Byrne v Allied Irish Banks

JurisdictionIreland
Judgment Date21 July 1976
Date21 July 1976
Docket Number[1974 No. 1751 P.]
CourtHigh Court

High Court

[1974 No. 1751 P.]
Byrne v. Allied Irish Banks
In the Matter of Kum Tong Restaurant (Dublin) Limited (in liquidation)
Patrick J. Byrne, Applicant, and Allied Irish Banks Limited
Respondent

Cases mentioned in this report:—

1 Eyre v. McDowell (1861) 9 H.L. Cas. 619.

2 Hillingdon Estates Co. v. Stonefield Estates Ltd. [1952] Ch. 627.

3 Paul & Frank Ltd. v. Discount Bank (Overseas) Ltd. [1967] Ch. 348.

4 Tempany v. Hynes [1976] I.R. 101.

Company - Charge Registration - Book debts - Sale of company's land - Equitable charge on purchase money - Liquidation before sale completed - Whether charge registrable - Companies Act, 1963 (No. 33), s. 99.

Motion on Notice.

On the 26th January, 1974, the company contracted to sell its premises at No. 43 Grafton Street, Dublin, to Peter Mark Ltd. and on the 31st January, 1974, the company sold its goodwill in the business carried on in those premises to the same purchaser. The sale had not been completed when, on the 17th June, 1974, the High Court (Kenny J.) ordered that the company be wound up by the court and appointed the applicant to be the official liquidator of the company. Prior to the date of that order the respondent bank had advanced moneys to the company by way of loan and upon the strength of the contract for sale.

The conflicting claims of the applicant and of the respondent to the purchase money arising from the sale came before the High Court (McWilliam J.) and on the 1st June, 1976, the judge adjourned the matter for further argument and expressed his reasons for that decision as follows:—

"This matter comes before me on a motion for directions under the following circumstances. The company, presumably being then in financial trouble, entered into a contract for the sale of their premises at No. 43 Grafton Street, Dublin, on the 26th January, 1974. On the 31st January, 1974, the company entered into a contract with the same purchaser for the sale of the goodwill of the business carried on by the company in the same premises. It would appear that the company proposed to carry on business in the premises until the completion of the sales, which I have been informed should have occurred on the 26th April, 1974. To enable the company to carry on business until that date, an application for a loan was made to Allied Irish Banks Ltd. who agreed to grant a bridging loan of £4,000 on the strength of the contract for sale of the premises and the undertaking of the solicitors for the company given on the 8th April, 1974, to hold the documents of title in trust for the bank and redeem the loan out of the proceeds of the sale. Undoubtedly, had the sale been completed, the bank would have been repaid in full. On the 17th June, 1974, an order was made that the company be wound up and liberty was given to the official liquidator to disclaim the two contracts. By order of the 24th June, 1974, the order giving liberty to the official liquidator to disclaim the...

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