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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> Moffett & anor -v- O'Hare & McGovern Ltd & ors [2014] IEHC 368 (25 July 2014) URL: http://www.bailii.org/ie/cases/IEHC/2014/H368.html Cite as: [2014] IEHC 368 |
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Judgment Title: Moffett & anor -v- O'Hare & McGovern Ltd & ors Neutral Citation: [2014] IEHC 368 High Court Record Number: 2002 2189 P Date of Delivery: 25/07/2014 Court: High Court Composition of Court: Judgment by: Barrett J. Status of Judgment: Approved |
Neutral Citation: [2014] IEHC 368 THE HIGH COURT [2002 No. 2189 P] BETWEEN WILLIAM MOFFETT AND ANSON LOGUE PLAINTIFFS AND
O'HARE AND McGOVERN LIMITED AND THOMAS ALAN McNEILL, ALISTAIR GRIFFEN, COLIN W REID, PhiLIP J McMAHON, ROY J.C. McNEILL, STEPHEN B McBRIAR, WESLEY McCAMLEY, JOHN McFADDEN, ERNEST McKEEGAN AND COLIN G. SHAW trading as WDR & RT TAGGART DEFENDANTS JUDGMENT of Mr. Justice Barrett delivered on the 25th day of July, 2014 1. These proceedings comprise an application by respectively the first defendant and the second to eleventh defendants to dismiss the plaintiffs' proceedings for want of prosecution pursuant to the inherent jurisdiction of the court. There is some discrepancy in the documentation before the court as to whether the surname of the first-named plaintiff is 'Moffett' or 'Moffat'; the court has proceeded on the basis that it is 'Moffett'. 2. Newbay Properties, of whom the plaintiffs are the remaining partners, were the developers of a shopping centre in Monaghan Town. The centre was substantially completed in or about November 1996. Taggart were engaged by Newbay in June 1994, to supervise and procure the erection of the shopping centre (the works). It was agreed that Power Supermarkets Limited would be the anchor tenant of the shopping centre pursuant to a lease dated 2nd December, 1994. O'Hare and McGovern Limited was engaged to construct the shopping centre by Newbay under a written agreement of 20th February, 1996. The works were carried out between April and November 1996, by which later time they were substantially completed. Subsequent to construction, severe settlement ensued at the site. Tesco Ireland Limited, the successor in title to Power, alleges that this is due to poor design and construction. Tesco commenced arbitration proceedings against Newbay in 2001 and Messrs. Moffett and Logue, who had bought out the interest of the other partners of Newbay, initiated court proceedings against the defendants in these proceedings in 2002. After some initial delay, the pace of those proceedings was relatively quick. Thus the plenary summons issued on 8th February, 2002. The Statement of Claim was delivered on 13th March, 2003. O'Hare and McGovern's notice for particulars issued on 3rd June, 2003. Replies to same issued on 14th July, 2003. A defence for Taggart issued on 30th April, 2003. Taggart also issued a notice for particulars on the same date and a reply to same issued on 4th June, 2003. A defence and counterclaim for O'Hare and McGovern was delivered on 8th December, 2003. The plaintiffs issued a notice for particulars to O'Hare and McGovern on or about 8th December, 2003. Then nothing of substance happened for a time. A notice of change of solicitor for the first-named defendant issued on 21st January, 2005. After that, just over eight years passed until the issuance, on 22nd February, 2013, of a notice of change of solicitor for Messrs Moffett and Logue, along with a notice of the plaintiffs' intention to proceed with their litigation. Why did the litigation effectively go into abeyance for the better part of a decade? In a nutshell, because Tesco and Newbay had entered into protracted arbitration of the dispute between them and this took centre-stage in the years that followed: thus they appointed an arbitrator effective 10th January 2001; he issued two interim awards, one on 14th January, 2004 and another on 2nd February, 2007; following his death, a second arbitrator was appointed and issued a final award on 6th March, 2013. The sequence of correspondence that flowed over the years between the plaintiffs and the defendants concerning the arbitration and the litigation is worth reciting in some detail:-
- on 22nd May, 2002, a letter issued from Taggart to Newbay indicating that the terms of their appointment to give technical advice in the arbitration proceedings had been accepted by Newbay. - on 27th August, 2002, a letter issued from the solicitors for Newbay to the solicitors for O'Hare and McGovern advising that high court proceedings had issued and that if O'Hare and McGovern and also Taggart did not wish to join in the ongoing arbitration between Tesco and Newbay "then our Clients will have no alternative but to pursue their High Court proceedings against both your Clients and Taggarts. It seems to us that this would not be in anyone's interests as it will involve an entirely separate set of Proceedings to the Arbitration presently under-way ...". This letter contemplates contemporaneous arbitration and litigation and does not, for example, suggest that the litigation would be postponed until after the arbitration. No response appears to have issued to this letter. - on 30th August, 2002, a similar letter issued to Taggart as that which issued to O'Hare and McGovern on 27th August, 2002. Again, this letter contemplates immediate litigation contemporaneous with the arbitration, stating that "[T]o protect their interests, Newbay ...have instituted proceedings in the High Court in Dublin against both Taggarts and O'Hare McGovern, and we must now call upon both Taggarts and O'Hare McGovern, to agree to indemnify Newbay ...against all liability, costs and damages which may be awarded to Tesco in this Arbitration. In default of an acknowledgement of such liability ...the High Court proceedings referred to will be served and prosecuted'. - on 11th September, 2002, the solicitors for Taggart issued a letter to the solicitors for Newbay declining to join the arbitration and urging a different course of action, writing:- "You say that you have issued proceedings in Dublin and that they will be served on our clients if they do not join the arbitration. Whilst this is a decision for your clients, we would have thought it was in their interests for them to await the conclusion of the arbitration before deciding what further steps, if any, need to be taken. If they are successful in the arbitration, having previously served legal proceedings, they would then have to withdraw the legal proceedings and pay our and the contractor's costs. We urge your clients to take this approach." - on 18th September, 2002, a letter issued from the solicitors for Newbay to the solicitors for Taggart noting that neither Taggart nor O'Hare and McGovern had consented to joining the arbitration and also stating that the deferral of the litigation as proposed in the letter of 11th September, 2002, would not suit Newbay. - on 5th November, 2002, a letter issued from the solicitors for Newbay to the solicitors for Taggart referring to their letter of 11th September, 2002, and enclosing a copy of the plenary summons in the High Court proceedings.
- a letter of 20th December, 2004, from the solicitors for Newbay to the new solicitors for O'Hare and McGovern indicating, for the first time, that matters might be sequenced so that the litigation would follow the arbitration, stating that "the results of [the]...Arbitration will dictate the future course of this High Court litigation". - a letter of 9th February, 2005, from the solicitors for Newbay to Taggart referring in some detail to the ongoing arbitration and some issues arising in the context of same. - a letter of 24th June, 2007, from the solicitors for Newbay to Taggart referring in some detail to the ongoing arbitration and some issues arising in the context of same. - a letter of 4th July, 2007, from the solicitors for Newbay to the solicitors for Taggart indicating that the litigation against Taggart had not proceeded further ''pending the outcome of the Arbitration". The sequencing of matters so that any litigation would follow the arbitration is again made apparent in this letter. - a letter of 4th July, 2007, from the solicitors for Newbay to the solicitors for Hare and McGovern identifying the progress of the arbitration. -a letter of 31st October, 2007, from the solicitors for Newbay to the solicitors for Taggart advising as to the progress of the arbitration and inviting Taggart to take over the defence of the arbitration "given the savings in legal costs", a reference to the already commenced litigation, that will otherwise ensue. - a letter of 12th November, 2007, from the solicitors for Taggart to the solicitors for Newbay denying any liability towards Newbay and declining to assume the defence of the arbitration even if this were possible, which was disputed. - a letter of 10th March, 2011, from the solicitors for Newbay to the solicitors for Taggart advising Taggart as to the progress of the arbitration, in particular the quantum of claim formulated by Tesco and inviting Taggart's input into the process of discussion regarding quantum. - a like letter of 10th March, 2011 from the solicitors for Newbay to the solicitors for O'Hare and McGovern. - a letter of 15th March, 2011, from the solicitors for Taggart to the solicitors for Newbay acknowledging receipt of the letter of 10th March. - a letter of 4th January, 2012, from the solicitors for Newbay to the solicitors for O'Hare & McGovern advising of the appointment of a new arbitrator following the death of the previous arbitrator. - a like letter of 4th January, 2012 from the solicitors for Newbay to the solicitors for Taggart. - a letter of 31st January, 2012, from the solicitors for Taggart to the solicitors for Newbay seeking further details about any proposed settlement with Tesco and raising various questions as to proposed remedial works. - a letter of 2nd February, 2012, from the solicitors for Newbay to the solicitors for Taggart detailing a settlement offer and providing certain further details regarding the still ongoing arbitration. - a letter of 10th February, 2012, from the solicitors for Taggart to the solicitors for Newbay, referring to the issue of quantum and inputting on the issue of remediation. - a letter of 24th May, 2012, from the solicitors for Taggart to the solicitors for Newbay indicating, amongst other matters, that in any litigation that follows the arbitration Taggart will challenge Newbay's handling of the arbitration unless a particular step is taken. - a letter of 6th June, 2012 from the solicitors for Newbay to Taggart in which input is sought of Taggart into a legal response being formulated in response to a claim made by Tesco, presumably as regards quantum, though this is not expressly mentioned in the letter. - a letter of 21st September, 2012, from the solicitors for Newbay to the solicitors for Taggart indicating that by virtue of bankruptcy proceedings taken against them Mesrs. Moffett and Logue were no longer in a position to participate in the arbitration, that the solicitors had no instructions from certain previous partners of Newbay who were named as defendants in the arbitration proceedings, and inviting Taggart to take over the defence of the arbitration. 5. What conclusions of fact can be drawn from the above facts and correspondence? As regards O'Hare and McGovern, the court concludes that (1) from the time it received the letter of 7th December, 2001, it knew of the arbitration and that Newbay was alleging liability on the part of O'Hare and McGovern; (2) from at least the time of the receipt of the letter of 27th August, 2002, it knew that Newbay's litigation was pending against them; (3) initially it looked as though this litigation would be contemporaneous with the arbitration but from at least the time of the letter of 20th December, 2004, it was apparent that the intent was that matters would be sequenced so that litigation would follow the arbitration; (4) thereafter, in 2007, 2011 and 2012, O'Hare and McGovern was kept apprised of the progress of the arbitration which finally concluded in early-2013; (5) it appears from the correspondence put before this Court that at no point prior to the instant application did O'Hare and McGovern apply to have the court proceedings that had been commenced against it dismissed on grounds of delay in prosecution of the claim. 6. As regards Taggart, the court concludes that (1) for some time previous to the issuance of the letter of 22nd May, 2002, they knew of the arbitration between Tesco and Newbay; (2) from at least the time of receipt of the letter of 30th August, 2002, they knew that related litigation against them was being commenced by Newbay; (3) as a result of the letter of 18th September, 2002, they had every reason to believe that the litigation would run contemporaneous with the arbitration; (4) from at least the time of the letter of 4th July, 2007, it was apparent that the intent was that matters would be sequenced so that litigation would likely follow the arbitration; (5) thereafter, in 2007, 2011 and 2012, Taggart were kept apprised of the progress of the arbitration and inputted into same, with the arbitration finally concluding, of course, in early-2013. 7. Having regard to all of the foregoing, it is difficult to avoid the conclusions, and the court concludes in respect of O'Hare and McGovern and Taggart, that:-
(ii) they were both aware that litigation had been commenced against them; (iii) they both knew that the litigation which had been commenced against them would effectively be put on stay until after the arbitration concluded, in the case of O'Hare and McGovern from at least the time of receiving the letter of 20th December, 2004, and in the case of Taggart from at least the time of receiving the letter of 4th July, 2007; (iv) they both made no, certainly no material objection to this proposed sequencing; (v) prior to the present application being made, at no point throughout the period when the arbitration was ongoing and the instant proceedings remained live against them does it appear that either O'Hare and McGovern or Taggart sought to have the instant proceedings dismissed for want of prosecution; (vi) both O'Hare and McGovern and also Taggart at least implicitly acquiesced in the sequencing of the litigation-arbitration process and hence the resultant timing of the litigation. 8. There are two key lines of authority governing an application for dismissal for want of prosecution. They arise respectively from the Supreme Court decisions in Primor plc v. Stokes Kennedy Crowley [1996] 2 I.R. 459 and O'Domhnaill v. Merrick [1984] I.R. 151. In Primor, Hamilton C.J., at p. 475, summarises the principles to be applied in an application such as that now before the court. The Primor principles have since been recited with approval in a number of later cases and the court does not propose to repeat them here. In essence, the Primor case establishes a three-limb test to be applied in cases of delay: (1) is the delay inordinate? (2) is the delay inexcusable? (3) even if inordinate and inexcusable, is the balance of justice in favour of or against a case proceeding? There is suggestion in recent case-law, such as JMacH v. JM [2004] 3 IR 385, that the Primor case ought to be viewed as concerned with post-commencement delay only and it is true that on its facts Primor was an application to dismiss based on post-commencement delay. However, there are other cases such as Guerin v. Guerin [1992] 2 I.R. 287, which pre-date but appear consistent with Primor, in which regard has been had to the full backdrop of delay arising. When delay is inordinate and inexcusable the third limb of the Primor test may nonetheless require that a case be allowed to proceed because the balance of justice favours such a result. In all cases the court must also have regard also to the line of authorities commencing with the decision of the Supreme Court in O'Domhnaill v. Merrick. In that case, Henchy J. referred, at p.157, to the need:-
10. The above are the leading precedents and the general principles currently applicable to any proceedings concerned with dismissal for want of prosecution. The same precedents and principles appear to apply regardless of whether the application to dismiss is grounded on o.122 of the Rules of the Superior Courts or the inherent jurisdiction of the court. The court turns now to apply the tests established in Primor and O'Domhnaill, as well as certain other authorities that are of particular relevance to the present proceedings. Is the delay arising inordinate? Is the delay arising inexcusable? 13. In Truck and Machinery Sales Ltd. v. General Accident Fire and Life Assurance Corporation plc [1999] IEHC 201, the plaintiff sought to excuse delay by virtue of the fact that it had been distracted by its involvement in other litigation. Geoghegan J. doubted that such an excuse could render a delay excusable, stating, at p.4, that:-
15. In Comcast, the Supreme Court decided that the delay in prosecuting the proceedings was excusable in circumstances where the plaintiffs said that they were waiting for the completion of the investigative stage of a tribunal of inquiry, the Moriarty Tribunal, into the granting of the State's second mobile phone licence. The plaintiffs' claim in that case involved serious allegations of corruption and misfeasance of public office by a Government minister. The Supreme Court considered that the case was exceptional and that in the unique circumstances it presented it was legitimate for the plaintiffs to wait until evidence had been heard at the tribunal which might assist it in framing its claim against the State. In the course of her judgment, Denham C.J. noted, at para. 40, that:-
18. In Silverdale and Hewett's Travel Agencies v. Italiatour [2001] 1 ILRM 464, Finnegan J. held in effect that substantial commercial enterprises are expected to pursue litigation with reasonable expedition and a failure to do so is culpable. Per Finnegan J., at p.469:-
20. In the relatively recent case of O'Carroll & Another v. EBS Building Society & Another [2013] IEHC 30, the plaintiff, as personal representative of a deceased investor, took proceedings arising out of the deposit of certain monies by the deceased with a Mr. Hall, the second-named defendant, who was licensed to accept deposits on behalf of EBS Building Society. Mr. Hall had taken the deposit but instead of placing it with EBS had invested or otherwise used it for his own benefit. The deceased died in 2000. Probate was granted in 2002. The plaintiff instituted proceedings in 2004. Mr. Hall consented to judgment in 2008 but died in 2012, by which time attempts to enforce the judgment against him had been unsuccessful. In 2013, EBS brought an application to dismiss the plaintiffs’ claim. O'Malley J. held that the delay arising was inordinate but not inexcusable, stating inter alia, at paras. 36ff, that:-
22. In Desmond v. M.G.N Limited [2009] 1 IR 737, Mr. Dermot Desmond, a prominent businessman, issued proceedings for libel in May 1998 concerning certain newspaper articles that alleged he had made various corrupt payments. However, a notice of intention to proceed was only issued in February 2005. The reason offered by Mr. Desmond for the significant delay in the proceedings was that he had acted on legal advice. The Supreme Court considered that the delay arising was both inordinate and inexcusable, though a majority were satisfied that the balance of justice required that Mr. Desmond's action should be allowed to proceed. Referring to Mr. Desmond's decision to "park' his defamation proceedings pending the determination of certain issues by an ongoing tribunal of inquiry into certain payments to politicians (the 'Moriarty Tribunal'), Kearns J., as he then was, observed at p.752, albeit in a dissenting judgment, that:-
24. In O'Carroll, O'Malley J. also refers in her judgment to the fact that the delay arising was attributable to a course of action, viz. the pursuit of Mr. Hall, which would, if successful, have been to the benefit of EBS Building Society. Equally, in this case, there was a benefit arising for O'Hare and McGovern and Taggart in that if Newbay was successful in the arbitration, then it was less likely, perhaps unlikely, that either O'Hare and McGovern or Taggart would be troubled further, at least by Newbay, in relation to the disputes that had arisen concerning the construction of the shopping centre. 25. For the reasons stated above, the court considers, consistent with the general trend of the applicable authorities, that the plaintiffs delay in these proceedings is excusable. Where does the balance of justice lie? 27. In Primor, Hamilton C.J., at p.475 et seq., indicated that the following criteria could be taken into account when determining where the balance of justice lies:-
(ii) whether the delay and consequent prejudice in the special facts of the case are such as to make it unfair to the defendant to allow the action to proceed and to make it just to strike out the plaintiff's action, (iii) any delay on the part of the defendant - because litigation is a two party operation, the conduct of both parties should be looked at, (iv) whether any delay or conduct of the defendant amounts to acquiescence on the part of the defendant in the plaintiff's delay, (v) the fact that conduct by the defendant which induces the plaintiff to incur further expense in pursuing the action does not, in law, constitute an absolute bar preventing the defendant from obtaining a striking out order but is a relevant factor to be taken into account by the judge in exercising his discretion whether or not to strike out the claim, the weight to be attached to such conduct depending upon all the circumstances of the particular case, (vi) whether the delay gives rise to a substantial risk that it is not possible to have a fair trial or is likely to cause or have caused serious prejudice to the defendant, (vii) the fact that the prejudice to the defendant referred to in (vi) may arise in many ways and be other than that merely caused by the delay, including damage to a defendant's reputation and business."
2. the nature of the claims; 3. the probable issues to be determined by the court; in particular whether there will be factual issues to be determined or only legal issues; 4. the nature of the principal evidence; in particular whether there will be oral evidence; 5. the availability of relevant witnesses; 6. the length of lapse of time and in particular the length of time between the acts or omissions in relation to which the court will be asked to make factual determinations and the probable trial date. Further, on the second question it will be relevant to consider any actual prejudice to the defendant in attempting to defend the claim by reason of the lapse of time."
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