Martin v O'Keeffe & Anor (Approved)

Factual and Procedural Background

The Plaintiff initiated proceedings seeking specific performance of an alleged contract to purchase a property known as "the Beach Tavern" located at 7/9, Bath Street, Irishtown, County Dublin ("the Property"). The Plaintiff asserted that an option to purchase the Property was conferred by a tenancy agreement and registered a lis pendens against the Property on 18 September 2018.

In a judgment dated 21 March 2021 ("the Option Judgment"), the Court found that the Plaintiff had exercised an option to purchase the Property for €725,000 rather than the €625,000 claimed. An application to vacate the lis pendens was refused at that time.

On 21 January 2022, the High Court ordered that the Plaintiff was entitled to rely on the option to purchase the Property for €725,000 ("the 2022 Order"). However, the purchase did not occur.

Subsequently, the Defendants sought to dissolve or vary the 2022 Order by a motion filed on 22 March 2024 ("the Variation Motion"). The Court refused relief in a judgment delivered on 20 January 2025 ("the Variation Judgment"), finding that there was no order for specific performance and no jurisdiction to vary the 2022 Order.

Following the Variation Judgment, the Defendants requested the Plaintiff to vacate the lis pendens. Instead, the Plaintiff made a further offer to purchase the Property subject to deductions for legal costs.

The Defendants then filed the present Motion on 6 March 2025 seeking to vacate the lis pendens pursuant to section 123 of the Land and Conveyancing Law Reform Act 2009.

Legal Issues Presented

1. Whether the lis pendens registered against the Property should be vacated under section 123(a)(i) of the Land and Conveyancing Law Reform Act 2009 on the basis that the proceedings to which it relates have been determined.
2. Whether the lis pendens should be vacated under section 123(a)(ii) due to alleged unreasonable delay in prosecuting the action or lack of bona fide prosecution.

Arguments of the Parties

Defendants' Arguments

• The lis pendens was validly registered but the Plaintiff has failed to exercise the option to purchase the Property since the 2022 Order.
• The proceedings have been determined, thus the lis pendens should be vacated under section 123(a)(i).
• Alternatively, there has been unreasonable delay in prosecuting the action since the determination, justifying vacation under section 123(a)(ii).
• The Plaintiff had the right to exercise the option since March 2021 by paying €725,000 but never did so.
• Legal costs are separate and cannot be unilaterally deducted from the option price.
• The Defendants risk losing their family home if restrained indefinitely from selling the Property.

Plaintiff's Arguments

• The Plaintiff asserts readiness and willingness to complete the purchase in accordance with the Option Judgment and produced evidence of funds.
• Claims that the Defendants frustrated attempts to complete the sale and delayed the process.
• Maintains that agreements to purchase the Property existed despite the Defendants' conduct.
• Relies on offers to purchase the Property subject to deductions for legal costs, explaining the basis for such deductions.
• Asks the Court to deny the motion to vacate the lis pendens.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court first examined the nature of the lis pendens, emphasizing its purpose to maintain the status quo during ongoing litigation and its close connection to pending proceedings. The Court noted that a lis pendens may be vacated where the related action has been discontinued or determined, or where there is unreasonable delay in prosecution.

The Court found that the proceedings relating to the option to purchase the Property had been finally determined by the Option Judgment and the 2022 Order, with no appeals filed. The Plaintiff had failed to exercise the option within a reasonable time, and no completed contract had arisen.

Given that the lis pendens had been registered over 6.5 years ago and remained in place for nearly 3.5 years after the proceedings were determined, the Court held that the purpose of the lis pendens was spent. The Plaintiff's position had been protected for longer than contemplated by section 123.

The Court rejected the Defendants' secondary argument based on section 123(a)(ii), finding no evidence of unreasonable delay in prosecuting the action since the proceedings were determined. The Court emphasized that delay in exercising rights after determination does not constitute delay in prosecuting the action.

Accordingly, the Court concluded that section 123(a)(i) empowered it to vacate the lis pendens and that it was appropriate to do so in the circumstances, noting the injustice to the Defendants if restrained indefinitely from disposing of the Property.

Holding and Implications

The Court granted the Defendants' motion to vacate the lis pendens.

This decision means the lis pendens registered against the Property is removed, allowing the Defendants to sell or otherwise dispose of the Property without the restriction imposed by the lis pendens. The Plaintiff's failure to exercise the option within a reasonable time and the final determination of the proceedings justified this outcome. No new legal precedent was established; the ruling applies the established principles governing lis pendens and the statutory provisions of the Land and Conveyancing Law Reform Act 2009.

The Court also provisionally viewed that the Plaintiff should bear the Defendants' costs related to this Motion and scheduled a further hearing to finalize cost orders.