Eamon Flanagan and Another v Thomas Crosby and Others

• Jurisdiction: Ireland
• Judge: Mr. Justice Hogan
• Judgment Date: 07 February 2014
• Neutral Citation: [2014] IEHC 59
• Court: High Court
• Docket Number: [2012 No. 70 CA]
• Date: 07 February 2014

Flanagan & Prendeville v Crosby & Ors

BETWEEN

EAMON FLANAGAN AND MARESA PRENDEVILLE

PLAINTIFFS

AND

THOMAS CROSBY, MICHAEL MCNAMARA AND KIERAN O'BRIEN

DEFENDANTS

[2014] IEHC 59

[No. 70 C.A./2012]

THE HIGH COURT

EQUITY

Equitable execution

Appeal against appointment of receiver - Future salary or emoluments - Whether receiver could be appointed by equitable execution in respect of statutory rights - Whether receiver could be appointed by equitable execution in respect of future salary or other emoluments of employee - Whether power to appoint receiver by way of equitable execution confined to equitable interests in property only - AG v Residential Institutions Redress Board [2012] IEHC 492, (Unrep, Hogan J, 6/11/2012); Holmes v Millage [1893] 1 QB 551; Honniball v Cunningham [2006] IEHC 326, [2010] 2 IR 1; Kadri v Governor of Cloverhill Prison [2012] IESC 27, [2012] 2 ILRM 392; M'Creery v Bennett [1904] 2 IR 69; Meagher v Dublin City Council [2013] IEHC 474, (Unrep, Hogan J, 1/11/2013); National Irish Bank Ltd v Graham [1994] 1 IR 215; O'Connell v An Bord Pleanála [2007] IEHC 79, (Unrep, Peart J, 19/2/2009); Picton v Cullen [1900] 2 IR 612; In re Shephard, Atkins v Shephard (1889) 43 Ch D 131; Soinco SACI v Novokuznetsk Aluminium [1998] 1 QB 406 and Waterside Management Co Ltd v Kelly [2013] IEHC 143, (Unrep, Kearns P, 11/4/2013) considered - Rules of the Superior Courts 1986 (SI 15/1986), O 50, r 6(1) - Judicature Act 1873 (36 & 37 Vict, c 66), s 25 - Supreme Court of Judicature (Ireland) Act 1877 (40 & 41 Vict, c 57), s 28 - Enforcement of Courts Orders Acts 1926 (No 18) - Statute of Limitations 1957 (No 6), s 5 - Interpretation Act 2005 (No 23), s. 6 - Appeal allowed; appointment of receiver not permitted (2012/70CA - Hogan J - 7/2/2014) [2014] IEHC 59

Flanagan v Crosby

Facts: In November 2010, the plaintiffs obtained judgment against the three defendants in the sum of €8,955.53 plus costs in respect of a claim for damages for breach of contract. At the time of this judgment, the sum remained largely undischarged. The first named defendant was a councillor with Roscommon County Council, and on the 5th September 2011 the County Registrar made a conditional order appointing a receiver by way of equitable execution in favour of the plaintiffs over any monies due to Mr. Crosby by Roscommon County Council by way of emoluments in respect of his position as a councillor both then and in the future. Despite the first named defendant"s objections, this order then became absolute by the County Registrar. The matter was then brought to the Circuit Court where the order was affirmed. The first named defendant subsequently initiated an appeal against that decision.

The first named defendant argued that the Circuit Court judge did not have the jurisdiction to make the order that it did because the established case law made it clear that the Court"s power to appoint a receiver by way of equitable execution was confined to equitable interests in property only.

Held by Hogan J. that the appointment of a receiver by way of equitable execution is generally regarded as a remedy of last resort and is only to be invoked when the other available legal remedies fail. It was noted that the principles that had been established in Holmes v. Millage [1893] 1 QB 592, namely that a judgement creditor is not entitled to receiver of the future earnings of his judgment debtor, had generally been applied in subsequent cases. It was also pointed out that case law in recent times – such as in National Irish Bank Limited v. Graham [1994] 1 I.R. 215 - made it clear that the appointment of a receiver by way of equitable execution is confined to circumstances where the debtor has an equitable interest in property which cannot otherwise be reached by the legal process.

As a result, it was held that the judicial interpretation of the appointment of a receiver by way of equitable execution had been comprehensively established in both old and recent case law, which meant the Court was bound to follow this authority. It was also said that even if the appointment of a receiver for the plaintiffs benefit was allowable, the Court would have declined to do so given the administrative burden that would have been placed on Roscommon County Council and the fact that the obtainment of an instalment order from the District Court under the terms of the Enforcement of Court Orders Acts 1926-2009 would have been a more appropriate remedy.

Appeal allowed.

HOLMES v MILLAGE 1893 1 QB 551

M'CREERY v BENNETT 1904 2 IR 69 1903 37 ILTR 240

PICTON v CULLEN 1900 2 IR 612 1900 34 ILTR 139

NATIONAL IRISH BANK LTD & GRACE v GRAHAM 1994 1 IR 215 1994/5/1506

HONNIBALL v CUNNINGHAM 2010 2 IR 1 2006/29/6197 2006 IEHC 326

O'CONNELL v BORD PLEANALA UNREP PEART 19.2.2007 2007/48/10159 2007 IEHC 79

KEANE EQUITY & THE LAW OF TRUSTS IN THE REPUBLIC OF IRELAND 2ED 2011 385

WATERSIDE MANAGEMENT CO LTD v KELLY UNREP KEARNS 11.4.2013 2013 IEHC 143

HOLMES THE PATH OF THE LAW 1897 10(8) HARV L REV 457

SUPREME COURT OF JUDICATURE ACT (IRL) 1877 S28(8)

RSC O.50 r6(1)

MEAGHER v DUBLIN CITY COUNCIL & HEALTH SERVICE EXECUTIVE UNREP HOGAN 1.11.2013 2013 IEHC 474

SUPREME COURT ACT 1981 S37(4) (UK)

INTERPRETATION ACT 2005 S6

SUPREME COURT OF JUDICATURE ACT (IRL) 1877 S28(7)

MATRIMONIAL CAUSES & MARRIAGE LAW (IRL) AMDT ACT 1870 S13

KADRI v GOVERNOR OF WHEATFIELD PRISON 2012 2 ILRM 392 2012/20/5671 2012 IESC 27

G (A) v RESIDENTIAL INSTITUTIONS REDRESS BOARD UNREP HOGAN 6.11.2012 2012/16/4476 2012 IEHC 492

1 1. Can a receiver be appointed by way of equitable execution in respect of the future salary or other emoluments of an employee to which he is in law entitled? Or is the power to appoint a receiver by way of equitable execution confined to equitable interests in property only? These are essentially the questions which are presented in this appeal from a decision of the Circuit Court. The issue arises in the following way. In November, 2010 the plaintiffs, Mr. and Ms. Flanagan, obtained judgment against the three defendants in the sum of € 8,955.53 plus costs in respect of a claim for damages for breach of contract. The figure for costs was taxed at just under € 23,000, so that by September 2011 the total sum due was € 31,774.40. Save for a few payments, this judgment remains undischarged.

2 2. The first defendant, Mr. Crosby, is a councillor with Roscommon County Council. On 5 ^th September, 2011, the County Registrar made a conditional order appointing a receiver by way of equitable execution in favour of the plaintiffs over any monies due to Mr. Crosby by Roscommon County Council by way of emoluments in respect of his position qua councillor both then and in the future. That order was made absolute by the County Registrar on 8 ^th December 2011 and it envisaged that one Bríd Miller, solicitor, be appointed receiver by way of equitable execution over part of the income of Mr Crosby in the sum of € 500 per month until this debt was paid. It should be noted, however, that the making of that order was opposed by Mr. Crosby's legal representatives on 3 ^rd October, 2011, when the matter first came back into the Registrar's list.

3 3. That matter came back before the Circuit Court judge (His Honour Judge McCabe) on 20 ^th March 2012. He made the order appointing a receiver by way of equitable execution absolute, save that the monthly payment to be paid by Roscommon County Council until the debt be discharged was reduced to the sum of € 400.

3 3. The first defendant, Mr. Crosby, has now appealed against this order, contending that the established case-law does not permit the appointment of a receiver by way of equitable execution in a case such as this. It is further contended that such an appointment would not be convenient, as this procedure is essentially one of last resort which is not intended to displace the Enforcement of Court Orders Acts 1926-2009.

4 4. In considering these questions, it is, perhaps, here unnecessary to determine the wider questions potentially presented by this appeal, whether the circumstances in which the appointment of a receiver by way of equitable execution can be said to be confined solely by reference to those categories of cases which obtained prior to the enactment of the Supreme Court of Judicature (Ireland) Act 1877. Nor is necessary to consider the potentially even wider question as to the extent to which law and equity can be said to be fused following the enactment of the 1877 Act, even though these issues are in view in this appeal.

5 5. It is, however, sufficient to say that the appointment of a receiver by way of equitable execution is generally regarded as a remedy of last resort to be invoked in those cases where the traditional legal remedies are likely to be ineffective. In considering the case-law, we may start with the well-known decision of the English Court of Appeal in Holmes v. Millage [1893] 1 QB 592. Here the plaintiff had obtained judgment against the defendant, who was the foreign correspondent of a British newspaper then living in Paris. The plaintiff sought to garnishee his future weekly earnings, but not to no avail. She then sought to have a receiver appointed by way of equitable execution.

6 6. In his judgment for the Court Lindley L.J. held ( [1893] 1 QB 551 at 554-555) that the order of the Divisional Court which appointed the receiver must be discharged:-

"The question involved in this appeal is whether the judgement creditor is entitled to receiver of the future earnings of his judgment debtor. Going back to the time before the Judicature Acts it is clear that a judgment creditor had no such right. The common law writs of execution did not extend to future income. The garnishee process did not reach it; nor was the statutory process of charging orders applicable...