Keating v Keating

• Jurisdiction: Ireland
• Judge: Miss Justice Laffoy
• Judgment Date: 24 August 2009
• Neutral Citation: [2009] IEHC 405
• Docket Number: [No. 2652 P/2002]
• Court: High Court
• Date: 24 August 2009

Keating v Keating

BETWEEN

JAMES KEATING

PLAINTIFF

AND

CATHERINE KEATING AND PATRICK KEATING

DEFENDANTS

[2009] IEHC 405

[No. 2652 P/2002]

THE HIGH COURT

CONTRACT

Sale of land

Duress - Undue influence - Unconscionable bargain - Improvident transaction - Setting aside transaction - Actual undue influence - Whether contract procured by duress or undue influence - Equity - Principles to be applied - Conduct of land transfer irregular - No independent legal advice received by plaintiff - Plaintiff in poor psychological and physical condition at time of contract - Plaintiff under serious disadvantage - Plaintiff actively seeking defendants to purchase land not bar to plaintiff's claim of unconscionable bargain or improvident transaction - Whether improvident transaction or unconscionable bargain -Defences - Laches - Acquiescence - Clean hands - Whether plaintiff delayed - Remedies - Restitutio in integrum - Damages - Aggravated damages - Principles to be applied - Alec Lobb (Garages) Ltd v Total Oil (Great Britain) Ltd [1983] 1 WLR 87 followed; Carroll v Carroll [1999] 4 IR 241, Grealish v Murphy [1946] IR 35 and Conway v Irish National Teachers Organisation [1991] 2 IR 305 applied - Transfer set aside and damages awarded (2002/2652P - Laffoy J - 24/8/2009) [2009] IEHC 405

Keating v Keating

EQUITY

Undue Influence

Land transfer - Set aside - Damages - Duress -Improvident transaction - Unconscionable bargain - Discretionary nature of equitable remedies - Allegations of assault - Clean hands - Circumstances court will intervene to set aside improvident transaction - Whether plaintiff disadvantaged because of lack of understanding - Independent legal advice - Whether defendants lost right to have land transfer set aside - Affirmation - Laches - Restitutio in integrum - Delay - Estoppel - Damages - Applicable principles - Carroll v Carroll [1999] 4 IR 241 and Grealish v Murphy [1946] IR 35 applied; Alec Lobb (Garages) Ltd v Total Oil (Great Britain) Ltd [1983] 1 WLR 87 and Conway v Irish National Teachers Organisation [1991] 2 IR 305 considered - Relief granted; land transfer set aside and plaintiff awarded €14,000 (2002/2652P - Laffoy J- 24/8/2009) [2009] IEHC 405

Keating v Keating

Facts The plaintiff sought an order setting aside the transfer of land to the first named defendant for value on the ground that it was procured by duress or undue influence, or alternatively, on the ground that it was an improvidence transaction or an unconscionable bargain. The plaintiff also sought orders directing the first named defendant to account for all rents and profits received by her in respect of the land. The plaintiff also sought an order directing the first named defendant to account to the plaintiff in respect of all monies and profits received by her on foot of or by reason of a purported transfer of the plaintiff's Suckler Cow Premium Quota. The plaintiff also sought damages for detinue and conversion in relation to a number of cattle and two items of machinery. Furthermore, the plaintiff sought damages against the second named defendant for trespass to the person and assault and the plaintiff sought injunctive relied in relation to the severance of the water supply to his house and the closure of the septic tank. The first named defendant was the widow and the second named defendant was the son of the deceased first cousin of the plaintiff and lived on a farm adjoining the plaintiffs. The plaintiff was in serious financial difficulty and in poor physical health at the time of the transfer of land. The plaintiff alleged that he was put under pressure by the second named defendant to transfer the land and was also assaulted by that defendant. The defendants denied those allegations. The plaintiff alleged that he did not sign a Quota transfer and adduced evidence by a forensic document examiner to the effect that his signature on that transfer document had been forged.

Held by Laffoy J. in favour of the plaintiff: That the transfer of land was not procured by duress or undue influence. However, the defendants took unfair advantage of the plaintiff and it was probable he was bullied and intimidated by the second named defendant in relation to the quota and the stock. The plaintiff was seriously disadvantaged because of his lack of understanding of the overall ramifications of what he was doing after he contracted to sell the land and his state of health was a contributory factor. The defendants exploited the situation once the plaintiff was contractually bound to sell the land. Furthermore, the plaintiff did not get the benefit of independent legal advice. Consequently, the overall transaction was improvident. It was also oppressive and unfair. The plaintiff was entitled to have the land transfer set aside on the basis that restitution in integrim would be effected by set off to the extent appropriate. Furthermore, the first named defendant was liable to account to the plaintiff for the sum of €39,527.60 in respect of the quota and the plaintiff was entitled to an award of €14,000 damages for the loss of machinery and cattle. Finally, the plaintiff was entitled to an award of €12,500 damages for personal injuries.

Reporter: L.O'S.

DELANY EQUITY & THE LAW OF TRUSTS IN IRELAND 4ED 2007 19

DELANY EQUITY & THE LAW OF TRUSTS IN IRELAND 4ED 2007 21

DELANY EQUITY & THE LAW OF TRUSTS IN IRELAND 4ED 2007 701

CARROLL v CARROLL 1999 4 IR 241 2000 1 ILRM 210 1999/4/699

GREALISH v MURPHY 1946 IR 35

ALEC LOBB GARAGES LTD & ORS v TOTAL OIL (GB) LTD 1983 1 WLR 87 1983 1 AER 944

CONWAY & ORS v IRISH NATIONAL TEACHERS ORGANISATION & ORS 1991 2 IR 305 1991 ILRM 497

Miss Justice Laffoy

1 The plaintiff, who was born on 1^st August, 1937, is a bachelor. He has lived for most of his life on a small farm located in West Clare near Loop Head. In 1966 he became the owner of the farm which is registered on Folio 1454F, County Clare. He lived in a dwelling house on the land with his brother, a tradesman, who also helped on the farm, until his brother's death in 1994. Thereafter, he lived there alone. The plaintiff's parents had predeceased his brother, his father having died in 1973 and his mother having died in 1979. The plaintiff has one sister, but she has no connection with the events which have given rise to these proceedings.

2 The first named defendant is the widow, and the second named defendant is the son, of Patrick Keating (Mr. Keating Senior), who was a first cousin of the plaintiff. Mr. Keating Senior was approximately twelve years younger than the plaintiff. He died suddenly in January 1999 at the age of 48 from a massive heart attack. During his lifetime, Mr. Keating Senior had been the joint owner with the first named defendant of a farm of land adjoining the plaintiff's farm. Mr. Keating Senior was a full-time employee of the Electricity Supply Board (the ESB) prior to his death. It was the first named defendant who was primarily concerned with their farming enterprise. For many years, the plaintiff and Mr. Keating Senior and the first named defendant enjoyed a friendly relationship and were frequent visitors to each others houses. As the second named defendant put it, his family lived only two fields away from the plaintiff. The second named defendant was born in January, 1977, so that he was just 22 years of age when the events which are the subject of these proceedings commenced. Having finished school, the second named defendant lived and worked in England and later in the United States. Following the unexpected death of his father in January 1999 he returned home. His dealings with the plaintiff in February 1999 were the genesis of these proceedings.

The plaintiff's claim and the defendants' response thereto as pleaded

3 The plaintiff's claim as pleaded and as pursued is one of some complexity, notwithstanding the modest nature of the property the subject of the proceedings. It contains a number of elements.

4 First, arising out of a transfer dated 12^th July, 1999 (the Land Transfer), whereby the plaintiff transferred the land registered on Folio 1454F of the Register of Freeholders, County Clare to the first named defendant for value, the plaintiff seeks an order setting aside the Land Transfer on the ground that it was procured by duress or undue influence or, alternatively, on the ground that it was an improvident transaction or an unconscionable bargain. The plaintiff claims ancillary relief with a view to having the title to the land restored to him. He also seeks an order directing the first named defendant to account for all the rents and profits received by her in respect of the land since the date of the Land Transfer. The land registered on Folio 1454F comprises three parcels: land at Feeard comprising 10.9560 hectares (approximately 27 acres); a plot in the townland of Ross comprising .4880 hectares (slightly over an acre); and one undivided thirteenth part of commonage in Feeard comprising 47.7300 hectares. In relation to his share of the commonage, the plaintiff had entered into an agreement for exchange dated 23^rd February, 1987 with the Irish Land Commission for the exchange of his one undivided thirteenth share in the entire commonage for an area in the townland of Feeard comprising 4.173 hectares (slightly more than 10 acres), which the plaintiff beneficially owned in 1999. There was, and is, a modest single storey dwelling house on the land registered on Folio 1454F and there were certain farm buildings on the land. As regards this element of the case, the position of the defendants is that the Land Transfer was not procured by duress or undue influence. The defendants further contend that the Land Transfer was for full value and was not an improvident transaction or an unconscionable bargain.

5 The second element relates to what is described as a...