Pepper Finance Corporation [Ireland] Designated Activity Company v O'Reilly

• Jurisdiction: Ireland
• Judge: Mr. Justice Mark Heslin
• Judgment Date: 05 June 2025
• Neutral Citation: [2025] IEHC 333
• Court: High Court
• Year: 2025
• Docket Number: RECORD NO. 2024/228CA

Between

Pepper Finance Corporation (Ireland) Designated Activity Company

Plaintiff

and

Martin O'Reilly

Defendant

[2025] IEHC 333

RECORD NO. 2024/228CA

THE HIGH COURT

Possession of property – Hearsay – Discovery – Plaintiff seeking possession of property – Whether the plaintiff’s evidence was inadmissible hearsay

Facts: The Circuit Court, on 16 July 2024, made an order that the plaintiff, Pepper Finance Corporation (Ireland) DAC, recover from the defendant, Mr O’Reilly, possession of property comprised in Folio 858L County Cavan. The defendant appealed to the High Court and (per s. 37 of the Courts of Justice Act 1936) the appeal involved a de novo hearing of the plaintiff’s application for possession. The defendant’s arguments were as follows: (1) he was “wrongly ambushed” and there had been a denial of his right to be heard; (2) there was no “chain of title” to the plaintiff in respect of his loan facility and related security; (3) he gave his original lender, IIB Home Loans Ltd (IIB), “no permission to transfer” his loan and mortgage; (4) there had been “no absolute transfer” and assignment to the plaintiff of his loan and mortgage; (5) the plaintiff failed to execute a “Statutory Declaration”, drafted by him, regarding proof of ownership of his loan facility and security; (6) the provisions of the Supreme Court of Judicature Act 1877 were not complied with; (7) the plaintiff was a credit service provider and could not enforce a credit agreement; (8) the plaintiff’s evidence was “inadmissible hearsay”; (9) he was entitled to discovery of documents for reasons given by him; (10) he did not pay the sum of €5,426.14; and (11) reliance on Start Mortgages DAC v Ramseyer [2024] IEHC 329, Fannon v Ulster Bank Ireland DAC & Ors [2024] IEHC 51 and Pepper Finance Corporation (Ireland) DAC v Moynihan [2024] IEHC 625.

Held by Heslin J that: (1) there was no “ambush” and no denial of the defendant’s rights; (2) there was no merit in the defendant’s argument that IIB should have been registered on his folio and/or that a failure to see IIB registered as owner of the charge, in December 2010, amounted to a missing ‘link’ in the ‘chain of title’; (3) this argument ignored the contents of para. 11 of the mortgage which the defendant (as “Borrower”) executed, on 23 November 2005, in the presence of a solicitor; (4) it was not credible that the plaintiff did not acquire full ownership of the charge which was registered against the defendant’s property (citing Part 3 of Folio 858L, which comprises exhibit ‘PR2’ to the affidavit sworn, on 2 August 2022, by Mr Reynor, solicitor for the plaintiff); (5) there was no obligation on any representative of the plaintiff (or KBC Bank Ireland Plc, as the plaintiff’s predecessor in title), to swear any declaration at the insistence of the defendant; (6) there was ample evidence that the requirements of s. 28(6) of the 1877 Act had been met; (7) the plaintiff was not acting as a credit service provider, but as the legal owner of a charge seeking possession; (8) the plaintiff’s evidence was admissible, having regard to s. 14 of the Civil Law and Criminal Law (Miscellaneous Provisions) Act 2020; (9) in circumstances where relevance is determined with reference to the pleadings in a case, there is no need for discovery; (10) this was not a claim for a money judgment - it was a claim for possession in which the amount of the indebtedness was not the issue, given that the issue of default was and remained clear; and (11) the authorities which the defendant sought to rely on were distinguishable on the facts.

Heslin J granted the relief sought by the plaintiff.

Relief granted.

JUDGMENT of Mr. Justice Mark Heslin delivered on the 5 ^th day of June 2025

Introduction

1 . On 16 July 2024, the Circuit Court made an order that the plaintiff recover from the defendant possession of property comprised in folio 858L County Cavan (“the property”). The defendant has appealed and ( per Section 37 of the Courts of Justice Act 1936) this appeal involves a de novo hearing of the plaintiff's application for possession.

2 . I am grateful to Mr. Neuman BL who provided written and oral submissions on behalf of the plaintiff. The defendant represented himself at the hearing and made his position very clear, by means of affidavits and submissions, written and oral.

3 . Before looking at all of the salient facts disclosed in the affidavit evidence, it is useful to note certain legislative provisions and legal principles which are of particular relevance, given that the property comprises of ‘registered’ land and the plaintiff is the owner of the charge registered as a burden on the defendant's folio.

1964 Act

4 . In this application, the plaintiff seeks to exercise rights under the Registration of Title Act, 1964 (the “1964 Act”), s. 62(1) of which provides:

“A registered owner of land may, subject to the provisions of this Act, charge the land with the payment of money either with or without interest, and either by way of annuity or otherwise, and the owner of the charge shall be registered as such.”

Conclusiveness of the Register

5 . In Tanager Designated Activity Company v. Kane [2018] IECA 352 (“ Tanager”) the Court of Appeal considered certain questions of law, the first being:-

“1) does the defendant have an entitlement to challenge the registration of the plaintiff as owner of the charge at entry no. 7 on the defendant's folio in these proceedings having regard to the conclusiveness of the Register pursuant to s. 31 of the 1964 Act?”

The charge registered as a burden

6 . The Court of Appeal answered that question in the negative. In the present case, exhibit ‘PR2’ to the affidavit sworn on 2 August 2022 by Mr. Philip Reynor, solicitor for the plaintiff, comprises a copy of folio 858L. The first entry in ‘Part 3’ (which concerns “ Burdens”) is dated 7 December 2010 and states:

“Charge for present and future advances repayable with interest.

KBC Bank Ireland plc is owner of this charge.

Note: The ownership of this charge has been transferred.

See Entry no. 2”

Plaintiff is the registered owner of the charge

7 . The second entry in Part 3 is dated 4 March 2022 and states:

“Pepper Finance Corporation (Ireland) Designated Activity Company is the owner of the charge registered at Entry no. 1”

8 . Thus, this Court has conclusive evidence that the plaintiff is the owner of the charge registered in the Land Registry against the defendant's property. Later, I will refer to the terms of the charge in question.

S.62 of the 1964 Act

9 . Returning to the 1964 act, s. 62(7) provides:

“When repayment of the principal money secured by the instrument of charge has become due, the registered owner of the charge or his personal representative may apply to the court in a summary manner for possession of the land or any part of the land, and on the application the court may, if it so thinks proper, order possession of the land or the said part thereof to be delivered to the applicant, and the applicant, upon obtaining possession of the land or the said part thereof, shall be deemed to be a mortgagee in possession” (emphasis added).

Summary application

10 . As pleaded in the Civil Bill, which issued on 2 December 2019, Section 62(7) of the 1964 Act is the statutory basis upon which the plaintiff in this case seeks possession of the property. As seen above, s. 62(7) explicitly permits a registered owner of a charge to seek possession in a “summary manner”.

11 . The significance and effect of s. 62 (7) and the nature of summary applications were explained by Ms. Justice Baker in the Supreme Court's decision in Bank of Ireland Mortgage Bank v. Cody [2021] IESC 26 (“ Cody”) wherein the learned judge stated:

“15. The jurisdiction conferred by that section applies to proceedings for possession by the registered owner of a charge once monies secured by the charge have become due. The subsection does not identify what is meant by the making of an application “in a summary manner”, but the Court is given a discretion, if it so thinks proper, to order possession of the land to be delivered up, the consequence whereof is that the owner of the charge thereupon becomes a mortgagee in possession.

16. In Bank of Ireland v. Smyth [1993] 2 IR 102, [1993] ILRM 790, Geoghegan J. rejected the notion that s. 62(7) confers a wide discretion which enables a court to refuse an application for possession on grounds of sympathy. He thought the words “may, if it so thinks proper” simply mean that the court should apply equitable principles in considering the application for possession, but not “sympathetic factors” and thus ensure that the application is made bona fide with a view to realising the security:

“The words ‘ may, if it so thinks proper’ in s. 62, sub-s. 7 mean no more, in my view than, that the court is to apply equitable principles in considering the application for possession. This means that the court must be satisfied that the application is made bona fide with a view to realising the security.” (p. 111)

17. The procedure was explained in the decision of this Court in Irish Life and Permanent v. Dunne [2015] IESC 46, [2016] 1 IR 92, in which it held that any court seeking to make an order for possession under s. 62(7) must first ask itself whether, as a matter of law, it can properly be said that the monies are secured and are due”. (emphasis added).

3 questions

12 . Guided by the foregoing principles, in Start Mortgages v. Connaughton [2023] IEHC 364, I posed 3 questions, which also arise in the present case, namely:

• (i) are the relevant monies secured (e.g. by way of mortgage)?

• (ii) has there been default, resulting in the secured monies having become due? and;

• (iii) is the application made bona fide with a view to realising the security?

Relevant facts

13 . Armed with the foregoing legal principles, I now turn to look...