Danske Bank as t/a Danske Bank v John Meagher

• Jurisdiction: Ireland
• Judge: MR JUSTICE MICHAEL PEART
• Judgment Date: 04 October 2013
• Neutral Citation: [2013] IEHC 496
• Docket Number: RECORD NUMBER: NO. 176 S/2013
• Court: High Court
• Date: 04 October 2013

[2013] IEHC 496

THE HIGH COURT

RECORD NUMBER: NO. 176 S/2013

Danske Bank A/S t/a Danske Bank v Meagher

BETWEEN:

DANSKE BANK AS TRADING AS DANSKE BANK

PLAINTIFF

AND

JOHN MEAGHER

DEFENDANT

CRANE & SONS v WALLIS 1915 2 IR 411

FARDEN v RICHTER 1889 23 QB 124

PRACTICE AND PROCEDURE

Service

Application to set aside judgment for liquidated sum in default of appearance - Summons not received - Service by prepaid ordinary post on foot of order for substituted service - Awareness on enforcement - Lack of residence at address - House owned and occupied by sister - Service of orders for discovery of assets, of garnishee and for attachment served on same address - Order for substituted service on solicitor - Credibility - No defence set out on affidavit - Whether aware of proceedings - Whether sufficient basis to set aside order for substituted service - Whether judgment obtained irregularly - Crane & Son v Wallis [1915] 2 IR 411 and Farden v Richter [1889] 23 QBD 124 considered - Rules of the Superior Courts 1986 (SI 15/1986), O 124, r 3 - Application refused (2013/176S - Peart J - 4/10/2013) [2013] IEHC 496

Danske Bank A/S (t/a Danske Bank) v Meagher

Facts: These proceedings concerned an application brought by the respondent for an order setting aside a judgment for almost €7 million granted against him in default of appearance. On the 31^st January 2013, the plaintiff obtained an order for substituted service, which allowed it to serve a summary summons on the defendant by ordinary prepaid post. However, the defendant claimed that he never received the summons, hence why he had not appeared in court prior to the judgment being delivered. The defendant claimed that the plaintiff”s application for an order for substituted service was flawed because the information that was submitted in regards to the residence of the defendant was incorrect. It emerged that the property that the summons was sent to was actually owned and occupied by the defendant”s sister and her family. Following judgment, an order for discovery of assets and oral examination of the defendant and an order for Garnishee was subsequently sent to the same address, but the defendant claimed he never received these either. The defendant claimed that he only became aware of the judgment when an order for attachment was made, at which point he immediately presented himself to the court and sought leave to bring the present application.

The plaintiff”s solicitor, Mr Ian Bell, stated that he was contacted on the 5th June 2013 by Mr Mark O'Callaghan, solicitor of CCK Law Firm, who informed him that he acted for the defendant in proceedings against Dublin City Council. Mr Bell stated that it was clear that Mr O”Callaghan was aware of the proceedings being brought by the plaintiff; therefore, he asked whether he could serve the documents related to the order for discovery and oral examination on his firm. Mr O”Callaghan stated he had no instructions to accept service so the plaintiff obtained a court order for substituted service onto CCK Law Firm. CCK Law Firm then wrote to Mr Bell and informed him firstly that they were unaware of the proceedings, and secondly that they were not instructed in the plaintiff”s proceedings. The plaintiff then obtained an order of attachment. The defendant claimed that he had been out of the country around this time and only became aware of the proceedings when he was informed of them by CCK Law Firm upon his return. He subsequently appeared before the Court on the 10^th July 2013 and allegedly instructed CCK Law Firm to represent him in the matter on the 19^th July 2013.

Held by Peart J that in considering the application, the Court first of all had to decide whether the substituted service order of the 31^st January 2013 should be set aside because material facts were not put before the Court, which would invalidate the default judgment; and secondly, if the Court did not think that the substituted service order should be set aside, whether the default judgment should be set aside anyway because of irregularity.

It was held that there were serious doubts as to the defendant”s credibility. It was clear that he had used his sister”s address for the deliverance of business related documents for several years, which strongly suggested that the documents sent by the plaintiff would have been brought to his attention. The summons server has also outlined how he had spoken to a postman when he tried to serve the summons at the defendant”s sister”s home who confirmed that he regularly delivered letters that were addressed to the defendant. It was, therefore, held that there had been a sufficient basis to make a substituted service order.

In regards to whether the default judgment should be set aside, it was said that it was for the defendant to prove the irregularity. It was held that the defendant was unable to demonstrate he was not aware of the proceedings; in particular, it was noted that in support of the application to set aside the judgment, the defendant had provided two affidavits (one from himself and one from his niece), which were sworn on the 24^th July 2013. It was said that if CCK Law Firm had been instructed on the 19^th July 2013, it seemed unlikely that they would have been able to draft these documents in such a short time frame. It was also pointed out that the fact that Mr O”Callaghan contacted Mr Bell about the proceedings indicated that he and the defendant were aware of them. There was no other ground advanced by the defendant on the issue of irregularity; therefore, the application to set aside judgment was refused.

Application to set aside judgment refused.

JUDGMENT OF

MR JUSTICE MICHAEL PEART

1 The defendant seeks to set aside a judgment for almost €7 million granted against him in default of appearance by order of Mr Justice Kelly dated the 25th February 2013 in the Commercial Court. He says he never received the summary summons after it was served by ordinary prepaid post pursuant to an order for substituted service made by Kelly J. on the 31st January 2013.

2 That order permitted the plaintiff to serve same on him by ordinary prepaid post at Milltown, Ashbourne, County Meath. Following service of the summary summons by ordinary post to that address, the documents were not returned to the plaintiff's solicitors. He says he only became aware that judgment had been obtained around the end of June 2013, after other steps had been taken by the plaintiff by way of enforcement. I will come to that.

3 In so far as the plaintiff says that there was no irregualrity in the manner in which it proceeded to obtain judgment in default of appearance, since it served the proceedings precisely in accordance with an order for substituted service duly obtained, the defendant seeks to set aide that order on the basis that the information as to the residence of the defendant put before the court was incorrect. He says that the address in question is not his residence, that he does not reside there and never has, and he does not own the house there and never has. It has emerged that the house is owned by his sister Cora, and her husband Edward Cox, who live there with thgeir family.

4 Having obtained its judgment, the plaintiff took certain further steps in its attempt to have the judgment satisfied. It served a Notice of Motion and grounding papers by ordinary post to the same address seeking an order for discovery of assets and oral examination of the defendant. That application was granted by Kelly J. on the 13th May 2013. That order was served on the defendant, again by ordinary post to the same address. It required the defendant, inter alia, to make discovery of his assets and documents relating thereto by a certain date, and to attend before the Court on the 10th July 2013 for examination. He did not attend on that date.

5 On the 13th May 2013 the plaintiff obtained also an order of Garnishee by which a sum of €70,000 paybale to the defendant by Dublin County Council was ordered to be paid to the plaintiff in part satisfaction of the amount owing to the plaintiff..

6 Again, the defendant says that he did not receive any of these documents, as the address to which they were sent is not where he resides. An order for his attachment was made. He was out of the country at this time apparently, but heard about that through a friend who read about it in the newspapers. He returned to the country, and appears to have presented himself to Mr Justice Kelly and explained that he was unaware of an order requiring him to do anything, and appears to have been given liberty to bring the present application to set aside the judgment and other orders.

7 Before dealing with the evidence that was put before the Commercial Court on the 31st January 2013 to ground the application for substituted service was obtained prior to service of the summary summons, I want to set out a sequence of events which occurred after the plaintiff's solicitor attempted to serve the order for discovery and examination of the defendant which had been obtained on the 13th May 2013.

8 In his affidavit sworn on the 10th June 2013, Ian Bell, solicitor has averred, inter alia, that following his service of the said documents by ordinary post to the said address, they were returned to him from that address. He mentioned also that two letters sent to the defendant by registered post had been returned marked 'not called for'. When the documents were returned to Mr Bell they were accompanied by a letter from Edward Cox, who, as I have stated above is the defendant's brother-in-law being married to the defendant's sister, Cora Cox. The letter states:

"To whom it may concern:"

9 Please be advised that these letters are continually arriving here and that John Meagher does not live here and he is not receiving these letters....