Aidan Farrell v Everyday Finance DAC

• Jurisdiction: Ireland
• Judge: Ms. Justice Stack
• Judgment Date: 24 May 2022
• Neutral Citation: [2022] IEHC 303
• Court: High Court
• Docket Number: [Record No. 2020/5639 P]

Between

Aidan Farrell

Plaintiff

and

Everyday Finance DAC

Defendant

[2022] IEHC 303

[Record No. 2020/5639 P]

THE HIGH COURT

Inspection of documents – Redaction – O. 31, r. 18 of the Rules of the Superior Courts – Plaintiff seeking to inspect documents – Whether the defendant had adequately complied with the plaintiff’s notice to produce

Facts: The plaintiff, Mr Farrell, applied to the High Court to inspect documents pursuant to O. 31, r. 18 of the Rules of the Superior Courts, s. 91 of the Land and Conveyancing Law Reform Act 2009, O. 50, r. 4 of the Rules, and the inherent jurisdiction of the court. The plaintiff borrowed monies on foot of certain loan facilities provided by AIB Bank Plc and AIB Mortgage Bank (collectively, AIB) and granted associated securities to AIB over eleven properties in Donegal and Dublin. The defendant, Everyday Finance DAC, said it was the successor in title to AIB’s interest in the said loans and securities and asserted its title as mortgagee in respect of the said securities on foot of a Global Deed of Transfer dated 2 August, 2018 and an Amended and Reinstated Global Deed of Transfer dated 22 October, 2018. There were two significant issues between the parties on the motion to inspect: first, there was the question of whether the defendant had adequately complied with the plaintiff’s notice to produce dated 22 March, 2021, by exhibiting redacted copies of the Global Deed of Transfer and the Amended and Reinstated Global Deed of Transfer in its replying affidavits; and, secondly, whether the plaintiff was entitled to production of documents other than those deeds.

Held by Stack J that redaction on the grounds of commercial sensitivity and the need to maintain duties of confidentiality owed to third parties was permissible but only if effected on the basis of an accurate analysis of the issues in the proceedings and where specific explanations for the various redactions were set out on affidavit.

Stack J held that she would direct a further affidavit to be sworn by the defendant’s solicitor dealing with the redaction of documents which Stack J had found to be liable to inspection pursuant to O. 31, r. 18, and that she would list the matter before her for mention in early course in order to hear the defendant’s proposals as to a timeline for that to occur.

Application granted.

JUDGMENT of Ms. Justice Stack delivered on the 24th day of May, 2022.

Introduction

1 This is an application to inspect documents, which is brought pursuant to O.31, r.18 of the Rules of the Superior Courts, s. 91 of the Land and Conveyancing Law Reform Act, 2009, Order 50, rule 4 of the Rules, and the inherent jurisdiction of the court. The plaintiff borrowed monies on foot of certain loan facilities provided by AIB Bank Plc and AIB Mortgage Bank (collectively, “AIB”) and granted associated securities to AIB over eleven properties in Donegal and Dublin. The defendant says it is the successor in title to AIB's interest in the said loans and securities and asserts its title as mortgagee in respect of the said securities on foot of a Global Deed of Transfer dated 2 August, 2018 (“the Global Deed of Transfer”) and an Amended and Reinstated Global Deed of Transfer dated 22 October, 2018 (“the Amended and Reinstated Global Deed of Transfer”).

2 Broadly speaking, there are two significant issues between the parties on this motion to inspect. First, there is the question of whether the defendant has adequately complied with the plaintiff's notice to produce dated 22 March, 2021, by exhibiting redacted copies of the Global Deed of Transfer and the Amended and Reinstated Global Deed of Transfer in its replying affidavits and, secondly, whether the plaintiff is entitled to production of documents other than those deeds.

3 The plaintiff has delivered a lengthy statement of claim which makes the following essential complaints:

• (i) The defendant has refused to permit the plaintiff to inspect the documents of title held by the defendant as mortgagee notwithstanding the plaintiff's right to such inspection pursuant to s. 91 of the Land and Conveyancing Law Reform Act, 2009;

• (ii) The plaintiff entered into a restructuring agreement with AIB in or about 2015, on foot of which he took steps to sell certain property, including his family home, thereby creating an estoppel which bound AIB and the defendant as its successor. Alternatively, it is said that insofar as a successor is not bound, then the transfer of the loans and securities is invalid;

• (iii) It is claimed that the plaintiff is entitled to buy out his loans and securities and that his right to redeem is on terms to be imposed by equity including a fair price to be paid by the mortgagor for redemption, by reason whereof the plaintiff has a right of first refusal or pre-emption if the loans and securities are offered for sale at below par value;

• (iv) That the mortgage was subject to a term or condition that the mortgagee would not sell the plaintiff's loans and security together with other assets which might be less saleable, so as to prevent the mortgagor from offering an equal or better price (which I understand is the price paid by the defendant for the plaintiff's loans and mortgages) or so as to encourage litigation;

• (v) That the plaintiff had a right to redeem at the price or value offered by the defendant;

• (vi) That the sale of the plaintiff's loan and security savoured of maintenance and champerty;

• (vii) That AIB ought not to have transferred the plaintiff's loans and security to an entity which was not a bank or credit institution under Irish or European Union law, at least without the express consent in writing of the plaintiff;

• (viii) That the defendant would make available its title deeds to the plaintiff for the purposes of disposing of the mortgaged properties;

• (ix) That the defendant had caused loss to the plaintiff by causing several sales of the mortgaged properties to fall through;

• (x) That the defendant is not entitled to appoint a receiver given that the plaintiff had abided by the restructuring agreement with AIB.

4 The defendant delivered a defence on 19 March, 2021, in which it is pleaded inter alia:

• (i) That the original loan agreements and the further agreements reached between the plaintiff and AIB on 23 September, 2015 and 28 September, 2015 were to the effect that the sums advanced by AIB to the plaintiff were and remained repayable upon written demand being made of the plaintiff;

• (ii) That the plaintiff had previously acknowledged the defendant's title and was now estopped from challenging it;

• (iii) That the plaintiff was not entitled to claim for losses associated with sales of the mortgaged properties which did not go through;

• (iv) That the defendant was AIB's successor in respect of the agreements and related mortgaged securities entered into between the plaintiff and AIB, and para. 9 of the defence specifically relied on the Global Deed of Transfer and the Amended and Reinstated Global Deed of Transfer as evidence of the defendant's lawful acquisition of, and legal title in, the agreements and related mortgage securities referred to in the statement of claim;

• (v) That s. 91 of the 2009 Act did not apply to “the title documents executed further to the agreements entered into between inter alia AIB and the defendant and further to which the defendant as transferee acquired the legal rights, interests and title previously vested in AIB in the agreements and related mortgage securities.”

• (vi) Alternatively, it was pleaded that s. 91 did not entitle the plaintiff to inspect and take copies of the Global Deed of Transfer and the Amended and Reinstated Global Deed of Transfer in unredacted form;

• (vii) That the statement of claim did not disclose a cause of action insofar as s. 91 of the 2009 Act was concerned;

• (viii) That there was no bar to the transfer by AIB of the plaintiff's loans and security;

• (ix) That the 2015 agreements with AIB had not subsequently been varied by conduct or otherwise;

• (x) That the plaintiff was not entitled to the benefit of any estoppel;

• (xi) That the plaintiff had no sustainable cause of action in respect of the alleged right to buy out his loans and related securities;

• (xii) That the transfer of the plaintiff's loans and related securities to the defendant did not require the plaintiff's prior consent;

• (xiii) That the defendant was not bound by any obligations other than those created and defined by the agreements between AIB and the plaintiff and the related mortgage security;

• (xiv) The plaintiff had no entitlement to bid in respect of his loans;

• (xv) That the price obtained by AIB from the defendant did not affect the plaintiff's outstanding liability which was in the sum of €2,172,259.80 as of 19 March, 2021;

• (xvi) That the plaintiff's equity of redemption remained and was conditional upon the plaintiff discharging in full his outstanding indebtedness lawfully due and owing to the defendant, which the plaintiff had failed to do;

• (xvii) That the defendant was entitled to appoint a receiver.

Application to inspect

5 The application to inspect was originally brought by notice of motion returnable for 15 February, 2021. This notice of motion also sought interlocutory relief in relation to the appointment of a receiver, but that aspect of the motion had been dealt with by way of undertaking on the part of the defendant and therefore does not now arise.

6 The notice of motion was based on O.50, r.4 of the Rules and s.91 of the 2009 Act, as well as the inherent jurisdiction of the court.

7 Subsequently an unfiled notice of motion in amended form was provided to the defendant, and as the only amendment was to refer specifically to O.31, r. 18, in para. 2, the application proceeded on the basis of the notice of motion in amended form.

8 The documents sought pursuant to O.50, r.4, s. 91 of the...