Condon v Allied Irish Bank Plc

JurisdictionIreland
JudgeMs. Justice Ní Raifeartaigh
Judgment Date02 February 2018
Neutral Citation[2018] IEHC 92
Docket Number[2005 No. 809 P]
CourtHigh Court
Date02 February 2018

[2018] IEHC 92

THE HIGH COURT

Ní Raifeartaigh J.

[2005 No. 809 P]

BETWEEN
ANN CONDON
PLAINTIFF
AND
ALLIED IRISH BANK PLC, KIERAN ASHCROFT, THE GOVERNOR

AND

COMPANY OF THE BANK OF IRELAND,

AND

MICHAEL CARROLL
DEFENDANTS

Contract – Breach – Fraud – Negligent misstatement – Vicarious or direct liability – Quantification of losses

Facts: The present case dealt with the liability of the defendants against the plaintiff. The plaintiff contended that the second defendant had defrauded her in the joint purchase and running of a pub. The plaintiff alleged that the first, third and fourth defendants were vicariously or directly liable as a result of negligence and misstatement on their part for the losses suffered by the plaintiff as a result of the fraud committed by the second defendant. The second defendant had fled the jurisdiction of Ireland and his whereabouts were not known.

Ms. Justice Ní Raifeartaigh held that the liability on the part of the first, third and fourth defendants had not been established so it could not proceed with the quantification of the losses against them. Moreover, the Court also held that it had no evidence of fraud by the second defendant and thus, it was not entitled to reach conclusions or draw inferences from any presumption of wrongdoing or fraud on the part of the second defendant.

JUDGMENT of Ms. Justice Ní Raifeartaigh delivered on the 2nd day of February, 2018
Nature of the Case
1

This is a case in which the plaintiff alleges that the second defendant, Mr. Ashcroft, defrauded her in the context of their joint purchase and running of a pub in Cork, known as the Anchor Bar, and that the first, third and fourth defendants are liable to her in respect of her loss as a result of his fraud, either or both on the ground(s) of vicarious liability or direct liability for fraud, negligence and/or negligent misstatement. Mr. Ashcroft was an employee of AIB, the first defendant, and he opened bank accounts at AIB in the plaintiff's name through which various monies related to the purchase and running of the business were processed. The fourth defendant, Mr. Carroll was an employee of Bank of Ireland, the third defendant, and the plaintiff claims that he engaged in a negligent misstatement by introducing her to the second defendant as a reliable person with whom to go into business, that he was involved in the purchase of the Anchor Bar, and that he continued to have an involvement with regard to the Anchor Bar, including with regard to the giving of a loan for renovations approximately 17 months after its opening.

2

It was decided by the Court in the course of the hearing that issues relating to liability should be dealt with in the first instance, and that the Court should only proceed to hear evidence as to the quantification of the various losses if and when was established by the plaintiff that there was liability on the part of any or all of the first, third and fourth defendants. This judgment accordingly deals with liability only.

3

The Court was made aware that the second defendant, Mr. Ashcroft, had fled the country after he had been arrested and interviewed in the course of a Garda investigation into his alleged fraudulent dealings with monies entrusted to him by a number of customers of the AIB. The Court heard evidence that the DPP had directed that certain criminal charges be brought against Mr. Ashcroft, following the submission to that office of the Garda investigation file, but that no trial ever took place because he could not be located. It does not appear that Mr. Ashcroft was ever served with these proceedings. It was a frequently repeated theme in the plaintiff's case that Mr. Ashcroft was guilty of fraud on various customers at AIB. Indeed, this went so far as the making of an assertion, in written submissions, that he had perpetrated a fraud on the scale of €1.25 million over 60 customers over about 3 years. However, the evidence of Detective Sergeant Fogarty (called on behalf of the plaintiff) before me was that there were 15 complainants in addition to the plaintiff, including AIB itself. He did not put any figure of the estimated amount of fraud. He said that Mr. Ashcroft had been arrested and questioned on the 2nd February 2004, and a file subsequent submitted to the DPP. The DPP directed that charges be preferred under theft and fraud legislation, although he could not recall if any of the directed charges related to Ms. Condon, and he recalled that ‘one of the difficulties was that it [her case] was lacking proof’. He said that Mr. Ashcroft was never charged because he disappeared and could not be found, despite Interpol and Europol having been circulated.

4

It may well be that these events provide a context as to why the plaintiff has concluded so firmly that Mr. Ashcroft defrauded her in the various ways put forward in the course of this case. However, this court has no evidence of fraud by Mr. Ashcroft other than the evidence put forward by the plaintiff herself, and is not entitled to start from a position of any presumption of wrongdoing or fraud on the part of Mr. Ashcroft, or of loss on the part of the plaintiff. All of the ingredients of the plaintiff's case must be established on the balance of probabilities in the ordinary way, on the basis of the evidence adduced before the court in these proceedings. The court is not entitled to reach conclusions or draw inferences from the evidence that it would not otherwise draw, simply because there is a history of allegations having been made, a criminal investigation carried out, and charges directed, which would have led to the preferment of charges against Mr. Ashcroft if he had been located.

Lapse of time since the events complained of
5

It is a striking feature of this case that although the trial was conducted in 2017, the proceedings were initiated in 2005, and related to events which had taken place between 1999 and 2002. Thus, there was a gap of some 15-18 years between the events in question and the giving of evidence about those events. This is, needless to say, a situation which is very far from ideal, given the effect of time upon memories. The proceedings were initiated by plenary summons issued on the 3rd March, 2005. Appearances were entered on behalf of the first, third and fourth defendants between March and October, 2005. A detailed statement of claim was delivered on the 22nd November, 2006. Defences were delivered in 2007 and 2008. Notice for particulars were served and replies furnished in due course, and a discovery order in respect of AIB was made on consent on the 5th November, 2010. Notice of trial was served on the 23rd January, 2012. By order dated 21st May, 2015, discovery was ordered in respect of the plaintiff. Further particulars of loss were served on behalf of the plaintiff on the 14th October, 2015. In March 2017, there was a 12-day hearing before me, and the plaintiff herself gave evidence for the best part of 5 days of that hearing.

6

It emerged towards the end of the plaintiff's cross-examination that the plaintiff had previously instituted proceedings against Mr. Ashcroft, the second defendant, by plenary summons dated the 14th November 2002. In her evidence, she indicated that this was in respect of the same complaints the subject-matter of the present case. The solicitor acting for her at that time was a different solicitor, Mr. Martin Harvey. It is unclear to what extent she told her current solicitor about that case, as the latter did not seek out Mr. Harvey's file prior to the present hearing. It is clear that the plaintiff had numerous engagements with Mr. Harvey, as the court has seen a detailed bill of costs showing that various steps were taken on her behalf during the period between October 2002 and April 2005 by Mr. Harvey as well as junior counsel and senior counsel. This resulted in a total bill of IR£59,000 which was ultimately not paid by her and resulted in an order of fieri facias being made against her. She gave evidence to the Court that she did not know what had happened to the case against Mr. Ashcroft which had been commenced in November 2002. The records of the Central Office indicate that those proceedings concerned dissolution of the partnership and the taking of accounts; and that she obtained judgment in default against Mr. Ashcroft.

7

The plaintiff also gave evidence that settlement discussions of some kind took place on the steps of a courthouse in Cork in the context of the Anchor bar's landlords having issued forfeiture proceedings. Again, she said that she did not know what the outcome was, but said the lease was forfeited and that she did not in any way benefit financially as a result of these settlement talks.

8

It is, to put it mildly, most unsatisfactory that these proceedings, heard in 2017, took place against a backdrop of such uncertainty as to what legal proceedings, financial settlements or other outcomes might have occurred back in the 2002-2005 period.

Outline of events between 1999-2002
9

In my examination of this case, it has seemed to me that the case turns primarily on the view the Court takes of the facts. I propose in the first instance to set out a short outline of the chronology of events between 1999 and 2002, in order to provide a framework for the discussion of the claims and evidence which then follows the short chronology.

1996

The plaintiff purchases the pub ‘Isaac Bells’

10

In 1996, the plaintiff, then a woman in her 40s, with a few years of experience working in a public house, purchased a public house in Cork, called Isaac Bells, with the assistance of a loan from Bank of Ireland. At that stage, she was a customer of Bank of Ireland, and was receiving advice from a Mr. Dermot Kelly in that bank (Patrick's Bridge branch). She ran this business for some time, but encountered financial difficulties and was unable to obtain further...

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