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GAZETTE

SEPTEMBER 1986

inch structural concrete slab having been

omitted - and that walls rested on inadequate

foundation. It noted that all the defects were

"hidden" in the sense that they were not

discoverable by the sort of examination which

a lay person would be expected to carry out,

but were discoverable by a reasonably careful

inspection carried out by a person with an

ordinary professional qualification in house

construction, such as those that an architect

or engineer would have obtained.

Having reviewed the trend of development

of the English cases from

Bottomley

-v-

Ban-

nister

[1932] I KB 458 through

Otto

-v-

Bolton

and Norris

[1936] 2 KB 46 to

Dutton

-v-

Bog-

nor UDC

[1972] I QB 373 and

Anns

-v-

Mer-

ton London Borough

[1978] AC 728 the

Court also considered the Irish cases of

McGowan

-v-

Harrison

[1941] IR 231,

Cham-

ber

-v-

Lord Mayor of Cork

[1959] ILTR 45,

Siney

-v-

Dublin Corporation

[1980] IR 400

and

Colgan

-v-

Connolly Construction

Com-

pany

(High Court unreported 29th February

1980) the Court held that in Irish as in English

Law the former immunity in tort of a builder

who owns the land on which the house was

built and who subsequently sells (or lets it to a

Lessee) no longer exists and that the duty was

not affected by the fact that instead of selling

it immediately after its construction the

Vendor resided in it himself for a number of

years.

The Court noted that in

Colgan's

case the

Court awarded damages for defects based on

the cost of making good defects which threat-

ened the health or safety of the occupier but

not for defects in the quality of workmanship

which did not threaten health or safety. This

decision predated

Junior Books

-v-

Veitchi

[1982] 1WLR 447 in which the House of

Lords held that the duty of care extended to a

duty to avoid causing pure economic loss

consequential on defects in the work and to

avoid defects in the work. The Court found

the reasoning of the majority in the House of

Lords persuasive.

The Court held that the Vendor was in

breach of duty in (a) causing defects which

resulted in danger to the health and safety of

the Plaintiff; (b) causing defects in workman-

ship and (c) causing defects which resulted in

inconvenience and discomfort to the Plaintiff

and his wife.

2. The Claim against the Local Authority

The Plaintiff claimed firstly that the valu-

ation carried out by the Third-Named Def-

endant on behalf of the Council was carried

out negligently and that the Council was

vicarously liable to the Plaintiff for that

negligence. As the Court was about to hold

that the Third-Named Defendant was not

negligent, that claim failed. The Plaintiff

claimed secondly that in carrying out its

statutory function the Council owed a com-

mon law duty of care to the Plaintiff which

they breached. The Plaintiff's case was that

in carrying out its statutory duty to inspect

the bungalow under the 1972 Housing Regu-

lations to ascertain its market value before

granting a loan, a duty arose which was

breached by authorising an inspection by

someone

who

lacked

the

necessary

qualifications to ascertain reasonably discov-

erable defects. Noting that the English cases

of

Dorset Yacht Company Limited

-v-

Bognor

UDC

and

Anns

-v-

London Borough

oj

Merton

had decided that a common law duty

could arise on the exercise of a statutory

power the Court referred to the most recent

application of the doctrine in the House of

Lords in

Governors of Peabody

Donations

Fund

-v-

Sir Lindsay Parkinson and Others

[1984] 3WLR 953.

The Court noted that the scheme which the

Council adopted for the making of loans

under the Housing Authorities (Loan for

Acquisitional Construction Houses) Regu- .

lations 1972 provided "no advance shall be

made by the Council until the Council is

satisfied as a result of a report by the Council's

Valuer as to the actual value of an existing

house" . . . and, accordingly, an Applicant

would be entitled to assume (a) that the

Council had obtained a report from their

Valuer on the actual value and (b) that as a

result of that report the Council was satisfied

that the house was readily saleable. The

Court held that the Council was operating

their lending powers under the Act to assist

persons on low incomes to purchase their

own homes and in particular those who

would have been unable to do so but for the

Council's help. The Court also held that on

the facts known to the Council it should have

been aware that it was unlikely that the Plain-

tiff would himself employ a professional

person to examine it and should have known

that if avaluationwere carelessly done it might

not disclose defects in the premises as a result

of which the Plaintiff might suffer loss or

damage.

The Court concluded that as the purpose for

which the statutory duties were exercised was

to help persons like the Plaintiff it was con-

sistent with the Councils public law powers

that they should be accompanied by a private

law duty of care in his favour and found that

a duty of care arose in this case. The Council

also had a duty to ensure that the person who

carried out the valuation would be competent

to discover reasonably ascertainable defects

which could materially affect the market

value and were in breach of that duty by not

engaging a person with an ordinary profes-

sional qualification in relation to building

construction.

3. The Case against the Third-Named Def-

endant

The Court having assumed (but without

deciding) that the Third-Named Defendant

owed a duty of care to the Plaintiff held that

the Plaintiff failed to establish that an auctioneer

of ordinary skill and competence would have

discovered the "hidden" defects of the type

which existed in this bungalow. The

t

Third-

Named Defendant was not to be blamed for

the absence of qualifications which he did not

hold himself as having.

Contributions under Section 29 of the Civil

Liability Act

The Court considered in the light of the

judgments in

O'Sullivan

-v-

O'Dwyer

[1971]

IR 275 and

Carroll

-v-

Clare County Council

[19751

IR221

that the builder who constructs

a grossly substandard house which contains

serious hidden defects is much more blame-

worthy than a public authority whose fault

lies in the choice it made in the professional

qualifications necessary to inspect the prem-

ises and decided that the Local Authority

should recover from the builder 90^o of any

damages and costs which it might have to pay

to the Plaintiff.

Ward

-v-

McMaster, Louth County

Council

and Nicholas Hardy & Co. Ltd. High Court

(per Costello JJ 20 April 1985 - unreported.

John F. Buckley

REVENUE

Temporary 2% levy on live Bovine Animals -

Operation unfair and oppressive - Section 79

Finance Act 1980 not applicable - Not

necessary to consider EEC Law.

In 1979, the Government introduced a tem-

porary levy of 2°7o in respect of Bovine

Animals which were slaughtered in, or exported

from, the State. The duty was payable by the

proprietor of the premises in the case of

animals slaughtered on the premises, and by

the exporter in the case of animals exported

from the State.

The Revenue Commissioners were empow-

ered to regulate the system of collecting the

duty. The Plaintiffs challenged the validity of

the duty on the grounds that it amounted to

an imposition of a Customs Duty contrary to

the provisions of the Treaty of Rome.

The issue was referred to the European

Court of Justice which ruled that in principle

the tax was not incompatible with the Treaty

but that it would be if it impeded the proper

functioning of the relevant Common Organ-

isations but that these were facts to be deter-

mined by a National Court. In the High

Court Barrington J. held the levy invalid.

On Appeal to the Supreme Court there

were three main arguments for the Plaintiff.

1. Whether the Statutory Instruments which

introduced the levy were ultra vires of the

Finance Act, 1966?

2. Even if the Statutory Instruments were

not ultra vires were they invalid because

they operated arbitrarily and unreasonably?

3. Was the levy equivalent to a Customs Duty

on Exports and therefore void from being

contrary to a Community Law?

Henchy J. held that it was only necessary to

consider Argument No. 2.

The Tax was unreasonable if not impos-

sible for the Exporter or the Proprietor of the

Slaughter House to recover the tax from the

Farmer on whom the Levy was intended as a

tax. He held that the Application of the test

of reasonableness applied in his Judgment in

Cassidy

-v-

Minister for Industry and Com-

merce

[1978] IR 297 was applicable.

He also stated it was generally undesirable

to decide a case by invoking provisions of

Community Law when a case can be decided

by reference to domestic Law.

Section 79 of the Finance Act 1980 which

purported to remedy the defect could only act

prospectively and not retrospectively and

thus could not cure the defect of the levy.

HELD: Appeal Dismissed.

Doyle & Ors -v- An Taoiseach <£ Others. Sup-

reme Court (per Henchy J. Nem. Diss.) 29th

March, 1985 — unreported.

John O'Connor

PLANNING

Local Government (Planning and Develop-

ment) Acts 1963-1982 — Planning Appeal —

Rights of Third Parties.

The Hibernian Shirt Company &

R. E.

Flanagan applied to Dublin Corporation for

planning permission for a shop/office devel-

opment at Great Strand Street and Liffey

Street, Dublin. The application was refused

by Dublin Corporation but on appeal to An

ii