Allied Irish Banks Plc v Hiney
| Jurisdiction | Ireland |
| Judge | Ms. Justice O'Regan |
| Judgment Date | 05 June 2018 |
| Neutral Citation | [2018] IEHC 325 |
| Docket Number | [RECORD NO. 2016 1880 S] |
| Court | High Court |
| Date | 05 June 2018 |
[2018] IEHC 325
[RECORD NO. 2016 1880 S]
THE HIGH COURT
Loan – Liability – Preferential treatment – Plaintiff seeking to enter final judgment against the defendant in the sum of €11,821,000 – Whether the duty contended for by the defendant as a consequence of the change from joint and several liability to several liability only in the guarantee status of the defendant was an arguable duty imposed on the bank
Facts: The plaintiff, Allied Irish Banks plc, by way of letter of loan sanction of the 23rd November, 2011, agreed to advance the sum of €11,734,371 to Drogheda Leisure Facilities Ltd (the company) to refinance existing facilities, which loan was repayable on demand and without prejudice to that, it was envisaged that interest would be paid as it fell due and the balance would be paid in full on or before the 31st March, 2012. The company accepted the facility by executing same on the 14th December, 2011 and part of the security for such facility was a guarantee in writing from the defendant, Ms Hiney. Such guarantee of the defendant was previously executed by the defendant bearing date 10th November, 2008 wherein the defendant agreed in consideration of the advances to the company, to pay and satisfy on demand the plaintiff all sums due and owing by the company to the plaintiff limited to the sum of €11,861,000. The company failed to pay the loan in full on or before the 31st March, 2012 and a demand was made of the defendant on foot of the guarantee which demand is dated the 16th September, 2016 however the defendant failed, refused and/or neglected to pay the sum demanded. The plaintiff’s claim before the High Court was brought by way of notice of motion dated the 13th of April, 2017 wherein the plaintiff sought to enter final judgment against the defendant in the sum of €11,821,000 and further sought interest pursuant to contract and/or the Courts Act 1981 from the 16th of September, 2016 to the date of judgment. The claim of the plaintiff was resisted by the defendant who effectively sought to have the matter transferred to plenary hearing. The defendant’s grounds of resistance were: (i) the significance of the shift in the status as and from November, 2008 when the security moved from joint and several liability of the guarantors to several liability was never advised to her; (ii) Mr Caulfield, shareholder and director of the company and a guarantor of a portion of the company’s indebtedness to the plaintiff, was treated more favourably than other guarantors, this preferential treatment being made without informing her; (iii) the plaintiff had entered into settlement discussions with her co-guarantors and the plaintiff had not informed her or given her details in relation to same.
Held by O’Regan J that: (i) the duty contended for by the defendant as a consequence of the change from joint and several liability to several liability only in the guarantee status of the defendant (which the defendant asserted was not pointed out to her) was not an arguable duty imposed on the bank in the light of the Court of Appeal decision in ACC Bank plc v Connolly & Anor [2017] IECA 119 and was not supported by any of the documents before the court; (ii) the asserted preferential treatment to Mr Caulfield which was allegedly not made known to the defendant or otherwise pointed out to her was contradicted by documents before the court and not supported by any documentary evidence exhibited including the documentary evidence exhibited on the part of the defendant; (iii) the bald assertion of the defendant to the effect that she believed that the bank had entered into settlement discussions with her co-guarantors was not sufficient to deprive the plaintiff of the benefit of securing summary judgment.
O’Regan J held that she would grant summary judgment to the plaintiff in the sum claimed.
Relief granted.
The plaintiff's claim before the court is brought by way of notice of motion dated the 13th of April, 2017 wherein the plaintiff seeks to enter final judgment against the defendant in the sum of €11,821,000 and further seeks interest pursuant to contract and/or the Courts Act 1981 from the 16th of September, 2016 to the date of judgment. The defendant is resisting the plaintiff's application and seeks to have the matter adjourned for plenary hearing.
The parties have not disputed that in or about assessing whether or not summary judgment should be afforded or the matter adjourned to plenary hearing, the Supreme Court judgments in Aer Rianta v. Ryanair Ltd [2002] 1 ILRM 381 and Harrisrange Ltd v. Duncan [2003] 4 IR 1 identify the principles to be applied. In Aer Rianta, Hardiman J. indicated that the question to be posed is this; is it very clear that the defendant has no case? In Harrisrange, McKechnie J. indicated that the test was whether the defendant had satisfied the court that he has a fair or reasonable probability of having a real or bona fide defence.
The plaintiff has referred to the judgment of Baker J. in ACC Loan Management Ltd v. Dolan [2016] IEHC 69 where she quoted from an earlier decision of Charleton J. in National Asset Loan Management v. Barker [2014] IEHC 216 to the effect that if a defendant's assertion is made in the teeth of a written contract, then a particular scrutiny of the facts and how it fits with the matrix will be required, and a defendant must be in a position to show that a defence which they seek to make is not totally undermined by the correspondence between the parties. In the case before Baker J., the case which the defendants sought to make was not consistent with the documentary evidence and therefore not credible.
The within proceedings have been commenced by way of summary summons of the 10th October, 2016 which records that by way of letter of loan...
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