A class action-type set of proceedings on behalf of people in Donegal seeking compensation for the use of defective building products involves 2,260 plaintiffs and that number is likely to grow to more than 2,500 in the coming weeks, the solicitor handling the unprecedented case has said.
The “multiparty action” is being funded by a company that is being funded by a Donegal businessmen, Adrian Sheridan, who has contributed more than €2 million, according to David Coleman of Coleman Legal, which is acting for the plaintiffs and being funded by the third-party company.
Mr Coleman said he expects a number of lead cases to be heard next year and that the outcomes of these cases will guide the advice then given to the other plaintiffs.
Given the huge size of the collective claims, it is likely that any High Court judgment will be appealed to the Court of Appeal and the Supreme Court, resulting in legal costs substantially greater than those already accumulated.
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Mr Sheridan, based in Dubai, is funding the actions on a not-for-profit basis, which means that if the case is successful he will get his money back but no reward. The plaintiffs involved are not being asked to pay anything towards the costs of the actions, though this offer is due to close on July 7th. Plaintiffs who join the process after that date will have to pay modest fees.
Irish law involves restrictions on champerty – the third-party funding of litigation in return for a share of any gain that might result – but Mr Coleman said he is confident that the structure involved in the Donegal cases is in compliance with the law. His work on the case is being funded on a cost-only basis.
He has been involved in the proceedings since August 2021 and no one has sought to query the funding arrangement, he said. The firm will receive what he says is a modest fee for the net gain from any successful plaintiff’s action.
A company called Micaredress100 CLG, trading under the name Defective Blocks Ireland, has been established by Mr Sheridan and another Donegal businessman, Shaun Hegarty. The company’s latest accounts, for the period to the end of December 2022, show it had a loan from Mr Sheridan then totalling €1.64 million.
The defendants to date in the actions are Cassidy Brothers Concrete Products Ltd, Cassidy Brothers Topmix Ltd, the National Standards Authority of Ireland (NSAI), and Donegal County Council.
The State has put in place a scheme to provide financial assistance to homeowners with damaged dwellings due to defective concrete blocks, but the multiparty case will argue that the scheme is insufficient to address the scale of the problem and is too limited in the type of building that can qualify.
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A complaint to be made to the European Commission alleging a failure to apply EU law correctly in this jurisdiction has been signed by 650 people and may have 1,000 signatures by the end of next week, Mr Coleman said.
The Cassidy Brothers businesses are based in Buncrana, Co Donegal. A request for comment met with no response. There was also no response from Donegal County Council. A spokesperson for the NSAI said it would not be appropriate to comment on ongoing legal proceedings.
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