Feniton Property Finance Dac v White ; Feniton Property Finance Dac v Dublin Land Securities Ltd

• Jurisdiction: Ireland
• Court: High Court
• Judge: Mr. Justice Quinn
• Judgment Date: 18 July 2019
• Neutral Citation: [2019] IEHC 527
• Date: 18 July 2019
• Docket Number: 2018 876 S 2018 878 S

[2019] IEHC 527

THE HIGH COURT

COMMERCIAL

Quinn J.

2018 876 S

2018 878 S

BETWEEN

FENITON PROPERTY FINANCE DAC

PLAINTIFF

V.

PETER WHITE

AND

ALICIA WHITE

DEFENDANTS

FENITON PROPERTY FINANCE DAC

PLAINTIFF

V.

DUBLIN LAND SECURITIES LIMITED, PETER WHITE

AND

BLUE NILE HOLDINGS LIMITED

DEFENDANTS

Summary judgment – Overdue balances – Arguable defence – Plaintiff seeking summary judgment – Whether the defendants’ complaints formed the basis of an arguable defence

Facts: The plaintiff, Feniton Property Finance Dac, applied to the High Court for summary judgment in respect of the balance it claimed to be owed pursuant to a series of facilities granted to fund the acquisition and refurbishment of properties at 1 and 16 Wellington Road, Dublin 4, 1 Heytesbury Lane, Dublin 4, 119 St. Stephens Green Dublin 2, and to fund certain other investments specified in the facility letters. The loans were made originally between 2006 and 2008 by Bank of Scotland (Ireland) Ltd whose interest was ultimately transferred to the plaintiff in November 2015. In replying affidavits, the defendants, Mr and Ms White, Dublin Land Securities Ltd and Blue Nile Holdings Ltd, introduced a number of complaints and allegations concerning the manner in which the plaintiff and receivers appointed by it had conducted themselves since the plaintiff acquired the loans and facilities in November 2015.

Held by Quinn J that the basic proofs advanced by the plaintiff substantiated its claim for the balances overdue. Quinn J held that the defendants’ complaints did not go to the validity of the claim for repayment of the overdue balances and could not form the basis of an arguable defence.

Quinn J held that, apart from the claim for default interest, he would enter judgment in the amounts claimed in the proceedings. The most up to date information available to the court for this purpose was contained in the affidavit of Mr O’Sullivan, a director of the plaintiff, dated 1 April 2019 and, subject to any submissions regarding the calculation of relevant amounts, including any necessary corrections of the amounts referred to in this judgment, Quinn J held that he would enter judgment for those amounts.

Judgment granted.

JUDGMENT of Mr. Justice Quinn delivered on the 18th day of July, 2019

1 The plaintiff applied for summary judgment in these proceedings in respect of the balance it claims to be owed pursuant to a series of facilities granted to fund the acquisition and refurbishment of properties at 1 and 16 Wellington Road, Dublin 4, 1 Heytesbury Lane, Dublin 4, 119 St. Stephens Green Dublin 2, and to fund certain other investments specified in the facility letters. The loans were made originally between 2006 and 2008 by Bank of Scotland (Ireland) Limited (‘BOSI’) whose interest was ultimately transferred to the plaintiff in November 2015.

Feniton v. Peter and Alicia White : 2018 876 S

2 The claim in this action arises from four facilities granted to Peter White and Alicia White for sums totalling €8,419,831.57, a balance of which is now claimed in an amount of €3,015,235.98.

3 The First Facility was issued by BOSI on 18 May, 2006, (accepted by the first and second named defendants, Peter White and Alicia White, on 25 May, 2006) in a sum of €2,070,500. The purpose of the facility was the purchase of a property at 1 Heytesbury Lane Dublin 4. The initial term was for a period of twelve months. Extensions were granted from time to time and the facility expired on 3 November, 2009.

4 The facility was secured by the extension of an existing charge over the borrowers” existing property at 1 Wellington Road, and a first charge on the property at 1 Heytesbury Lane.

5 The Second Facility was issued on 18th October, 2006, (accepted by the Whites on 26 October, 2006) for an amount of €5,513,750.

6 The purpose of this facility was the purchase of a property at 16 Wellington Road, Dublin 4. The term was a period of three years and the facility was to be secured by the grant of a first legal charge on 16 Wellington Road, and extension of existing charges previously granted by the Whites to the plaintiff.

7 The Third Facility issued on 16 July, 2008, (accepted on 30 July, 2008) for a sum of €303,000. The purpose of this facility was the refurbishment of 16 Wellington Road. The term was for a period of twelve months, and the security was to be by way of extension of existing charges.

8 The Fourth Facility issued on 21 November, 2008, was accepted by the Whites on 25 November, 2008, for a sum of €595,581.57. The purpose of this facility was to ‘refinance an existing loan’ and the term was nine months. Again this was to be secured by an extension of existing charges.

9 Each of these loans was to be repaid by a single payment at their maturity, with interest being paid quarterly during the currency of the term. The facility letters provided for the payment also of arrangement fees, legal outlays, and incorporated BOSI's standard loan conditions, which included provision that the obligations of the borrowers were joint and several.

10 On 31 December, 2010, the assets and business of BOSI including these loans and security held became vested in Bank of Scotland plc. pursuant to orders of this Court (Kelly J. 22 October, 2010) and of the Scottish Court of Session (Lord Glennie, 10 December, 2010).

11 On 29 July, 2015, Bank of Scotland plc. agreed to assign the loans and security to the plaintiff. By a Loan Purchase Deed of 20 November, 2015, the loans were assigned to the plaintiff.

12 On 26 October, 2015, Bank of Scotland plc notified the defendants of the transfer of the loans and on 23 November, 2015, the plaintiffs appointed agent Pepper Finance Corporation Ireland Limited (‘Pepper’).

13 The letter from Pepper of 23 November, 2015, was a standard form of notification informing the defendants that from that date forward payments on the accounts should be made to the plaintiff and it provided details of how payments should be made including bank account details and provided contact details for Pepper.

14 Between November 2015 and February 2017 the parties engaged in relation to the accounts. In affidavits, the parties give different accounts of the engagement. In an affidavit sworn on 1 October, 2018, Mr. White characterises the plaintiff as having acted ‘with considerable bad faith for in excess of two years’. Where relevant I shall return to this subject later. However, much of the correspondence exchanged during this period relates to communication between the parties regarding proposals and counterproposals for settlement of the accounts and regarding proposed disposal of assets by the defendants.

15 On 3 February, 2017, the plaintiff wrote to the defendants demanding immediate payment of the amount of €6,614,768.98, being the balance at that time claimed to be due and owing from the defendants on foot of the four loan facilities. By this letter the plaintiff also declared all loans advanced to the defendants to be immediately due and payable and reserved its right to exercise all of its rights against the defendants pursuant to the facility letters, at law, and any security provided pursuant to the facilities, including the power to appoint receivers over the properties charged.

16 On 10 February, 2017, the plaintiff appointed a receiver Mr. Ken Tyrrell, over the properties at 1 Heytesbury Lane, and 16 Wellington Road, and other properties held as security for other loans.

Feniton v. Dublin Land Securities, Peter White and Blue Nile Holdings Limited [2018 No. 878 S]

17 By four facilities, BOSI advanced amounts totalling €6,517,500 to Dublin Land Securities.

18 The First Facility was for Loan ‘A’ granted on 4 December, 2006, (accepted 8 December, 2006) for a sum of €251,250.

19 The purpose of the facility was to ‘fund the borrowers” investment in the Liberty Asset Management Flagship Fund and to capitalise the banks” arrangement fee of €1,250’.

20 The term was a period of 6.5 years, to be serviced with quarterly interest payments. The security required was a debenture including a floating charge and a guarantee by Peter White.

21 The Second Facility was for ‘Loan B’ and was also granted on 4 December, 2006, (accepted 8 December, 2006) in an identical amount of €251,250 and its purpose was to fund ‘managed investments and arrangement fee’. The term of this facility was a period of two years, with interest to be paid quarterly and the security required was identical.

22 The Third Facility was dated 24 May, 2007, (accepted 28 May, 2007) to Dublin Land Securities Limited for a sum of €1,002,500. The loan was stated to be for the following requirements of the borrower: -

(i) To invest in the Delancey DV4 fund,

(ii) To invest in the Stenham German Property Portfolio 3, and

(iii) To invest in other managed investments to be properly identified.

The term was for a period of twelve months with interest to be paid quarterly. In April 2009, the period for repayment was extended to two years. Again, the security was an extension of the existing debenture and a guarantee by Peter White.

23 The Fourth Facility issued on 30 October, 2007, (accepted 8th November, 2007) to Dublin Land Securities Limited was for a sum of €5,012,500. Its purpose was to fund ‘an equity release on 119 St. Stephens Green Dublin 2’. The term was a period of three years with interest to be paid quarterly.

24 The security for the fourth facility was a guarantee by Blue Nile Holdings Limited, a subsidiary of the borrower, supported by a mortgage over a property held by Blue Nile Holdings Limited at 119 St. Stephens Green.

25 The security also included a floating charge, a charge on shares held by Dublin Land Securities Limited in Blue Nile Holdings Limited, and a guarantee by Peter White supported by a charge on his shares then held in Blue Nile Holdings Limited

26 The four facilities issued to Dublin Land...