Goodman company wins €8.7m order in Blackrock row
A COMPANY controlled by businessman Larry Goodman is entitled to an €8.7m judgment and interest against developer John Flynn and his company Benray after winning an appeal in a bitter dispute over control of Dublin's Blackrock Clinic.
A three-judge Court of Appeal also found a receiver appointed by the Goodman company, Breccia, in 2014 over shares of Benray in Blackrock Hospital Ltd (BHL) was validly appointed and is entitled to sell Benray's shares in the clinic.
The court said it would overturn orders and declarations made by the High Court in favour of Mr Flynn and Benray because the High Court misinterpreted provisions of the 2006 BHL shareholders agreement.
Ms Justice Mary Finlay Geoghegan agreed with Breccia there was no "general principle" of good faith and fair dealing in Irish contract law beyond recognised examples such as partnerships and in insurance law. Even if there were, no "general" duty of good faith could be implied from the 2006 agreement, she held.
The court overturned the High Court findings there was an implied term in the 2006 agreement the shareholders owe each other "mutual general duties of good faith and fair dealing" and the agreement limited a shareholder's right to recover monies under another shareholder's loan. The parties have until April 5 to consider the judgment.
In another separate case by another shareholder, Dr Joseph Sheehan, the court ruled he could redeem his loans for €16.9m, not €20m sought by Breccia.
Blackrock Clinic was founded in 1984 by Dr Sheehan with fellow surgeons Jim Sheehan and Maurice Nelligan, and Dr George Duffy. Dr Sheehan and Mr Flynn/Benray brought separate actions against Breccia over the price for redemption of loans made by the former Anglo Irish Bank from 2006 to buy shares in the clinic.
The Sheehan and Benray loans were later acquired by Nama and later sold to Breccia.
The appeal court's judgement concerned an appeal and counterclaim by Breccia - whose co-directors are Mr Goodman and Declan Sheeran - against orders and declarations made by Mr Justice Robert Haughton in August and September 2015.
Giving the main judgment, Ms Justice Finlay Geoghegan said the appeal raised important questions concerning the proper approach to interpretation and implication of terms into an agreement between shareholders. The judge found that while a duty of good faith applies to some types of contract the shareholders agreement was not an agreement to which any such "general" duty of good faith applied.