Bank of Scotland Plc v Stapleton

• Jurisdiction: Ireland
• Judge: Mr Justice Michael Peart
• Judgment Date: 29 November 2012
• Neutral Citation: [2012] IEHC 549
• Docket Number: [2012 No. 25 CA]
• Court: High Court
• Date: 29 November 2012

Bank of Scotland Plc v Stapleton

No Redaction Needed

Dublin Circuit

County of the City of Dublin

Between:

Bank of Scotland Plc.

Plaintiff/Respondent

And

Julia Stapleton

Defendant/Appellant

[2012] IEHC 549

Record Number: No 25 CA/2012

THE HIGH COURT

BANKING LAW

Evidence

Proceedings seeking possession - Bankers' books - Whether employee of company providing administrative support to mortgagee had capacity to give evidence - Whether evidence hearsay as no personal knowledge of books and records of mortgagee - Letter of authority provided by mortgagee - Whether letter of authority sufficient to render witness competent - Whether evidence inadmissible hearsay - Rule against hearsay - Whether proof to be provided could be delegated - R v Albutt [1911] 6 Cr Ap R 55; Criminal Assets Bureau v Hunt [2003] 2 IR 168 and Moorview Developments Ltd v First Active Plc [2010] IEHC 275, (Unrep, Clarke J, 9/7/2010) considered - Bankers' Books Evidence Act 1879, ss 3, 4, 5 and 9 - Appeal allowed (2012/25CA - Peart J - 29/11/2012) [2012] IEHC 549

Bank of Scotland Plc v Stapleton

Facts: The plaintiff bank had obtained an order in the Circuit Court for possession of a dwelling house. The defendant and her late husband had fallen into arrears. The issue arose as to the lack of physical presence of the plaintiff in Ireland following the transfer of assets and liabilities of the plaintiff to another entity from 1 January 2011, outsourcing the management of its loan portfolio to a service company. An individual was authorised to give oral evidence on the behalf of the plaintiff who was not employed by the plaintiff. The Court considered whether this letter of authority was sufficient to render her a competent witness as to the arrears on the defendants mortgage account and whether her evidence was inadmissible, pursuant to the provisions of the Bankers Books Evidence Acts 1879-1959.

Held by Peart J. that the authorised individual to give evidence on behalf of the bank had accepted in cross-examination that she was neither a partner not officer of the plaintiff bank and neither was she an employee of the plaintiff bank. There was nothing within the relevant legislation which relieved the bank from the strictures of the rule against hearsay. The bank had to provide evidence in a manner complying with the evidentiary requirements. The Court would allow the appeal.

BANKERS BOOKS EVIDENCE (AMDT) ACT 1959

BANKERS BOOKS EVIDENCE ACT 1879 S9

BANKERS BOOKS EVIDENCE ACT 1879 S3

BANKERS BOOKS EVIDENCE ACT 1879 S4

BANKERS BOOKS EVIDENCE ACT 1879 S5

MATTHEWS & MALEK DISCLOSURE 2ED 2000 PARA 8.39

PHIPSON & ORS PHIPSON ON EVIDENCE 15ED 2000 PARA 36.46

R v ALBUTT & SCREEN 1911 6 CR APP R 55

CRIMINAL ASSETS BUREAU v HUNT 2003 2 IR 168 2003/10/2095

CRIMINAL JUSTICE ACT 1994 S63

MOORVIEW DEVELOPMENTS LTD & ORS v FIRST ACTIVE PLC & JACKSON UNREP CLARKE 9.7.2010 2010/37/9346 2010 IEHC 275

1 On the 24 ^th January 2012, the plaintiff bank obtained an order in the Circuit Court for possession of certain property, including a dwellinghouse, at Rathcoole, Co. Dublin. That property had secured certain borrowings advanced by the bank to the defendant and her now late husband by way of a Deed of Mortgage and Charge dated 9 ^th September 2005. The defendant and her late husband fell into arrears with mortgage repayments, and in due course proceedings were commenced in the Dublin Circuit Court in which the banksought an order for possession in order to enforce its security in respect of the loan.

2 The original mortgagee was Bank of Scotland (Ireland) Limited ("BOSI"), whose were then at Canada House, 65-68 St. Stephens Green, Dublin 2. Indeed, it was this company which is named as plaintiff in the said proceedings. However all the assets and liabilities of BOSI including the said mortgage transferred to Bank of Scotland with effect from after the 31 ^st December 2010, and BOSI was dissolved without going into liquidation. In effect thereafter all the rights and obligations under the mortgage, including rights of enforcement, became vested in Bank of Scotland, who, by order of the Circuit Court made on the 22 ^nd March 2011 were substituted as plaintiff in these proceedings in place of BOSI.

3 While the Defence delivered by the defendants contained a simple traverse, the issue raised both in the Circuit Court, and again in this Appeal to the High Court, is a legal issue.

4 That issue arises from the fact that BOS has no physical presence in this country following the transfer of the assets and liabilities of BOSI to BOS as and from 1 ^st January 2011, and has outsourced the management of its loan portfolio here to an independent service company called Certus, which, according to the evidence of Joanne Finnegan, an employee of Certus, provides what she described as customer support to BOS borrowers, and administrative support to BOS. Certus is based in Dublin. She explained that customer support can take the form of dealing with queries from existing borrowers, dealing with mortgage accounts which are not in arrears yet, but where customers wish to discuss restructuring their mortgage, as well as dealing with mortgage accounts that are in arrears, such as that in the present case. Certus will make contact with borrowers whose mortgage is in arrears, and if necessary will liaise with solicitors here for the purpose of instituting proceedings in order to recover the amount due on foot of the mortgage, if that initial contact does not result in some agreed solution. All of that is perfectly understandable given that BOS does not have personnel on the ground here,yet would need to deal with these matters in this jurisdiction even though BOS itself has no physical presence here anymore. But that imperative does not mean that the normal and well-established rules of evidence can be bent or relaxed in order to avoid for BOS the trouble, inconvenience and expense of having to send over some employee of BOS to prove any facts which may be necessary for the purpose of proceedings against a borrower.

5 Ms. Finnegan was authorised in writing by BOS to give oral evidence on behalf of BOS both in the Circuit Court, and on appeal to this Court. Her capacity to give such evidence is challenged by the defendant on the basis that she is not employed by BOS and therefore her evidence must of necessity be hearsay, given that she has no personal knowledge of the books and records of BOS. Her letter of authority on Bank of Scotland headed paper which was used in this appeal is one dated 12 ^th November 2012. The letter is not addressed to anybody in particular but bears the title and record number of these proceedings, and it purports to be signed by "Mr Gary Collins, Assistant Manager, Lloyds Banking Group, Princess Street, 1 Suffolk Lane, London EC45 0AX". It states:

"I, Gary Collins, Assistant Manager, Retail Credit, Ireland Business Support Unit, Lloyds Banking Group, Princess House, 1 Suffolk Lane, London EC4R 0AX, on behalf of Bank of Scotland plc having their registered office at The Mound, Edinburgh EH1 1YZ, Scotland, United Kingdom, and acting with its authority HEREBY AUTHORISE Ms. Joanne Finnegan, Manager, Certus, 124-127 St. Stephens Green, Dublin 2 to give evidence on behalf of the Plaintiff Bank of Scotland Plc in the above entitled action before the High Court."

6 Ms. Finnegan has referred in her evidence to certain copy statements which she received from BOS and which relate to the defendant's mortgage account and...