A dispute over the division of profits between property developer Seamus Ross and estate agent Arthur French was brought to the High Court yesterday.

Mr French has claimed that he is owed millions in profits from a joint venture to build luxury homes on the grounds of the exclusive K Club hotel and golf course.

Mr Ross' company, Menolly Homes and Mr French jointly developed the Ladycastle housing scheme and agreed to split the profits 50/50.

However, Mr French has said that the profit figure of €28.9m produced by Menolly Homes was a "major understatement" and insisted the "true profit" from the development is about €46.4m.

-- Advertisement --

The estate agent claimed the understatement is a result of several factors, including the overstatement of building costs, misallocated fees and other costs. He also said that Menolly Homes deducted a "management" fee of €3.6 million.

The proceedings were admitted yesterday to the Commercial Court. In the action, Mr French is seeking damages or an account of profits for alleged breach of contract and of fiduciary duty.

Mr French, operator of French Estates, claimed he secured an option to purchase lands at Ladycastle, part of the K Club grounds.

In seeking a partner for a residential development on the land he entered into an agreement with Mr Ross, principal beneficial shareholder of Menolly Homes.

Before construction began, it was hoped that the development would yield profits in the region of €49.7m. The development was completed in September 2006.

After draft financial statements for the year ended June 2007 disclosed a profit of €29.98m, he appointed accountants KPMG to assess the situation and it concluded the profits had been "significantly understated" because costs as presented were not reasonable or not properly incurred.

(VB/JM)