The developer of a new town centre in Cherrywood in south Dublin has brought a legal challenge over a local authority’s demand for €31.4 million in development contributions.
Hines Cherrywood Development Fund ICAV claims there is no lawful basis for the demand issued last August by Dún Laoghaire Rathdown County Council.
Hines says it had an express understanding and legitimate expectation it could offset the approximate €57 million costs of certain works done to date against development contributions due, but the council has disputed its entitlement to do so.
On Monday, Mr Justice David Bairnville granted Hines's application to have the case fast-tracked in the Commercial Court, the big business division of the High Court. The council consented to the case being entered into the court's list. A hearing date will be fixed later.
Planning permissions
Hines, of George’s Court, Townsend Street, Dublin 2, an Irish collective asset management vehicle engaged in commercial property development, owns lands within the Cherrywood Strategic Development Zone (SDZ), located within the council’s functional area.
Hines has various planning permissions for development of roads and infrastructure and three public parks known as Tully Park, Ticknick Park and Beckett Park as approved within the SDZ planning scheme.
In 2018, it obtained permission for construction of a new town centre development, including construction of 15 blocks comprising 1,269 residential units, retail use, high-intensity employment uses, non-retail uses, community uses and all associated roads, streets and public spaces and services.
That 2018 permission included conditions requiring Hines to pay development contributions to the council “as a contribution towards expenditure that is, or is proposed to be incurred, by the planning authority” in respect of the provision of certain public infrastructure and facilities.
In Hines’s court documents, it was stated three of the conditions in the 2018 permission requiring the payment of development contributions were expressly imposed under the DLRCC Development Contribution Scheme 2015-2020 (“the 2015 scheme”), notwithstanding the fact that the 2015 scheme had been superseded by the DLRCC Cherrywood Planning Scheme Development Contribution Scheme 2017-2020 (“the 2017 scheme”) when the 2018 permission was granted.
Completed works
Hines claims it has carried out certain infrastructure development works, to a value of €57 million, under its permission, and following consultation with the council. It claims those works were completed in accordance with the council’s requirements and subject to its oversight and were undertaken on the basis Hines was entitled to offset its full cost against the development contributions required under the 2018 permission and the other permissions concerning the Cherrywood SDZ scheme.
The council is obliged under the 2017 scheme to engage with Hines about entering a legal agreement to assess and agree the amount of the offsets but has failed, refused or neglected to do so, and has also frustrated Hines’s right to avail of the offsets due, it is claimed.
It is further claimed the council had last August demanded payment of some €31.4 million in development contributions and had said, if payment was not made, the ongoing development being constructed by Hines under the 2018 permission would be rendered unauthorised.
The council has failed to provide any “substantive” response to a September 2020 letter from Hines solicitors requesting confirmation of Hines’ entitlement to avail of the offsets, it is alleged.
