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[2004] IEHC 211
Record No. 2001/14106P
BETWEEN:
Plaintiffs
Defendants
MR. JUSTICE T.C. SMYTH DELIVERED HIS JUDGMENT, AS
FOLLOWS, ON WEDNESDAY, THE 9TH DAY OF JUNE 2004
MR. JUSTICE SMYTH:
The Plaintiffs are farmers who reside at Dublin Road, Mullingar, in the County of Westmeath. The Defendants are businessmen who reside in Mullingar. The Plaintiffs contracted to sell to the Defendants certain lands in Folio 14915F of the register of Freeholders, County of Westmeath, on 16th June 2000, for the sum of £4.5 million. The contract provided that the Defendants would pay the sum of £3,375,000 within six months from the date of the contract and the balance of £1,125,000 six months thereafter. The Defendants were to take possession of the lands, which have been referred to in the documents as "Stage I", on payment of £3,375,000, and on the final payment of £1,125,000 were to be given possession of Stage II of the transaction. The closing date provided for Stage I was six months from the date of the contract, ie, 16th December 2001, and the closing date for Stage II, being six months thereafter, was to be 16th June 2001. The contract also provided that if the sale was closed in total within twelve months or earlier the Defendants would be refunded by way of "luck penny" the sum of £20,000, provided that if there was a delay that the "luck penny" would still be paid if the delay was the default of the Vendors.It was appreciated by both parties that the lands were being bought for development purposes and that the purchase price reflected that clear common understanding.
Difficulties arose subsequent to the execution of the contract and ultimately a Completion Notice pursuant to General Condition 40 of the Conditions of Sale (1995 Edition) of the Law Society of Ireland (as incorporated in the said contract) was served on the Defendants on 12th July 2001.
These proceedings were formulated originally as specific performance proceedings, and the pleadings having been closed a compromise was arrived at in January 2003. The arrangement then made was that the Purchasers agreed to complete the purchase of the property not later than 31st January 2003, on payment of the full balance of the purchase money, on the basis that the ongoing litigation will continue excluding only the claim in respect of the purchase money. It was further agreed that the figure in respect of "luck penny" as specified in the contract would be held on joint deposit receipt pending finality in regard to the litigation and dependent on any specific court order or agreement as between the parties in regard to the "luck penny" pursuant to the terms of the contract. The proceedings gave rise to Discovery, that being sought and made in February 2003, and upon receipt and inspection of same the
Defendants sought, by Notice of Motion dated 19th March 2003, the following reliefs as against the Plaintiffs:-
1. An order dismissing the remainder of the Plaintiffs' claim herein, the contract the subject of the litigation having been completed on 31st January 2003. The Plaintiffs' further action for interests for delay cannot succeed.
2. An Order striking out the Plaintiffs' claim herein, in that the Plaintiffs' further prosecution of their claim following completion of the contract is actuated by malice and improper purpose.
3. An Order pursuant to Order 19, Rule 28 of the Rules of the Superior Courts and pursuant to the inherent jurisdiction of the court
striking out the Plaintiffs' claim as having no reasonable prospect or no prospect of success.
The Plaintiffs also brought a motion, dated 25th February 2003, seeking further and better discovery from the Defendants arising from the Discovery furnished by the Defendants on 24th January 2003, which was furnished pursuant to a court order dated 20th November 2002.
The motion to dismiss the proceedings was in order of hearing, first heard by the court and essentially it was directed to the claim being made by the Vendors for interest in the sum of £1.4 million. The case made for and on behalf of the Defendants was that, at the date of the completion, there were at least four major difficulties regarding title furnished by the Plaintiffs/Vendors to the Defendants/Purchasers. These concerned the following:-
(a) Non-disclosure to the Purchasers that a cluster of five Wavin pipes constituting a ducting or piping system were installed by the Electricity Supply Board on the subject property. In this regard, reference was made to a map of the ducting pipe line and photographs of same were exhibited to the court. A protracted correspondence from the Vendors' solicitors to the ESB was referred to in court and it emerged that prior to serving any Completion Notice proceedings had been brought by the Plaintiffs/ Vendors against the Electricity Supply Board in respect of a pipeline. These proceedings are still in being and are awaiting trial as at the date of the hearing of these motions.
(b) The nature and extent of way leaves and pipelines granted to Westmeath County Council by the Vendors and the extent to which the County Council unilaterally placed the pipeline as shown on the map attached to the way leaves furnished in response to requisitions on title was unclear. This had the effect or influence on the reserved open space and development potential of the lands to a significant extent and further it influenced to a great extent the necessary construction costs such as the shoring up of foundations as were near the extended pipeline area. The exact nature and extent of the way leaves and pipelines in favour of the County Council was not ascertained or provided for by way of grant of way leave until the week prior to the closing of the sale on 31st January 2003, and accordingly it is the case of the Purchasers that the Vendors at the date of the service of the Completion Notice were not in the position of being able, ready and willing to complete the sale in accordance with the contract. Indeed, in paragraph 31 of an affidavit sworn on 16th December 2003 by
Mr. Denis Shaw for the Plaintiffs/Vendors he avers as follows:
"It is the contention of the Plaintiffs/ Vendors that all issues, other than the alleged issue with regard to the way leaves with Westmeath County Council, which became a protracted issue as between the Plaintiffs/Vendors and the Defendants/ Purchasers, were resolved prior to the issue of the Completion Notice on the 12th day of July 2001."
The Defendants contended that the consequences of the non-disclosure of the existence of the pipeline and the extent of the disclosed pipeline by the Plaintiffs had caused undue delay, uncertainty and ongoing investigation by the Defendants, and had caused a significant loss of bargain. Furthermore, they claimed that the extent of a claim of another party, to wit Waterways (otherwise successor to CIE) to an area of land along the canal adjoining the premises in sale was the subject of very serious doubt on the title. This dispute also led to litigation a between the Vendors and Waterways.
(c) Difficulties were also caused as a result of what was stated to be an undisclosed claim to an easement of necessity from neighbouring lands for development. Those neighbouring lands apparently included lands of the father and perhaps the brother of the Plaintiffs (it is referred to as the Kelly claim). In summary, therefore, the claim of the Defendants was that the Plaintiffs were not, as of the date of the service of the Completion Notice, able, ready and willing to complete the contract in accordance with its terms and their obligations arising therefrom. Most, if not all, of the matters that gave rise to the litigation and were agitated before the court in the course of the hearing of the motions could be said to have arisen from the formulation of an application of planning permission by the Defendants. While the contract was not subject to the obtaining of planning permission, it was agreed by the Vendors that the Purchasers could proceed to formulate and apply for planning permission and the Plaintiffs/Vendors were disposed to being of as much assistance as they could be to the Defendants in that regard.
The difficulties, however, that arose could be categorised as falling under four headings:
(1) The claim of the ESB
(2) The way leaves of the County Council
(3) The way leaves of Waterways/OPW/CIE
(4) the Kelly claim.
THE CLAIM OF ESB
I am satisfied and find as a fact on the evidence placed before me that the claim for interest as against the Defendants in the period December 2000, and thereafter, attributable to the claim of the Electricity Supply Board are unsustainable. It was appreciated by the Vendors some considerable time before the closing of the sale that there was at least ducting in the property underneath the lands in sale and the ducting had been placed on the lands by the ESB. There was correspondence which appears to have been at cross purposes as to whether a 38KV cable, the property of ESB, ran through the lands in sale, and this confused an already contentious issue. Suffice it to say that the Vendors were sufficiently concerned about "clearing the ESB off the title" to issue proceedings against the Board on 25th January 2001. On 17th May 2001, the position of the Board became clear when that body wrote to the solicitors for the Vendors in the following terms:
"Dear Sirs,
With reference to your letter of 11th May, ESB does not accept that it has any liability for the failure of the Purchasers to fulfil their contractual obligations to your clients.
In the first instance, there is no electricity cable on your clients' lands at present. Permission to lay a cable was received orally from your clients prior to the carrying out of any works by ESB, but the only works carried out to date on your clients' lands are the laying of a conduit for a proposed electricity cable. On 11th January this year a letter was issued by ESB to Westmeath County Council requesting them to disregard the presence of a cable in considering the planning application of C&F Developments as ESB was prepared to alter, reposition or relocate the underground cable if there was a conflict between any permitted development and the cable. The Purchasers were informed of this on the same date and copies of both letters were sent to you.
However, up to last week C&F Developments had failed to furnish Westmeath County Council with any response for additional information. Westmeath County Council requested information some time in March/April 2001, on a long list of disparate issues (eg, density of housing, traffic, height and scale, overlooking, conflict with the Development Plan, footbridge, harbour, sewage, etc). Until this information is received by Westmeath County Council, processing of C&F Developments' application cannot proceed. C&F Developments are well aware of this fact.
In addition, an inspection of the planning file in the offices of the County Council will show that the substantial reason for the delay in determining the planning application by C&F Developments is a number of objections received to the proposed development.
ESB, therefore, fails to see how it is being held up as the sole reason for C&F Developments' planning permission not advancing when it is quite clear there are other more pressing issues affecting its progress.
However, we have now informed the County Council that we are not proceeding with the proposed cable along this route. ESB agreed to abandon the conduit crossing your clients' lands and are actively selecting a new route. The existing conduit can be demolished during the earthworks stage of the development when it takes place."
Between December 2000 and 17th May 2001, there can be no liability on the part of the Purchasers to pay the Vendors any interest. Even if there is a claim for interest for this period, and it is by no means certain that there is, it may not be the liability of the ESB and it is not the responsibility of the Purchasers. Because, even as of 12th July 2001 the question of the way leave(s) of Westmeath County Council had not been resolved. In my judgment, the Purchasers were reasonable in refusing (as they could be said to have done so) to close the sale in respect of the objection referable to ESB before 17th May 2001. As of 12th July 2001, (notwithstanding proceedings 2001/2295P), such problem(s) as existed (if ever and any) as the result of any act or default of the ESB did not and was not a cause of the non-completion of the sale of the parties to these proceedings.
THE WAY LEAVES OF THE COUNTY COUNCIL
The difficulties arising from way leaves granted in favour of Westmeath County council were compounded by the fact that when the copy documents were being made available to the Purchasers as part of the contract a way leave of 1987 which did have a map was attached to a way leave of 1999 which did not have a map attached to it. Furthermore, the pipeline as indicated in the map attached to the way leave did not accurately reflect the actual location of the pipe in the ground. Because of the necessity of providing certain areas for work and maintenance on either side of the pipeline, which had the pipeline been set or put down in or on the line provided for in the map of 1987, perhaps no difficulties may have arisen. It appears the pipes and/or ducts may have been laid in accordance with the map attached to the 1999 way leave agreement, but such map was not furnished by the Plaintiffs/Vendors to the Defendants/Purchasers at the time of entering into the contract and therefore did not form part of the signed contract.
However, that was not the case and accordingly a considerable bulk of correspondence was exchanged not only between the solicitors of the parties but between the County Council and their solicitors and particularly with the solicitors for the Vendors. Both parties engaged surveyors; Messrs Malachi Cullen & Partners were engaged by the Vendors and Messrs Coughlan & Associates, architects, were engaged for the Defendants. I am satisfied and find as a fact that as of the date of the service of the Completion
Notice on 12th July 2001 that the matters of the way leaves had not been cleared up either to the satisfaction of the Vendors or Purchasers, and while the Vendors may not necessarily have been concerned about this (in the same way as the Purchasers), it is clear from correspondence from that time, and Malachi Cullen & Partners, from September 2001 onwards, that the matter was unresolved. I am satisfied and find as a fact that as of the date of the issue of the plenary summons in these proceedings (September 2001) the Plaintiffs/Vendors, through their solicitors, had been advised by their own engineers that certain steps still required to be taken to resolve the mapping, measurement and boundaries of the way leaves. (The Defendants/Purchasers only became aware of these facts after Discovery was made by the Plaintiffs/Vendors.) I am satisfied that the ultimate true position claimed to be as set out in a letter of 21st November 2001, from Messrs Coughlan & Associates, architects, to the Purchasers' solicitors is correct.
Without making any concession to the Purchasers, the Vendors' solicitors, in a letter of 28th November 2001, addressed to the Secretary of Westmeath County Council, dealt at length with the problem of the respective way leaves and the points raised by Messrs Coughlan & Associates. It concludes as follows:-
"There are very substantial issues arising by virtue of the delay in completion of the sale in monetary terms. The pipeline/way leave is the only outstanding issue. Interest on the unpaid purchase money accrues at £1,497 per day. We have had a consultation with counsel on Friday evening last and it has been confirmed by senior counsel that the failure of the County Council to reply to recent correspondence is not at all helpful to the issues in the High Court proceedings.
In the light of the issues raised in correspondence, it would appear that there would be advantage to marking the boundaries of a way leave clearly with marker posts and also separately marking the line of the sewer pipe through the way leave so that it can be apparent on the surface of the ground as to the exact demarcation of the boundaries of the way leave and also the line of the pipe through the specified way leave. We presume that this would not cause much difficulty and you might revert to us. Delay in dealing with the issues as set out above and dealing with the correspondence generally will leave the Vendors with no alternative but to join Westmeath County Council in the existing proceedings or in such separate proceedings as counsel may direct."
Correspondence between the County Council and their advisors and between the parties hereto and their advisors continued over a period until the matter of the nature and extent and mapping and measurement of the way leaves was finally resolved in January 2003. The problem of the Purchasers was that they purchased a parcel of land and when documentation was received the conditions on site varied from those shown on such map or maps as were furnished to them. They could not be expected to buy into a law suit or close a sale when the Vendors were not in a position to give good marketable title and clearly explain whatever discrepancies had been highlighted in the correspondence. Appreciating the argument that was made in the course of the hearing that any developer would be anxious to have as clean a site as possible so as to maximise such development as might be possible on the site, I am nonetheless satisfied that notwithstanding that the number of linear metres by which the pipeline might be said to be out of "alignment" per the maps furnished with the way leave, does not mean that the Purchasers were obliged to conclude a sale which had certainly to adopt the Plaintiffs/Vendors' euphemism, "paper difficulties". In my judgment, this was not a case of mere paper difficulties -- the difficulties were real and not imaginary.
The position taken by the County Council as to their amenability to meet such requirements as had been raised in the correspondence is particularly set out in their letter of 12th December 2001, some six months after the Completion Notice. The deviation from the line of the pipe was "approximately three linear metres at the southern end of the Birminghams' way leave", and by letter of Westmeath County Council, dated 12th December 2001, or expressed in a memorandum prepared by the Vendors' solicitor, was in the following terms:-
"This way leave would meet with the amended requirements of Mr. Coughlan, it would correct the error in the existing way leave where the map on the June 1999 reference number 16 way leave agreement is short by a number of metres."
This is not the issue. The real issue was that the Purchasers could not be expected or should not have been expected in buying development land to have been obliged to accept a title which was problematic in this regard. This was not a matter of trifling materiality, it was not de minimis in the context of land clearly and known by both parties to be development land.
Even if it were argued that this memo might not be available to a Defendant in evidence in the trial, there is no dearth of evidence of the like character which would be available. While it is true, as submitted by Mr. Allen for the Plaintiffs/Vendors, that their solicitor did not accept that the Defendants/Purchasers were entitled to all they were looking for in good, clear, marketable title in accordance with the contract, I do not accept that the steps taken by the Plaintiffs/Vendors were carried out merely to accommodate the Defendants/ Purchasers so as to bring the sale to a conclusion. The kernel of this case is the efficacy of the Completion Notice. I am satisfied and find as a fact and as a matter of law that as of the date of the Completion Notice and at the extended date accorded to the Purchasers to comply therewith the Plaintiffs/ Vendors were not able, ready and willing to complete the sale in accordance with the contract.
THE WAY LEAVES OF WATERWAYS/CIE
Another difficulty that arose in connection with this sale was referable to a small, narrow piece of land adjoining the Royal Canal which was adjacent to the lands in sale, the property of the Vendors. It is clear from the documentation presented to me that there was, before any contract of sale was entered into, correspondence between the Vendors' solicitor and the Office of Public Works (OPW), the original owners of the Royal Canal and whose interests had passed to them from CIE and eventually through the OPW to Waterways. Subsequent to the signing of the contract, in a letter dated 25th September 2000, the Purchasers' solicitors referred to two agreements with Westmeath County Council, attached to the back of one of which was a licence between Francis Birmingham and CIE, with an attached map which included part of the lands which the Vendors had purported to sell to the Purchasers. This was the first of many letters arising out of the replies to requisitions, in respect of requisition 3, the queries and responses to which were as follows:-
"Easements and Rights
1(a) Are there any pipes, drains, sewers, wires, cables or septic tank on, under or over other property which serve the property on sale?
Reply: None other than those disclosed from muniments of title or would be apparent from inspection.
(b) If there are, furnish now evidence of the easement grant or way leave authorising same.
Reply: Copy agreement and consent of Frank Birmingham with Westmeath County Council dated January and March 1987. Copy, agreement and consents of Robert Birmingham and George Birmingham with Westmeath county Council dated 1st November 1999.
(c) What are the Vendors' rights and obligations in respect of same?
2(a) Is the property subject to any right of way, water, light, air or drainage, or any other easement, reservation, covenant, condition or restriction, or to any right of any kind, or
(b) is the property subject to any liability to repair any road, sewer, drain or sea wall, or any other similar liability?
(c) if so, furnish now details of same.
Reply: See reply to requisition 3.1. The Vendors believe the OPW/Waterways Ireland have a right to access the property in order to maintain and clean the canal."
The document disclosed was an agreement made on 3rd February 1969, between Francis Birmingham and CIE. It was effectively a form of licence permitting Mr. Birmingham to graze part of the lands of the Royal Canal in the Townland of Petitswood and Ballinderry, as shown coloured red on Plan 1707/6, which is attached to the agreement, which claimed an annual licence fee of one pound five shillings. The obligation arising thereunder provided as follows: "During the continuance of the said licence I shall herd, tend and keep from straying all
animals thereon, and shall maintain and keep the drains, water courses, fences, ditches, hedges and gates in and upon the said land in good order, repair and condition, and shall keep the said land free from noxious weeds as by law required and indemnify the Board for and against any omission so to do."
It was further agreed that the Board may determine the licence at any time on one month's notice in writing in the event of the Board requiring the land for their own purposes or in the event of any breach of the licensee of any of the conditions attached to the licence. There was a prohibition on "assigning, sub-letting or parting with possession of the lands or any portion thereof under any pretence whatsoever, this licence being solely for temporary convenience". Proceedings were issued by the Vendors' solicitors to assuage the concerns of the Purchasers' solicitors, particularly in a letter of 8th November 2000, but nonetheless not only were proceedings initiated against Waterways Ireland Limited on 15th January 2001, they were not discontinued until 12th June 2001, so clearly the Vendors had a concern vis-a-vis the sale, that there was something that required resolution such as warranted the institution of litigation. That was referred to again by the Vendors' solicitor in a letter of 5th July 2001, which on dealing with this topic to the Defendants/ Purchasers' solicitors, under paragraph (5), concluded as follows:
"Waterways, through their solicitors, have acknowledged the absolute title of the Vendors to the entirety of the property of which the Vendors are registered owners. Inherent in that acknowledgement is the fact that they could not therefore presume to grant any rights in favour of a third party over the lands and not a shred of written evidence has been produced by your clients to support such allegations. It would appear that in advising the Purchasers on this issue you are choosing to ignore the fundamental legal criterion to create an enforcement of way leave."
The problem, however, with Waterways was not simply that Waterways had expressly granted a way leave to Mr. Francis Birmingham, father of the Plaintiffs (before he transferred the lands in sale to the Vendors herein), but there had been apparently some informal arrangement between Westmeath County Council and Waterways Limited concerning the laying of a pipe in lands which the Vendors had an interest. This is compounded and confirmed in a letter dated 10th July 2001, by the Vendors' solicitors to the Secretary of Westmeath County Council, which, inter alia, states as follows:-
"We will require confirmation pursuant to the terms of your letter that the County Council acknowledged that they have no claim in respect of any way leave over the area alleged to have been repudiated by Waterways on the basis that they have withdrawn any claim in title over the particular area of the lands comprised in the registered holding of Robert and George Birmingham. This will finalise matters to the satisfaction of the Vendors and this letter is required by return.
The effect of the last paragraph of the letter of July 9th does not effectively confirm that the County Council acknowledged the repudiation of Waterways to cancel out any such alleged way leave agreement as exists."
This was followed by a further letter of 13th July 2001 (the day after the Completion Notice) from the Vendors' solicitors, again to the County Council, in which it is stated, inter alia, as follows:-
"We require by return an acknowledgement by Westmeath County Council that they fully acknowledge their repudiation of Waterways of any claim to a way leave in favour of Westmeath County Council over the area between the way leave granted by Robert and George Birmingham and the canal bank on the basis of the acknowledgement of Waterways of the title of the Vendors to this area.
Unless we receive this letter, the County Council remain in the frame as liable for damages for delay in completion of sale in the event that this continues as an issue between the Vendor and the Purchaser. This letter and previous correspondence by the Council will be used in support of this claim."
Correspondence goes on to reveal a situation that in a letter of 1st August 2001 the Vendors' solicitors, in writing to Messrs Arthur Cox & Co (solicitors for Waterways Limited), they acknowledged that "we have had an exchange of correspondence from the Council and their solicitors and indeed are more than surprised that copies of maps prepared by the Westmeath County Council have now come to light in respect of the temporary and permanent way leave referred to".
It was not until 28th August 2001 that the Purchasers' solicitors were in a position to write to the Vendors' solicitors concerning the way leave of Waterways Ireland problem that had arisen in the following terms:-
"Subject to the letter from Arthur Cox & Co re waterways being dealt with on an open basis, they are satisfied with the recent letter from Arthur Cox & Co confirming no rights of access over the property. We have dealt with this matter in ours of 27th inst."
It is clear to me, having considered the correspondence and the submissions of counsel, that for approximately a month or more after the issue of the Completion Notice the Purchasers were within their rights questioning the closing of the sale until matters were put beyond yea or nay. I am satisfied and find as a fact that, as in the case of the ESB, there had been activity on the land or premises of the Vendors, in discussion at least, less than a year prior to the making of a contract in 2000, and whatever documentation may have been absent as between the Westmeath County Council and Waterways Ireland Limited, the Vendors, it seems to me, quite clearly were aware that some pipes or pipes had been laid in the ground and there was no express provision in this regard in the contract of these facts.
THE KELLY CLAIM
This problem arose concerning the title of the property prior to any Completion Notice being served and arose as a result of certain lands adjacent to that of the Vendors but owned, it would appear, by a Mr. Tom Birmingham (and perhaps Mr. Frank Birmingham,
father of the Plaintiffs) being sold to a Mr. Kelly. This apparently arose in or about February 2001, so far as the Purchasers and the Defendants in this case are concerned, and they took the matter up with the Vendors' solicitors in correspondence at that time. It would appear that Mr. Kelly was given either a way leave or an indication that such was available to him over the lands in sale in these proceedings. Mr. Kelly was also a man who apparently bought land for the purpose of building and while the lands in sale in the instant case were serviced, it was clear that Mr. Kelly had hoped to tap into or connect into the services on the land the subject of the sale to the Defendants. No such provision was made for this in the contract at the time of negotiation or at its being concluded. It is not necessary for present purposes to go into the details of the to-ing and fro-ing between the respective solicitors and the attempts made by Mr. Kelly to seek or to avail himself of the services that were in the land in sale in these proceedings. Suffice it to say that in a letter dated 27th February 2001 the Purchasers' solicitors clearly articulated the concern of their clients to the Vendors' solicitors in the following terms:
"Of concern is, the fact that Mr. Kelly is clearly making a case that he has a legitimate way leave agreement through our clients' lands. The suggestion from Mr. Kelly's solicitor is that our clients are now on notice of, as they put it, of Mr. Kelly's rights which they point out predates our clients' contract. They expect a court to 'favour Mr. Kelly in any disputes with our clients'."
The matter remained one of concern to the Purchasers and, in my view, reasonably so, until approximately 11th June 2001. In the light of the correspondence of the claim being made by Mr. Kelly, I do not think that the Purchasers were unreasonable in being concerned to ensure that if they concluded the sale they would not be buying a law suit involving Mr. Kelly. However, this matter was concluded to the satisfaction of the Purchasers before the Completion Notice and it does not concern the validity of the Notice, but in my view does satisfactorily explain the alleged delay referable to this. The fact that other matters were outstanding and that the sale could not otherwise be concluded is quite a separate issue.
An issue was raised by the Defendants/Purchasers concerning the obtaining of a Capital Gains Tax Clearance Certificate, but this matter was very properly not pursued by Mr. Hussey on their behalf. This matter was resolved and its non availability on 12th July 2001, the date of the Completion Notice, of itself, would not have invalidated the Notice.
SUMMARY
At the date of the Notice to Complete there was no problem inhibiting the vendor closing the sale with the Purchaser arising from the claim of the ESB, Waterways or the Kelly claim. There were various problems concerning and regarding the way leaves of the County Council and these continued to within an hour of the closing of the sale on 31st January 2003. Neither at the date six months from the date of the contract or on the date of the Completion Notice or its expiry or at the extension of the time accorded by the Plaintiffs/Vendors to the Defendants/ Purchasers were the Plaintiffs/Vendors able, willing and ready to complete the sale in accordance with the contract.
THE PROCEEDINGS
The matter came before the court on different dates separated by approximately six months. occasion, the Defendants' motion, under Order 19, Rule 28, and the inherent jurisdiction of the Court was advocated by the Defendants, but the Plaintiffs submitted they ought not to be obliged to respond thereto until their motion for further and better Discovery was considered and ruled upon. The dispute concerning Discovery centred on a claim of privilege in the Defendants' affidavit, which was questioned by the Plaintiffs. It was agreed that I should assume the burden of examining such documents and that an order be made to discover such documents in respect of which I considered privilege had been improperly claimed and that the Plaintiffs/Vendors be entitled to file an additional affidavit in the proceedings confined to such recently discovered documents. This limitation was imposed so as to preserve the integrity of the proceedings as they stood on the adjournment arising from the Plaintiffs' motion.
Notwithstanding the Defendants having made Discovery in early 2003, the Plaintiffs, up to and including the date of the final hearing of the applications on 20th May 2004, had not troubled to inspect the same.
COMPLETION NOTICE
It is an undisputed fact that Condition 40 of the General Conditions provides for Completion Notices: to the extent relevant to the present proceedings, it provides as follows:
"40. Save where time is of the essence in respect of the closing date, the following provisions shall apply:
(a) if the sale be not completed on or before the closing date, either party may on or after that date (unless the sale shall first have been rescinded or become void) give to the other party notice to complete the sale in accordance with this condition, but such notice shall be effective only if the party giving it shall then be able, ready and willing to complete the sale or is not so able, ready or willing y reason of the default or misconduct of the other party." (emphasis added)
The penal and draconian nature of a Completion Notice has been recognised by the courts (Viscount Securities Ltd -v- Kennedy, unreported Supreme 6th May 1986). The importance for the person themselves serving such a notice to be able, ready and willing to complete the sale has long been the subject of several decided cases, the most recent perhaps being Tyndarious Ltd -v- O'Mahony & Ors (unreported Supreme Court 3rd March 2003). In that case, the Plaintiff/Purchaser sought declaratory relief that the Defendants were not, at the date they served the Completion Notice, able to complete the sale and that their failure or inability to make good title to the lands in question rendered the notice invalid. Keane CJ, delivering the judgment court, dismissed the Defendants' appeal, holding that the Defendants were not in a position to complete the contract and make title to the property in accordance with the contract. The Completion Notice being invalid gave rise to an entitlement of the Plaintiff to rescind the contract in accordance with its terms.
THE LAW AND LEGAL SUBMISSIONS
There is a clear distinction between a case that may be dismissed under Order 19, Rule 28, where the court can only make an order when a pleading discloses no reasonable cause of action on its face and a case that may be dismissed by invoking the inherent jurisdiction of the court, where the court is not limited to the pleadings of the parties but is free to consider evidence on affidavit. The underlying principles on which the court exercises this jurisdiction (and it is one to be used sparingly and only in clear cases) are well established in the decided cases and their purpose is to ensure that there is no abuse of process of the court; thus, proceedings that are vexatious or frivolous will be stayed.
In the instant case, there is no dispute as to the contract document or the correspondence. In this context, the judgment of Costello J in Barry -v Buckley [1981] IR 306 at 308 is in point:-
"If, having considered the documents, the court is satisfied that the Plaintiff's case must fail, then it would be a proper exercise of its discretion to strike out proceedings whose continued existence cannot be justified and is manifestly causing irrevocable damage to a Defendant."
In his submissions on behalf of the Plaintiffs/ Vendors, Mr. Allen laid considerable stress on that part of the judgment of the Supreme Court (delivered by McCarthy J) in Sun Fat Chan -v- Osseous Ltd [1992] 425 at p.428/9, under the heading "Jurisdiction". The instant case is clearly distinguishable from Sun Fat Chan not only in its facts but also, and crucially, as to the state of the pleadings. In Sun Fat Chan matters had only reached the Statement of Claim when the Defendant brought a motion to dismiss the action. In the instant case, not only were pleadings closed and the main substantive issues settled between the parties, leaving only the issue of interest outstanding, but full Discovery had been made. In my judgment, there is no disputed facts put before the court, but argument was advanced as to how the facts could or should be interpreted. Commentary in affidavits that may be disputed is not the same as undisputed facts. If they were treated as interchangeable or one the equivalent to the other, applications under Order 19, Rule 28 and/or under the inherent jurisdiction of the court could be circumvented by what, in effect, would be a devise in defeasance of a jurisdiction.
In this case, there were three problems known to exist during the first six months of the contract; thereafter, a fourth arose (viz the Kelly claim). The Plaintiffs/Vendors sued both the ESB and Waterways Limited. Both these problems, and the Kelly claim, ceased to exist at the date of the Completion Notice; but notification and acceptance was not coincident with the date of Notice to Complete. Throughout the entire period, from 6th December 2000 to 31st January 2003, the problems arising from the way leaves of Westmeath County Council existed. In my judgment, the Defendants/ Purchasers were not responsible for the delays encountered in bringing the sale to a conclusion on 31st January 2003.
In my judgment, this is a clear case and it can certainly be said that there is no prospect that the action, if allowed to proceed to trial, will succeed. Likewise, as considerable injustice could result if the matter is not disposed of now, to permit the case to proceed to trial would be to permit an abuse of the court's process and an unfair vexation of the Defendants.
END OF JUDGMENT