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Dublin: 4°C Thursday 13 May 2021

Firm headed by Sean Gallagher in High Court dispute with corporate tenant over heating system

Nokia Ireland initiated proceedings alleging Clyde Real Estate Blanchardstown was in breach of a lease agreement.

Image: Mark Stedman

A DISPUTE BETWEEN a property company of presidential candidate Sean Gallagher and Nokia Ireland over heating and cooling systems for a Dublin premises has come before the High Court.

Counsel for Nokia told the court on Thursday Mr Gallagher had in an email threatened to close down the premises if the dispute went to court.

Gallagher has insisted he made no “threat” and was merely outlining the factual situation on the ground in that architects and builders had made it clear, if an injunction threat was holding up works, they would move on to other projects.

He said that would mean fire safety issues in the building would not be remedied, it could not be safely occupied as a result and would have to be closed.

Mr Justice Tony O’Connor said he “really encouraged” the sides to sit down together to address “quite a serious situation”.

The dispute concerns the provision of heating and air conditioning systems at a building in Blanchardstown owned by Clyde Real Estate Blanchardstown Ltd, of which Gallagher is CEO, and where the tenant is Nokia Ireland Ltd.

About 100 employees work there and Nokia says they had complained about excessively hot and cold temperatures.

Nokia initiated proceedings last June claiming Clyde was in breach of a lease agreement of March 2015 and was required to provide heating, ventilating and air conditioning services in line with the terms of the lease.

Pending hearing of the case, Nokia sought injunctions preventing Clyde closing down, demolishing or decommissioning a heating, ventilation and air conditioning (HVAC) plant.

Clyde did not dispute that, as a landlord, it was required to provide HVAC plant to serve the Nokia premises but it has argued, on a proper construction of the lease agreement, the electricity and gas consumed in operating a HVAC system was the responsibility of Nokia as a tenant.

Clyde has claimed the HVAC plant at issue is “obsolete”, beyond its working life,“hugely problematic”, time-consuming and expensive to repair and maintain.

The plant must be replaced with a suitable alternative and Clyde had been endeavouring to do for some time, it said.

The matter had been adjourned after Clyde provided undertakings which it said reflected its obligations under the lease.

In court on Thursday, Imogen McGrath BL, for Nokia, said temperatures had soared to 27 degrees last June and that presented considerable issues for the employees.

Conditions were such that Nokia had health and safety concerns for those working in the building, she said.

She said after Nokia informed the landlord that failure to rectify the situation would result in court proceedings, the defendant had “threatened to close down and demolish the premises if the matter went to court.”

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McGrath said an offer had been made to put in a new HVAC system next January but that was “not sufficient” from Nokia’s perspective and the system needed to be replaced much sooner than that.

There were concerns about working in the building when temperatures drop as winter approaches, she added.

The research works at the premises are dependent on appropriate temperatures being maintained, Nokia claims.

John Freeman BL, for Clyde, said this was a landlord and tenant dispute at a commercial premises.

Nokia was essentially seeking to compel Clyde to operate an “obsolete” system, Nokia itself had admitted two years ago the system was obsolete and now it wanted Clyde to operate it, he added.

Mr Justice O’Connor said this was “quite a serious situation” and the heating system issues raised required to be investigated. He “really encouraged” the parties to sit down together, he said.

The judge made directions for exchange of legal documents and fixed 27 November to hear the injunction application.

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Aodhan O Faolain

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