PEOPLE WHO bought expensive apartments in the North and then found themselves unable to go through with the deal after being made redundant in the recession were given a ray of hope yesterday.
In the High Court in Belfast Mr Justice Deeny refused to grant an order forcing a man to complete a contract to buy a £264,500 (€321,350) apartment in the Titanic Quarter at the city’s Abercorn residential complex.
The judge held that Neil Rowe, from east Belfast, had a clearly arguable case that it was impossible for him to complete the contract as he had lost his job as a building surveyor and had no significant asset.
Mr Rowe’s lawyers had advanced the novel argument of “impecuniosity” – no money – in the action brought against him by Titanic Quarter Ltd, owned by the Dublin-based property company Harcourt Developments Ltd.
Mr Justice Deeny refused to grant the plaintiff company a legal order known as specific performance. In doing so he quoted a judgment of the late Lord MacDermott that the courts should not make an order “that will beat upon the air”.
The judge said Mr Rowe had not denied that a valid contract existed between him and the company but pleaded that an order for specific performance would be in vain and that it would cause him exceptional hardship.
He said a significant number of such cases were coming before the court due to the rapid rise in house prices up to 2007 which had been followed by a sharp descent.
“It has meant that whereas a few years ago purchasers were bringing applications for specific performance against vendors who were unwilling to sell because the value of their property exceeded the price agreed, now there is a situation where vendors and developers are seeking to enforce contracts for the sale of apartments which are now worth significantly less on the open market than the price agreed in the contract,” said the judge.
Mr Justice Deeny said the case was chosen as a test case as to whether impecuniosity constituted a defence to a claim for an order for specific performance.
“I am satisfied that impossibility of performance is a ground in law for refusing the remedy of specific performance,” he said. “I refuse the decree of specific performance sought by the vendor.” In court were a number of people who agreed to buy apartments in the Ormeau Bakery development and are now unable to complete.