The Duddy Hospitality Group has been declined injunctions by the High Court, which included a prohibition against receivers selling a hotel located in Dublin. UK’s Propiteer group was also not prevented by Justice Rory Mulcahy from appointing or eliminating directors to companies managing the Ibis Red Cow Hotel in Dublin, specifically Clondalkin. Despite acknowledging a serious issue presented by the Duddy group, the judge refused the injunctions, stating that financial compensation would suffice should the plaintiffs win the full case. He indicated that the plaintiffs hadn’t presented substantial factors that demonstrated a high risk of unfairness that warranted the injunctions.
Judge Mulcahy described the clash between the parties as a clear business disagreement, where the hotel investment intended solely to generate a commercial return. He emphasised a prompt resolution as being in the best interest for all parties, offering his assistance for a quick hearing of the dispute. If the injunctions were approved, they would stand till the completion of the case proceedings.
The ruling features a conflict over a hotel amongst other assets, between the Duddy and Propiteer groups, citing a supposed breach of contract concerning a division of jointly-owned assets. Subsequent to the disagreement, Propiteer Ireland Holdings Limited, DADAC Ltd, and Propiteer Ltd have been taken to court by Duddy Hospitality Ireland Holdings Limited, Brendan, and Lawrence Duddy.
Colin Sandy and David Marshall, primary figures in Propiteer, have also been sued, as the judge explained. The defendants challenged the injunction requests for several reasons, asserting that the request for orders was delayed by the plaintiffs, and alluded accusations of misconduct and a lack of “clean hands”. The judgement mentioned allegations of embezzlement which were reciprocated with rejections and justifications by both warring parties.
The judge emphasised that no judgement has been made regarding any potential lack of integrity, despite lingering questions that still need addressing. Furthermore, the court hasn’t made a decision to deny the injunctions based on any alleged delay.
Applications have been made by the Duddy Group to halt receivers Ken Fennell and Andrew O’Leary from selling their business, arguing their appointment over the hotel by the defendants was unjust. The Duddys are asserting that proceeding with the hotel’s sale, initially planned for last year, could disadvantage them.
Moreover, the collective contends that attempts have been made by the defendants to oust directors from the boards of two hotel-related companies intending to replace them with their preferred nominees. According to Duddy’s group, the defendants are not legally permitted to proceed in this manner. All accusations of misdeeds are repudiated.
Once partners in numerous ventures including an Exeter hotel and developments in Dublin and Belfast, discord arose between the two groups in 2019. This led to an agreement to partition the mutual assets and part ways. During that year, the Duddy group alleges it was entitled to gain ownership and control of the Ibis Red Cow Hotel and connected companies as part of the agreement.
Nevertheless, they assert that the Propiteer group infringed upon this settlement agreement. They say the defendants purchased the hotel’s debt, preventing Duddy’s group from ultimately acquiring ownership. The Duddy group posits that the defendants now feel remorse after witnessing the hotel’s success post acquisition.
The Duddy group is applying for actions, including legal enforcement of the 2020 agreement, to be ratified by the courts, as well as orders regarding the removal of receivers appointed for some assets, including the hotel.
The Propiteer group dismisses allegations of breaching the agreement or obstructing the Duddy group’s refinancing attempts. They also suggest that a later call option agreement has superseded the original settlement due to Duddy’s alleged failure to fulfil specific conditions. The receivers also reject any allegations of misconduct.
The dispute is set to continue in court later this month.