Stewart (John) and Stewart (Jonathan) v Martin (Adrian) and Martin (Robert) and Others
| Jurisdiction | Northern Ireland |
| Judge | Keegan J |
| Judgment Date | 30 January 2019 |
| Neutral Citation | [2019] NIQB 7 |
| Court | Queen's Bench Division (Northern Ireland) |
| Date | 30 January 2019 |
1
Neutral Citation No: [2019] NIQB 7
Judgment: approved by the Court for handing down
(subject to editorial corrections)*
Ref: KEE10535
Delivered: 05/11/2018
And Addendum
30/01/2019
IN THE HIGH COURT OF JUSTICE IN NORTHERN IRELAND
________
QUEEN’S BENCH DIVISION (COMMERCIAL LIST)
________
Between:
JOHN STEWART
First-named Plaintiff;
and
JONATHAN STEWART
Second-named Plaintiff;
and
ADRIAN MARTIN
First-named Defendant;
and
ROBERT MARTIN
Second-named Defendant;
and
BARRY P FINLAY, ALAN T W REID, NIGEL G KIRKPATRICK,
EILEEN McLARNON, AIDAN P DONNELLY AND RONALD J LOWRY
(PRACTISING AS MURLAND SOLICITORS)
Third-named Defendants.
________
KEEGAN J
Introduction
[1] In 2007 the plaintiffs paid for redeemable preference shares in a property
development company of which the first and second named defendants were
directors. The consideration was £600,000 made up of £490,000 in cash and a credit
of £110,000 from a previous project. The third named defendants were the solicitors
acting for the company in the transaction. The plaintiffs never received the shares
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and the company went into administration. The plaintiffs now claim that their
money was misapplied and so they seek rescission and/or damages.
[2] The writ is dated 12 March 2013 and it sets out the plaintiffs’ claims in the
following terms:
(a) Rescission of a contract between the plaintiffs and the first and second-named
defendants made on or about 12 June 2007 concerning the investment of
monies belonging to the plaintiff in a company called BMD Developments Ltd
(“BMD”) with the intention of purchasing two residential property sites at
Ballygowan, Co Down, for developments, and of sharing the profits of the
subsequent sale thereof, and which contract/agreement was evidenced by a
letter from the fourth-named defendant addressed to the third-named
defendant dated 12 June 2007 containing the terms of the said
contract/agreement.
(b) A declaration that the said contract/agreement referred to at (a) above is null,
void and of no legal cause or effect.
(c) Repayment of the sum of £600,000 being: £490,000 having been paid to the
first and second-named defendants through the offices of the third-named
defendants, and with the knowledge of the fourth-named defendant, on or
about 6 July 2007, plus £110,000 comprising an existing liability to the
plaintiff’s expressly acknowledged by the first and second-named defendants,
and/or each of them, arising from the sale of the apartment at Cedar View,
Upper Knockbreda Road, Belfast, in or about March 2007.
(d) Further and/or in the alternative, damages being loss and damages sustained
by the plaintiffs by reason of:
(i) the breach of fiduciary duty of, conversion and the dishonest
acquisition and use of the plaintiffs’ monies by the first and
second named defendants in their personal capacity, and as Directors
of BMD, and further and/or in the alternative, by reason of the
misrepresentation, negligent mis-statement, breach of contract, breach
of condition, breach of warranty, and conversion of/by the first and
second-named defendants in and about the obtaining an use of the
plaintiffs money; and/or
(ii) the dishonest assistance of the third-named defendants as solicitors
acting on behalf of BMD and its Directors, the first and second-named
defendants rendering the third-named defendants personally liable for
the amounts paid over by the plaintiffs to the first and second-named
defendants as Directors of BMD, and further and/or in the alternative
acting as solicitors to the plaintiffs as intended redeemable preference
shares at BMD, for whom the third-named defendants acted, or
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alternatively acting as the plaintiffs’ agents for the purpose of paying
over the monies to the Directors of BMD in accordance with the terms
of the contract/agreement made on or about 12 June 2007, or
alternatively holding the monies as trustee on trust for the plaintiffs to
be paid over to the first and second-named defendants only in
accordance with the terms of the said trust; further or in the alternative
the negligence, and/or breach of contract, breach of condition, breach
of warranty, and/or breach of retainer of the third-named defendants
and/or
(iii) the negligence of and/or the dishonest acquisition and use of the
plaintiffs’ monies by the fourth-named defendant.
(e) Interest thereon at a rate of 8% per annum until judgment or sooner payment,
in accordance with Section 33A of the Judicature (Northern Ireland) Act 1978.
(f) Such further and other relief as to the court as appropriate.
(g) Costs.
[3] The plaintiffs set out the alleged misrepresentations/negligent misstatement
of the first and second defendants in the statement of claim as follows:
“77(a) Misrepresenting to the plaintiffs that BMD
represented a more convenient special purpose vehicle by
which to conduct the purchase of sites at Ballygowan,
when, in truth, BMD had other property acquisitions that
required to be funded, and that, by investing in the
company, the directors could misapply the funds for their
own purpose
(b) Misrepresenting through words to the first and
second named plaintiff that the monies would be applied
solely for the purchase of sites at Ballygowan site 1 and
site 2, when it was known or intended by them that this
would not be the case
(c) Misrepresenting to the plaintiffs that there was, in
fact, an agreed purchase price in relation to Ballygowan
sites 1 and 2,when this was not so
(d) Misrepresenting through conduct that the monies
were being held by BMD until the purchase of the
Ballygowan sites 1 and 2 could proceed:
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