Monday 23 September 2019

British lord must pay arrears of €571,000 in mansion dispute

Castletown Cox, near Piltown, Co Kilkenny
Castletown Cox, near Piltown, Co Kilkenny

Tim Healy

The High Court has granted summary judgment for some €571,000 against a British life peer who once owned and later rented one of Ireland's finest Georgian mansions.

The judgment against Lord George Magan was over a dispute about rent arrears for his family's secondary home, Castletown Cox and its 513-acre estate in Co Kilkenny.

Lord Magan, whose primary residence is in Kensington, London, opposed the application for judgment by a trust set up by him, the Castletown Foundation. Managed by Jersey-based Yew Tree Trustees, it was established to benefit two of his children, Edward Magan and Henrietta Black. Lord Magan continued on as a tenant of the property at a rent of €100,000 per year.

In a counter-claim, he argued he was entitled to a set-off of some €361,000 for what he spent on upkeep. He separately claimed he was entitled under the Landlord and Tenant Act to a new tenancy and that this matter was currently before the Residential Tenancies Board.

He claimed the trust took unlawful possession of the house in a "dawn raid" on May 23 last. His lawyers said "a large gang" employed by the trust cut chains to enter the property. Lord Magan is seeking damages for trespass and forcible entry because he was disputing the termination of his tenancy at the time.

The trust said it costs half a million a year to look after the property. The €100,000 rental and fees from a licence to use the house's collection of fine art and furniture was not enough to pay the bills, it said.

This was in circumstances of the €570,000 rent arrears while some €1.8m was also due for use of art and furniture. Lord Magan also owes another €2.1m for loans to him from the trustees to meet personal expenditure unrelated to Castletown Cox, the trust said.

Alongside this, some €14.5m in borrowings are secured on the property to a finance company, Sancus Jersey.

The trust managers, Yew Tree Trustees, decided in 2015 the only way to relieve the financial strain on the trust was "to bite the bullet and sell Castletown Cox". An agreement was reached this year to sell it to an unidentified buyer for more than €19m.

That was due to close last August. A month later, Sancus Jersey could have exercised its right to appoint a receiver to the property because of default on the unpaid €14.5m. However, the intended purchaser paid off the debt in anticipation of securing ownership of the house.

If Sancus appointed a receiver there would be a "fire sale" of the asset and significant value would be lost, the trust said.

The Castletown Foundation argued that if the court granted summary judgment over the unpaid rent, Lord Magan could not maintain his claim for a new tenancy because the judgment would be a "knockout blow".

Lord Magan's lawyers said the matter should go to full hearing in order to prevent an injustice in circumstances where he was now counter-claiming for wrongful exclusion.

Mr Justice Robert Haughton said the foundation was entitled to summary judgment of €571,893 over the rent arrears. He also ordered 20pc should be remitted to the Revenue.

He will hear the parties on a later date in relation to staying a further hearing of the matter in the High Court.

Irish Independent

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