Allied Irish Banks Plc v Finnegan

• Jurisdiction: Ireland
• Judge: BLAYNEY J.
• Judgment Date: 16 February 1996
• Neutral Citation: 1996 WJSC-SC 16
• Docket Number: 413/95
• Court: Supreme Court
• Date: 16 February 1996

1996 WJSC-SC 16

THE SUPREME COURT

Hamilton C.J.

O'Flaherty J.

Blayney J.

413/95

AIB v. FINNEGAN

ALLIED IRISH BANKS PLC

Plaintiff/Respondent

and

GERARD FINNEGAN AND LINDA FINNEGAN

Defendants/Appellants

Citations:

FAMILY HOME PROTECTION ACT 1976 S3(3)

FAMILY HOME PROTECTION ACT 1976 S3(1)

FAMILY HOME PROTECTION ACT 1976 S3(3)(a)

FAMILY HOME PROTECTION ACT 1976 S3(4)

FAMILY HOME PROTECTION ACT 1976 S3(2)

FAMILY HOME PROTECTION ACT 1976 S(4)

Synopsis:

BANKER

Security

Enforcement - Mortgage - Family - Home - Deed executed by husband - Prior written consent of wife - Validity of consent challenged by separated wife - Mortgage void unless such consent given except where bank a purchaser for full value without notice of wife's interest - (413/95 - Supreme Court - 16/2/96)

|Allied Irish Banks Plc. v. Finnegan|

EVIDENCE

Onus of proof

Conveyance - Validity - Family - Home - Deed executed by husband - Prior written consent of wife - Validity of consent challenged by separated wife - Mortgage void unless such consent given except where bank a purchaser for full value without notice of wife's interest - Bank to discharge onus of proving claim to be such purchaser - (413/95 - Supreme Court - 16/2/96)

|Allied Irish Banks Plc. v. Finnegan|

REAL PROPERTY

Alienation

Restriction - Conveyance - Validity - Family - Home - Mortgage executed by husband in favour of bank - Prior written consent of wife - Validity of mortgage challenged by separated wife - Bank asserted rights of bona fide purchaser for value - Bank to discharge onus of proof of assertion - Dispute remitted to High Court for plenary hearing - Family Home Protection Act 1976, s.3 - (413/95 - Supreme Court - 16/2/96)

|Allied Irish Bank Plc v. Finnegan|

1 JUDGMENT delivered on the 16th day of February 1996 by BLAYNEY J.[NEM DISS]

2 The defendants in these proceedings are husband and wife. They were married on the 3rd June 1978 but have been separated since February 1992.

3 In 1989 the defendants decided to buy a new family home at , Howth and in order to effect the purchase a sum of £100,000 was borrowed from the plaintiff bank (hereinafter called the bank). The house was conveyed to Mr. Finnegan on the 5th December 1989 and on the 15th December 1992 he executed a mortgage in favour of the bank to secure the amount borrowed. On the 1st December 1989 Mrs. Finnegan had signed a form of consent for the purposes of the Family Home Protection Act, 1976agreeing to the mortgage to be given by her husband to the bank.

4 In 1992 Mr. Finnegan stopped making the payments due to the bank under the mortgage and on the 24th March 1994 the bank commenced the present proceedings by special summons claiming an order for possession of _______________, Howth, which was then occupied by Mrs. Finnegan on her own. At the time the proceedings were issued, the sum of £121,888.49 was due to the bank under the mortgage.

5 The special summons was issued against Mr. Finnegan alone and Mrs. Finnegan was joined as a defendant subsequently. Mr. Finnegan is not defending the proceedings. Mrs. Finnegan has put in two affidavits. I will deal with the contents more fully later, but in summary what she avers is that she did not consent to the mortgage to the bank. She believed that the form of consent that she signed, and which had been prepared by her husband's solicitor, was a document connected with putting the family home, which was being purchased, into the joint names of herself and her husband.

6 In the High Court it was submitted on behalf of Mrs. Finnegan that there was an issue of fact to be decided in regard to whether her consent to the mortgage was valid and that accordingly there would have to be a hearing on oral evidence. The bank submitted that it did not have to go into the question of the validity of the consent; it was a stranger to what had taken place between Mrs. Finnegan and her husband's solicitor and it was entitled to rely on the fact that it was a bona fide purchaser for value. The bank relied on the exception contained in subs. (3) of s. 3 of the Family Home Protection Act, 1976to the provision contained in subs. (1) of the same section.

7 Subs. (1) provides as follows:-

"(1) Where a spouse, without the prior consent in writing of the other spouse, purports to convey any interest in the family home to any person except the other spouse, then, subject to subsections (2) and (3) and section 4, the purported conveyance shall be void."

8 Subs. (3) then...