McCarthy -v- Moroney & anor; Moroney -v- Property Registration Authority & ors,  IEHC 379 (2018)
|Docket Number:||2017 8108 P; 2018 1692 P|
|Party Name:||McCarthy, Moroney & anor; Moroney -v- Property Registration Authority & ors|
THE HIGH COURT[RECORD NO. 2017 8108 P]
PADRAIG MORONEY AND GERALDINE MORONEYDEFENDANTSAND
THE HIGH COURT[RECORD NO. 2018 1692 P]
PROPERTY REGISTRATION AUTHORITY AND ENNIS PROPERTY FINANCE DAC
BANK OF SCOTLAND PLC
JUDGMENT of Mr. Justice Denis McDonald delivered on the 29th day of June 2018
This judgment is delivered in respect of a number of applications (described in more detail below) which arise in the two sets of proceedings named above. In the first set of proceedings brought by Shane McCarthy against Mr. Padraig Moroney and Mrs. Geraldine Moroney, the plaintiff receiver seeks possession of the lands comprised in Folios 9986, 14683, 11981, 32600F, 19275 and 15169 of the Register, Co. Clare. These proceedings were commenced by plenary summons issued on 8 September 2017.
The second set of proceedings were commenced by Mr. Moroney (acting in person) against the Property Registration Authority (“PRA”) and the other defendants named above on 22 February 2018. In those proceedings, Mr. Moroney seeks declaratory relief and damages. In particular, Mr. Moroney claims that there has been an unlawful attack on his private property rights as a consequence of the registration by the PRA of the second named defendant “Ennis Property” and the third named defendant (“Bank of Scotland”) as owners of registered charges previously granted by Mr. Moroney and his wife in favour of Bank of Scotland Ireland Ltd (“BOSI”) over the lands comprised in the Folios described in paragraph 1 above. Mr Moroney also complains that there has been a failure by the PRA to afford him fair procedures. He also contends that there has been a failure to afford him fair procedures as a consequence of the steps taken under the Cross-Border Mergers Regulations (described in more detail below). It will be necessary in due course to analyse the claims made by Mr. Moroney in greater detail but, before doing so, I should identify the nature of the applications which came on for hearing before me on 15, 16 and 17 May 2018.
The applications before the court
There are a number of applications before the court as follows:
(a) In terms of date, the first application before the court is an application by Mr. McCarthy (as the receiver appointed by Ennis Property over the lands comprised in the Folios described in paragraph 1 above) for interlocutory orders against Mr. Moroney and his wife, Mrs. Geraldine Moroney, restraining them from impeding or preventing Mr. McCarthy from taking possession of the lands in question (together with certain ancillary relief which it is unnecessary, at this point, to address).
(b) In chronological sequence, the next application is Mr. Moroney’s application (in the proceedings commenced by him) for an interlocutory order compelling the PRA to remove the charges currently held in the name of Ennis Property from the Folios described in para. 1 above.
(c) the next application is the motion brought by Mr. Moroney (filed on 11 April, 2018) seeking an order joining the Attorney General and certain other parties including Pepper Finance DAC (“Pepper”) as defendants to the proceedings.
(d) there is also an application brought on 20 April 2018 by Ennis Property and Mr. McCarthy in Mr. Moroney’s proceedings seeking orders pursuant to O. 19 r. 28 (RSC) and/or the inherent jurisdiction of the court dismissing the proceedings on the grounds that they are either frivolous or vexatious or are bound to fail and/or are an abuse of process.
(e) there is also a further application brought by Mr. Moroney on 30 April 2018 in which he seeks an order pursuant to O. 60 r. 2 (RSC) joining the Attorney General as a notice party to Mr. Moroney’s proceedings.
(f) the remaining application (similar to that described at (d) above) is the notice of motion dated 20 April 2018 brought by Bank of Scotland against Mr. Moroney seeking to strike out Mr. Moroney’s proceedings pursuant to O. 19 r. 28 or alternatively seeking an order dismissing the proceedings pursuant to the inherent jurisdiction of the court on the grounds that they are unsustainable.
On the first day of the hearing before me, it was agreed that the motions brought by Ennis Property and by Bank of Scotland should be heard first. On the second day of the hearing it was agreed that the hearing of those motions should then be followed by the hearing of Mr. Moroney’s application for an interlocutory injunction against the defendants in his proceedings and that the application by Mr. McCarthy for an interlocutory injunction against Mr. and Mrs. Moroney would be dealt with thereafter. It was agreed that the further motions brought by Mr. Moroney to add additional parties to his proceedings would be considered after I give this judgment (to the extent that the joinder of additional parties might still be live at that stage).
Before addressing each of the applications before the court individually, it may be helpful at this point to set out some relevant background which is apparent from the documents and affidavit evidence before the court.
On 1 June 2004, BOSI issued a Facility Letter to Mr. and Mrs. Moroney offering them a variable interest rate term loan of up to €500,000 for a term of 20 years together with a revolving loan of up to €100,000 for a term of four months. The facility letter recorded that the purpose of the loan was to assist in the purchase of 90 acres of land at Kilmurray, Co. Clare for €700,000 of which €100,000 was to be provided by Mr. and Mrs. Moroney themselves and the remainder was to be funded by the BOSI facilities. The Facility Letter made clear that, as security for the loan, BOSI required a first specific charge over the 90 acres to be acquired together with a first specific charge over land comprising 48 acres at Claremount, Broadford, Co. Clare and a similar charge over 4 acres of development land also at Broadford.
The Facility Letter (which was countersigned by Mr. and Mrs. Moroney on 2 June 2004) was stated to be subject to the BOSI General Loan Conditions issued in 2004.
On 29 June 2004, Mr. and Mrs. Moroney executed a Deed of Mortgage and Charge in respect of the facilities described in the Facility Letter under which they charged their property in each of the Folios mentioned above in favour of BOSI. It will be necessary in due course to consider some of the provisions of the June 2004 Deed.
On 21 November 2004, BOSI issued a further facility letter to Mr. and Mrs. Moroney offering a further variable interest rate loan up to €144,000 for a term of 20 years for the purpose of the purchase of what was described as a “S. 50 apartment at Parkview Hall, Dublin Road, Limerick”. The Facility Letter made clear that this loan would be offered on the basis of the existing security over the lands described above, together with a first charge over the Section 50 apartment.
Mr. and Mrs. Moroney countersigned the Facility Letter of 21 November 2004 (by executing the relevant acceptance attached to the letter) on 22 December 2004.
There is no dispute between the parties that the funds the subject of the Facility Letters described above were duly advanced to Mr. and Mrs. Moroney. There was a subsequent amendment made to the 20 year Facility in 2008, but, at this point, I do not believe that it is necessary to consider that amendment.
There was a further amendment made to the Facilities by an amending Facility Letter dated 9 February 2009 which provided (inter alia), at that time, for interest only payments together with certain repayments of principal (dealt with in more detail below) and which also provided that the loan facilities should now be subject to the 2008 edition of the BOSI standard conditions. These amendments were accepted by Mr. and Mrs. Moroney on 6 March 2009.
A further Facility Letter issued on 5 May 2009 which provided for a facility of €142,500 to refinance certain of the existing liabilities. This facility was also made available on the basis of the existing security.
During the course of 2010, proceedings were commenced in the High Court in Ireland and contemporaneously in the Court of Session in Scotland seeking the approval of a cross- border merger under the European Communities Cross-Border Mergers Directive 2005/56/EC (“the Cross-Border Mergers Directive”) under which the business of BOSI in Ireland would be transferred to Bank of Scotland (which had its seat in Edinburgh). On 22 October 2010, the High Court in Ireland issued a pre-merger certificate confirming that the relevant pre-merger requirements had been completed (insofar as Ireland was concerned) in respect of the proposed merger.
Subsequently, on 10 December 2010, the Court of Session in Edinburgh approved the completion of the cross-border merger and fixed 23:59 hours (GMT) on 31 December 2010 as the time and date on which the consequences of the merger were to have effect. As a matter of law, BOSI ceased to exist as at that time on 31 December 2010 and all of the assets and liabilities of BOSI became assets and liabilities of Bank of Scotland. That is clear from the terms of the cross-border mergers directive and the Irish regulations implementing the directive, namely the European Communities Cross-Border (Mergers) Regulations 2008 (S.I. no 157 of 2008) (“the 2008 Regulations”). If any further authority is required for that proposition it is to be found in the observations of Clarke J. (as he then was) in Kavanagh v. McLaughlin  3 IR 555 at p. 573. The decision in Kavanagh v. McLaughlin is considered in more detail below.
On 29 November 2014, Bank of Scotland entered into an agreement to sell a portfolio of loans and related security (including the loans to Mr. and Mrs. Moroney) to a company called ELQ Investments 11 Ltd (“ELQ”). However, prior to the completion of that sale, the bank, ELQ and Ennis Property...
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