERVICE PARTNER IRELAND LIMITED

DEFENDANT

JUDGMENT of O'Sullivan J. delivered 28th day of July 1998.

1. The Plaintiff is a well-known fish and chip outlet operator and seeks to compel the Defendant to include its name and brand as an element in a forthcoming tender for the catering concession in Dublin Airport to be submitted to Aer Rianta before the end of August. This application is made to enforce an agreement dated the 24th June 1998 of which a memorandum of agreement has been signed by the parties. Because this memorandum, at Clause 8, refers to the intention of the parties to "enter into a more formal agreement subsequently" it has been referred to as a "heads of agreement" , although it is not so self-styled.

2. Subsequent to this agreement, and I accept in good faith, the Defendant discovered that it had an overall agreement with Harry Ramsden plc which is currently in existence and whereby it has agreed:-

"....for itself and on behalf of its group companies not... to undertake or become concerned in or have any interest in any capacity whatsoever in any fish and chip business in any company in the world...."

3. Simply put, the Defendant now says that it has two conflicting contractual obligations and that any Court Order compelling it to specifically perform its contract with the Plaintiff will cause it to be in breach of its agreement with Harry Ramsden plc.

4. It accepts that it is or intends to be in breach of its agreement with the Plaintiff, but it says that the Court should not make an interlocutory mandatory Order requiring it to specifically perform that agreement for the following reasons:-

1. The agreement is not complete: specifically there is no termination

clause. Clearly any reasonable termination clause would at most allow one year's termination period and since it is not intended that the Plaintiff's outlet would open prior to the year 2000, the agreement could - at least arguably - be terminated prior to that date. An Order directing inclusion of the Plaintiff in the Defendant's tender would, therefore, fail to reflect this reasonable view of the contractual relationship between the parties;

2. Damages is an adequate remedy: the fact that damages may be difficult to calculate does not mean that they are not an adequate remedy;

3. The balance of convenience clearly favours the Defendant. The effect of an Order would preclude the Defendant from tendering, or force them to tender on a basis which could undermine their arrangements at Dublin Airport by reason of the consequential breach of their agreement with Harry Ramsden plc. They refer to two hundred catering jobs in Dublin Airport which are involved and say that damages would clearly be an inadequate remedy;

4. The Plaintiff, they say, is free to tender to Aer Rianta in its own right. The Defendant undertakes not to include Harry Ramsden plc or any other fish and chip outlet in its tender. The Defendant says that damages is an adequate remedy for the Plaintiff.

5. On the other hand the Plaintiff says:-

1. This case is unusual in that it is a clear case in the sense that the Court at trial will be in possession of no better evidence or material on the legal question between the parties than it is now because the Defendant admits that it is or intends to be in breach of its agreement;

2. Furthermore, the contract is clear and any ambiguity relates only to clauses which are not relevant at this stage because the Plaintiff is seeking to enforce the unambiguous clauses;

3. The Court by refusing an injunction would be permitting the Defendant to select by reference to its own best advantage and contrary to the requirements of justice which contract it would breach. By making an Order the Court would be effectively compelling the Defendant to breach its agreement with Harry Ramsden

plc; whereas by refusing to make an Order it is allowing the Defendant to break its contract with the Plaintiff thereby handing over the election to the Defendant itself.

CONCLUSIONS

1. I consider that the agreement is sufficiently clear and unambiguous for present purposes;

2. I agree with the Plaintiff that the Court is now in as good a position as it will be at the trial of the action on the central legal issue between the parties in the sense that the Defendant accepts that it is or intends to be in breach of its agreement with the Plaintiff;

3. That being so, I consider that I should approach this application in accordance with the principles laid down by the Supreme Court in Dublin Port and Docks Board -v-Britannia Dredging Company Limited (1968 IR 136) and in particular by the then Chief Justice O'Dalaigh C.J. at page 147 where he said:-

"...and the position is therefore not different from what it would be if at the trial the Court should reach the same conclusion. The principle stated in Doherty -v- Allman (1907:AC:351) is accordingly applicable and the Court is not concerned to examine either the balance of convenience or the amount of damage".

6. I must, accordingly, enforce the agreement unless in the exercise of my discretionary jurisdiction I should refuse the remedy of specific performance.

7. If this were the Plenary hearing of the action I would have to consider the Defendant's plea of mistake. I would have to consider, not whether the Plaintiff is entitled to a remedy (which in principle it clearly is) but whether the Court in its discretion should refuse the remedy of specific performance on the grounds of the Defendant's mistake, including a consideration of whether the hardship which the Order of specific performance will cause to the Defendant is such as would warrant a refusal of the relief of specific performance to the Plaintiff.

8. I do not think the kind of hardship now prayed in aid by the Defendant - the hardship anticipated (but not necessarily certain) as a consequence of its breach of its agreement with Harry Ramsden plc - is of the order of hardship which justifies a Court in refusing a decree of specific performance to which a Plaintiff is otherwise entitled. I refer generally to the judgment of Costello J. (as he then was) in O'Neill -v- Ryan (3) (1992:1:IR:191).

9. Against this hardship is the hardship of the Plaintiff if I refuse a decree of specific performance. The Plaintiff would be deprived of an enhanced opportunity of procuring a premier international showcase for its fish and chip outlet and I do not consider damages an equivalent remedy to a decree of specific performance.

10. Accordingly, I will make the Orders sought by the Plaintiff at paragraphs 1 and 2 of the Notice of Motion.