Bank of Ireland Mortgage Bank v Farrington
| Jurisdiction | Ireland |
| Judge | Mr. Justice Coffey |
| Judgment Date | 14 June 2018 |
| Neutral Citation | [2018] IEHC 331 |
| Docket Number | [2017 No. 188 CA] |
| Court | High Court |
| Date | 14 June 2018 |
[2018] IEHC 331
THE HIGH COURT
DUBLIN CIRCUIT COUNTY OF DUBLIN
Coffey J.
[2017 No. 188 CA]
AND
Possession of property – Preliminary issues – Abuse of process – Plaintiff seeking possession of property – Whether the proceedings should be struck out or dismissed as being oppressive or an abuse of process
Facts: The plaintiff, Bank of Ireland Mortgage Bank, on 15 July 2015, issued a Civil Bill for Possession of the family home of the defendants, Mr Farrington and Ms Farrington, the property known as No. 78 Heytesbury Lane, Ballsbridge, Dublin 4. On 13 June 2016, Mr Farrington swore an affidavit in which he raised the following preliminary issues: 1) whether the proceedings should be struck out or dismissed as being oppressive or an abuse of process; 2) whether the proceedings should be struck out or dismissed as breaching the rule in Henderson v Henderson (1843) 3 HARE 100; 3) whether the proceedings should be struck out or dismissed as being a case of issue estoppel; 4) whether the proceedings should be struck out or dismissed as being a case of cause of action estoppel; 5) whether the proceedings should be stayed until the costs in the High Court case between the parties (being proceedings entitled, The High Court, Record Number 2011, No. 3477S, Between, Bank of Ireland Mortgage Bank, Plaintiff and Richard Farrington and Audrey Farrington, Defendants) are first paid or discharged; 6) whether the proceedings should be struck out or dismissed or stayed on public policy or other equitable grounds. On 19 June 2017, the President of the Circuit Court made an order refusing the defendants’ application on the trial of a preliminary issue for an order striking out, dismissing or staying the proceedings in respect of those six issues set out in an issue paper before the court. The defendants appealed to the High Court against that order.
Held by Coffey J that the failure of the plaintiff to vacate the judgment of the Circuit Court given on 13 December 2011 prior to the commencement of these proceedings precluded the plaintiff from succeeding before the High Court on the preliminary issue. Coffey J held that, as a matter of law, the plaintiff already had an order for possession and the matter was, therefore, res judicata, albeit for a reason that was never argued or even considered by the defendants either in the Circuit Court or on appeal.
Coffey J held that the justice of the case required that he allow the defendants’ appeal and make an order staying the proceedings but only until such time as the plaintiff had vacated the order of the Circuit Court made on 13 December 2011.
Appeal allowed.
This is an appeal against an order of the President of the Circuit Court made on 19 June 2017 wherein he refused the defendants' application on the trial of a preliminary issue for an order striking out, dismissing or staying the proceedings in respect of the six issues set out in an issue paper before the court.
The issues set out in the issue paper are as follows:
1. ‘Whether the proceedings herein should be struck out or dismissed as being oppressive or an abuse of process.
2. Whether the proceedings herein should be struck out or dismissed as breaching the rule in Henderson and Henderson.
3. Whether the proceedings herein should be struck out or dismissed as being a case of issue estoppel.
4. Whether the proceedings herein should be struck out or dismissed as being a case of cause of action estoppel.
5. Whether the proceedings herein should be stayed until the costs in the High Court case between the parties (being proceedings entitled, The High Court, Record Number 2011, No. 3477S, Between, Bank of Ireland Mortgage Bank, Plaintiff and Richard Farrington and Audrey Farrington, Defendants) are first paid or discharged.
6. Whether the proceedings herein should be struck out or dismissed or stayed on public policy or other equitable grounds.’
The plaintiff in this action seeks possession from the defendants of their family home, the property known as No. 78 Heytesbury Lane, Ballsbridge, Dublin 4 (‘the property’). The property was purchased by the defendants on 16 November 2006 for the sum of €2,600,000. The plaintiff advanced two loans to the defendants to assist with the purchase of the property, a loan of €1,000,000 for a term of twenty years and a loan of €1,000,000 for a term of five years, being €2,000,000 in the aggregate.
The money so advanced by the plaintiff to the defendants was secured by a mortgage dated 16 November 2006 over the property. The mortgage was in the plaintiff's standard form and included the following terms:
‘3.01 The Mortgagor as beneficial owner hereby grants and conveys onto the Mortgagee ALL THAT AND THOSE so much of the Mortgage Property (save any parts of the ownership whereof is registered in the Land Registry) as is a freehold tenure TO HOLD the same unto the Mortgagee in fee simple subject to the proviso of redemption hereinafter contained.
3.02 The Mortgagor as beneficial owner hereby demises unto the Mortgagee ALL THAT AND THOSE so much of the Mortgaged Property (save any parts the leasehold ownership whereof is registered in the Land Registry) as is of leasehold tenure TO HOLD the same unto the Mortgagee for all the residue or respective residues of the term or respective terms of years of the Mortgagor's tenure less the last three days of such term or respective terms subject to the proviso for redemption hereinafter contained.
6.01 At any time after the execution of this Mortgage the Mortgagee may without any further consent from or notice to the Mortgagor or any other person enter into possession of the Mortgaged Property or any part thereof or into receipt of the rents and profits of the Mortgaged Property or any part thereof.
6.02 The Mortgagee shall have the statutory powers conferred on mortgagees by the Conveyancing Acts as varied and extended by this Mortgage including the power to appoint a receiver and particular subject to the following variations and extensions that is the say…
6.05 The powers conferred on the Mortgagee by this Mortgage are an addition to all the powers and remedies conferred on or vested in the Mortgagee by statute, common law or otherwise.’
Definition B(4)
The ‘Conveyancing Acts’ means the Conveyancing Acts, 1881 to 1911 and the Registration of Title Act, 1964 and ‘Act of 1881’ means the Conveyancing Acts, 1881.’
Section Headed ‘C Interpretation’ at page 5
(4) Reference to any enactment includes reference to any statutory modification thereof whether by way of amendment addition deletion or repeal and re-enactment with or without amendment and whether such be occasioned by Act of the Oireachtas, Ministerial order or regulation or by regulation or directive or other enactment of any organ of the European Union.’
It is common case that the defendants defaulted in repaying the monies due and owing to the plaintiff under the terms of the loan agreements, that the monies due and owing are substantial and that they are secured by way of mortgage on the property by virtue of the Mortgage dated 16 November 2006.
On 20 December 2010 the plaintiff issued a Civil Bill for Possession of the property in proceedings entitled ‘Bank of Ireland Mortgage Bank, Plaintiff, Richard Farrington and Audrey Farrington Defendants, the Circuit Court, the County of the City of Dublin, Record No. 1287 8/2010’.
On 13 December 2011 the Circuit Court granted an order for possession in respect of the property. The defendants appealed this order of the Circuit Court by notice of appeal dated 15 December 2011.
Prior to this, on 1 December 2009 the Land and Conveyancing Law Reform Act 2009 (‘the Act of 2009’) came into force. The Act of 2009, inter alia, repealed ss. 15 to 24 of the Conveyancing and Law of Property Act 1881 (‘the Act of 1881’). The sections of the Act of 1881 so repealed were those which set out the statutory powers of sale of a mortgagee and the statutory powers of a mortgagee to appoint a receiver. The Act of 2009 also abolished the previous power that a mortgagee had to seek foreclosure.
When the appeal came on for hearing before the High Court, the defendants contended that there was no express power of sale reserved to the plaintiff in the mortgage deed other than the statutory powers conferred on mortgagees by the ‘Conveyancing Acts’ and which statutory powers were defined in the deed as being subject to ‘amendment addition deletion or appeal’. The defendants argued that the plaintiff no longer had a power of sale in circumstances where the statutory powers referred to in the deed had been repealed by the Act of 2009. The defendants further argued that the plaintiff's power to seek possession of the property was not a right in itself and was no more than a power in aid of the statutory powers of sale and foreclosure, both of which had been repealed. Accordingly, it was contended that the plaintiff could not seek to enforce a right to seek possession. In so contending, the defendants relied on the legislative loophole identified by Dunne J. in Start Mortgages Limited & Ors. v. Gunn & Ors. [2001] IEHC 275.
On 25 July 2013 the High Court (Charleton J.) stated a case to the Supreme Court pursuant to s. 38 of the Courts of Justice Act 1936 as follows:
‘Whether, by virtue of the passing of the Land and Conveyancing Law Reform Act 2009, the power of sale and/or power to seek possession which the Plaintiff previously enjoyed under the mortgage have been removed from the Plaintiff OR whether the power of sale and/or power to seek possession of the Property which the Plaintiff so enjoyed have survived and remain enforceable in accordance with the provisions...
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Farrington v Promontoria (Oyster) DAC
...by virtue of the saver provided for under the 2013 Act. Simons J held that the judgment in Bank of Ireland Mortgage Bank v Farrington [2018] IEHC 331 does not stand as authority for the proposition that the saving provisions of the 2013 Act are ineffective; it follows that Promontoria (Oyst......