Liam Carroll included in legal dispute at The Square

The High Court has agreed to have Liam Carroll included as a defendant in a legal case that is delaying plans to develop The Square, writes Jack Fagan

A legal row which is delaying a planned €300 million extension to The Square shopping centre in Tallaght, Co Dublin, took a new turn this week when another developer was added to the proceedings.

The High Court agreed to a request by a company controlled by Noel Smyth to have Liam Carroll included as a defendant in its case against developers Tom McFeely and Larry O'Mahony. Last summer Smyth initiated the proceedings against the first two, claiming that they had failed to implement a 2005 agreement to transfer licences over Lowe Taverns and the car-park at The Square to Smyth's Alburn Developments in exchange for a stake in the entire development. Alburn was to act as project manager.

The court has allowed proceedings to be served against Carroll by next Monday and he will then have two weeks to file his defence.

Five years ago Carroll and Smyth clashed over control of the former plc, Dunloe Ewart, which is now owned by Carroll's Rambridge company.

Last July Smyth paid €320 million for Quinlan Private's major stake in The Square which brought his stake up to 62 per cent.

His Alburn company also won the right to develop The Square's planned €300 million phase three and four extensions.

The redevelopment and enlargement of the centre has been blocked for several years by ownership and legal problems.

Much of the difficulties centre around Lowe Taverns, now controlled by McFeely and his business partner O'Mahony. They bought Lowe for €55 million in 2005. More importantly, Lowe owns one of the three council-issued licences for The Square's 20-acre surface car-parking which the council inadvertently granted to Lowe in the 1990s. Alburn has been granted two other licences over the car-park which is now central to the proposed major extension.

Smyth had undertaken to pay South Dublin County Council €24 million for the freehold to the entire car-park. The council was also to get social and affordable housing units and alternative parking as well as 10 per cent of the rent roll from phase four. The deal has been held up because the council will not proceed with the sale until the issue over the Lowe licence is resolved.

The proposed development is for 120,770sq m (1.3 million sq ft) of mixed-use facilities including 355 apartments, a hotel, some 13,225sq m (250,000sq ft) of shopping as well as offices and leisure amenities and 1,500 car-parking spaces. A planned phase four development of 83,610sq m (900,000sq ft) is also at "master plan" stage.

Penneys has undertaken to take an anchor store of 9,290sq m (100,000sq ft) which would be its largest in Ireland. Several other major international traders are also known to be interested in moving into The Square.

Alburn is expected to claim substantial damages because of the continuing loss of tax allowances. South Dublin County Council had certified the planned extension for urban renewal tax incentives which are due to run out in June, 2008.