AIB Mortgage Bank -v- Van Eeden & anor, [2016] IEHC 163 (2016)

Docket Number:2015 900 S
Party Name:AIB Mortgage Bank, Van Eeden & anor
 
FREE EXCERPT

THE HIGH COURT Record No. 2015/900S

Between:

AIB MORTGAGE BANKPlaintiff– and –

SAMUEL VAN EEDEN AND ZELDA VAN EEDENDefendants

JUDGMENT of Mr Justice Max Barrett delivered on 5th April, 2016.

Part 1

Key Issue Presenting

  1. AIB Mortgage Bank (AIB) seeks summary judgment for the balance that remains outstanding on a loan following the sale by AIB of the property that was mortgaged by way of security for that loan. Dr and Mrs Van Eeden, the relevant borrowers, contend that the dispute now arising is a matter that ought to go to plenary hearing.

    Part 2

    Background Facts

  2. In January 2007, AIB Mortgage Bank (AIB)agreed to advance €1.65m to Dr and Mrs Van Eeden for the purchase of a residential property in Malahide. On 7thFebruary, 2007 the advance was made. In June 2007, the Van Eedens entered into a form of ‘all sums due’ mortgage with AIB, which mortgage covered the property in Malahide. In or about August 2008, the Van Eedens defaulted on their loan repayments. In October 2009, AIB demanded repayment of all that was owing to it. In March 2010, the Circuit Court granted AIB possession of the Malahide property. In May 2012, the property was sold for the remarkably low sum of €305k. In May 2015, AIB issued a summary summons in respect of the balance of the amount owing under the loan agreement.

    Part 3

    Contentions Made

  3. The Van Eedens contend that this case is not a matter which ought to be dealt with by way of summary summons but ought instead to go to a full hearing. They offer a number of reasons why this is so.

  4. First, the Van Eedens contend that the loan agreement makes no reference to the totality of the sum owing becoming payable upon default. This is not so. Clause 8 of the “General Terms and Conditions of Offer of Mortgage Loan”, under the Heading “DEMAND FOR MORTGAGE LOAN REPAYMENT” states as follows:

    “The Bank may, subject to due compliance with any statutory requirements, if applicable exercise the right to demand early repayment of the Mortgage Loan balance outstanding and accrued interest thereon…”

  5. The term “Mortgage Loan” is defined in clause 1 of the said terms and conditions as “the Loan offered to the Customer in Part 1”, and when one turns to Part 1 of the loan agreement entered into with the Van Eedens, the “Loan offered” is the €1.65m loan and the “Customer” is defined as both Dr and Mrs Van Eeden.

  6. Second, the Van Eedens contend that pursuant to the ‘all sums due mortgage’ AIB sought enforcement of amounts that were owing under other credit arrangements between them and AIB. This seems an irrelevance to the within proceedings, in which recovery of the amount under the mortgage loan agreement is all that has been sought. It appears to the court from what it has seen, read and heard that upon default under the home loan, all applicable credit accounts were treated as being in default...

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