Another IPAS centre developer has contract repudiated by Minister for Justice

Ann O'Loughlin

Another developer behind an International Protection accommodation project has sued the Government over the shelving of its support for the plan, the Commercial Court has heard.

The Palmerstown Temporary Accommodation (PTA) Ltd company says it spent €17 million on converting a unit in the Cherry Orchard Industrial Estate in west Dublin which was to accommodate 456 individuals.

It would bring in some €26.6 million in State payments, based on an €80 per person per day fee, over an initial two-year period.

PTA's parent is Tailored Projects Ltd, with a registered office at The Box, Chapel Lane, Killarney, Co Kerry, which bought the unit for around €3.5m in early 2024.

In February 2024, South Dublin Co Council issued a "declaration of exemption for planning" which meant the 32,000 sq feet building did not require planning permission to turn it into accommodation.

PTA signed a contract in July 2024 with the Minister for Children to carry out the conversion. Last May, responsibility for the accommodation of international protection applicants passed to the Minister for Justice, Home Affairs and Migration.

In April, at a meeting with Department of Justice officials, PTA director Peter Dunlea said he was informed the defendant "might not proceed" the the accommodation at that centre. Later in April, Mr Dunlea said in an affidavit, he was told the property was being removed from consideration as an accommodation centre.

Mr Dunlea said this came "as a complete shock to me as this is completely out of the blue."

Mr Dunlea also said it was deeply concerning that the Department of Justice was informing public representatives that the centre was not going to proceed.

It was apparent the defendant was "attempting to walk away" from the contract without acknowledging its binding nature or the "enormous costs" already incurred in getting it ready, he said.

PTA said it would be willing to participate in mediation as per a clause in the contract dealing with disputes between the parties. However, no response was received after a number of letters and legal action was initiated.

In the proceedings, it seeks a declaration the defendant has repudiated the contact as well as damages for a number of matters including alleged negligent misrepresentation/misstatement and breach of duty.

On Monday, Mr Justice Michael Quinn entered the case into the fast track Commercial Court on the application of Joe Jeffers SC, for PTA.

Ailbhe O'Neill SC, for the defendant, consented to the entry application but sought an adjournment for a week because this and a number of similar matters which are going to mediation will be dealt with on that day.

She said there may also be an application for security for costs against PTA.

In relation to a similar case before the court on Monday, Ms O'Neill was granted an adjournment to February as she said the parties have agreed to go to mediation.

In that case it is alleged by a developer that the Government has also repudiated a contract to refurbish Knockmitten House in the Western Industrial Estate in Dublin as accommodation for 66 international protection applicants.