McGuinness v Ulster Bank Ltd
| Jurisdiction | Ireland |
| Judge | Ms. Justice Finlay Geoghegan |
| Judgment Date | 28 March 2019 |
| Neutral Citation | [2019] IESC 20 |
| Court | Supreme Court |
| Docket Number | [Appeal No: 2014/286] |
| Date | 28 March 2019 |
and
[2019] IESC 20
Finlay Geoghegan J.
MacMenamin J.
Dunne J.
Finlay Geoghegan J.
[Appeal No: 2014/286]
THE SUPREME COURT
Appointment of receiver – Deed of charge – Deed of appointment – Plaintiffs seeking to appeal against appointment of receiver – Whether the appointment of the receiver had been made in accordance with Clause 9.1 of the deed of charge
Facts: The High Court (Hogan J) determined that Mr O'Connor was validly appointed as receiver over property charged by the plaintiffs, Mr McGuinness and Mr Mulligan, and others to the defendant, Ulster Bank Ireland Ltd, by deed of mortgage and charge of 14 August 2006, for the reasons set out in a judgment delivered on 27 May 2014. Hogan J made a declaration to that effect in an order of 3 June 2014. It was from that order and judgment that the plaintiffs appealed. The appeal was transferred to the Court of Appeal pursuant to Article 64 of the Constitution in October 2014 and reverted to the Supreme Court. The contention of the plaintiffs was that the appointment of the receiver had not been made in accordance with Clause 9.1 of the deed of charge. They submitted that Clause 9.1 permitted the appointment by the Bank to be made by a document either signed by an authorised officer of the Bank or executed under seal. They contended that Mr McNaughton did not sign as an authorised officer of the Bank. They also contended that the deed of appointment was not executed under seal.
The plaintiffs relied upon the decision of Gilligan J in Re Belohn Limited (No.1) [2013] IEHC 130 to submit that as the appointment of the receiver did not comply with the contractual requirement, it was fatal to the validity of the appointment. The plaintiffs also contended that as the deed of appointment was made by the Bank, which was a company registered in the State, in accordance with s. 64(2)(b)(ii) of the Land and Conveyancing Law Reform Act 2009, to be a deed, it must be executed under the seal of the Bank in accordance with its Articles of Association.
Held by Finlay Geoghegan J that the deed of appointment by which the Bank appointed Mr O'Connor as receiver, which was signed but not sealed by Mr McNaughton pursuant to the Power of Attorney and whose signature was witnessed, was a document made by Mr McNaughton, an individual, within the meaning of s. 64(2)(b) of the 2009 Act and a deed within the meaning of s. 64 which took effect as if it were a document under seal pursuant to s. 64(3) of the 2009 Act. Hence, Finlay Geoghegan J held that the Bank validly appointed Mr O'Connor as receiver in compliance with the requirements of Clause 9.1 of the deed of charge.
Finlay Geoghegan J held that the appeal would be dismissed.
Appeal dismissed.
This appeal concerns the validity of the appointment of a Mr. David O'Connor as receiver (‘the Receiver’) over property charged by the plaintiffs and others to the defendant (‘the Bank’) by deed of mortgage and charge of 14 August 2006 (‘the Deed of Charge’).
In the High Court, Hogan J. determined that the Receiver was validly appointed, for the reasons set out in a judgment delivered on 27 May 2014: [2014] IEHC 281. He made a declaration to that effect in an order of 3 June 2014. It is from that order and judgment that the plaintiffs appealed. The appeal was transferred to the Court of Appeal pursuant to Article 64 of the Constitution in October 2014 and has recently reverted to this Court.
The plaintiffs appeared in person. The submissions at the hearing were made by Mr. McGuinness, the first named plaintiff, and Mr. Mulligan adopted the same. As appears from the issues considered below, the appeal raised quite technical legal issues and Mr. McGuinness, as a litigant in person, addressed these with considerable skill.
The issue before the High Court, and again before this Court, arises from the following facts which are not in dispute. Clause 9.1 of the Deed of Charge, made between the plaintiffs and others and the Bank, provided:-
‘At any time after the Chargor so requests or the security hereby constituted becomes enforceable, the Bank may from time to time appoint under seal or under the hand of a duly authorised officer of the Bank any person or persons to be receiver and manager or receivers and managers…. of the Secured Assets’
By 27 January 2012, the security created by the Deed of Charge had become enforceable and by a deed of that date between the Bank and Mr. O'Connor (‘the Deed of Appointment’), the Bank appointed him to be receiver and manager over the charged property. The Deed of Appointment was signed by a Mr. Michael McNaughton beside the following words as an attestation clause:
‘SIGNED AND DELIVERED BY MICHAEL MCNAUGHTON for and on behalf of and as the deed of ULSTER BANK IRELAND LIMITED under Power of Attorney dated 13th April 2011 which has not been revoked, in the presence of Steven Williams.’
Mr. Williams also signed, giving his occupation as bank official and his address as Ulster Bank, Georges Quay, Dublin 2. No seal was affixed to the document.
By a deed of power of attorney made on 13 April 2011 (‘the Power of Attorney’) the Bank had appointed Mr. McNaughton and other named people to be ‘our Attorneys and we give and grant full powers, warrant and authority to our Attorneys for us and in our name and on our behalf to sign or otherwise execute and deliver the following documents, videlicet’. The documents identified in the Power of Attorney include at para. 4, ‘such… deeds of appointment… as may be required in connection with… receiverships…’. The Power of Attorney was executed by affixing the common seal of the Bank in the presence of two authorised signatories who signed the document. There is no challenge to the validity of the Power of Attorney.
The contention of the plaintiffs is that the appointment of the Receiver has not been made in accordance with Clause 9.1 of the Deed of Charge. They submit that Clause 9.1 permits the appointment by the Bank to be made by a document either signed by an authorised officer of the Bank or executed under seal. They contend that Mr. McNaughton did not sign as an authorised officer of the Bank. They also contend that the Deed of Appointment was not executed under seal. They rely upon the decision of Gilligan J. in Re Belohn Limited (No.1) [2013] IEHC 130, [2013] 2 I.L.R.M. 388 to submit that as the appointment of the Receiver does not comply with the contractual requirement, it is fatal to the validity of the appointment.
The plaintiffs also contend that as the Deed of Appointment is made by the Bank, which is a company registered in the State, in accordance with s. 64(2)(b)(ii) of the Land and Conveyancing Law Reform Act 2009 (‘the 2009 Act’), to be a deed, it must be executed under the seal of the Bank in accordance with its Articles of Association.
The Bank accepts that the appointment of the Receiver must be in accordance with Clause 9.1 of the Deed of Charge. Whilst attention was drawn to Clause 9.2, counsel on its behalf stated that it was not relying on Clause 9.2 of the Deed of Charge. The Bank does not contend that it established that Mr. McNaughton executed the Deed...
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