Courtney v Ocm Emru Debtco Dac

JurisdictionIreland
CourtHigh Court
JudgeMr. Justice Robert Haughton
Judgment Date15 Mar 2019
Neutral Citation[2019] IEHC 160
Docket Number[2018 No. 9736 P.]

[2019] IEHC 160

THE HIGH COURT

THE COMMERCIAL COURT

Haughton Robert J.

[2018 No. 9736 P.]

BETWEEN
EILEEN COURTNEY
PLAINTIFF
AND
OCM EMRU DEBTCO DAC

AND

DAVID O'CONNOR
DEFENDANTS

Redaction – Loan sale agreement – Commercial sensitivity – Plaintiff seeking to inspect un-redacted copies of a loan sale agreement and a loan sale deed – Whether the redaction was justified on the basis of commercial sensitivity

Facts: The application of the plaintiff borrower, Ms Courtney, pursuant to O. 31 r. 15 of the Rules of the Superior Courts raised the question as to whether she, whose debt and security were the subject of an alleged sale and transfer by National Asset Loan Management Ltd (NALM) to the first defendant, OCM, should, prior to the close of pleadings/discovery and on foot of Notices to Produce for inspection, be entitled to inspect un-redacted copies of the relevant loan sale agreement and loan sale deed, and in particular those redacted or omitted parts of the documents that bear on the price allocated to the plaintiff’s connection, and the price paid generally. The defendant in opposing the application sought to justify the redaction on the basis of commercial sensitivity, confidentiality and lack of relevance, and on the basis that they were documents of title which were excluded from inspection under O. 31 r. 15.

Held by the High Court (Haughton J) that understanding the loan sale deeds as a whole was relevant to the plaintiff’s pleaded claims, and that this was unfairly impeded by the redactions. Haughton J was satisfied that disclosure of such redacted parts was necessary for doing justice to the plaintiff’s case, and for fair disposal of the interlocutory applications that were pending before the court. Haughton J held that he would order the disclosure of less redacted copies of the loan sale deed and deed of transfer.

Haughton J held that subject to hearing counsel further in relation to the order and undertakings that must be given by the plaintiff and her legal team he would propose ordering the following: a) an order limited in time would be made for production by the defendants to the plaintiff’s solicitors of copies of the loan sale deed and deed of transfer redacted only to the extent permitted by this judgment; b) inspection of such documents should be limited to the plaintiff and her solicitor having conduct of the case and counsel only, without further leave of the court; and c) this order would be made on the undertaking of the plaintiff to be given under oath in open court, and to be given by her counsel and her solicitors (i) not to use any of the documents or the information in them otherwise than for the purposes of the action, (ii) not to use or mention the commercially sensitive information and in particular, but without prejudice to the generality of this undertaking, any price sensitive information, in the documents, in open court (by spoken word or otherwise) or in any documents or electronic transmissions (other than secure inter partes correspondence or correspondence between solicitor and counsel) including further pleadings, requests for particulars and replies, or affidavits, save with redaction agreed inter partes or with leave of the court, and (iii) that if there was any change of representation of the plaintiff undertakings in similar terms would be obtained by the plaintiff’s solicitor having conduct of the case from the incoming solicitors/counsel and would be copied by the outgoing solicitor to the defendants’ solicitors and the Commercial List registrar.

Application granted.

JUDGMENT of Mr. Justice Robert Haughton delivered on 15th day of March, 2019
1

Since the establishment of the National Asset Management Agency (‘NAMA’) under the NAMA Act 2009, it has under its statutory remit acquired loan facilities and related security, and engaged in realising the sale of impaired debt and the related security at the best price that it can obtain.

2

The price paid by the private equity companies who have frequently acquired such debt/security is generally well below the par value i.e. the actual sums contractually due under the original facility and lending terms agreed between the bank and the borrower.

3

Typically, when NAMA (or its subsidiary National Asset Loan Management Limited (‘NALM’)) sells a loan book, it does so by way of a competitive sales process resulting in a loan sale agreement with the successful bidder, with completion by way of a transfer or loan sale deed whereby the debt and related security are assigned/transferred to the buyer. One or both of these documents set out in schedules details of the loans and security relating to a borrower or co-borrowers and guarantors, collectively often described as “connections”. The definitions in the loan sale agreement, and other elements, are often incorporated by reference into the transfer deed.

4

When it comes to court proceedings involving debt recovery or repossession proceedings taken by the acquiring entity, or by debtors seeking injunctions or declarations against them or their receivers, invariably there is extensive redaction by the deponent on behalf of the acquiring entity of copies of the loan sale agreement and loan sale deed exhibited on affidavit, by electronically blacking out all text including definitions in any way related to price, and blacking out, or omitting in their entirety, one or more of the schedules save only in so far as they list the connection the subject of the proceedings. In my experience such redaction is never preceded by any court application seeking leave to redact, and the redaction not infrequently gives rise to suspicion, resentment, and contention.

5

This application pursuant to O. 31 r.15 of the Rules of the Superior Courts raises the question as to whether the plaintiff borrower, whose debt and security are the subject of an (alleged) sale and transfer by NALM to the first named defendant (‘OCM’) should, prior to the close of pleadings/discovery and on foot of Notices to Produce for inspection, be entitled to inspect un-redacted copies of the relevant loan sale agreement and loan sale deed, and in particular those redacted or omitted parts of the documents that bear on the price allocated to the plaintiff's connection, and the price paid generally.

6

The defendant in opposing the application seeks to justify the redaction on the basis of commercial sensitivity, confidentiality and lack of relevance, and on the basis that these are documents of title which are excluded from inspection under Order 31 rule 15 of the Rules of the Superior Courts (‘O. 31 r.15’).

Background
7

By facility dated February 2007, Anglo Irish Bank Corporation plc (‘Anglo’) agreed to lend to the plaintiff and her late husband David Courtney €1,493,000 for the purpose of funding the purchase of a chalet in France for €1,650,000, repayable on demand, but without prejudice repayable on or before 31st January, 2009, or such later date as Anglo might determine in its absolute discretion. This ‘Chalet Facility’ was secured by a first ranking legal charge over the chalet. The loan monies were drawn down but not repaid and OCM claims that there is €1,609,668.48 due on foot of this facility as of 27th November, 2018.

8

By letter of offer dated 11th January, 2008, Anglo agreed to make four further facilities available to the plaintiff and David Courtney, Facilities A, B, C and D, for maximum amounts of approximately €355,190, €250, €4,000 and €1,270,000 respectively. The purpose was to renew existing facilities granted in February 2006. Security included a first legal charge over commercial units 3, 4, 5 and 9 at Killarney Town Centre, Co. Kerry and the first legal charge over town house numbers 4, 5, 18, 23 and 24, at Killarney Town Centre.

9

Facilities A, B, C and D were expressed to be repayable on demand at Anglo's sole discretion, but without prejudice to this were to be repaid by 30th September, 2008. By certificate dated 31st January, 2008, the borrowers certified that they were not acting as ‘consumers’ in respect of these facilities. The monies had been drawn down on foot of these facilities. They were not repaid and on 9th March, 2018 OCM demanded repayment of €2,160,447.97.

10

These loan facilities and all the related securities were acquired by NAMA/NALM pursuant to the NAMA Act 2009.

11

By arbitration determination and award dated 29th November, 2012, a former judge of the Supreme Court, Finnegan J., made a final and binding determination that the plaintiff was liable to NALM on foot of facility D in the amount of €1,267,129.77 as of 25th September, 2012.

12

On 19th April, 2013, NAMA (including NALM), the plaintiff and the late David Courtney executed an agreement – the ‘Forbearance Agreement’ - under which the plaintiff and David Courtney agreed, acknowledged and undertook that they were jointly and severally liable to NAMA for the several loan facilities, and that they were in default, a specific indebtedness as of 15th March, 2013 was agreed, and they further agreed all amounts due would be repaid in full on or before 5pm on 31st December, 2015.

13

Clause 8 of the Forbearance Agreement provided that it would run until 31st December, 2015 and that, upon termination of the Forbearance Agreement, the loan facilities would immediately become repayable on demand and NAMA would be entitled to enforce its security. The amounts due were not repaid in full before 5pm on 31st December, 2015. This Forbearance Agreement is relied upon by OCM in these proceedings as an acknowledgment for the purposes of the Statute of Limitations 1957 (as amended).

14

In 2016 NAMA/NALM purported to sell the facilities and the related security as part of the ‘Project Emerald and Ruby Portfolio’ to OCM. Of importance in the present case, and as pleaded in the Statement of Claim delivered on 15th January, 2019, is that in advance of the sale...

To continue reading

Request your trial
7 cases
  • Victoria Hall Management Ltd v Cox
    • Ireland
    • High Court
    • 11 September 2019
    ...whom the onus of establishing the appropriateness of the redactions rests. The judgment of Haughton J. in Courtney v OCM Emru Debtco DAC [2019] IEHC 160 ( “Courtney”) discusses very comprehensively the relevant principles and case-law on the redactions of documents. I adopt and approve the......
  • Promontoria (Aran) Ltd v Sheehy
    • Ireland
    • High Court
    • 31 July 2019
    ...sometimes contended that it has such relevance in special circumstances, (see Eileen Courtney v OCM Emru Debtco DAC and David O'Connor [2019] IEHC 160, discussed below). However, in a case where the plaintiff itself has invoked the equitable doctrines of restitution and unjust enrichment, ......
  • Little v IBRC
    • Ireland
    • High Court
    • 8 October 2019
    ...reading which invariably arises. Further factors to be considered 23 Haughton J. in Courtney v. OCM Emru Debtco DAC & David O’Connor [2019] IEHC 160 (unreported, High Court, 15th March, 2019) ( “Courtney”), referred to the established principles in redaction cases before positing furth......
  • Everyday Finance dac v Woods
    • Ireland
    • High Court
    • 19 July 2019
    ...to justify the extent of the redaction made. The next decision is the decision of Haughton J in Courtney v OCM EMRU Debtco [2019] IEHC 160. At paragraph 55 of that judgment, Haughton J. deals with the burden which I have just identified, I do not think it is necessary tto quote from paragr......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT