A claim by a university lecturer that his firm was entitled to fees of more than £100,000 for professional services was challenged by an international pharmaceutical firm in the High Court yesterday.
Dr Noel Murphy of UCD, and Hazards International Consultants Ltd, of Fitzwilliam Place, Dublin, have brought an action against Bristol Myers Squibb Pharmaceuticals Ltd and its subsidiary, Swords Laboratories Ltd, Watery Lane, Swords, Co Dublin.
In a statement on behalf of Dr Murphy and Hazards it was alleged that the Swords company wished to commence production of an anti cancer agent at its plant in 1991. The capital investment in the project was £12 million.
The Swords company had already been told by experts that planning permission was required and an Environmental Impact Statement (EIS) would be necessary. The planning experts, it was alleged, also advised there was no guarantee that planning permission would be obtained.
Dr Murphy claimed his company was requested to solve the problem and he supplied the planning authority, Dublin County Council, with full details in a memorandum. In August 1991 the council wrote back saying the process could be carried out in the existing buildings and an EIS statement or planning permission was not necessary.
Mr Dan O'Keeffe SC, for Dr Murphy and Hazards, told Mr Justice Smyth that personnel from the Swords company had impressed on Dr Murphy the urgency and sensitivity of this assignment. They did not want to go through the planning process and possible delays.
There was no mention, said Mr O'Keeffe, of fees or the basis on which Dr Murphy would be remunerated if he solved the problem. In November 1991 an invoice was sent to the pharmaceutical company for a fee of £96,500, together with VAT of £20,265.
Dr Murphy said he had been associated with UCD for 20 years and had more than 33 years experience in chemical plant design. In June 1991 he spoke to Mr John O'Doherty, the chief executive, and other officials at the Swords plant.
Dr Murphy said the fee was assessed on the basis of savings to the pharmaceutical company. If it had had to embark on a planning process and produce an EIS statement, the costs would not have been under £500,000 and could have been up to £1 million.
The basis of the fee calculation was one fifth of £500,000 and a bit off for goodwill. Dr Murphy said he and the company thought 20 per cent was reasonable and fair. This had been a unique assignment.
Cross examined by Mr Garrett Cooney SC, for the pharmaceutical company, Dr Murphy agreed he was a full time salaried and pensionable lecturer in UCD.
He agreed that the other major shareholder in Hazards besides himself had no formal qualifications and that the company had one full time secretary. It was correct that no accounts had been filed in the Companies Office by Hazards, which had been incorporated in 1987.
Dr Murphy disagreed with Mr Cooney's suggestion that notes of a three hour meeting at the Swords plant in his diary demonstrated that he was going to charge on an hourly basis.
Mr Cooney said that from diary entries it seemed Dr Murphy made a total of five telephone calls during the first week and had a three hour meeting. Dr Murphy said there were various meetings with personnel in Swords. Mr Cooney said these were not recorded.
Dr Murphy said it was totally wrong to suggest that he wrote hi memorandum to the county council on the basis of information supplied by staff at the Swords plant.
The hearing continues next Tuesday.