Dunnes Stores facing substantial legal costs after High Court ruling

Dunnes Stores is facing a substantial legal costs bill after the High Court ruled it had sued An Bord Pleanála for the "ulterior motive" of avoiding contractual obligations relating to a shopping centre development.

Mr Justice Max Barrett noted that Deerland Construction Ltd, the developer of the Ferrybank centre in Co Kilkenny and a notice party to Dunnes case, was "in Nama", with the effect the firm's legal costs would have to be met by Nama and the taxpayer. There was no reason why Deerland, Nama or the taxpayer should be "out of pocket" because Dunnes had brought proceedings which pursued an ulterior motive from start to finish and abused the process of the court in an attempt to do that, he said.

He was marking the court’s disapproval by granting Deerland’s application for costs against Dunnes on the higher solicitor-client level, he said. Because An Bord Pleanála had, “not ungenerously”, sought its costs on the standard party-party level only, he would grant costs to the board on that basis, he added.

Mr Justice Barrett was delivering a recent judgment on costs issues arising from previous judgments in which he found the true object of Dunnes’s action concerning the Ferrybank centre was to enable it delay, or avoid complying with, its contractual obligations to fit out and occupy the anchor store in that development. He had also refused leave to appeal that decision.

Dunnes’s case, on its face, was concerned with the legality of a decision to grant certain retention permission to Deerland concerning the Ferrybank development, he said. The anchor store there was owned by Dunnes and a retention permission allowed five minor alterations.

In “a twist worthy of Lewis Carroll”, Dunnes in fact had no issue with the alterations. The case had “nothing to do with planning law” and “everything to do” with Dunnes securing an advantage for itself in a long-running contractual dispute with Deerland and a Nama company.

The judge struck out Dunnes’s case on the basis of his findings that its true objective was to facilitate a contrived legal justification for Dunnes’s “long-time failure” to meet its contractual obligations to fit out and occupy the anchor store. In those circumstances, the court refused to consider the planning issues raised and dismissed the case.