Goodman v Kenny
| Jurisdiction | Ireland |
| Judge | Kinlen J. |
| Judgment Date | 30 July 1996 |
| Neutral Citation | [1996] IEHC 52 |
| Court | High Court |
| Date | 30 July 1996 |
[1996] IEHC 52
THE HIGH COURT
BETWEEN
AND
Citations:
COURTS ACT 1981 S22
RSC O.15 r13
JUDICATURE (IRL) ACT 1877
CHITTY ON CONTRACTS 26ED PARAS 1393 & 1394
WYLIE JUDICATURE ACTS 63 & 65
MONEYLENDERS ACT 1900
HALSBURYS LAWS OF ENGLAND 3ED V27 8
GREAT BULLPRINT CRIPPS WARBURG V COLOGN INVESTMENT 1980 IR 321
WESTPAC BANKING CORPORATION V DEMPSEY 1993 3 IR 331
TANNANT V ASSOCIATED NEWSPAPERS GROUP LTD 1979 FSR 298
STAMP ACT 1891 S12(5)
Synopsis:
Contract Law
Loan advanced on security of promissory note; promissory note never issued; loan not repaid; whether failure of consideration; whether inordinate delay in prosecuting proceedings; whether existence of similar proceedings in Cyprus a bar to present action; whether plaintiffs engaged in moneylending practice contrary to Moneylender's Act - Held: Judgment entered in favour of plaintiffs for amount owed - (High Court: Kinlen J - 30/07/1996)
|Goodman & ors. v. Kenny|
Judgment delivered the 30th day of July, 1996 by Kinlen J.
Initially these proceedings were commenced by a Summary Summons dated the 18th September, 1990. The Plaintiffs therein were named as Laurence J. Goodman and A.B.P. Holdings Limited. The Special Indorsement of Claim reads as follows:-
"The Plaintiffs and each of them claim against the Defendant for:-"
(a) The sum of £22,830,000 in sterling currency being the amount due and owing by the Defendant to the Plaintiffs under a loan advanced by the Plaintiffs to the Defendant which requires repayment by the Defendant on or before the 13th June, 1990 which sum is still due and owing by the Defendant to the Plaintiffs and notwithstanding the expiry of the said repayment date and requests and demands for payment of same the said sum is due and owing by the Defendant to the Plaintiffs as money lent by the Plaintiffs to the Defendant or as monies had and received by the Defendant for the use of the Plaintiffs or as monies paid for a consideration which has wholly failed.
(b) Under and by virtue of a letter of the 13th March, 1990 from the Defendant to the first named Plaintiff the Defendant agreed he would pay the sum of £22,830,000 in sterling currency on or before the 13th June, 1990 to an account to be designated by the first named Plaintiff which was in consideration of the money being advanced to the Defendant at his request on or about the said 13th day of March, 1990 and under the terms of the said letter it was provided that in consideration of the said payment the Defendant would require the return of cancellation of a Promissory Note of £25,000,000 from Mercantile Credit to the 13th March, 1990 which ostensibly purported to secure the advance of the said loan of money by the Plaintiffs to the Defendant but the said Promissory Note was not affected properly or at all by the Defendant notwithstanding the requirements of the said loan agreement and in the circumstances the said monies were advanced for a consideration which had wholly failed and the said monies were had and received by the Defendant to the use of the Plaintiffs.
(c) Interest on such sums as are awarded pursuant to Section 22 of the Courts Act of 1981.
An appearance was entered on the 21st January, 1991. The matter seems to have lain fallow until late in 1994. By a Motion paper dated the 9th November, 1994 returnable for the 15th December, 1994, application was made to the Master for an Order adding Anglo Beef Processors Limited as a Plaintiff and changing the name of the second named Plaintiff to 1st A.B.P. Holdings Limited and for an Order giving the Plaintiffs liberty to enter final judgment against the Defendant in the sum of £22,830,00 in sterling currency (or the equivalent thereof in Irish currency as of the date of judgment) being the amount due and owing by the Defendant as monies lent or given in trust by the Plaintiffs to the Defendant at his request and, if necessary, an Order directing that interest on same under Section 22 of the Courts Act, 1981should be determined by a judge and transferring the matter to a judge for determination of the issue in relation to interest. This was grounded on the Affidavit of Tom Walsh sworn the 8th November, 1994 with two exhibits attached thereto. Mr. Walsh is the former group treasurer of the Anglo Irish Beef Processors Group ("AIBP Group") and he held that position from January, 1986 to August, 1990. He makes the Affidavit on behalf of and with the authority of the Plaintiffs. He avers that on or about the 26th of February he was approached in his capacity as such group treasurer by Mr. Desmond Lamont of L & P Financial Trustees of Ireland Limited on behalf of their client the Defendant herein, Mr. Joseph Kenny. Mr. Lamont stated that the Defendant was a representative of property investors in Ireland with a property portfolio in this country worth £25,000,000 and that the investors wished to use that portfolio as security to consummate a property transaction off-shore. Mr. Lamont represented that the Mercantile Credit Company of Ireland Limited were holding the title deeds to the property portfolio. Mr. Lamont further stated that the Defendant required funds for a period of three to four months and that security in the form of a Promissory Note was to be provided by Mercantile Credit Company of Ireland Limited which was to be payable to a limited liability company in the AIBP Group to be nominated by the Plaintiffs (which in the event was to be the second named Plaintiff herein). He further avers that on the 13th March, 1990 the Defendant was advanced by way of a loan or trust the sum of £22,830,000 the said sum to be repayable on or before the 13th June, 1990. Prior to advancing the said loan or trust the Plaintiffs had received and approved the text of the Promissory Note from Mercantile Credit Company of Ireland Limited and in addition had received a draft of a letter from the Defendant guaranteeing repayment of the monies. Copies of the said Promissory Note and letter are exhibited as "TW 1".
Mr. Walsh further avers that:-
"The said sum was advanced to the Defendant by the first named Plaintiff with monies obtained from the second named Plaintiff acting as his agent to a bank account nominated by the said Defendant namely, City Project Financier's Bank Account at National Westminster Bank in London. On the 14th day of March, 1990 the Plaintiffs received a formal acknowledgement in writing signed by the Defendant that the said monies were repayable to the first named Plaintiff on or before the 13th June, 1990."
A copy of the said letter is exhibited as TW 2 in this Affidavit.
He further avers:-
"The repayment date has long since passed. In the event it has transpired that no security was at any material time provided by Mercantile Credit Corporation of Ireland Limited or otherwise. The monies were subsequently dissipated and the Defendant herein has failed to repay the said monies or any part thereof notwithstanding requests and demands for payment of same. The AIBP group of companies went into receivership in August of 1990 resulting in a number of changes within the group structure."
Mr. Walsh was informed and believes that the second named Plaintiff, a Northern Ireland Registered Company, sold by way of an Asset Purchase Agreement dated 3rd September, 1990 its entire business as a going concern together with the undertakings property rights, assets, contingent assets, liabilities and obligations whatsoever to Shoreditch Limited, a company registered in the Republic of Ireland. On the 27th September, 1991 Shoreditch Limited sold all of its business undertakings, property rights, assets, contingent assets, liabilities and obligations to Rusper Limited, a company registered in England. That company subsequently changed its name to Anglo Beef Processors Limited.
The aforesaid company is entitled to be a Plaintiff in these proceedings. On the 11th October, 1991 the second named Plaintiff had changed its name to 1st ABP Holdings Limited.
By an Affidavit sworn the 5th January, 1995 the Defendant avers:-
"In March 1990 persons representing me had negotiations with representatives of the Plaintiffs concerning raising funds in order to finance an investment transaction and a broad agreement was reached orally that certain funds should be advanced."
It was a pre-condition of any liability on my part that any monies advanced should be:-
(i) paid into a bank account which I would designate, and entirely control,
and
(ii) loan will be secured by a Promissory Note from a financial Institution
furnished in advance.
Neither of these conditions were fulfilled for reasons entirely beyond my control.
The Plaintiffs in breach of the aforesaid agreement,
(i) neglected to obtain the security which had been agreed and recklessly advanced the said funds without any security
and
(ii) did not lodge the said funds into a bank account designated by me or over which I had full control but recklessly paid into some other bank account.
By reason of the aforesaid the Plaintiffs had contravened fundamental conditions of the aforesaid oral agreement and there is no liability on my part in respect of their alleged loan.
4. "Regarding my letter of the 13th March, 1990 to Laurence J. Goodman exhibited by the Plaintiffs,
(i) The said letter was written on the understanding that each of the aforesaid preconditions of any liability on my part would be fulfilled. As neither of these were fulfilled I am advised by Counsel that there has been an entire failure of consideration.
(ii) The explicit and only consideration...
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