The owner of property which adjoins lands in south Dublin rezoned in the early 1990s is claiming €5.8 million of a €12.8 million compensation award made to a company of businessman Jim Kennedy in High Court proceedings.
The land at Carrickmines is worth €12.8 million only on the basis that a family who lived next to the property consents to the removal of a legal restriction on its development, it is claimed.
Mairead Smith, widow of the late solicitor Thomas Kevin Smith, a principal in Smith Foy & Partners, and his estate, argue that, as long as that legal restriction exists, they are entitled to g €5.8 million of the €12.8 million valuation put on adjoining land owned by Mr Kennedy's Jackson Way Properties Ltd (JWPL).
The claim relates to an 18-acre "take" of JWPL-owned land by Dún Laoghaire -Rathdown Co Council as part of the compulsory acquisition of land in 2001 for the M50 motorway which has since been built.
An arbitrator assessed the value of the land at around €1.1 million per hectare, on the basis it could have been developed for industry had it not been acquired for the motorway.
The council and the Smiths said that valuation should have taken into account a “restrictive covenant” affecting the development potential of the JWPL land which they and previous owners of the Smiths land had enjoyed since 1962.
JWPL denied the covenant still exists or affects its land. Last October, it lost a High Court bid for the council to pay out the award, or at least €7 million of it, pending determination of the restrictive covenant issue and the Smiths’ €5.8 million claim.
Mr Justice David Keane is now dealing with JWPL's application for an order that the covenant no longer applies.
The council and the Smiths are opposing the application.
The court has heard the Carrickmines lands have been subject of years of legal cases including a freezing order obtained by the Criminal Assets Bureau (CAB) alleging corrupt enrichment of JWPL as a result of rezoning of the land by Dublin county councillors in the 1990s. CAB later withdrew its case against JWPL saying it could not proceed due to unavailability of witnesses.
JWPL is now suing CAB for damages for misfeasance in public office. CAB denies the claims.
JWPL separately sued Dún Laoghaire-Rathdown Council for judgment for the €12.8 million arbitrator’s award. It later claimed the restrictive covenant no longer applies.
The council says no one should get paid until the covenant issue is dealt with as the valuation issue may then have to go back to an arbitrator for re-assessment.
In refusing JWPL an order last October for payment of the award, or part of it, Mr Justice Donald Binchy said, if that was done, it was possible it would result in a substantial overpayment to JWPL. He also said JWPL failed to take any steps to clear the restrictive covenant until it issued proceedings against the Smiths in 2010.
While the explanation for this was due to the personal difficulties of Mr Kennedy, it would be unfair to attribute any of the delay during this period to the council, he said.