Supermac’s owner resolves dispute with Limerick franchisee

A legal dispute between Supermac's founder Pat McDonagh and tenants of one of the fast-food chain's outlets has been settled.

As part of the settlement between the businessman and John and Mary Lyons, who operate a Supermac’s premises at Ennis Road, Limerick the High Court was told that an allegation Mr McDonagh had forged Mr Lyons' signature on a document was withdrawn.

The settlement was in respect of a High Court appeal against findings by Limerick Circuit Court including an order requiring Mr McDonagh to reimburse more than €150,000 in overpaid council rates and rent to the couple.

The appeal was listed for hearing before Mr Jsutice Garrett Simons on Tuesday and was expected to last two days.

At the call over Rossa Fanning SC for Mr McDonagh said that the case has been settled on terms including the withdrawal of the appeal and the respondent's cross-appeal against the Circuit Court's findings.

Mr Fanning said the Circuit Court's decision would remain in place.

In addition, counsel said it was agreed that an allegation that a signature by Mr John Lyons on a franchise agreement in respect of a Supermac’s outlet had been forged by either Mr McDonagh or anyone else was being withdrawn.

Counsel said a letter from the plaintiff's solicitor stated that following an inspection of the original document by Mr Lyons and his handwriting expert, the couple was "happy to accept that the signature presented as Mr Lyon's signature is his signature "and "was not forged by Mr McDonagh or anyone on his behalf".

The allegation was made following an inspection in March 2018 of a copy, and not an original, of the franchise agreement by Mr Lyons and his expert.

Sheila Finn Bl for Mr and Mrs Lyons said were consenting to the settlement agreement.

Last year the Circuit Court found Mr McDonagh had breached the terms of a long-standing oral tenancy agreement with the plaintiffs.

The court heard that as part of an agreement in 1995 the couple paid an annual rent of about €132,000 and that Mr McDonagh would discharge rates of about €22,000 to Limerick City Council.

Mr McDonagh stopped paying the rates for the Supermac’s premises in 2009.

This meant the couple had to pay rates on top of the rent, totalling more than €154,000.

Mr McDonagh claimed the annual rent at about €196,000.

John and Mary Lyons claimed the annual rent should be €86,000.

The couple argued that while they were willing to pay rates, they were entitled to recover losses after they had overpaid. Their claim was opposed by Mr McDonagh.

In his decision, Judge Terry O’Sullivan agreed with the plaintiff’s valuation of the rent.

The Judge found that there was an overpayment, and the plaintiffs were entitled to a rebate and that the rent is reduced. He said the Lyons’ obligation to pay rates would continue.

He also ordered Mr McDonagh to reimburse the rates previously paid by the plaintiffs since 2009 by way of annual deductions to the new fixed rent at €125,000.

The parties were also involved in separate but related proceedings concerning the Ennis Road outlet. Last month the High Court dismissed Supermac's application for an injunction preventing the couple from carrying out refurbishment works on the premises.

Supermac's, who accept that refurbishment works need to be carried out, claimed the couple were in breach of a franchise agreement which stipulates that it carries out refurbishment and repair works on its fast food restaurant's outlets.

The couple denied the claims and argued Supermac's had failed to carry out necessary refurbishments works for several years and said the action was linked to the Circuit Court appeal.