National Asset Loan Management Ltd v Eileen Browne, John McGee

• Jurisdiction: Ireland
• Judge: Mr. Justice Twomey
• Judgment Date: 22 February 2018
• Neutral Citation: [2018] IEHC 94
• Date: 22 February 2018
• Court: High Court
• Docket Number: [2004 No. 538 P] (2014 No. 28 COM)

[2018] IEHC 94

THE HIGH COURT

COMMERCIAL

Twomey

[2004 No. 538 P]

(2014 No. 28 COM)

BETWEEN:

NATIONAL ASSET LOAN MANAGEMENT LIMITED

PLAINTIFF

-AND-

EILEEN BROWNE, JOHN MCGEE, HOWARD MILLAR, RONAN O'CAOIMH, IFCANA DEVELOPMENTS LIMITED

DEFENDANTS

EX TEMPORE JUDGMENT of Mr. Justice Twomey delivered on the 22nd day of February, 2018.

Introduction

1 This is an application on behalf of Cannockway Limited (“Cannockway”) pursuant to Order 42, Rule 24 of the Rules of the Superior Courts for leave to issue execution on foot of a judgment granted by Kelly J. (as he then was) on 26 ^th March, 2014, against the fourth named defendant, Ronan O'Caoimh (“Mr. O'Caoimh”) in the sum of €5,450,593.16.

2 While leave to issue execution on foot of a judgment would normally be a relatively straight forward application, and in some instances the leave would be granted on an ex parte basis, in this case Mr. O'Caoimh argues that leave should not be granted.

Background

3 The background to this application is that Mr. O'Caoimh and the four other defendants were co-borrowers from Bank of Ireland in connection with 10.5 acres at Cuckoo's Lane, Ballybeg, Rathnew, County Wicklow. The five defendants were jointly and severally liable on the borrowings. The plaintiff, National Asset Loan Management Limited (“NAMA”) acquired the loans as part of the re-structuring of the banking sector in Ireland after the economic downturn. When NAMA sought payment from the co-borrowers of the sums due (€5.4 million approx), it received only payment from the third named defendant Mr. Howard Millar (“Mr. Millar”) in December 2015, presumably because he was the only defendant who was willing and/or able to pay anything close to the sum due. He procured the payment to NAMA (through his nominee company, Cannockway) of €4.8 million in satisfaction of the entire sum due.

4 Mr. Brendan Delaney, the company secretary of Cannockway, avers that Mr. Millar “agreed to procure the payment of €4.8 million” (the Settlement Monies) pursuant to a Settlement Agreement between Mr. Millar and NAMA dated 21 ^st November, 2014. Mr. Delaney further avers that on foot of the payment of the Settlement Monies, it was agreed that NAMA would transfer to Mr. Millar or his nominees “the loans, the associated security and the Judgments obtained” by NAMA in the proceedings issued by it for the recovery of the loan. One of those judgments is the judgment obtained by NAMA against Mr. O'Caoimh and the subject of these proceedings. Mr. Delaney further avers that Mr. O'Caoimh's judgment was duly purchased by Cannockway pursuant to a Loan Sale Agreement dated 18 ^th December, 2015, between NAMA and Cannockway. Clause 3 of that Loan Sale Agreement, exhibited by Mr. Delaney, states in relation to the ‘Loan Documentation’, which is defined as including the judgment against Mr. O'Caoimh, that:

“The consideration for the purchase of the Loan Documentation by the Purchaser shall be the consideration which has been paid by the Purchaser to the Vendor in accordance with Clause 3.1 of the Settlement Agreement receipt of which the Vendor hereby acknowledges.”

Thus, the consideration for the purchase by Cannockway of, inter alia, Mr. O'Caoimh's judgment was the Settlement Monies paid by Cannockway under the Settlement Agreement. Mr. Delaney also avers that:

“I believe that [Mr. O'Caoimh's] judgment is capable of being acted upon and, in circumstances where the settlement of the claim by [NAMA] against all the parties to the original loan was obtained by way of a payment by [Mr. Millar], his nominee, Cannockway Limited, is entitled to proceed on foot of that judgment which has been lawfully assigned to it in order to secure its own recovery.”

5 Since it would be unlikely that a borrower such as Mr. Millar would arrange for the discharge of borrowings jointly and severally owed by him with his co-borrowers out of the goodness of his heart, it was no surprise that, having acquired the benefit of the judgments obtained against his co-borrowers, through Cannockway, Mr. Millar, or more accurately, Cannockway, would seek to recover on those judgments. Hence these proceedings.

6 The first step in this process is seeking leave to issue execution on foot of the judgment. This is because Order 42, Rule 42 states:

“In the following cases, viz.:-

(a) where six years have elapsed since the judgment or order, or any other change has taken place by death or otherwise in the parties entitled or liable to execution[…]

the party alleging himself to be entitled to execution may apply to the Court for leave to issue execution accordingly. The Court may, if satisfied that the party so applying is entitled to issue execution, make an order to that effect […]”

7 Since the judgment against Mr. O'Caoimh was obtained by NAMA, but it is sought to be enforced by Cannockway, there is therefore an apparent change in the parties entitled to execute the judgment. Hence the application by Cannockway in this case.

8 While Mr. O'Caoimh is the first application in this regard by Cannockway, this Court was advised that similar proceedings have been issued in relation to the second named defendant, Mr. John McGee.

9 It is common case that whether to grant leave to issue execution is a matter for the discretion of the court, since as noted by the Lavery J. in Fitzgerald v. Gowrie Park [1966] IR 662 at 670:

“I agree with the view taken by Parker J. in Dale v. Powell 105 LT 291 that you may take into consideration the state of the accounts between the parties entitled and liable to execution, and...