Landmark court case to establish who's responsible for fixing defective apartments

A receiver for the National Asset Management Agency is asking the court to force an Owners Management Company to consent to the sale of 30 apartments in a development in south Co Dublin despite outstanding issues around defects. File picture: Sasko Lazarov/RollingNews.ie

A landmark case is to be heard in court on Friday over who has responsibility for rectifying fire safety defects in Celtic Tiger-era apartments. 

A receiver for the National Asset Management Agency (Nama) is asking the court to force an Owners Management Company (OMC) to consent to the sale of 30 apartments in a development in south Co Dublin despite outstanding issues around defects.

Carrickmines Green is a 235-unit development to which people began moving in around 2008, just as the building boom at the time was coming to a halt. 

The original developer, Laragan Developments, went bust and Nama took over the estate and appointed receiver McStay Luby to run Carrickmines Green on its behalf. 

The development had not been completed and was only finally finished in 2020.

In the meantime, a number of major fire safety defects were uncovered. 

Following requests from the OMC, MsStay Luby appointed fire safety consultants to carry out a full audit of the building. This highlighted further defects and the receiver agreed to have remedial work done to address the problems.

When this was completed, the receiver wanted to hand over the completed development to the OMC, which would allow for the sale of the remaining apartments. 

However, the owners were not satisfied all the defects had been addressed and appointed another consultant to review the defects. 

The resulting report highlighted further defects and the owners want these addressed before taking full control of the developments.

Their case is that the receiver was effectively acting as the developer and should therefore be responsible for having all the defects addressed. 

McStay Luby is claiming it is not the developer and has fulfilled and even gone beyond its responsibilities as the receiver of the developer’s loans.

The case, to be heard in Dublin Circuit Court, will be closely watched by owners of the up to 100,000 apartments built during the Celtic Tiger era which were left with defects. 

An expert group report published last July said the cost of remediating the defects could be as high as €2.8bn. 

An interdepartmental group is currently devising a system by which apartment owners can be recompensed. Many of the developers that were operating during the building boom subsequently went bust with their loans having been taken over by Nama.