ICC Bank Plc v Verling

• Jurisdiction: Ireland
• Judge: Mr. Justice Lynch
• Judgment Date: 01 January 1995
• Neutral Citation: 1994 WJSC-HC 3083
• Docket Number: Record No. 2523P/1994
• Court: High Court
• Date: 01 January 1995

ICC BANK PLC v. VERLING

BETWEEN

ICC BANK PLC

PLAINTIFFS

AND

RICHARD VERLING, NIAMH LANDY AND WINE DIMENSIONS LIMITED

DEFENDANTS

1994 WJSC-HC 3083

Record No. 2523P/1994

THE HIGH COURT

Synopsis:

ADVERTISEMENT

Notice

Licence - Transfer - Application - Purpose - Statute - Terms - Compliance - Mortgagee not obliged to search newspapers - (1994/2523 P - Lynch J. - 5/8/94) 1995 1 ILRM 123

|ICC Bank Plc. v. Verling|

INJUNCTION

Interlocutory

Motion - Order - Mandatory relief - Mortgagee - Claim - Possession - Unauthorised lease made by mortgagor in possession - (1994/2523 P - Lynch J. - 5/8/94) 1995 1 ILRM 123

|ICC Bank Plc. v. Verling|

REAL PROPERTY

Incumbrance

Mortgagee - Rights - Enforcement - Possession - Claim - Interlocutory motion - Grounds - Demand for payment of principal and interest by mortgagor - Premises leased by mortgagor after demand in contravention of terms of mortgage - Strong prima facie case made by mortgagee - Balance of convenience - Mandatory interlocutory order made - Conveyancing Act, 1881, s. 18 - (1994/2523 P - Lynch J. - 5/8/94) 1995 1 ILRM 123

|ICC Bank Plc. v. Verling|

Citations:

CONVEYANCING ACT 1881 S18

CONVEYANCING ACT 1881 S18(6)

CONVEYANCING ACT 1881 S18(7)

CONVEYANCING ACT 1881 S18(13)

CARSONS REAL PROPERTY STATUTES 2ED 579–581

DEALE ON LANDLORD & TENANT 108–109

WYLIE ON IRISH LAND LAW 2ED 683

THOMAS MURPHY & CO LTD V MARREN & O'DOWD 1933 IR 393

CAMPUS OIL LTD & ORS V MIN FOR INDUSTRY 1983 IR 88

1 Judgment of Mr. Justice Lynch delivered the 5th day of August 1994.

2 This is an action brought by the Plaintiffs as mortgagees against the first Defendant as mortgagor and the second and third Defendants as his purported leasees in possession for a declaration that the sum due by the first Defendant to the Plaintiffs stands well charged on the premises the subject matter of the mortgage and for possession of the mortgaged premises.

3 What is before me for decision is an application by the Plaintiffs for Interlocutory Relief in the form of a Mandatory Interlocutory Injunction and a Prohibitory Interlocutory Injunction in the following terms as set out in the Plaintiffs' Notice of Motion:

4 2 "(1) An Interlocutory Injunction to compel the Defendants and each of them to forthwith deliver up vacant possession of the lands and premises being all that and those the premises known as 1 Vernon Avenue in the Parish of Clontarf Barony of Coolock in the City of Dublin together with the benefit of the beer retailers off-licence, spirit retailers off-licence and wine retailers licence as attaching thereto to the Plaintiffs herein.

5 (2) If necessary an injunction restraining the Defendants or any of the Defendants from selling dealing or purporting to charge the premises the subject matter of these proceedings or in any mode or manner dealing with the said premises to the prejudice of the Plaintiffs herein."

6 The mortgage executed by the first Defendant in favour of the Plaintiffs is dated the 31st of May, 1991 and was registered in the Registry of Deeds on the 14th of August, 1991. Clause 15 of the said mortgage provides as follows:

"During the continuance of this security the statutory and any other powers of leasing, letting, entering into agreements for leases or lettings and accepting or agreeing to accept surrenders of leases or tenancies shall not in relation to the mortgaged property or any part thereof be exercisable by the borrower nor shall the borrower part with possession of the same or any part thereof nor confer any licence, right or interest to occupy nor grant any licence or permission to assign, underlet or part with possession of the same or any part thereof nor agree, suffer or permit any variation or addition to the terms of any lease, tenancy or licence without in every such case obtaining the prior consent in writing of the lender under the hand of a manager of the lender."

7 On the 14th of October, 1992 the Plaintiffs wrote to the first Defendant as follows:

"As you are in default of our loan agreement dated 13th May 1991 we have no alternative other than to demand repayment of the said loan in full.

The balance due on the loan as of the 14th day of October 1992 is £163,905.76 calculated as follows:-

Principal	£162,468.97
Interest	1,436.79

Please note that interest currently accrues at the daily rate of £128.70. I hereby demand repayment of our loan in full within the next seven days."

8 On the 23rd of March, 1993 the first Defendant purported to let the mortgaged premises to the third Defendant for a term of two years and nine months from the 1st of January, 1993 "subject to a rent consisting of the net profit of the off-licence business carried on in the demised premises up to a limit of £35,000 per annum".

9 On the 14th of July, 1993 accountants on behalf of the second and third Defendants wrote to the Plaintiffs as follows:

"Further to our recent telephone conversation I write to confirm that I act on behalf of Miss Niamh Landy of Wine Dimensions Limited."

10 My client has provided me with copy of a lease executed between Mr. Richard Verling and Wine Dimensions Limited effective from 1st January 1993 for a period of two years and nine months from that date.

11 Our client entered into this agreement in good faith and has expended considerable sums in effecting the transfer of the licence into her name as nominee and other related matters prior to opening the premises for trading.

12 My client has advised that at all times she dealt with Mr. Richard Verling as landlord of the property on an arm's length basis.

13 I note the Bank is in discussions with a third party concerning the sale of the property.

14 I am writing to bring to your attention our client's interest in the property and that she is concerned at recent developments. I would be grateful if you outline the Bank's position on the matter.

15 As our client is anxious to proceed to open the premises for trading, I should be grateful if you would come back to me as soon as possible".

16 On the 20th of July the Solicitors for the Plaintiffs replied to the foregoing letter writing to Solicitors for the second and third Defendants as follows:

"We write to put you on notice that we act for ICC Bank P1c which holds a first fixed charge over the above premises on foot of a mortgage dated 13th May 1991 made between Richard Verling and ICC Bank Pic. We note that you act for Wine Dimensions Limited.

We have been copied by Messrs. Rowan and Company Solicitors for Richard Verling with a letting agreement dated the .... day of ....... 1993 made between Richard Verling and Wine Dimensions Limited. This purports to be a letting agreement for two years nine months commencing 1st of January 1993.

We have taken our client's instructions on this and are instructed that ICC Bank P1c did not furnish its consent to the creation of this letting agreement. As you may be aware, the consent of ICC as mortgagee is required to any letting of the premises the subject matter of the mortgage. This consent was not procured and accordingly the agreement is null and void.

Having carried out a licensing search against the premises we note that Niamh Landy holds the licences as nominee for Wine Dimensions Limited. We hereby call upon your client to transfer the licences attaching to the premises to our client and to confirm that your client has now vacated the premises at 1 Vernon Avenue. Please also let us have by return copies of the original licences".

17 It should be noted that despite the references in this letter and the earlier letter of the 14th of October, 1992 to the first Defendant, the date of the mortgage is in fact the 31st of May, 1991 not the 13th of May, 1991. On the 23rd of July, 1993 the Solicitors for the second and third Defendants...