Phoenix Rock Enterprises [Trading as Frank Pratt & Sons] v Hughes (Approved)

Factual and Procedural Background

The Plaintiff, a multi-million euro sand and gravel company with 45 employees ("the Plaintiff"), initiated proceedings seeking specific performance of an alleged oral agreement by the Defendant, a 76-year-old farmer ("the Defendant"), to sell a property to the Plaintiff. The Plaintiff also alleged that the Defendant had committed to negotiate exclusively with the Plaintiff regarding the property disposal. The Defendant denied both the existence of any such agreement and the exclusivity commitment. The Defendant applied to strike out the proceedings. The case involves a dispute over whether a binding contract was formed following a telephone call on 11 April 2023, an acceptance letter dated 20 April 2023, and subsequent repudiation by the Defendant on 25 April 2023. Prior negotiations dating back to 2015-2017 and issues concerning ownership of the property by six co-owners were also relevant. The Plaintiff sought to amend its claim multiple times, including attempts to rely on doctrines such as part performance and proprietary estoppel. The Defendant sought dismissal of the claim pursuant to Order 19 rule 28 of the Rules of the Superior Courts (RSC).

Legal Issues Presented

1. Whether the 11 April 2023 telephone call and subsequent correspondence constituted a concluded and enforceable contract for the sale of land.
2. Whether there exists a note or memorandum in writing satisfying the requirements of section 51 of the Land and Conveyancing Law Reform Act 2009 ("the 2009 Act").
3. Whether the alleged contract is void for uncertainty due to failure to agree essential terms, including the period for securing planning permission and deposit arrangements.
4. Whether the Plaintiff can invoke the doctrine of part performance to enforce the alleged oral agreement.
5. The implications of the property being owned by six co-owners, with only the Defendant as a party.
6. Whether the Defendant is bound by an alleged commitment to negotiate exclusively with the Plaintiff.
7. Whether the claim is bound to fail in its entirety and should be struck out under Order 19 rule 28 RSC.

Arguments of the Parties

Plaintiff's Arguments

• The Plaintiff contended that a binding oral agreement was made on 11 April 2023, with acceptance by letter dated 20 April 2023, subject to planning permission.
• The Plaintiff sought to amend its claim to assert that a note or memorandum existed meeting the requirements of s.51 of the 2009 Act.
• The Plaintiff relied on the doctrine of part performance, alleging that it retained a planning consultant at economic cost following acceptance.
• The Plaintiff asserted that the Defendant had committed to negotiate exclusively with it regarding the sale of the property.
• The Plaintiff argued that the Defendant misrepresented himself as sole owner, inducing reliance and detriment.
• The Plaintiff sought declarations including that the expense of hiring a planning consultant constituted consideration and that proprietary estoppel arose from exclusivity representations.

Defendant's Arguments

• The Defendant denied that any concluded agreement existed.
• The Defendant argued that the alleged contract was not in writing as required by s.51 of the 2009 Act.
• The Defendant submitted that essential terms, such as the period for planning permission and deposit arrangements, were uncertain and unresolved.
• The Defendant contended that the doctrine of part performance did not apply, as the only alleged act (retaining a planning consultant) was insufficient, predated the contract, and was not induced by the Defendant.
• The Defendant asserted that the Plaintiff could not claim relief against non-parties (the co-owners) and that the Defendant alone could not sell the entire property.
• The Defendant denied any binding exclusivity commitment and argued that even if such existed, it was terminable on reasonable notice.
• The Defendant maintained that the claim was bound to fail, disclosed no reasonable cause of action, and was an abuse of process.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court undertook a detailed and methodical analysis of the Plaintiff’s claim and the Defendant’s strike out application. It began by emphasizing the high threshold required to dismiss a claim under Order 19 rule 28 RSC, noting that dismissal is only appropriate where the claim is clearly bound to fail and there is no real risk of injustice. The Court then examined the core issues:

• Existence of a Concluded Agreement: The Court found that the pleadings failed to establish an arguable basis for a concluded contract. Essential terms, such as the period for securing planning permission and deposit arrangements, were not agreed. The Plaintiff’s reliance on the 11 April 2023 telephone call and the acceptance letter dated 20 April 2023 was undermined by the absence of mutual intention to create legal relations, especially given the longstanding "subject to contract" stipulations in prior negotiations. The Court rejected the Plaintiff’s submission that the postal rule applied to the acceptance letter, concluding that acceptance occurred only upon receipt on 24 April 2023, leaving a very narrow window for any acts of part performance.
• Section 51 Requirements: The Court held that no note or memorandum sufficient to satisfy s.51 of the 2009 Act existed. The Plaintiff’s attempt to rely on the Defendant’s solicitor’s 28 July 2017 letter failed as that letter expressly disavowed constituting a memorandum under the statute and contained terms too uncertain to form a binding contract.
• Doctrine of Part Performance: The Court found the Plaintiff’s evidence of part performance insufficient. The sole act relied upon—a planning consultant’s retention—was not proven to have occurred after contract formation, was not induced or acquiesced in by the Defendant, and was insubstantial ("de minimis") in the context of a €1.2 million transaction. The Plaintiff failed to provide particulars or evidence of the consultant’s engagement, costs, or work done during the narrow contractual window. The Court noted that preparatory acts or unilateral acts not referable to the contract do not suffice to invoke part performance.
• Ownership and Parties: The Defendant was one of six co-owners, but the Plaintiff had not joined the others as parties. The Court found that the Defendant alone could not convey the entire property, and no relief could be granted against non-parties. The Plaintiff’s claims based on alleged misrepresentation of sole ownership were noted as theoretically possible but unlikely to result in damages absent proof of loss.
• Exclusivity Commitment: The Court found no legally binding exclusivity agreement. The alleged open-ended exclusivity lacked essential terms, consideration, and certainty. The Court endorsed the reasoning in Triatic and Walford that agreements to negotiate or to agree are unenforceable. Any exclusivity was terminable on reasonable notice, likely one month, and the Defendant was free to deal with others.
• Pleadings and Conduct of Plaintiff: The Court criticized the Plaintiff’s prolix, confusing, and internally inconsistent pleadings. The Plaintiff repeatedly conflated different periods and claims, failed to provide meaningful particulars, and did not correct serious errors in amended pleadings. Affidavits were sometimes prepared and sworn without proper verification or correction. The Plaintiff’s failure to respond to challenges and discovery requests was noted as undermining its case.

Overall, the Court concluded that the Plaintiff’s claim disclosed no reasonable cause of action, was bound to fail, and amounted to an abuse of process. The Plaintiff had had multiple opportunities to remedy defects but failed to do so.

Holding and Implications

The Court's final decision was to STRIKE OUT AND DISMISS the Plaintiff’s claim pursuant to Order 19 rule 28 RSC.

The direct effect of this decision is that the Plaintiff’s claim for specific performance and related reliefs in respect of the alleged contract and exclusivity commitment is dismissed. The Plaintiff has no arguable case for a binding contract, no sufficient written memorandum, no adequate acts of part performance, and no enforceable exclusivity agreement. The Plaintiff also cannot pursue relief against non-parties (the co-owners). The Court noted that the Plaintiff might theoretically have a damages claim against the Defendant for misrepresentation but found no basis to conclude any loss was suffered. No new legal precedent was established; the decision reaffirms established principles concerning contract formation, the statute of frauds, part performance, and exclusivity agreements. The Plaintiff was afforded multiple opportunities to amend but failed to provide a coherent or particularised case, justifying dismissal. The Defendant is presumptively entitled to costs.