A High Court decision on the meaning of the word “house” means a local authority must repay a commercial property giant €526,121 paid in development contributions.
The question for determination in the dispute between Dún Laoghaire-Rathdown County Council and Hibernia Real Estate Group was: “What is a house?” said Judge Emily Farrell.
It was “a further clear demonstration of how words used in legislation may not bear the meaning which would be generally understood”.
The case arose after Hibernia bought a site in late 2014 from a bank-appointed receiver at Ballally, Ballinteer, Dublin 16, with a partially built apartment block and permission for a block of 213 apartments.
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Hibernia said its purpose was to acquire a distressed construction site, engage a contractor to complete the development and rent out the apartments. All 213 units were completed by July 2015.
The issue was whether the site was, in November 2014, a “house” or comprised houses within the meaning of section 2 of the Planning and Development Act 2000.
Section 2 states a house “means a building or part of a building which is being or is occupied as a dwelling or was provided for use as a dwelling but has not been occupied and, where appropriate, includes a building which was designed for use as two or more dwellings or a flat, an apartment or other dwelling within such a building”.
A finding that the structure was a “house” in November 2014 would mean Hibernia was not entitled to reduced development contributions.
Permission for 213 apartments was granted in June 2006, subject to development contributions under the 2000 Act. An amended permission was granted in September 2006, with conditions for payment of development contributions in line with the Dún Laoghaire-Rathdown County Council development contribution scheme 2004.
When the original permission and the amended permission were granted, the 2004 scheme applied with contributions of €13,470 per unit.
In May 2013, the council adopted a revised scheme, which applied from June 2013 to December 2015, and included a reduced contribution of €11,000 per unit.
Hibernia paid the higher contributions, amounting to €1.75 million, in line with the 2004 scheme, while maintaining it was entitled to the reduced rate under the 2013 revised scheme. It claimed the council was “unjustly enriched” because the structure was not a “house” at the time Hibernia bought it.
In opposing the case, the council argued its obligation to reduce development contributions only arose where a commencement notice was not lodged, or where the development comprised houses of which one or more had not been sold.
It said a commencement notice was served before the amendment providing for reduced contributions came into force and maintained the 213 apartments were houses within the meaning of the 2000 Act.
Having construed the law, the judge ruled the fact the structure had been designed for use as two or more dwellings was insufficient to bring it within the definition of “house” when it was sold as a partially constructed building in November 2014.
A “house” as defined by section 2(1) does not include a partially constructed building which was designed for use of two or more dwellings but had not become capable of occupation as a dwelling, she said.
“House” is defined in a manner which includes houses, as commonly understood, flats, apartments, other dwellings and buildings or parts of buildings which have been or are capable of occupation as dwellings, she said.
On foot of her findings, the judge ruled Hibernia was entitled to the benefit of section 48 of the 2000 Act, which provided for payment of reduced contributions under the 2013 scheme, and to be repaid €526,121.
