Surely this has to be overturned??

Corkboi

Just read this in the examiner, surely this cant be right as he already forfeit his deposit??

At Ennis Circuit Court last month, Judge James O’Donohoe ordered Brian P Smyth of Clonmaskill, Devlin, Co Westmeath, to pay the €128,000 in damages over not proceeding with the purchase of the apartment in Shannon, Co Clare, from Paddy Burke (Builders) Ltd.

In the court, auctioneer Rory Fitzpatrick said the current market value of the three-bed apartment was €125,000.

Mr Smyth paid a deposit of €29,000 on the property and will forfeit that.

Even after paying €128,000 in damages to the firm, Mr Smyth will not take possession of it and the property will remain in the possession of receiver of Paddy Burke (Builders) Ltd, Eoin Ryan of Howarth Bastow Charleton. Mr Ryan was appointed receiver of the long-established firm by the National Assets Management Agency in December.

Yesterday, the Ennis Circuit Court office confirmed Mr Smyth has appealed the ruling.

As a result, a stay has been put on the order. The appeal case is due to come before the High Court in Ennis later in the year.

Paddy Burke (Builders) Ltd brought the action against Mr Smyth after failing to proceed with the agreed February 2007 purchase of the apartment in Block J at Bru na Sionna, Shannon, Co Clare.

The builder stated the company completed the construction of the apartment and Mr Smyth failed to complete the sale.

Mr Smyth lodged a counter-claim. However, this was dismissed by Judge O’Donohoe.

Judge O’Donohoe gave his judgment in the action in December and last month calculated the scale of damages to be made based on the current value of the apartment.

Judge O’Donohoe described the price drop as shocking. "It is more than the national average — I am stunned by the great value that you would get for this penthouse apartment."

But Mr Fitzpatrick said: "There is very little activity. There is no hope of funding. The banks aren’t lending."

Lorcan Connolly, counsel for the builder, also provided a second valuation to the court with Sherry Fitzgerald McMahon, stating that its market value is €140,000 and Mr Fitzpatrick said this would be at the upper end of its worth.

Judge O’Donohoe said he was in the unenviable position of not being able to compare the value of the apartment to another in Shannon, but said that he would adopt the value of €140,000.

Judge O’Donohoe said that Paddy Burke (Builders) is entitled to €128,000 in damages and also ruled that Mr Smyth must pay the builder’s legal costs.

234

The deposit might be credited to the award of damages. The normal remedy in cases such as these is specific performace i.e. the buyer is forced to pay the contract price and take posession of the property. However, by giving damages instead of specific performance the buyer might be gettin off lighter. If he had to pay the contract price it could easily be a lot higher and the difference beween the contract price and the award of damages could be greater than the current value of the property if he took posession. He might be saving money be taking the award of damages. You would need more info on the case to see why the vendor sought damages rather than specific performance.

blueythebear

234 wrote: »

The deposit might be credited to the award of damages. The normal remedy in cases such as these is specific performace i.e. the buyer is forced to pay the contract price and take posession of the property. However, by giving damages instead of specific performance the buyer might be gettin off lighter. If he had to pay the contract price it could easily be a lot higher and the difference beween the contract price and the award of damages could be greater than the current value of the property if he took posession. He might be saving money be taking the award of damages. You would need more info on the case to see why the vendor sought damages rather than specific performance.

The builer I would presume sought specific performance of the contract and the judge awarded damages in lieu of specific performance. I would have to presume that the fact that the apartments now belong to NAMA, then specific performance could not be awarded, hence the damages in lieu.

I think the deposit was taken account of in the award as the deposit was for €29,000 which indicates a purchase price of €290,000. If it's now valued at €140,000 then that;s a price drop of €150,000 which taking into acccount the retention of the deposit, equates to €121,000 for damages.

The extra €7,000 could be accounted for by anything from inaccurate reporting to estate agents fees.

Either way, on the facts in the article, it's probably a fair judgement perhaps with the exception of the valuation of €140,000 in today's market and that is probably the basis for the appeal.

Milk & Honey

blueythebear wrote: »

Either way, on the facts in the article, it's probably a fair judgement perhaps with the exception of the valuation of €140,000 in today's market and that is probably the basis for the appeal.

There were two valuations offered to the court. The judge chose the one most favourable to the defendant. The defendant is now appealing, but it can hardly be on the basis of the figure of 140K. It is more likely on the basis of the counterclaim which was thrown out!

Peregrinus

If you sign a contract to buy a property, and the contract becomes unconditional, then you are committed to buying the property. Should you default, your risk is not limited to the loss of your deposit. The vendor can seek an order compelling you to complete the sale, or he can accept your default, sell the property for the best price he can get in the market, and then sue you for his loss on the sale, to the extent that it isn't covered by the forfeited deposit.

nuac

PEREGRINUS +1

Heading should have given some clue as to the topic.

blueythebear

Milk & Honey wrote: »

There were two valuations offered to the court. The judge chose the one most favourable to the defendant. The defendant is now appealing, but it can hardly be on the basis of the figure of 140K. It is more likely on the basis of the counterclaim which was thrown out!

The judge agreed with the Plaintiff's evidence re value of the apartment which was the higher figure of the two valuations provided. This figure was less favourable to the Defendant as it resulted in a larger award of damages.

Without knowing anything about the substance of the counterclaim that was dismissed, it's impossible to say on what grounds the appeal was made. Maybe it was on the high valuation figure applied or maybe it was on the basis of the counterclaim. Or maybe on some other ground entirely.

Victor

blueythebear wrote: »

The builer I would presume sought specific performance of the contract and the judge awarded damages in lieu of specific performance. I would have to presume that the fact that the apartments now belong to NAMA, then specific performance could not be awarded, hence the damages in lieu.

NAMA isn't mentioned, so I doubt that is a factor.

NAMA owns very little property. Most of what they own is loans secured against property.

Milk & Honey

blueythebear wrote: »

The judge agreed with the Plaintiff's evidence re value of the apartment which was the higher figure of the two valuations provided. This figure was less favourable to the Defendant as it resulted in a larger award of damages.

.

On the contrary, damages were assessed by reference to the difference between the original contract price and the current market value. The higher the deemed current market value, the less the difference and thus the less the Defendant had to pay in damages. The lower the current valuation the more the Plaintiff would be entitled to in damages.

Kosseegan

If you are involved in this case you should not post about it.