Business

Judge criticises Supermac’s boss and firms over information in court dispute

Case brought against Pat McDonagh, Supermacs Ireland Ltd and Funworld bowling centre on Ennis Road, Limerick

Supermac’s subsidiary Funworld (Ireland) Ltd had clearly carried out an unauthorised development before securing retention for works to create a rival restaurant, the High Court said. Stock image.

Thu Mar 7 2024 - 16:23

A judge has criticised the way information was provided to the High Court on behalf of Supermac’s boss Pat McDonagh and two of his companies in a case against them over a dispute with a former franchisee.

Mr Justice Garrett Simons also said the original case brought by the former Supermac’s franchisee operators, John and Mary Lyons, should not have been dismissed by the Circuit Court because a Supermac’s subsidiary, Funworld (Ireland) Ltd, had clearly carried out an unauthorised development before it got retention permission for works to create a rival restaurant to the Lyons’ business.

The judge made the comments when he adjourned an application for costs in the case brought by the Lyons against Mr McDonagh, Supermacs Ireland Ltd and Funworld, who are the owners and operators of the Funworld bowling centre on the Ennis Road in Limerick.

The Lyons had previously operated a Supermacs franchise called “The Hungry Lyons” next door to Funworld which is part of the same building housing both businesses.

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In 2019, the franchise arrangement ceased due to what the Lyons said was the “commercial pressure” that was placed on them by the defendants. Then, they claimed, Mr McDonagh decided to go into direct competition with them by operating a restaurant from the bowling alley premises.

However, they said, this was in breach of their lease agreement which includes a non-compete clause that the landlord cannot assign or sub-let any part of the premises for a fast-food restaurant or delicatessen.

After works were carried out to provide a restaurant in Funworld, the Lyons sought an injunction from the Circuit Court declaring they were unauthorised. The Circuit Court dismissed the application and the defendants then applied to Limerick City and County Council for retention of the works.

In the meantime, the Lyons had appealed the Circuit Court decision and the hearing of that appeal was due to take place on Thursday before Mr Justice Simons.

However, Daniel Cronin SC, for the Lyons, told the judge the appeal was being withdrawn in light of a letter which had been sent to Funworld by planners saying retention permission was being granted.

Counsel said his side had not been provided with this information which was known some time ago by the defendants. Had it been, he would have withdrawn the case earlier.

In light of the fact that it was only Monday last that his side had sight of the letter, he was applying for costs or, in the alternative, there should be no order as to costs which means both sides pay their own costs.

Gerard Kiely SC, for the defendants, who was asked by the judge why the information in relation to the retention permission had not been sent to the Lyons side, said it was assumed they knew this already and that the council would have sent the same letter to the Lyons as objectors.

The judge responded that the information could still have been presented to the court last week when the call over for hearing dates was taking place.

“You have wasted a day’s hearing and (the judge) at the call over should have been told that you were going to put this on affidavit”, he said.

When the judge reminded counsel that he also had to seek permission to file an affidavit at such a late stage, Mr Kiely said “that was possibly an error”.

The judge also said it was clear the defendants had carried out unauthorised works when the Lyons sought their injunction but that an application for retention was then submitted.

The judge disputed Mr Kiely’s assertion that the appeal to the High Court would not have been successful in light of that fact. The Circuit Court had been in error in its decision dismissing the Lyons’ case, he said.

He would give a reserved judgment next week in relation to this matter because he was not happy with the “haphazard way” it was dealt with.

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