Hogan v Deloitte

• Jurisdiction: Ireland
• Judge: Ms. Justice Stewart
• Judgment Date: 10 November 2017
• Neutral Citation: [2017] IEHC 673
• Date: 10 November 2017
• Court: High Court
• Docket Number: [2015 No. 9654 P] [2016 No. 4186 P]

BETWEEN

RAYMOND HOGAN

PLAINTIFF

- AND -

DELOITTE, TOM KAVANAGH, KTECH SECURITY, KEVIN MCGARRY, PEPPER ASSET SERVICING, SHORELINE RESIDENTIAL LIMITED, MADDEN PROPERTY CONSULTANTS

and

FERGAL MADDEN

DEFENDANTS

BETWEEN

TOM KAVANAGH

PLAINTIFF

- AND -

RAYMOND HOGAN

and

PAUL WALSH

DEFENDANTS

[2017] IEHC 673

Stewart J.

[2015 No. 9654 P]

[2016 No. 4186 P]

THE HIGH COURT

CHANCERY

Property & Conveyancing – S.2 of the Consumer Credit Act 1995 – S. 12 of the Irish Bank Resolution Corporation Act 2013 – Deed of appointment – Locus standi – Interlocutory relief

Facts: In the current case, there were two notices of motion related to two sets of properties. In the first notice of motion, the first plaintiff (‘plaintiff’) sought an interlocutory relief that would prevent the defendants from trespassing on both the properties, and in the second notice, the second plaintiff sought an interlocutory relief in order to carry out his functions as the receiver over the second property. The facts of the case revolved around the property of the plaintiff where the second defendant resided. The plaintiff took mortgage on the second property due to some financial circumstances and thereafter, due to the non-payment of the same, certain authorities took over and transferred his account and appointed the second plaintiff as the receiver for the mortgaged property. The plaintiff primarily challenged the locus standi and privity to contract in the said matter and also the proof of validity of the second plaintiff's deed of appointment. It was also alleged that the authorities to which the plaintiff's account was transferred were unregulated and had breached the Registration of Title and Deeds Act 2006 by unduly entering charge over the second property. The plaintiff, in the said proceedings, argued that he came within the definition of a consumer under s.2 of the Consumer Credit Act 1995 and also stated that s. 12 of the Irish Bank Resolution Corporation Act 2013 (‘IBRC’) had an unconstitutional interference with his property rights.

Ms. Justice Stewart refused to grant relief in the first motion while she granted relief in the second motion. The Court stated that the plaintiff could not satisfy his status as a consumer and the issue of transfer of his account from a regulated entity to an unregulated entity. The Court observed that the plaintiff could not convince as to why s.12 of the IBRC Act 2013 was unconstitutional and that the plaintiff could not provide any substantial reason regarding the invalidity of the deed of appointment of the receiver.

JUDGMENT of the Hon. Ms. Justice Stewart delivered on 10th day of November, 2017.

1 There are two sets of proceedings currently before the Court, which have given rise to two notices of motion related to properties in Thurles, County Tipperary. Mr. Hogan resides with his family in the first of these properties, which is located in Athnid More. Mr. Walsh resides in the second property under a tenancy agreement operating between him and Mr. Hogan. In the first matter, the plaintiff, Mr. Hogan, issued a notice of motion dated 10th May, 2016, in which he seeks interlocutory relief preventing the defendants from trespassing on or taking unlawful possession of both properties. In the second matter, the receiver, Mr. Kavanagh, issued a notice of motion dated 12th May, 2016, in which he seeks interlocutory relief necessary in order to carry out his functions as receiver over the second property.

Affidavits sworn in the First Set of Proceedings

2 On 9th May, 2016, Mr. Hogan swore an affidavit in which he sets out the following background facts. Following his mother's death in 2002, Mr. Hogan acquired the fee simple in his parents' family home, subject to a life interest for his father. This is the property in which Mr. Walsh now resides and to which the second set of proceedings relate. Mr. Hogan's father was in debt brought about by the cost of Mr. Hogan's mother's end-of-life care, so Mr. Hogan took a mortgage out on the second property in 2005 to assist in relieving that debt. During the recent economic downturn, Mr. Hogan encountered financial difficulties and was in regular contact with his mortgagee throughout this time. Over the course of these contacts, he was informed that Shoreline Residential Limited (‘Shoreline’) and, subsequently, Pepper Asset Servicing (PAS) were taking over his account. Mr. Hogan responded to object to this and to make clear that he did not consent to the transfer of his account to an entity he characterised as a vulture fund that is unregulated in this jurisdiction. In May, 2015, Mr. Kavanagh was appointed by Shoreline to act as receiver for the mortgaged property.

3 Mr. Hogan challenges Shoreline's locus standi and privity to contract in this matter and requests proof of the validity of Mr. Kavanagh's appointment. He then summarises an interaction between his family and a representative of KTech Security that allegedly occurred at the first property, in which the Hogan family reside. He concludes by alleging that Shoreline have breached the Registration of Title and Deeds Act 2006 by incorrectly entering a charge over the second property.

4 On 1st June, 2016, Mr. Kavanagh swore a replying affidavit in which he begins by setting out the role of the various parties in these proceedings. He then adopts the contents of his affidavit sworn in the second set of proceedings, which are set out below. Mr Kavanagh sets out his understanding of the events that occurred when the representative of KTech Security attended the first property and he rejects the harmful effects of this incident alleged by Mr. Hogan. For further details, he refers to the affidavit sworn by the representative of KTech Secuirty. Mr. Kavanagh notes Mr. Hogan's failure to offer an undertaking in damages and questions his ability to pay any undertaking that he may offer in the future. He avers that damages would be an adequate remedy if Mr. Hogan were successful at the full hearing, as this is a residential investment property from which rent is being collected. As for the balance of convenience, Mr. Kavanagh avers that the status quo (the orderly continuation of the receivership) should be maintained.

5 On 1st June, 2016, John Paul Moloney swore an affidavit in which he sets out his version of events on the day he attended the first property as a representative of KTech Security. He avers that he attended the property for the purposes of serving paperwork and denies entirely the version of events put forward by the Hogans. The Hogans set out their version of events in Mr. Hogan's various affidavits and in the affidavits sworn by his wife, Jacqueline Hogan, on 16th June, 2016. On 4th July, 2016, Mr. Moloney swore a replying affidavit to Mrs. Hogan's affidavit, in which he more specifically denies her version of events.

6 On 16th June, 2016, Mr. Hogan swore an affidavit in which he challenges personal and subject matter jurisdiction in this matter. The contents of this affidavit are broadly similar, if not identical in some respects, to the affidavit of the same date sworn by Mr. Hogan in the second proceedings. Mr. Hogan repeats his contentions regarding Shoreline's lack of standing as a proper credit institution under the Credit Reporting Act 2013. PAS's attempts to characterise Mr. Hogan as their customer and themselves as adjudicators of this dispute are also denied. Mr. Hogan also avers that he has not been granted access to the original copies of various documents related to these proceedings and requests same.

7 On 4th July, 2016, Mr. Kavanagh swore a second affidavit, in which he expresses confusion regarding the jurisdictional issues to be established, as the High Court enjoys full and original jurisdiction in the matters arising from this case. Furthermore, he questions why Mr. Hogan would institute proceedings of his own in a venue that he alleges lacks jurisdiction. Regarding Mr. Hogan's consent to the transfer of his account, Mr. Kavanagh refers to the terms of the mortgage that Mr. Hogan signed, which expressly provide for the transfer of the mortgage to any party, regulated or otherwise. Mr. Kavanagh avers that he is unaware of any claim by PAS to act as adjudicators in this matter, nor is he aware of any term that would prevent Shoreline from employing PAS as their agent. Mr. Kavanagh avers that his undertaking has not been challenged on any factual basis and denies that he is under any obligation to provide the bond demanded by Mr. Hogan. Mr. Kavanagh also avers that none of the events alleged by Mrs. Hogan would have any bearing on his entitlement to act as receiver, regardless of their accuracy.

8 On the 14th July, 2016, Mr. Hogan swore a supplemental affidavit in which he challenges Mr. Moloney's, KTech Security's and Deloitte's qualifications, licencing and entitlements to act as they have, both on the date that Mr. Moloney visited the first property and throughout the currency of these proceedings. He also exhibits documentation that he alleges proves that IBRC were aware and did consent to the creation of a tenancy agreement over the second property. Mr. Hogan challenges Mr. Kavanagh's reliance on the terms of the mortgage as a basis for transfer, as the transfer of the mortgage to an unregulated entity has clear negative implications for a regulated mortgage contract, which is the contract that Mr. Hogan signed. Mr. Hogan avers that his statements regarding jurisdiction should be understood in the context of his allegedly unrebutted arguments regarding Mr. Kavanagh's invalid appointment and lack of standing in court (issues that do not apply to Mr. Hogan).

9 On 11th July, 2016, Anne Pounds swore an affidavit setting out the manner and basis on which she is assisting the Hogans in dealing with these proceedings. In this affidavit, she sets out her belief that this matter should be...