English v Promontoria (Aran) Ltd

• Jurisdiction: Ireland
• Judge: Ms. Justice Murphy
• Judgment Date: 16 November 2016
• Neutral Citation: [2016] IEHC 662
• Docket Number: [2015 No. 9196 P]
• Court: High Court
• Date: 16 November 2016

BETWEEN

DENIS ENGLISH

PLAINTIFF

AND

PROMONTORIA (ARAN) LIMITED

DEFENDANT

[2016] IEHC 662

[2015 No. 9196 P]

THE HIGH COURT

Banking & Finance – Assignment of loan facilities – Demand of payment by assignor – Appointment of receiver – Validity of appointment of receiver – Access to full suite documents

Facts: The plaintiff sought an order for setting aside the appointment of the defendant as the receiver of the plaintiff's unregistered lands that were mortgaged to the bank. The plaintiff also sought an injunction directing the defendant to disclose all the relevant documents unredacted establishing the transfer of all the right, title and interest by the bank to the assignee by virtue of a deed of transfer and the documentation pertaining to the appointment of the defendant by the subsequent assignee. The defendant refused to provide the unredacted documentation on the basis that those documents were of sensitive commercial nature.

Ms. Justice Murphy granted stay on the appointment of the defendant as the receiver until the assignee of the bank was able to establish that it had the right to appoint the receiver in relation to the plaintiff's properties. The Court held that the plaintiff being a mortgagor was entitled to insist on the proof of transfer and ownership of the mortgage before he was made to comply with the demand for payment by the assignee. The Court objected to the averments made by the defendant to the effect of making unredacted documents available to the Court for inspection. The Court held that it was for the benefit of the common good that justice should be done in public and it was not the role of the Court to do the scrutiny of the documents on behalf of a party. The Court held that the defendant was not entitled to redact the identities of the persons who had executed and witnessed the deed of transfer on behalf of the bank.

JUDGMENT of Ms. Justice Murphy delivered on the 16th day of November, 2016.

1 The plaintiff seeks the following reliefs: an order setting aside the defendant's appointment of Ken Fennell as receiver of the plaintiff's unregistered land at Knocklofty House, Knocklofty, Clonmel, Co. Tipperary on 6th November, 2015; an injunction directing the defendant to disclose all and any instruments, terms and conditions, deeds of novation, deeds of assignment, deeds of conveyance and assignment or any document or instrument on which the defendant relies as entitling it to appoint a receiver; and an order declaring that the defendant is not entitled to hold itself out as validly and legally entitled to the rights, title, interest and all other rights connected to the land.

Background

2 On 8th November, 2007, the plaintiff entered into a mortgage agreement with Ulster Bank Ireland Limited in respect of unregistered land at Knocklofty House Knocklofty, Clonmel, Co. Tipperary.

3 Between the years 2008 to 2011, the plaintiff entered into a series of facility agreements with Ulster Bank Ireland Limited as follows: facility letter dated 11th August, 2008 addressed to Denis English and Diane English; facility letter dated 7th November, 2008 addressed to Denis English and Gabrielle Martin; facility letter dated 13th May, 2010, addressed to Denis English and Gabrielle Martin; and facility letter dated 21st March, 2011 addressed to Denis English.

4 By letter dated 5th January, 2015, Ulster Bank Ireland Limited wrote to the plaintiff to inform him that it had agreed to transfer his loans to an affiliate of Cerberus Global Investors pursuant to the terms of the facility letters. It further informed the plaintiff that it would contact him immediately after the date of transfer of legal ownership to provide him with contact details for the purchaser.

5 Prior to the date of the letter of notification of 5th January, 2015 Ulster Bank Ireland Limited appears to have executed a mortgage sale deed in respect of the plaintiff's lands to Promontoria Holding 128 B.V. This deed, which has not been disclosed to the plaintiff, is according to the evidence, dated 16th December, 2014. This agreement was apparently the subject of a deed of novation dated 12th February, 2015. That deed has not been disclosed to the plaintiff either.

6 On the same date, 12th February, 2015, a global deed of transfer and a deed of conveyance and assignment were executed by Ulster Bank Ireland Limited and three related entities, UB SIG (ROI) Limited, Ulster Bank Limited and UB SIG (NI) Limited transferring all rights, title, interest and benefits in the facility letters and the mortgage relating to the plaintiff, to the defendant Promontoria (Aran) Limited. Heavily redacted copies of each of those deeds have been furnished to the plaintiff. In the deed of conveyance and assignment a section headed ' Background' has been fully redacted as has detail of other mortgages assigned and details of the identities of the parties executing the deed on behalf of each of the Ulster Bank entities. In the global deed of transfer, the recital clause which the plaintiff contends describes the relationship between the parties, has been completely redacted, as has the consideration paid by the purchaser, the other mortgages sold and the identities of those executing the deed on behalf of Ulster Bank Ireland Limited and the other bank entities who are parties to the deed.

7 On 22nd September, 2015, and on 16th October, 2015, the defendant issued letters of demand in accordance with the terms of the facility letters agreed by the plaintiff with UBIL.

8 On 6th November, 2015, the defendant appointed Mr. Ken Fennell of Deloitte as fixed charge receiver pursuant to the mortgage of the plaintiff's lands by way of instrument of appointment. The basis of the defendant's entitlement to appoint a receiver is expressed to be a transfer of the plaintiff's mortgage from Promontoria Holding 128 B.V. to Promontoria (Aran) Limited.

9 On 10th November, 2015, the plaintiff issued a plenary summons claiming declaratory and injunctive reliefs arising from his contention that Promontoria (Aran) Limited was neither validly nor legally entitled to hold itself out as being entitled to UBIL's interest in the facility letters nor the security underpinning them.

10 On 16th November, 2015, the defendant provided the plaintiff with copies of the facility letters, the mortgage, a redacted copy of the global deed of transfer and a redacted copy of the deed of conveyance and assignment in response to a notice of motion issued by the plaintiff seeking documentation relating to the transfer.

11 On 30th November, 2015, the transfer of mortgage from Ulster Bank Ireland Limited to the defendant was registered in the Registry of Deeds. The grantor is specified to be Ulster Bank Ireland Limited, Ulster Bank SIG (ROI) Limited, Ulster Bank Limited and UBSIG (NI) Limited. Evidence of the registration was produced in the course of the hearing by the defendant de bene esse and in response to arguments made by the plaintiff's counsel relating to the redaction of the execution clauses in the agreements.

12 The plaintiff raised multiple issues in his plenary summons and grounding affidavits but at the hearing, the issues were narrowed to the plaintiff's entitlement to access to the full ' suite' of documents relating to the transfer and to his entitlement to have them in an unredacted form. He also challenged the validity of the appointment of the receiver.

Access to full 'suite' of documents

13 The plaintiff submits that the documents which the defendant has provided to him are insufficient to establish the defendant's entitlement to appoint a receiver over the plaintiff's property. The defendant has provided the plaintiff with a redacted copy of the global deed of transfer dated 12th February, 2015; a redacted copy of the deed of conveyance and assignment dated 12th February, 2015; and a copy of the instrument of appointment of receiver dated 16th November, 2015.

14 The plaintiff asserts the right to have sight of, or otherwise have presented to the Court, the entire ' suite' of documents relating to the transfer of the mortgage, including the mortgage sale deed dated 16th December, 2014; the deed of novation dated 12th February, 2015; and the second deed of conveyance and assignment dated 12th February, 2015. The plaintiff contends that the first transfer which appears to have been between Ulster Bank Ireland Limited and Promontoria Holding 128 B.V. may affect...