Land price rose after cheque not honoured

Mahon Tribunal: The purchase price of the Carrickmines site in south county Dublin was increased by some £160,000 after a deposit cheque paid to secure the deal was not honoured, the planning tribunal has been told.

In 1988 a figure of £540,000 for the 108 acres site was agreed between Mr Jim Kennedy and the retired farmer Mr Bob Tracey. Mr Tracey wanted a £20,000 deposit. Some £5,000 was paid by cheque and it was not honoured. The cheque was paid by Mr Sam Stanley, who was acting as an agent for Mr Kennedy on the deal.

Solicitor Mr Gerry Charlton, who represented Mr Stanley, said when the cheque was not honoured Mr Kennedy was given legal advice that he could not enforce the contract on the transaction. The price was then renegotiated with Mr Kennedy's Paisley Park company and increased to £700,000.

Mr Charlton also told the tribunal that Mr Kennedy had contended at the time that he was merely acting as a land agent in the transaction and that he was not the buyer. This was a "charade", Mr Charlton said.

The deal became delayed but Mr Charlton said that at the time it was not believed the delay arose from any financial difficulty on the part of Mr Kennedy. "Jim Kennedy was a very, very, wealthy man and it came as a great surprise to us he would not be able to put up the purchase price," he said.

Mr Stanley had first agreed a £1 million fee for his work on the land deal. He later agreed to accept 20 per cent of the net profit instead. The tribunal heard that Mr Kennedy offered to buy Mr Stanley out of that arrangement by giving him "£50,000 cash in an envelope".

The tribunal continues today.