Bank of Ireland v O'Donnell

• Jurisdiction: Ireland
• Judge: Denham C.J.
• Judgment Date: 08 December 2015
• Neutral Citation: [2015] IESC 89
• Docket Number: Appeal No. 344/14
• Court: Supreme Court
• Date: 08 December 2015

[2015] IESC 89

THE SUPREME COURT

Denham C.J.

MacMenamin J

Laffoy J.

Appeal No. 344/14

Between/

The Governor and Company of Bank of Ireland

Plaintiff/Respondent

and

Brian O'Donnell and Mary Patricia O'Donnell

Defendants/Appellants

Extension of time - Locus standi - Bankruptcy - Appellants seeking leave to extend time to appeal - Whether appellants have locus standi to bring the motion

Facts: The plaintiff/respondent, the Governor and Company of Bank of Ireland, commenced summary judgment proceedings in December, 2010. The proceedings came on for hearing in the High Court in March, 2011. The proceedings were settled by an agreement dated the 4th March, 2011. The agreement acknowledged that the defendants/appellants, Mr O'Donnell and Ms O'Donnell, had no defence to the proceedings and it provided for the making of payments. The matter was re-entered and orders made on the 12th December, 2011. The appellants were adjudicated bankrupt by the High Court in August, 2013. The appellants sought a stay, but this was refused in September, 2013. The appellants brought a motion before the Supreme Court seeking: (i) to apply to the Court for leave to extend time to appeal the High Court order dated the 12th December, 2011, which was perfected on the 14th December, 2011; (ii) such further or other relief as the Court may seem just; and (iii) an order for the costs of the application. The appellants stated that the High Court judge did not make known any conflicts of interest or existing relationship with the respondent. The appellants referred to the fact that there were a number of motions before the High Court judge and that on every occasion he decided in favour of the respondent. The appellants submitted that the judge had an ownership stake in and a business relationship with Bank of Ireland. The appellants alleged objective bias on the part of the judge arising out of his comments and an email correspondence between the respondent and the judge's registrar in September, 2011. The respondent submitted that: (a) the appellants having been adjudicated bankrupt by order of the High Court have no locus standi to seek to appeal the judgment or to apply to extend time to bring such an appeal, any such standing vesting solely in the Official Assignee; (b) the appellants fail to satisfy any of the Éire Continental principles; c) it would be inequitable to permit the appellants to appeal at this juncture in circumstances where the judgment has formed the basis of the bankruptcy proceedings against the appellants and of separate proceedings alleging a fraudulent scheme to frustrate enforcement of the judgment and where the validity of the judgment has never been challenged by the appellants in those proceedings.

Held by Denham CJ that the appellants do not have locus standi to bring this application, the property and the right to litigate being vested in the Official Assignee, applying Heath v Tang [1993] 4 All ER 694. Denham CJ noted that the Official Assignee had indicated that he did not intend to proceed with this appeal.

Denham CJ held that he would dismiss the application of the appellants on the grounds that they did not have locus standi to bring the motion.

Application dismissed.

Judgment delivered on the 8th day of December, 2015, by Denham C.J.

1 Brian O'Donnell and Mary Patricia O'Donnell, the defendants/appellants, referred to as ‘the appellants’, have brought a motion against the Governor and Company of the Bank of Ireland, the plaintiff/respondent, referred to as ‘the respondent’.

2 The appellants have brought the motion seeking:-

(i) To apply to the Court for leave to extend time to appeal the order of Kelly J. dated the 12th December, 2011, which was perfected on the 14th December, 2011;

(ii) Such further or other relief as the Court may seem just; and

(iii) An order for the costs of the application.

3 In essence this is an application for leave to extend time to appeal the order of Kelly J. perfected on the 14th December, 2011.

Background facts

4 The application is grounded on an affidavit of Brian O'Donnell, who made the affidavit on behalf of the appellants, and referred to certain facts. He stated that he wished to apply to the Supreme Court to ask for the summary judgment order made on the 12th December, 2011, perfected on the 14th December, 2011, in the High Court, be voided or set aside. He stated that the proceedings were issued by the respondent on the 23rd December, 2010, with a return date of 5th January, 2011, to hear the application of the respondent to enter the application for summary judgment into the Commercial List.

Submissions of Appellants

5 The appellants state that the learned High Court judge did not make known any conflicts of interest or existing relationship with the respondent.

6 The appellants refer to the fact that there were a number of motions before Kelly J. and that on every occasion he decided in favour of the respondent.

7 At that time Kelly J. was running the Commercial List.

8 The appellants submitted that Kelly J. had an ownership stake in and a business relationship with Bank of Ireland.

9 The appellants allege objective bias on the part of Kelly J. arising out of his comments, the email correspondence between the respondent and the registrar of Kelly J. on the 13th September, 2011.

10 The appellants submitted that the judgment of 12th December, 2011, should not stand.

11 Reference was made to the decision of this Court in Goode Concrete [2013] IESC 39 and it was submitted that it should be applied.

12 The appellants seek an order extending time within which to appeal the order of the 12th December, 2011, on the grounds of lack of disclosure and objective bias.

Submissions of Respondent

13 The respondent has submitted that the relief sought by the appellants should not be granted, essentially for three reasons:-

(a) The appellants having been adjudicated bankrupt by order of the High Court on 3rd September 2013, have no locus standi to seek to appeal the judgment or to apply to extend time to bring such an appeal, any such standing vesting solely in the Official Assignee; and the application should accordingly be dismissed in limine.

(b) That, in any event, the appellants fail to satisfy any of the Éire Continental principles; in particular, where the appellants consented to the judgment and did not seek to raise any objection to the High Court entering judgment when they had ample opportunity to do so, they have no bona fide defence to the judgment, and accordingly no bona fide ground for appeal of the judgment; the identity of the High Court judge who entered the judgment is immaterial in the circumstances.

(c) It would, in any event, be wholly inequitable to permit the appellants to appeal at this juncture in circumstances where the judgment has formed the basis of the bankruptcy proceedings against the appellants (commenced in mid-2012) and of separate proceedings (commenced in July 2012) alleging a fraudulent scheme to frustrate enforcement of the judgment and where the validity of the judgment has never been challenged by the appellants in those proceedings.

Submissions of Official Assignee

14 The Official Assignee submitted that the appellants had not sought to have the Official Assignee bring the application to extend time to appeal, that he had not been served with the application, and that he had not received the papers until after the 10th October, 2014, when they were furnished by the respondent.

15 As to the question of whether he wishes to continue litigation commenced before the adjudication of bankruptcy, for the benefit of this estate, the Official Assignee has submitted that he has considered the litigation and in this case he does not wish to pursue it.

16 The Official Assignee submitted that the appellants could have brought an application to the High Court in bankruptcy requiring the Official Assignee to apply for the extension of time to appeal.

17 However, the Official Assignee accepted that the Supreme Court could consider an extension of time application, by its nature.

18 The Official Assignee submitted that the appellants did not have locus standi to bring this application. The Official Assignee submitted that all property of the bankrupts vests in the Official Assignee on the date of the adjudication of bankruptcy pursuant to s. 44 of the Bankruptcy Act, 1988, “the Act of 1988”. That property includes ‘things in action’, as provided for in s. 3 of the Act of 1988, which includes the right to litigate.

19 The Official Assignee submitted that it is clear from s. 44 of the Act of 1988, Quinn v. IBRC [2012] IEHC 261 and Heath v. Tang [1993] 4 All ER 694 that the right to appeal these proceedings vests in the Official Assignee.

20 The Official Assignee submitted that, having regard to Heath v. Tang [1993] 4 All ER 694 at 700, the fact that the judgment in question is the judgment upon which the petition of bankruptcy is based, is not relevant. The issue is one that affects the estate in bankruptcy, which is vested in the Official Assignee.

21 In this case the Official Assignee, while maintaining that the correct forum was elsewhere, submitted that if the parties and the Court believed that the matter could be determined more quickly and less expensively by the Court determining the motion for an extension of time he would not interfere.

Decision

22 This application relates to summary judgment proceedings commenced by the respondent on the 23rd December, 2010. The proceedings came on for hearing in the High Court on the 3rd...