Allied Irish Banks Plc -v- McCabe, [2019] IEHC 28 (2019)

Docket Number:2018 No. 137 SP
Party Name:Allied Irish Banks Plc, McCabe
 
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THE HIGH COURT2018 No. 137 SP

BETWEEN

ALLIED IRISH BANKS PLCPLAINTIFFAND

PATRICK McCABEDEFENDANTJUDGMENT of Mr Justice Garrett Simons delivered on 28 January 2019.

INTRODUCTION

  1. This is an application for an order for possession of certain lands in County Louth. The title of the relevant lands is registered under Folio 1074 and Folio 9730 of the Register of County Louth. The application arises out of a mortgage granted in favour of two related banks, AIB Mortgage Bank and Allied Irish Banks plc. Each bank has registered a charge as a burden on each of the two folios.

  2. The mortgage was created prior to 1 December 2009. Accordingly, the application for possession is governed by section 62(7) of the Registration of Title Act 1964. (See section 1 of the Land and Conveyancing Law Reform Act 2013).

  3. To assist in understanding the dispute which has arisen between the parties, it may be helpful to set out the provisions of section 62(7) in full.

    “(7) When repayment of the principal money secured by the instrument of charge has become due,* the registered owner of the charge or his personal representative may apply to the court in a summary manner for possession of the land or any part of the land, and on the application the court may, if it so thinks proper, order possession of the land or the said part thereof to be delivered to the applicant, and the applicant, upon obtaining possession of the land or the said part thereof, shall be deemed to be a mortgagee in possession.”

    *Emphasis added.

  4. As appears, the entitlement to apply for an order for possession is predicated on the principal money having become due. The dispute in the present case centres on whether a lawful demand for the principal money was ever made.

    PROCEDURAL HISTORY

  5. The Defendant to the proceedings, Mr Patrick McCabe, has entered an appearance dated 26 April 2018. Mr McCabe has also sworn an affidavit in opposition to the application dated 18 October 2018. The matter came on for hearing before me on 14 January 2019. Allied Irish Bank plc was represented by counsel, Mr John O’Regan, BL, and Mr McCabe was represented by his solicitor, Ms Sarah O’Mahoney.

    THE MORTGAGE

  6. The principal defence advanced is to the effect that no valid letter of demand was ever served in respect of the principal money. In particular, it is said that the various letters of demand which did issue were, first, issued without the requisite consent from AIB Mortgage Bank, and, secondly, were mistakenly issued in the name of both banks rather than in the sole name of Allied Irish Banks plc.

  7. In order to understand these arguments, it is necessary to consider the provisions of the mortgage. The mortgage is dated 24 April 2007.

  8. Clause 4 of the mortgage provides as follows.

    “4. AIB Mortgage Conditions

    The AIB Mortgage Conditions are hereby incorporated in this Mortgage. In the event of any conflict between the terms of the AIB Mortgage Conditions and this Mortgage, the terms of this Mortgage shall prevail.”

  9. Clause 5 of the mortgage provides as follows.

    “5. Ranking of Security

    5.1 The Lenders hereby agree and the Mortgagor hereby acknowledges that regardless of anything else to the contrary in this Mortgage:

    (a) until AIB Mortgage Bank has granted a full release or discharge of this Mortgage (the “AIB Mortgage Bank Release Date”);

    (i) this Mortgage shall rank as first security for the Total Debt owing to AIB Mortgage Bank in priority in all respects to the security held under this Mortgage by AIB; and

    (ii) thereafter shall rank next as security for the Total Debt owing to AIB; and

    (b) after the AIB Mortgage Bank Release Date, for so long as any Total Debt remains owing to AIB, this Mortgage shall rank as security for the Total Debt owing to AIB, regardless of: –

    (i) the order, registration, notice...

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