Two High Court disputes between construction firms over pyrite and liquidation are resolved

By Ann O'Loughlin

Two High Court disputes between Irish Asphalt Ltd and James Elliot Construction have been struck out at the High Court after the parties reached out of court agreements.

In the first of the two actions James Elliot Construction had sued Irish Asphalt, its directors Kevin and Terry Lagan and John Gallagher` and another related entity Lagan Cement Group Ltd for alleging deceit.

JEC had claimed had it was supplied with products by the defendants which they knew contained excessive amounts of pyrites and was allegedly not fit for purpose.

It had also claimed Irish Asphalt Limited (IAL) allegedly misrepresented the quality of the product sold by it and either knew, or was allegedly reckless, whether its representation of the product was true or false.

JEC sought damages, plus an indemnity in other proceedings taken against it over pyrite, from the defendants.

The claims were denied.

Today, Ms Justice Caroline Costello at the Commercial Court, was informed by Bill Shipsey SC for JEC that the case was being "dismissed".

Counsel said JEC was to acknowledge that there was "no basis" for the claim of deceit or misrepresentation and that it had made a contribution to the defendant's legal costs.

The Judge said she was happy the case has been dismissed as had it gone ahead the hearing was expected to last for up to 20 weeks.

In the second set of proceedings, which were before Mr Justice Tony O'Connor, James Elliot Construction brought a petition seeking the appointment of a liquidator to Irish Asphalt, which is part of the Lagan Group of companies over an alleged unpaid debt of more than €2.4m.

Patrick Leonard SC for JEC told the Judge those proceedings had been resolved.

Counsel said it had been agreed by the parties that the petition could be withdrawn and the proceedings struck out.

John Gleeson SC for Irish Asphalt said that mediation had helped to bring about the resolution of the proceedings.

Mr Justice O'Connor agreed to strike out the proceedings.

The winding up application had been opposed by Irish Asphalt Ltd, directors of the firm and a related entity Lagan Holdings Ltd which is IAL's largest creditor.

The defendants claimed JEL had an ulterior motive in seeking to have the company liquidated namely that it would have given it a tactical advantage in the 'deceit' proceedings, which was denied by JEC.

The debt at the centre of the winding up petition relates to a High Court judgment it obtained against the company in 2011.

That case arose out of the supply by IAL to JEC of stone infill with excessive amounts of pyrite used in the Ballymun Central Youth Facility building in Dublin and which subsequently had to undergo major repair work.

That ruling was appealed to the Supreme Court, which in turn referred issues of law arising out of the action to the European Courts of Justice (ECJ).

Ultimately the appeal was dismissed by the Supreme Court and the ECJ's findings did not benefit Irish Asphalt's position.


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