Shoreline Residential Designated Activity Company and Pepper Finance Corporation (Ireland) Designated Activity Company v Brendan Flannery and Maureen Flannery
| Jurisdiction | Ireland |
| Judge | Ms. Justice Siobhán Phelan |
| Judgment Date | 28 January 2022 |
| Neutral Citation | [2022] IEHC 41 |
| Court | High Court |
| Docket Number | RECORD NUMBER 2017/157/CA |
[2022] IEHC 41
RECORD NUMBER 2017/157/CA
THE HIGH COURT
CIRCUIT APPEAL
WESTERN CIRCUIT
COUNTY OF MAYO
Possession – Default – Loan – Plaintiff seeking an order for possession – Whether the plaintiff had established default in payments under a loan
Facts: The first plaintiff, Shoreline Residential DAC, claimed an order for possession consequent upon a default in payments under a loan. The matter came before the High Court by way of an appeal against the making of a possession order by the Circuit Court. There was no dispute that the money was advanced to the defendants, Mr and Ms Flannery, and that they had not repaid it and had been in arrears since in or about 2011. Counsel on behalf of the defendants indicated that there were three issues which he wished to pursue on the appeal. The issues identified to the court were as follows: (1) the loan agreement was unenforceable by reason of a failure to serve an important notice to the debtors in accordance with s. 129 of the Consumer Credit Act 1995; (2) the lack of evidence before the court concerning the joinder of Pepper Finance Corporation (Ireland) DAC as a co-plaintiff and demonstrating how it came to be the registered owner of the charge as recorded on the folio; (3) the entitlement of the first plaintiff to seek possession when the affidavit grounding the proceedings only referred to the activities of the first plaintiff and no reference was made to the original loan with the Irish Nationwide Building Society to demonstrate default on the terms of the loan agreement.
Held by Phelan J that the first plaintiff had established default at the time of transfer of the security and continuing default since then. She held that the first plaintiff was entitled to realise its security under the Mortgage Deed and had satisfied the court that an order for possession should be made.
Phelan J dismissed the appeal and affirmed the order for possession made in the Circuit Court.
Appeal dismissed.
EX TEMPORE JUDGMENT OF Ms. Justice Siobhán Phelan DELIVERED ON 28 JANUARY, 2022
This is a claim by the first named plaintiff for an order for possession consequent upon a default in payments under a loan.
This matter comes before the High Court by way of an appeal against the making of a possession order by the Circuit Court.
There is no dispute that the money was advanced to the defendants and that they have not repaid it and have been in arrears since in or about 2011.
Despite the relative simplicity of the proceedings, a series of different issues have been raised by the defendants both as litigants in person and by successive legal representatives on their behalf since the inception of these proceedings and voluminous documentation. Not all of these issues were advanced with any conviction during the appeal hearing. Nor were they clearly abandoned.
In this judgment, the court seeks to address the main issues identified. Issues that are not addressed have not been overlooked but the court does not consider that they are of such substance as to require analysis.
The proceedings were commenced by way of a civil bill for possession issued on the 31st March 2016. The principal relief sought was an order for possession. A number of motions were pursued in the Circuit Court including an application striking out the proceedings for want of a cause of action brought by the defendants in April 2017 in seeming reliance on alleged non-compliance with S.I. No. 224/1989 European Communities (Cancellation of Contracts Negotiated away from Business Premises) Regulations, 1989.
An order for possession was made by the Circuit Court (McCabe J.) on the 25th April, 2017. This order was made subject to a stay of 12 months. It was ordered that if the arrears were discharged within the period of the stay or within such time as the parties agree that the order for possession shall be vacated.
Thereafter, the defendants set about seeking to set aside the order for possession. An application for an extension of time for service and lodgement of a notice of appeal to the High Court was made to the Master on the 30th June 2017. It appears that he made an order on the 21st July 2017 extending the time to lodge the appeal by a period of three weeks.
A notice of appeal was lodged dated the 9th August 2017.
By letter dated the 13th September 2017, the defendants sought voluntary discovery. This was followed by a notice to produce dated the 14th September 2017.
By letter dated the 22nd September 2017, the plaintiffs' solicitors replied refusing the request for discovery and referring the defendants to the Data Protection Acts, 1988–2003. In this same letter, the plaintiffs' solicitor confirmed that they would facilitate inspection of the documents identified in the notice to produce at their offices.
By notice of motion dated the 26th September 2017, the first named defendant sought a copy of the DAR of the hearing before the Circuit Court (McCabe J. on the 25th April 2017) when the order for possession was granted.
The Circuit Appeal was first listed for mention in the Non-Jury List on the 23rd October, 2017. The matter appears to have been listed on multiple occasions thereafter.
This matter has been adjourned from time to time in the High Court list. It came before the court (Creedon J.) in 2018 when the first named defendant appeared as litigant in person. On that occasion, he was allowed time to engage a legal team.
The matter came back before the Court (Barniville J.) in February 2019 at which time it was indicated that a firm of solicitors was coming on record.
Subsequently, counsel instructed on behalf of the defendants appeared on behalf of the defendants/appellants and raised a point under the Consumer Credit Act, 1995. Consequent upon this development the matter was adjourned for written submissions.
By notice of motion dated the 11th November 2019, the first named plaintiff successfully applied to have Pepper Finance Corporation (Ireland) DAC joined as co-plaintiff/co-respondent in the action. This application was made in circumstances where the second named plaintiff is now the registered owner of the charge. The folio entry recording the second named plaintiff as owner was exhibited in an affidavit grounding the application to join the second named plaintiff, registration effected from the 25th July, 2019.
Most recently, the matter came on before the court on the 26th July 2021. On that date the court (Hyland J.) acceded to an application for an adjournment by the first named defendant in circumstances where a different barrister appeared instructed by a new firm of solicitors. The said firm of solicitors had not yet entered an appearance and were not formally on record. The court directed that a booklet of papers would be prepared.
The matter came on for hearing before this Court on the 24th January 2022.
At the outset counsel on behalf of the appellants/defendants indicated that there were three issues which he wished to pursue on the appeal. The issues identified to the court were as follows:
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1. The loan agreement is unenforceable by reason of a failure to serve an important notice to the debtors in accordance with s. 129 of the Consumer Credit Act, 1995;
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2. Lack of evidence before the court concerning the joinder of Pepper Finance Corporation (Ireland) DAC as a co-plaintiff and demonstrating how it came to be the registered owner of the charge as now recorded on the folio;
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3. The entitlement of the first named plaintiff to seek possession when the affidavit grounding the proceedings only refers to the activities of the first named plaintiff and no reference was made to original loan with the Irish Nationwide Building Society (hereafter ‘INBS’) to demonstrate default on the terms of the loan agreement.
The matter proceeded as a de novo hearing and counsel for the plaintiffs opened the proofs grounding the application.
During the course of the hearing, counsel for the defendants referred to their objection that the affidavit grounding the proceedings constituted hearsay (as made by affidavit of the first named defendant in his affidavit in response to the proceedings sworn on the 30th August 2016), albeit that this had not been flagged as one of the three issues the defendants intended to pursue on the appeal in the opening. It seems to me that this objection is linked to the issue at number 3 above and I will address both together.
In his affidavit sworn on the 30th August 2016, the first named defendant further objected that the deed of mortgage provided for transfer of the benefit under the deed to any other building society or person but that the plaintiff is not a “person”. The first named defendant protested on affidavit that he had not agreed to the transfer of his loan to the plaintiff. This argument was not repeated during the course of the appeal, presumably because of the express terms of the Deed of Mortgage which provided for the transfer of security.
As for the case advanced on the papers of on non-compliance with European Communities (Cancellation of Contracts Negotiated away from Business Premises) Regulations, 1989 (S.I. No. 224/1989) the Court does not consider it necessary to do more than refer to the decision of Noonan J. at paragraphs 21 and 22 of his judgment in Bank of Ireland v. McMahon [2017] IEHC 600 as the findings there set out that these Regulations have no application to a situation such as presents in this case is clearly correct.
It appears from the papers that it has, at times, been contended on behalf that there has been a failure to comply with...
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