TWO CONSTRUCTION companies have brought Commercial Court proceedings aimed at compelling Cork County Council to pay €6.2 million arising from a social housing agreement.
Diamond Developments Ltd and Bride View Developments Ltd, both with registered offices at Dundanion House, Blackrock, Cork, claim the money is due under an agreement of October 2007 for the transfer of two apartment blocks, comprising 24 units, and a community centre premises at a development at Bridgefield, Curraheen, Co Cork.
The companies say the agreement provided for the transfer of the apartments and community centre to the Respond Housing Association, a voluntary housing body nominated by the council, under the social housing provisions of part V of the Planning and Development Act.
The companies claim the two apartment blocks are substantially complete, but further costs of some €150,000 were required to complete the development.
The council had failed to make any stage payments under the contract and had evinced an intention not to be bound by the terms of the agreement, they claim. In light of that, the companies say they have not done the completion works although they are able and willing to do so.
They claim some €6.2 million is due and owing.
The council had told them in correspondence it had made a recommendation to the Department of the Environment, Heritage and Local Government concerning the October 2007 social housing agreement.
The companies say they were never told their agreement with the council in relation to their part V obligations was conditional on the department's approval. There appeared to be a significant obstacle in getting that approval, but that was not a matter which concerned the companies, they claim.
In an affidavit, Declan O'Mahony, a director of the companies, said that, given the downturn in the construction industry, the companies were coming under significant financial pressure.
He said it was essential for their financial viability that the proceedings were determined as speedily as possible.
In those circumstances, the companies applied to have the case fast-tracked in the Commercial Court and Mr Justice Peter Kelly yesterday admitted the case to that court's list.
