Cherrywood developer sues Johnny Ronan companies over €35m office contract

The High Court has granted a development firm permission to serve proceedings at short notice on companies in the Johnny Ronan group in a dispute over the development of a €35 million office building in Cherrywood, south Dublin.

DLR Properties Ltd has brought proceedings against RGRE Devco 4 Ltd (RGRE 4) and Ronan Group Real Estate Ltd seeking declarations that a development agreement between the parties was validly terminated as a result of breaches by the defendants.

DLR also seeks damages and an injunction directing the removal of statements from the Ronan Group website that state or imply the defendants have any legal or equitable title or interest in the planned office site. It also seeks corrections and prohibitions on further such publications along with damages for defamation.

On Friday, Mr Justice Garrett Simons granted short service of the proceedings on the defendants following an ex parte application from Marcus Dowling SC, with Elizabeth Corcoran, instructed by Sharon Scally of Amorys Solicitors, for DLR. The judge made them returnable to next week.

He also gave liberty to DLR to issue proceedings seeking that the matter go to arbitration.

The planned office site is 1.3 acres of an overall 13.3 acre site in Cherrywood, Loughlinstown, 12 acres of which is zoned for town centre development.

DLR says it entered into an agreement in May 2019 in which DLR would transfer the 12 acres to RGRE 4 in return for which that defendant was required to construct on the remaining 1.3 acres a 145,000sq ft office building at a cost (in 2019) of more than €35 million.

In an affidavit, DLR chief executive Conor Dalton said RGRE 4 failed to take the necessary steps towards constructing the building, thus breaching its obligations under the development agreement. Despite warning notices, the defendant provided no confirmation of its intention to begin construction, he said.

He said RGRE 4 “has not so much as hinted” what its defence to the claim for damages might be and he believes this shows it has no defence. His firm’s biggest concern is that RGRE 4 may not be a mark for damages.

Mr Dalton said RGRE 4 claims to have incurred costs of about €4 million in connection with the agreement but without “so much as hinting” why this might be so.

It has also made what he says were “vague threats that it will take steps to protect its position” and has asserted that the agreement between the parties was not terminated.

Of urgent concern to DLR are incidents of trespass and defamation and slander of title that have been committed by or on behalf of the defendants since the termination of the agreement, he said. These include an incident in which RGRE 4 directed or caused third parties to enter the site with geological survey equipment without permission.

Statements on the Ronan Group website in relation to a legal or equitable interest in the site constitute a slander of DLR’s title, he said.

“The statements are untrue and are made maliciously and in the knowledge that they are untrue or recklessly as to their truth or falsity,” he said. They were calculated to cause and likely to cause financial loss to DLR in respect of its property, he added.

The defendants are aware DLR is trying to sell the site and these false statements will cause serious concern among prospective bidders and frustrate or delay any sale, he said.

In its application on Friday, DLR also sought an injunction restraining the RGRE 4 from filing a “lis pendens” – a warning to any prospective purchaser of possible litigation over it – on DLR’s interest in the property.

However, Mr Justice Simons said he had a concern about this application particularly in circumstances where the case comes back next week, where the Ronan Group has made statements on its own website and where there was likely to be publicity about this case.

There would be no prejudice in declining that relief at this stage, he said.