Supermac's boss Pat McDonagh has been ordered to reimburse over €150,000 in "overpaid" council rates and rent to the tenants of one of his fast food outlets.
The order against the Galway businessman was made in the Limerick Circuit Civil Court after it found Mr McDonagh breached the terms of an "oral tenancy agreement" with the plaintiffs, John and Mary Lyons, for a Supermac's premises at Ennis Road, Co Limerick.
The plaintiff's firm, Watchford Limited, had entered into an oral franchise agreement with the defendant's company Supermac's Ireland Limited.
An annual rent of approximately €132,000 was agreed in March 1995, from which it was also agreed the defendant would discharge rates of approximately €22,000 to Limerick City Council.
Representing the plaintiffs, Shelia Finn BL, told the court Mr McDonagh stopped paying the rates for the Supermac's premises in 2009. This resulted in the plaintiffs, as occupiers, being obliged to pay rates on top of the rent, totalling over €154,647. The court heard that a valuer for Mr McDonagh has estimated the current annual rent at approximately €196,000.
However, a valuer for John and Mary Lyons estimated the annual rent should be €86,000.
Ms Finn said her clients were willing to pay rates going forward - however, she argued they were entitled to "recover" losses after they had "overpaid".
John Lyons gave evidence the Supermac's premises was "dilapidated". He claimed the defendant had not upgraded the premises, despite asking him to do so on "numerous" occasions.
David McHugh BL, for the defendant, said Mr McDonagh had invested significantly in the premises.
Judge Terry O'Sullivan ordered Mr McDonagh reimburse the rates previously paid by the plaintiffs since 2009 by way of annual deductions to the new fixed rent at €125,000.