McCONNON v PRESIDENT of IRELAND

JurisdictionIreland
JudgeMr. Justice Kelly
Judgment Date23 May 2012
Neutral Citation[2012] IEHC 184
CourtHigh Court
Docket Number[2011 No. 9378P]
Date23 May 2012
McConnon v President of Ireland & Ors
COMMERCIAL

BETWEEN

JAMES MCCONNON
PLAINTIFF

AND

PRESIDENT OF IRELAND, AN TAOISEACH, MINISTER FOR JUSTICE, EQUALITY AND LAW REFORM, IRELAND, ATTORNEY GENERAL, COMMISSIONER OF AN GARDA SÍOCHÁNA AND ZURICH BANK IRELAND
DEFENDANTS

[2012] IEHC 184

[No. 9378 P/2011]

THE HIGH COURT

PRACTICE & PROCEDURE

Strike out proceedings in limine

Inherent jurisdiction of court - Purpose of jurisdiction - Res judicata - Whether judgment of High Court final and conclusive for doctrine of res judicata when under appeal - Whether issues could have been raised by way of defence to summary proceedings - New evidence - The Sennar (No 2) [1985] 1 WLR 490 and Deighan v Sunday Newspapers Ltd. [1987] NI 105 approved - Whether alleged tort of reckless lending existed - ICS Building Society v Grant [2010] IEHC 17, (Unrep, Charleton J, 26/1/2010) followed - Proceedings dismissed (2011/9378P - Kelly J- 23/5/20120 [2012] IEHC 184

McConnon v President of Ireland

Facts The plaintiff had an on-going dispute with Zurich Bank Ireland (the Bank) in relation to a loan for €32 million. Proceedings had been issued and summary judgment had been granted against the plaintiff (under appeal). The plaintiff issued the present proceedings contending that the Bank had breached various banking legislation, had engaged in misrepresentation and that the loan agreement was of no effect. Damages were also sought by the plaintiff. Claims against the other named parties were withdrawn. An application was brought on behalf of the Bank claiming that the claim disclosed no reasonable cause of action, that the issues had already been litigated and that issues sought to be raised, could have been raised during the previous proceedings. The plaintiff also contended that there was new evidence, which consisted of an executive summary prepared by bank officials, which had not been available during the summary proceedings. There was also an issue as to whether the judgment of the High Court in the summary proceedings could be final and conclusive for res judicata purposes when there was an appeal to the Supreme Court.

Held by Kelly J in dismissing the plaintiff's proceedings: There was provision in the Rules of the Superior Courts and in the inherent jurisdiction of the court to strike out proceedings if they disclosed no reasonable cause of action or constituted an abuse of process. A party was precluded from relitigating matters decided in a judgment or from giving evidence to contradict them in subsequent proceedings. The court was satisfied that the High Court judgment was capable of raising res judicata despite the fact that there was an appeal pending from it to the Supreme Court. The executive summary which was sought to be introduced was not new evidence and had been available to the plaintiff's lawyers during the application for summary judgment. Neither the declaratory relief nor the claim for damages were capable of being pursued because they were subject to the res judicata rule. Either the allegations had already been raised (albeit perhaps in a somewhat different form) or ought to have been raised. The fact that they were not raised rendered them subject to the rule in Henderson and Henderson. The tort of reckless lending did not exist as a civil wrong in Irish law.

HENDERSON v HENDERSON 1843 3 HARE 100

RSC O.19 r28

BARRY v BUCKLEY 1981 IR 306

FAY v TEGRAL PIPES LTD 2005 2 IR 261

DOHERTY v MIN FOR JUSTICE UNREP MCGOVERN 15.5.2009 2009/13/3050 2009 IEHC 246

DSV SILO UND VERWALTUNGSGESELLSCHAFT MBH v OWNERS OF THE SENNAR (NO 2) 1985 1 WLR 490 1985 2 AER 104

DEIGHAN v SUNDAY NEWSPAPERS LTD 1987 NI 105

A (A) v MEDICAL COUNCIL 2003 4 IR 302

YAT TUNG INVESTMENT CO LTD v DAO HENG BANK LTD 1975 AC 581

JOHNSON v GORE WOOD & CO 2002 2 AC 1

COSGRAVE v DPP & ORS UNREP SUPREME 26.4.2012 2012 IESC 24

BANKERS BOOKS EVIDENCE ACT 1879

NATIONAL DEBT ACT 1882

SAVINGS BANK ACT 1893

RINGSEND PROPERTY LTD v DONATEX LTD & ANOR UNREP KELLY 18.12.2009 2009/49/12226 2009 IEHC 568

ICS BUILDING SOCIETY v GRANT UNREP CHARLETON 26.1.2010 2010/23/5653 2010 IEHC 17

1

JUDGMENT of Mr. Justice Kelly delivered on the 23rd day of May, 2012

Background
2

1. In 2007, the plaintiff (Mr. McConnon) applied to Zurich Bank Ireland (the Bank) for a loan of €32m. His application was successful. The money was advanced to him on foot of a letter of facility of 15 th June, 2007. The monies were required in connection with the construction and completion of a shopping centre located at Main Street, Castleblayney, Co Monaghan.

3

2. Unfortunately, that project ran into difficulties and Mr. McConnon was unable to discharge his obligations to the Bank.

4

3. The Bank commenced proceedings against Mr. McConnon in this court on 30 th November, 2010. Mr. McConnon was represented by senior and junior counsel and a solicitor in those proceedings. Birmingham J. heard an application for summary judgment against Mr. McConnon and on 4 th March, 2011, delivered a reserved judgment on that issue. Despite the endeavours of Mr. McConnon's counsel, that judge was unable to identify any arguable case or triable issue which would justify the refusal of summary judgment. Accordingly, he gave judgment against Mr. McConnon for the full amount.

5

4. Mr. McConnon appealed the decision of Birmingham J. That appeal has yet to be heard. Mr. McConnon sought from the Supreme Court a stay on execution of the judgment of Birmingham J. pending the determination of his appeal. On 8 th July, 2011, the Supreme Court refused that stay of execution.

6

5. On 20 th October, 2011, Mr. McConnon commenced the present proceedings. On 7 th November, 2011, he served a notice of discontinuance of the action against the first defendant, the President of Ireland.

7

6. On the application of the Bank, this action was transferred to the Commercial List and the Bank and remaining defendants brought motions seeking to have the respective claims against them struck out in limine. On the hearing of these motions on 19 th April, 2012, Mr. McConnon consented to his claim against the Taoiseach, the Minister, Ireland, the Attorney General and the Commissioner of the Garda being struck out. Accordingly, only Mr. McConnon's claim against the Bank remains and this is my judgment on the Bank's application to have that claim struck out.

Mr. McConnon's Claims
8

7. In his plenary summons, Mr. McConnon claimed the following reliefs against the Bank:-

9

2 " 1. An order declaring that the seventh named defendant Zurich Bank Ireland has acted ultra vires as against the plaintiff in its fraudulent, neglegent (sic) and fragant (sic) disregard to the following:-

10

The Banker Books Evidence Act 1879, as amended,

11

National Debt Act, 1882

13

2. An order staying all court proceedings as against the plaintiff by the seventh name defendant Zurich Bank Ireland and in particular the enforcement of any judgment and the commencing of bankruptcy proceedings until these proceedings are determined.

14

3. Damages both general and punitive.

15

4. An order for directions or such other order as this honourable court shall deem appropriate.

16

5. An order for costs."

17

8. The statement of claim was delivered on 21 st December, 2011 and seeks somewhat different reliefs against the Bank. The prayer reads as follows:-

18

2 " 1. A declaration that by reason of the misrepresentation of the seventh named defendant the plaintiff was induced into entering into a loan facility agreement with the seventh named defendant on 15 th June, 2007, under which the plaintiff was advanced a sum of circa €32m for the purchase of two sites and the completion of a shopping centre.

19

2. A declaration that by reason of the misrepresentation of the seventh named defendant, its servants and agents, the loan facility agreement is void and of no legal force and effect, and in the alternative.

20

3. A declaration that by reason of the misrepresentation of the seventh named defendant, its servants and agents, the plaintiff is released from his indebtness (sic) to the seventh named defendant under the loan agreement dated 15 th June, 2007.

21

4. Further and in the alternative, a declaration that the seventh named defendant acted in breach of its fiduciary duties, contractual duties and duty of care which if (sic) owed to the plaintiff as the plaintiff's banker in the manner in which it managed the plaintiff's loan account facility.

22

5. Such further other declaratory and other orders as this honourable court may deem fit.

23

6. Damages for misrepresentation.

24

7. Damages for breach of contract.

25

8. Damages for breach of fiduciary duties.

26

9. Damages for negligence including negligent misstatement and breach of duty.

27

10. Damages for unlawful interference with the plaintiff's economic interest.

28

11. Interest pursuant to the Court Act 1981.

29

12. Costs."

30

9. The Bank's application to strike out Mr. McConnon's claim is brought under a number of different headings. Aspects of the claim are said not to disclose a cause of action with any reasonable prospect of success and thus ought to be dismissed at this juncture. Other aspects of Mr. McConnon's claim are said to have already been adjudicated upon by either this Court or the Supreme Court and thus may not be the subject of a fresh claim inconsistent with those determinations. In addition, it is argued that some issues sought to be advanced in the present proceedings could have been raised by Mr. McConnon in the summary proceedings against him but were not in fact so raised by him. They are said to fall foul of the rule in Henderson v. Henderson [1843] 3 Hare 100 and thus may also be regarded as res judicatae.

Jurisdiction
31

10. Order...

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