Pepper Finance Corporation (Ireland) DAC v Kenny
| Jurisdiction | Ireland |
| Judge | Ms. Justice Siobhán Phelan |
| Judgment Date | 17 February 2023 |
| Neutral Citation | [2023] IEHC 115 |
| Court | High Court |
| Docket Number | [Record No.: 2019/1069 S] |
[2023] IEHC 115
[Record No.: 2019/1069 S]
THE HIGH COURT
Summary judgment – Substitution – Admissibility of evidence – Plaintiff seeking summary judgment – Whether the defendants identified an arguable defence
Facts: The plaintiff, Pepper Finance Corporation (Ireland) DAC, applied to the High Court for summary judgment against the defendants, Mr and Ms Kenny, by notice of motion dated the 5th of October, 2020. By motion dated the 20th of April, 2022, the defendants sought to set aside an order of Ferriter J made pursuant to Order 17, rule 4 of the Rules of the Superior Courts 1986 (RSC) substituting the plaintiff in the title to the proceedings. Phelan J heard the two motions together. The defendants resisted the application for summary judgment and sought leave to defend the proceedings and transfer to plenary hearing. The three principal issues identified by the defendants as providing the basis for an arguable defence were as follows: (i) the admissibility of evidence; (ii) the reference to the defendants as “deceased” in grounding the application to substitute the plaintiff; and (iii) the cancellation of the loan contract in reliance on the European Communities (Cancellation of Contracts Negotiated Away from Business Premises) Regulations 1989 (SI 224/1989) or Council Directive 85/577/EEC.
Held by Phelan J that the order substituting Pepper Finance as plaintiff was properly grounded on the affidavit of Mr Dowling and no proper basis for setting aside or declaring that order void had been advanced. She held that the erroneous reference to the defendants as deceased which occurred in the formula deployed to refer to an exhibit in the affidavit of Mr Dowling was in no way material. She held that the inclusion in error of the word “deceased” in the manner in which it occurred could neither have misled the judge nor affected the application for the order sought. She did not find the application for summary judgment defeated by reason of a lack of particularity in the pleadings in reliance on the decision in Bank of Ireland v O’Malley [2019] IESC 84. In her view the documents provided were sufficiently clear to meet the requirements of particularity set out by Clarke CJ in the O’Malley decision. Phelan J did not consider the defendants’ objection to the admissibility of evidence as hearsay to be arguable. She held that the affidavit evidence of Mr Smith adequately grounded the application of s. 14 of the Civil Law and Criminal Law (Miscellaneous Provisions) Act 2020 in the case in that it confirmed compliance with the conditions set down in s. 14(1)(a), (b) and (c), s. 14(2) and s. 14(7). It was her view that s. 14 provided a full answer to the complaint made as regards the admissibility of documents. She held that s. 18 of the 2020 Act addressed the defendants’ complaint regarding reliance on copy documents as opposed to originals, noting that the defendants had not exhibited any correspondence seeking production of documentation in accordance with their right to do so under the RSC. She held that the plaintiff had established a prima facie case for judgment in terms of the pleadings. She held that no arguable defence arose by reason of a failure of the plaintiff to prove its case. She held that no arguable basis for defending the claim in reliance on the 1989 Regulations or Council Directive 85/577/EEC had been identified. She held that the defendants did not identify a particular provision or provisions of any contractual document as being “unfair” under the Unfair Contract Terms Directive 93/13/EEC. In discharge of her “own motion obligations”, she had not been able to discern any term that had operated unfairly against the defendants in the context of the proceedings.
Phelan J held that the plaintiff had discharged the burden of demonstrating a prima facie case for judgment. She held that the defendants had failed to identify an arguable defence. She proposed making an order granting the plaintiff summary judgment against the defendants in the terms of the notice of motion issued in September, 2020, in the sum of €1,170,359.94.
Plaintiff’s application granted. Defendants’ application refused.
EX TEMPORE RULING delivered by Ms. Justice Siobhán Phelan on 17 th day of February, 2023
. This is my ruling on two motions, being (i) the Plaintiff's application for summary judgment against the two Defendants which comes before the Court by Notice of Motion dated the 5 th of October, 2020, and (ii) the Defendants' separate motion dated the 20 th of April, 2022 seeking to set aside an order of Ferriter J. made pursuant to Order 17, rule 4 of the Rules of the Superior Courts 1986 substituting the plaintiff in the title to the within proceedings. The applications proceeded on affidavit and I heard the two motions together.
. Both Defendants were present in Court for the hearing of this application but did not have the benefit of legal representation. The First Named Defendant addressed me by way of legal submission.
. The originating summary summons issued in the name of Tanager DAC in October, 2019 and was amended in July, 2020 pursuant to an Order of Murphy J. granting liberty pursuant to Order 28, rule 1 of the Rules of the Superior Court, 1986 to meet the requirement for particulars identified by the Supreme Court in Bank of Ireland Mortgage Bank v. O'Malley [2019] IESC 84; [2020] 2 I.L.R.M. 423 [hereinafter “ O'Malley”]. The judgment in O'Malley had clarified the manner in which a claim in summary summons proceedings should be pleaded and particularised. Relevantly, the Supreme Court held that the special indorsement of claim should specify the manner in which the amount said to be due is calculated, and whether it includes surcharges and/or penalties as well as interest.
. The claim for summary judgment is grounded on the Affidavit evidence of Mr. Karl Smith (director of Tanager DAC) and Mr. Seamus Dowling (Pepper Finance Corporation (Ireland) DAC. Three affidavits in reply have been sworn by the First Named Defendant.
. In this case it is pleaded that a loan agreement was entered into by Bank of Scotland (Ireland) Limited [hereinafter “BOSI”] and the Defendants in November, 2005. The loan facility was made subject to the standard loan terms and conditions of the Bank of Scotland (Ireland). Notably, the Defendants have not disputed that a loan was entered into with the BOSI. The signed loan facility together with the standard terms and conditions of the BOSI are exhibits grounding the application for summary judgment.
. It is pleaded in the Indorsement of Claim to the Summary Summons that all assets and liabilities of BOSI were transferred to Bank of Scotland PLC [hereinafter “BOS”] pursuant to the provisions of S.I. No. 157/2008 — European Communities (Cross-Border Mergers) Regulations 2008 and regulations introduced in both Ireland and the UK. This is a matter of law and is not disputed.
. A deed of purchase dated the 5 th of December, 2013 was entered into between BOS and Tanager Limited under which the interest in the loan facility with the Defendants was transferred. The Defendants were duly informed by letters dated the 28 th of March, 2014 from BOS and 13 th of April, 2014 from Tanager Limited. The Defendants do not dispute receiving this correspondence (which correspondence has been exhibited).
. The Defendants never made any repayments of the agreed monthly instalment on the loan facility entered into. This is not disputed by the Defendants.
. In consequence of the failure to make repayments, Tanager Limited wrote to declare an event of default in June, 2019 and demanded payment of sums due and owing in September, 2019. This correspondence is exhibited and the Defendants have not disputed receiving it. Despite this correspondence, it is not disputed that no payments were made following receipt of this correspondence.
. Full particulars of the claim for interest are set out in the amended Summary Summons albeit that a typographical error refers to the maintenance of the loan being outsourced to Pepper Finance Corporation [hereinafter “Pepper Finance”] from 2008, when the correct date as confirmed on affidavit is 2018. Interest on arrears is charged daily and compounded to bill once a month on the basis of the applicable interest rate which is specified in statements of account issuing periodically. The total sum claimed as due and owing comprising of principal in the sum of €800,000 and interest in the sum of €370,359.94 amounts to €1,170,359.94. The Defendants do not dispute the calculation of interest nor deny receiving statements of account showing the interest claimed and the applicable interest rate.
. In his first affidavit, which predated the Plaintiff's application for summary judgment, the First Defendant refers to a letter dated the 29 th of January, 2017 in which the Defendants purported to cancel the contract the subject of the within proceedings pursuant to S.I. No. 224/1989 the European Communities (Cancellation of Contracts Negotiated away from Business Premises) Regulations, 1989 which it is claimed was applicable at the inception of the contract with the BOSI. Reference is also made to the pleaded claim that the serving of the maintenance of the loan was outsourced to Pepper Finance in 2008 on the basis that this was not possible in circumstances where Tanager Limited did not acquire the facility until 2014. It is contended that the statements and correspondence issuing from Tanager Limited was inadmissible as hearsay. The letter purporting to cancel the contract as referred to on affidavit was not exhibited.
. In his affidavit sworn in October, 2020 to ground the application for summary judgment, Mr. Smith sets out his...
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