Behan v Bank of Ireland

• Jurisdiction: Ireland
• Judge: BARRON J.,Denham J.,Keane J.
• Judgment Date: 19 March 2002
• Neutral Citation: [2002] IESC 20
• Court: Supreme Court
• Docket Number: 304&315/97
• Date: 19 March 2002

[2002] IESC 20

THE SUPREME COURT

Denham J.

Murray J.

McGuinness J.

RECORD NO: 4815P/2001

APPEAL NO: 243/01

BEHAN v. BANK OF IRELAND

BETWEEN/

JAMES J. BEHAN

PLAINTIFF/RESPONDENT

and

THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND

DEFENDANT/APPELLANT

Citations:

RSC O.19 r28

BEHAN V BANK OF IRELAND 1998 2 ILRM 507

STATUTE OF LIMITATIONS ACT 1957 S71(1)(B)

STATUTE OF LIMITATIONS ACT (UK) 1939 S26(A)

STATUTE OF LIMITATIONS ACT (UK) 1939 S26(B)

BEAMAN V ARTS LTD 1949 1 AER 465

WHITE V SPENDLOVE 1942 IR 224

D V C 1994 ILRM 173

MCCAULEY V MCDERMOT 1997 2 ILRM 486

Synopsis:

PRACTICE AND PROCEDURE

Res judicata

Litigation - Banking - Whether issues already determined - Whether proceedings vexatious - Statute of Limitations, 1957 - Rules of the Superior Courts, 1986 Order 18, rule 28 (243/2001 - Supreme Court - 19/03/2002)

Behan v Bank of Ireland

Facts: The proceedings instituted by the plaintiff related to his dealings with the bank and an alleged failure by the bank to deal properly with his financial affairs. A prior claim made by the plaintiff had been dismissed by the Supreme Court. The defendant had brought a motion to dismiss the plaintiff's proceedings on the grounds that they were vexatious and were res judicata having already been determined. Kinlen J refused the motion on the basis that a new issue had come to light. The defendant appealed against the judgment.

Held by the Supreme Court (Denham J delivering judgment; Murray J and McGuinness J agreeing) in allowing the appeal and dismissing the plaintiff's proceedings. The issues in question had been litigated already. The fact that all the evidence the plaintiff would now wished to present to the court was not presented did not mean that the matter can be reopened. The High Court erred in determining that the matter was not res judicata. There must be finality in litigation.

1 Judgment delivered on the 19th day of March, 2002 by Denham J. [nem diss]

1. Motion to High Court

2 The Governor and Company of the Bank of Ireland, the defendant/appellant, hereinafter referred to as "the bank", applied to the High Court for an order striking out the proceedings herein of James J. Behan, the plaintiff/respondent, hereinafter referred to as the "plaintiff", in the absence of any reasonably cause of action, by reason of the action as against the bank herein being frivolous or vexatious, and being res judicata. The motion is brought pursuant to the inherent jurisdiction of this court and/or pursuant to the provisions of Order 19, Rule 28 of the Rules of the Superior Courts. The plaintiff sought an order for judgment in default of defence.

3 2. Counsel's note of the decision of the High Court (Kinlen J.), adopted by the learned trial judge, states:

"Following having heard the contentions made on behalf of Esmonde Keane BL, Counsel for the Defendant, and the Plaintiff who appeared in person, and having considered the contents of the Affidavit of Patrick Monahan, Sworn on behalf of the Defendant, dated the 17th of May 2001 and the Affidavit of Niall Browne, sworn on the 29th day of May 2001, His Honour Mr. Justice Kinlen stated that the application made on behalf of the Defendant herein was to strike out the proceedings in the absence of same disclosing any reasonable cause of action and in particular by reason of the action brought against the Defendant herein, being res judicata. His Honour Mr. Justice Kinlen stated that Mr. Browne in his Affidavit had stated that the matter relating to the credit obtained by the Defendant had only come to light after a number of days into the hearing of the matter before the High Court. The issue, accordingly, only came to light in that case and has only recently been launched in the proceedings herein. Accordingly, His Honour Mr. Justice Kinlen determined to dismiss the application and granted the Defendant the costs of attending before the High Court to argue same. In relation to the Plaintiff's Motion for Judgment in Default of Defence, three weeks was allowed to the Defendant for the filing of its Defence and reserved costs of that motion to trial judge."

3. Appeal

4 Against that decision of the High Court the bank has appealed. The grounds of appeal, as they appear on the Notice of Appeal, are as follows:-

5 2 "1. That the learned High Court Judge erred both in law and in fact in holding that the Pleadings herein disclosed any reasonable cause of action.

6 2. That the learned High Court Judge erred both in law and in fact in holding that any cause of action in the pleadings herein was not res judicata.

7 3. That the learned High Court Judge erred in law in holding that the inclusion of the issue (relating to the claim by the Plaintiff arising out of the receipt by the Defendant of credit of the farm rescue package) following the commencement of the hearing before the High Court in the proceedings between the parties herein entitled "the High Court, 1990, No. 9665P, Between : James J. Behan Plaintiff and The Governor and Company of the Bank of Ireland, Defendant" (hereinafter referred to as "the earlier proceedings"), accompanied as it was by the granting of liberty to amend the Statement of Claim and the subsequent amendment of same (including general and consequential damages arising from same) and further hearing the Judgement (sic) concerning same in the earlier proceedings, prevented the said issue and the other issues herein from being res judicata.

8 4. That the learned High Court Judge erred both in law and in fact in holding that there are any new issues disclosed in the present proceedings which have not already been determined upon in the earlier proceedings.

9 5. That the learned High Court Judge erred both in law and in fact in failing to hold that the action as shown by the Plaintiff's Pleadings herein was not frivolous or vexatious as against the Defendant herein.

10 6. That the learned High Court Judge erred both in law and in fact in failing to dismiss the proceedings and/or in failing to strike out the Pleadings herein.

11 7. That the learned High Court Judge erred both in law and in fact in holding that there is any issue disclosed in the current proceedings that is not res judicata by reason of the decision in the earlier proceedings."

4. Submissions

12 Full submissions were made on behalf of both the parties. Oral submissions were made on behalf of the bank by Mr. Daniel O'Keefe, S.C. and the plaintiff himself made submissions.

13 Counsel for the bank submitted that the proceedings should be struck out on the grounds that no reasonable cause of action was disclosed, that the proceedings were vexatious and that the matters were res judicata. Counsel also requested the court to apply the principle of estoppel. Mr. Behan submitted, inter alia that there had been probable fraud by the bank related to the concealment of their use of the farm scheme money. He argued that the fraud had been concealed by the bank, that the bank had misled him. He referred to the judgment of Barron J. in James Behan v Governor and Company of the Bank of Ireland, (Unreported, Supreme Court, 20th July, 1998). Mr. Behan submitted that he was pleading fraud in this case. Further, he submitted, the consequences had not been dealt with by Morris J. previously.

5 Facts

14 The original case of the plaintiff commenced by summons dated 5th July, 1990. That case was 18 days at hearing before the High Court. There was a very detailed Statement of Claim. The Statement of Claim was amended with permission of the trial judge, in mid-trial.

15 6. The amended Statement of Claim was as follows:

"Amendment to Statement of Claim:"

16 a) Pursuant to the Order of the Learned Trial Judge Mr. Justice Morris, the Statement of Claim is hereby amended by the inclusion of paragraphs P.Q.R.S. and in the Particulars of Negligence, Breach of Duty, and Breach of Contract.

17 b) That the Defendant failed to enter the Plaintiff in the Farm Rescue Package Scheme at a time or at all when money under the Scheme could have been used to his advantage.

18 c) In failing to credit the Plaintiff's account with money payable under the Reduced Interest Subsidy Scheme on due dates the Plaintiff was deprived of interest and obliged to pay interest at full prevailing Bank rates on the whole of his borrowings over the entire period at compound interest which considerably reduced his working capital.

19 d) Despite his being approved for the Scheme the Plaintiff's account was never credited with any subsidy in the relevant period 1st April, 1982, to 31st March, 1985 and the Defendant having called in the debt in April, 1985, effectively excluded him from achieving any benefit from the Scheme.

20 e) That the Defendant in drawing down the entire amount due to the Plaintiff under the said Scheme on 30th September, 1985, which was the last day when the Scheme was in operation for his purposes and converting that amount to its own use and benefit deprived the Plaintiff of its use.

21 f) That the Defendant in relation to the Plaintiff did not use the said Scheme for the purpose for which it was intended."

22 7. The High Court (Morris J.) delivered a reserved judgment on the 15th day of August, 1997. The learned trial judge dealt specifically with the Reduced Interest Subsidy Scheme for Farmers in Severe Financial Distress. Of this scheme Morris J. stated:

"It remains now to consider the claim that arises under the introduction of the "Reduced Interest Scheme for Farmers in Severe Financial Distress", (referred to as "the scheme").

This scheme was introduced by the Minister for Agriculture on the 1st April, 1982. The scheme had as its objective the provision of some relief from high interest rates for certain classes of farmers. It is, in my view, unnecessary to set out in detail the conditions of the scheme. All that is required is that...