McGrath v Godfrey

• Jurisdiction: Ireland
• Judge: Ms. Justice Irvine
• Judgment Date: 15 June 2016
• Neutral Citation: [2016] IECA 178
• Docket Number: Appeal No. 2016 31
• Court: Court of Appeal (Ireland)
• Date: 15 June 2016

Irvine J.

Hogan J.

Mahon J.

Padge McGrath, Mark McGrath, Dermot Kehoe, Brendan Butler

and

John Webb

PlaintiffS

- and -

Liam Godfrey

Defendant

[2016] IECA 178

Appeal No. 2016 31

THE COURT OF APPEAL

Personal guarantees – Costs – Repayment obligations – Defendant seeking to set aside order of High Court – Whether High Court judge erred in the manner in which he exercised his discretion

Facts: The plaintiffs, Mr P McGrath, Mr M McGrath, Mr Kehoe, Mr Butler and Mr Webb, on the 19th December, 2012, issued summary summons proceedings on foot of personal guarantees allegedly afforded by the defendant, Mr Godfrey, to each of them dated 21st May, 2007. Those guarantees were stated to support a total sum of ?1m loaned by them to Greenhill Investment Ltd, a company of which Mr Godfrey was a director and which has an address in Bulgaria. The company having defaulted upon its repayment obligations, the plaintiffs, by letter dated 8th May, 2012, called upon Mr Godfrey to meet his liabilities under the guarantees. On the 14th February, 2014, the High Court granted the plaintiffs liberty to enter final judgment against Mr Godfrey for a total sum of ?1,400,000 together with interest on the sum of ?1m from 8th May, 2012, and an order for their costs to be taxed in default of agreement. On the 11th January, 2016, the High Court refused the defendant?s application to set aside the order of the High Court dated 14th February, 2014. The defendant appealed to the Court of Appeal against that order. In his notice of appeal dated 22nd January, 2016, Mr Godfrey made a number of assertions as to fact, many of which related to the service of the proceedings, which he had not deposed to on affidavit when his application was dealt with in the High Court. Further factual claims were advanced by him in his written submissions. In addition, he lodged a number of further affidavits in support of his appeal.

Held by Irvine J that she was not satisfied that the High Court judge erred in the manner in which he exercised his discretion when he refused the defendant?s application to set aside the judgment obtained by the plaintiffs on 17th April, 2014. Irvine J noted that the judgment so obtained was procured in a regular manner and in accordance with the Rules of the Superior Courts; in particular, service of the relevant documentation was effected on the defendant in the manner provided for in the orders made providing for substituted service.?Irvine J held that the High Court judge, having been satisfied that the plaintiffs had fully complied with their obligations under the Rules of the Superior Courts concerning service of the summons and the motion for judgment, was entitled to uphold the aforementioned judgment. Irvine J held that the defendant did not discharge the onus to demonstrate the existence of a defence which had a real prospect of success in the materials which he put before the High Court. Having regard to the fact that Mr Godfrey appeared before the Court of Appeal as a lay litigant and sought to introduce evidence which he had not put before the High Court, Irvine J expressed her view that even if all of that evidence had been placed before the High Court judge, she was satisfied that he would have been acting well within his discretion had he refused to grant the defendant the relief which he sought.

Irvine J held that she would dismiss the appeal.

Appeal dismissed.

JUDGMENT of Ms. Justice Irvine delivered on the 15th day of June 2016

1 This is an appeal against the order of the High Court (Barr J.) made on 11th January, 2016 and perfected on 12th January, 2016, whereby he refused the defendant's (Mr. Godfrey's) application to set aside an order of the Master of the High Court dated 14th February, 2014. That Order granted the plaintiffs liberty to enter final judgment against Mr. Godfrey for a total sum of ?1,400,000 together with interest on the sum of ?1m from 8th May, 2012, and an order for their costs to be taxed in default of agreement.

Background

2 The background to the judgment is that on 19th December, 2012, the plaintiffs issued summary summons proceedings on foot of personal guarantees allegedly afforded by Mr. Godfrey to each of them dated 21st May, 2007. Those guarantees were stated to support a total sum of ?1m. loaned by them to Greenhill Investment Limited, a company of which Mr. Godfrey was a director and which has an address in Bulgaria. That loan is not disputed. The company having defaulted upon its repayment obligations, the plaintiffs, by letter dated 8th May, 2012, called upon Mr. Godfrey to meet his liabilities under the guarantees.

3 It should be stated that Mr. Godfrey's application to set aside the order of the Master dated 14th February, 2014, was supported by his own affidavit sworn on 14th December, 2015. The matters which he relied upon were replied to by Mr. Orm Kenny, the plaintiffs' solicitor, in an affidavit of 6th January, 2016. Mr. Godfrey did not seek to file any supplemental affidavit challenging the content of Mr. Kenny's affidavit which dealt with the service of the summary summons, notice of motion and grounding affidavit and also the matters relied upon by Mr. Godfrey to support his assertion that he had a bona fide defence to the proceedings.

4 In his notice of appeal dated 22nd January, 2016, Mr. Godfrey made a number of assertions as to fact, many of which related to the service of the proceedings, which he had not deposed to on affidavit when his application was dealt with in the High Court. Yet further factual claims were advanced by him in his written submissions. In addition, he lodged a number of further affidavits in support of his appeal.

5 The first of these affidavits was that sworn by Ms. Anne Murphy on 8th February, 2015, wherein she stated that she had accompanied Mr. and Mrs. Godfrey to Bulgaria on 17th January, 2013, and that they had remained there until 25th January, 2013. The second was an affidavit sworn by the defendant's wife, Mrs. Margaret Godfrey, on 5th February, 2016. In her affidavit she stated that when she arrived home from Bulgaria on 25th January, 2013, she saw no document in the house with her husband's name on it. She also confirmed that during the weeks which included 24th June 2013, and 20th January 2014, no post had arrived for her husband from the plaintiffs. She also advised that on 18th December, 2013, a man had come to their home looking for her husband. When she informed him that he was not there he allegedly put his foot in the door and was persistent to the point that she told him that she intended calling the gardai with the result that he left. The third affidavit was that of Mr. Joe Godfrey, the defendant's son, who asserted that his father left home at 7:55 a.m. on 16th January, 2013, and did not return until 25th January 2013. He claimed that nobody had come to the door of the house that morning and that he had found no document left in the letterbox. Thankfully, for the purposes of this appeal, it is not necessary to consider the weight that a court might reasonably attach to affidavits, such as those to which I have just referred, wherein the deponents have each asserted that they are in a position to recollect what, if any, post came through the letterbox of their home on a particular day or in the course of a particular week several years earlier.

6 Given that this is not an appeal from an interlocutory order, the approach which has been adopted by Mr. Godfrey on this appeal in seeking to introduce the aforementioned new material is highly irregular and is not in conformity with the Rules of Court. However, given that he represented himself at the hearing of the appeal, I feel that I should briefly summarise the more significant matters referred to by him in the aforementioned documentation, given that I am satisfied that these matters are not critical to or determinative of the outcome of the appeal.

7 Mr. Godfrey maintains that:-

(i) he was never served with the summary summons either personally or by ordinary pre-paid post;

(ii) he was not at his home on 18th December, 2013, when Mr. McGlynn attended for the purposes of seeking to effect service of the notice of motion. His wife was present but she was not served;

(iii) the summons should have been sent by registered post because post ?goes missing? in Ireland;

(iv) there were no personal guarantees and he signed no such documents;

(v) the first he knew of any court proceedings was in July, 2015 when he was advised of the existence of a European Enforcement Order, and

(vi) the effect of the judgment obtained against him has been that his shares in his Bulgarian companies have been seized and those companies are in the process of being liquidated and their assets sold off at a substantial undervalue.

Chronology and summary of the evidence before the High Court

8 The following is a brief chronology and summary of the evidence which was before the High Court Judge at the time he made his order.

9 As I have already stated, the plaintiffs issued a summary summons on 19th December, 2012. Mr. Simon Kennedy, the solicitor on record for the plaintiffs at that time, in his affidavit of 13th March, 2013, averred that he travelled to Limerick on 16th January, 2013, for the purposes of effecting service. He telephoned Mr. Godfrey prior to his arrival and told him that he had a document to serve on him. Mr. Godfrey advised him that he was going to Bulgaria and said he would phone back with the name of the solicitor upon whom the summons could be served. When he did so he advised Mr. Kennedy that he was not prepared to accept service. He did not want to be rushed in light of his travel arrangements. He then advised Mr. Kennedy that he was not at his home at Fedamore.

10 Mr. Kennedy, according to his...