Dunnes Stores sued for not reopening its Merchant's Quay store in Cork

The court heard that Dunnes removed all its stock from the unit which has left it in “an obviously vacant state which is unattractive” for both customers and for the smaller tenants in the centre

Shopping centre owners Phyluma claims that notwithstanding the permanent lifting in May 2021 of the Covid-era prohibitions on non-essential outlets, Dunnes has "failed without meaningful explanation" to re-open its Merchant's Quay outlet.

A dispute over Dunnes Stores' alleged failure to re-open one of its anchor stores after the lifting of the pandemic closure rules for non-essential retail outlets may be resolved later this month, the Commercial Court heard.

Phyluma Ltd has sued Dunnes Stores (Georges Street) Unlimited Co. claiming it is in breach of a "keep open" clause with regard to its anchor tenancy for a Dunnes clothing outlet at the Merchant's Quay Shopping Centre in Cork. Dunnes denies it is in breach.

Phyluma claims that notwithstanding the permanent lifting in May 2021 of the Covid-era prohibitions on non-essential outlets, Dunnes has "failed without meaningful explanation" to re-open its Merchant's Quay outlet.

It also says Dunnes removed all its stock from the unit and this has left it in “an obviously vacant state which is unattractive” for both customers and for the smaller tenants in the centre.

Tony Leonard, director of Phyluma, said in an affidavit he has spent over a year in "unyielding efforts" to get the store re-opened, including through numerous communications and meetings with Dunnes' senior representative Anne Heffernan, but he had not succeeded in doing so.

When Mr Leonard negotiated with another retailer to take up the lease on half of the anchor unit, he said that Ms Heffernan changed her mind about supporting this proposal. He said Ms Heffernan then said Dunnes were considering an "alternative offering" for its Merchant's Quay unit, though did not give any details of the alternative.

When Phyluma threatened legal action, Dunnes gave no timeframe for the re-opening of the anchor unit. Mr Leonard said Dunnes also denied Phyluma's claims that the reduction of footfall in the shopping centre, which led to tenants of other smaller units leaving, was due to the closure of Dunnes. 

Dunnes also claimed there was a failure by Phyluma to invest in the centre for a significant period of time.

On Monday, Micheál D O'Connell, counsel for Phyluma, applied to Mr Justice Denis McDonald for admission of the case to the High Court's fast-track commercial division. However, he said he was seeking an adjournment in circumstances where Dunnes had indicated it will re-open after October 27 next.

Martin Hayden, for Dunnes, said there was a significant issue about the delay in bringing the case. His client also "took exception" to a number of the claims made by Phyluma. The judge adjourned the case to next month.