Bank of Ireland v Hickey
| Jurisdiction | Ireland |
| Judge | Mr. Justice Garrett Simons |
| Judgment Date | 27 June 2022 |
| Neutral Citation | [2022] IEHC 375 |
| Court | High Court |
| Docket Number | 2009 No. 850 SP |
[2022] IEHC 375
2009 No. 850 SP
THE HIGH COURT
Extension of time – Execution – Order for possession – Plaintiff seeking an extension of time within which to issue execution of an order for possession – Whether the plaintiff had met the threshold of establishing a good reason which explained the failure to execute the order for possession up to the date the motion was issued
Facts: The High Court (Dunne J) granted an order for possession on 19 December 2011, subject to a stay on execution for a period of six months. The order was perfected on 9 January 2012. The order for possession was in respect of two properties: first, the defendants’ family home, and secondly, a public house called “The Cush”. The public house had since been sold and the proceeds of sale applied towards the indebtedness of the first defendant, Mr Hickey, to the plaintiff, Bank of Ireland. The plaintiff bank applied to the High Court for an extension of time within which to issue execution of the order for possession in respect of the family home only. The application was made pursuant to Order 42, rule 24 of the Rules of the Superior Courts. Counsel on behalf of the defendants drew attention to the fact that in certain correspondence in 2013 it was expressly stated that the bank intended to enforce against the family home. It was submitted that having formed that intention, there was no adequate explanation of the delay thereafter. Counsel also emphasised the fact that no formal structure was ever put in place for resolving the debt. It was further submitted that although the bank referred consistently to “forbearance” on its part, in truth no such measures in the technical meaning of that term were put in place; there was no actual agreement between the parties, still less a formal arrangement such as, for example, a split mortgage or some other mechanism envisaged by the code of conduct on mortgage arrears. Counsel made a careful submission as to how, as a result of their advanced years and failing health, the defendants were in a worse-off position than they would have been had they lost their home a number of years earlier. In particular, it was said that it would be more difficult, for financial and social reasons, for persons in their mid-sixties to secure alternative accommodation.
Held by Simons J that the true significance of the correspondence between the parties in this case was that (i) the plaintiff bank was open to receive proposals from the defendants as to how the debt might be resolved; (ii) the bank had made a specific proposal in November 2019; and (iii) the first defendant had, at relevant points, asked the bank not to pursue matters before the court. Simons J held that were leave to issue execution to be refused in such circumstances, it would be contrary to the public interest; to refuse leave would create a chilling effect and would discourage other judgment creditors from engaging in discussions. Simons J held that the plaintiff bank had met the threshold of establishing a good reason which explained the failure to execute the order for possession up to the date the motion was issued in March 2020. Simons J held that from a legal perspective, the prejudice asserted was not one which could be said to have been caused by the delay in executing the order for possession; rather, it was the defendants’ own decision not to comply with the court order from December 2011 that had resulted in ongoing litigation between the parties. Simons J was satisfied that the delay in executing the order for possession had not caused any prejudice to the defendants. Simons J held that the legal test for granting leave to issue execution, as per Smyth v Tunney [2004] IESC 24, had therefore been met.
Simons J proposed granting the plaintiff bank leave to issue execution, pursuant to Order 42, rule 24 of the Rules of the Superior Courts, in respect of the order for possession of 19 December 2011. Simons J held that were the default position under s. 169 of the Legal Services Regulation Act 2015 to apply, then the plaintiff bank would be entitled to its costs of the motion as against the defendants.
Leave granted.
Pauline McRandal for the plaintiff instructed by Mason Hayes & Curran
Keith Farry for the defendants instructed by Gibson & Associates
JUDGMENT of Mr. Justice Garrett Simons delivered on 27 June 2022
This matter comes before the High Court by way of an application for an extension of time within which to issue execution of an order for possession. The application is made pursuant to Order 42, rule 24 of the Rules of the Superior Courts.
A party who has the benefit of an order or judgment is generally required to execute same within a period of six years. If this is not done, then it is necessary to make an application for leave to issue execution pursuant to Order 42, rule 24.
That rule provides as follows:
“24. In the following cases, viz.:
(a) where six years have elapsed since the judgment or order, or any change has taken place by death or otherwise in the parties entitled or liable to execution;
(b) where a party is entitled to execution upon a judgment of assets in futuro;
(c) where a party is entitled to execution against any of the shareholders of a company upon a judgment recorded against such company, or against a public officer or other person representing such company;
the party alleging himself to be entitled to execution may apply to the Court for leave to issue execution accordingly.
The Court may, if satisfied that the party so applying is entitled to issue execution, make an order to that effect, or may order that any issue or question necessary to determine the rights of the parties shall be tried in any of the ways in which any question in an action may be tried: and in either case the Court may impose such terms as to costs or otherwise as shall be just. Provided always that in case of default of payment of any sum of money at the time appointed for payment thereof by any judgment or order made in a matrimonial cause or matter, an order of fieri facias may be issued as of course upon an affidavit of service of the judgment or order and non-payment.”
The grant of leave to issue execution under Order 42, rule 24 is discretionary. The criteria governing the exercise of this discretion have been set out in Smyth v. Tunney [2004] IESC 24; [2004] 1 I.R. 512. There, the Supreme Court held that it is not necessary to give some unusual, exceptional or very special reasons for obtaining permission to execute following the lapse of six years from the date of the judgment or order, provided that there is some explanation at least for the lapse of time. Even if a good reason is given, the court must consider counterbalancing allegations of prejudice.
The discretionary nature of the relief has recently been reaffirmed by the Court of Appeal in KBC Bank plc v. Beades [2021] IECA 41 (at paragraph 67):
“It is clear from the jurisprudence, particularly the decision of the Supreme Court in Smyth v. Tunney [2004] 1 I.R. 512, that O. 42, r. 24 is a discretionary order and reasons must be given for the lapse of time since the judgment or order during which execution did not occur. Even where a good reason is identified for the delay, the court can take into account counterbalancing arguments of prejudice. It is noteworthy that in Smyth v. Tunney, as in the instant case, orders sought to be executed had been made in the course of long running litigation, and leave to issue execution pursuant to O. 42, r. 24 had been made some twelve years or so later. It is also noteworthy that the reasons identified for lapse in time in Smyth v. Tunney included that the applicants had made a number of unsuccessful attempts to execute.”
The concept of delay in the context of an application for leave to issue execution is very different from that of inordinate and inexcusable delay in the context of an application to dismiss proceedings by reference to the principles in Primor plc v. Stokes Kennedy Crowley [1996] 2 I.R. 459. The position has been put as follows by the High Court (Allen J.) in Irish Nationwide Building Society v. Heagney [2022] IEHC 12 (at paragraph 36):
“It seems to me that even on first glance it is obvious that the rules governing the execution of a judgment or order are quite different to those which govern the prosecution of litigation. The holder of a judgment is free to issue execution at any time within six years of the judgment or order. By contrast, the times prescribed by the rules for the exchange of pleadings are measured in weeks. A delay of years in the prosecution of an action will always call for explanation but a judgment creditor need not explain or excuse any delay in the execution of a judgment or order within the first six years from the date of the judgment or order.”
The rationale underlying this approach has been explained as follows by Butler J. in Ulster Bank Ltd v. Quirke [2021] IEHC 199 (at paragraph 34):
“[…] In my view, an applicant under O. 42, r. 24 is not to be treated as being in an equivalent position to a party facing an allegation of inordinate and inexcusable delay in the prosecution of proceedings. Delay in the prosecution of proceedings impacts on the ability of the court to conduct a fair trial. Evidence and witnesses may become unavailable and the recollection of those witnesses who remain available will doubtless be impacted by the lapse of time. Where judgment has been granted, a court has already adjudicated upon any disputed issues between the parties or, as here, a party has admitted liability for the claim made by the other. Absent an appeal, or at the conclusion of the appeals process, the...
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