A High Court judge intervened in a case of "gazumping" yesterday to compel the vendors of a £2.45 million house to sell it to the originally agreed buyers.
Mr Justice Kearns granted an interim injunction requiring the owners of Adare House, in Silchester Road, Glenageary, Co Dublin, not to sell the property to anyone other than Mr Barry Maloney, chief executive of Esat Digifone, and his wife, Aileen.
The injunction was to expire on June 8th, but the two couples involved settled the case amicably last night with an exchange of contracts. A statement issued on behalf of the vendors, Brian and Mary O'Donnell, referred to the situation as a "misunderstanding".
Mr Colm O hOisin, counsel for the Maloneys, had earlier told the High Court the couple claimed they had sealed a deal with the O'Donnells for the purchase of the house for £2.45 million.
The house had been due to be auctioned at 2.30 p.m. yesterday by Lisneys. The Maloneys claimed to have signed a binding contract on Tuesday, May 25th.
Mr O hOisin said another couple had arrived in tears at the O'Donnell home and had raised their price by £50,000. The Maloneys had refused to match the new offer on the strength of their allegedly binding contract.
In an affidavit, Mr Maloney said he had worked in the United States and in Switzerland but had returned home about three years ago when he had been appointed chief executive of Esat Digifone. He and his family had since lived in rented accommodation in Dalkey.
They were shown Adare House by Mr Tom Day of Lisney Auctioneers and on May 6th he made an offer of £2.3 million. He had been told the O'Donnells wanted £2.5 million and he increased his offer to £2.4 million on the basis they would sell prior to auction.
He and his wife made a further offer of £2.45 million on Tuesday, May 25th. Some minutes after his offer Mr Day had telephoned to say they had a deal and advised him to make a cheque out for the deposit.
Mr Day called on Tuesday morning and in the presence of his solicitor, Mr Paul Meagher, of W.G. Bradley, he had signed the contract and handed over the cheque. He had pointed out the cheque was post-dated to allow funds to come from overseas and Mr Day had said it was not a problem. Mr Day said the house would be taken off the market at 11 a.m. that day and that it had now been sold.
He said Mr Day spoke to the O'Donnells' solicitors and told them the house had been sold and anyone making further inquiries should be so advised. He had emphasised that neither the amount nor the identity of the purchaser was to be identified.
At that stage Mr Day shook his hand and congratulated him. He left, saying he was going to get the contracts signed by the O'Donnells. At 4 p.m. on Tuesday Mr Day had telephoned to say there was a big problem.
Another party had arrived in tears at the O'Donnells' door and had made a higher offer of £2.5 million. He had reminded Mr Day he had said the house would be taken off the market at 11 a.m.
When Mr Maloney had telephoned his wife to tell her what was happening she said she had passed the house at 2.20 p.m. and it had "Sold" signs hanging on it.
He passed it at 7.30 p.m. and the signs were still up. Mr Meagher said it was clear to him from Mr Day's conduct at the signing of the contracts that he was of the view there was a binding agreement in place. At no stage was any term such as "subject to contract" used in any dealings between the parties.
During the case Mr Justice Kearns commented that the present overheated property market was creating a lot of very undesirable side-effects. The judge said he did not know if legislation was in the pipeline regarding price gazumping but he knew it had been mooted.