Smith v ACC Loan Management Ltd

JurisdictionIreland
JudgeMr. Justice Twomey
Judgment Date21 July 2017
Neutral Citation[2017] IEHC 505
Date21 July 2017
CourtHigh Court
Docket Number[2016 No. 5972P] [2017 No. 2743P]

[2017] IEHC 505

THE HIGH COURT

Twomey J.

[2016 No. 5972P]

[2017 No. 2743P]

BETWEEN:
JUNE SMITH
PLAINTIFF
-AND-
ACC LOAN MANAGEMENT LIMITED, KPMG, SHANE MCCARTHY, MARTIN FEELY, SEAN FARRELL, JOHN CUMMINS
DEFENDANTS
BETWEEN:
JANE SMITH
PLAINTIFF
-AND-
ACC LOAN MANAGEMENT

AND

JAMES SMITH
DEFENDANTS

Banking & Finance – Summary judgment – Unpaid loan – Dismissal of proceedings – Abuse of process of law – Isaac Wunder order

Facts: The first named defendant, by way of two motions, sought an order for the dismissal of the proceedings instituted by the plaintiffs. The first named defendant contended that it had obtained summary judgment against the plaintiffs for non-payment of debt and appointed a receiver for the sale of subject property kept as security for the realisation of the loan. The first named defendant argued that since the previous proceedings filed by the plaintiffs challenging the rights of the defendants to sell the said property was dismissed by the Court of Appeal; the present proceedings amounted to an abuse of process of law.

Mr. Justice Twomey struck out both the proceedings instituted by the plaintiffs on the basis that they amounted to an abuse of process of law. The Court made an Isaac Wunder order against the plaintiffs. The Court noted that since both the plaintiffs had been lay litigants, they were advised to file such proceedings against the named counsel who had acted as a McKenzie Friend. The Court gave liberty to the first defendant to take appropriate legal action against that counsel if need be.

JUDGMENT of Mr. Justice Twomey delivered on the 21st day of July, 2017.
1

Mrs. June Smith (‘Mrs. Smith’) and her daughter, Ms. Jane Smith (‘Ms. Smith’) both previously issued separate proceedings challenging the right of ACC Loan Management Limited (‘ACC’) to sell a farm belonging to Mrs. Smith and her husband, Mr. James Smith, (‘Mr. Smith’), which farm is security for an unpaid loan extended by ACC to Mr. Smith and Mrs. Smith. These previous proceedings were held to be an abuse of process by both the High Court and the Court of Appeal

2

Notwithstanding this fact, this hearing is concerned with further proceedings issued by Mrs. Smith and Ms. Smith which challenge the right of ACC to sell the farm in question. Accordingly, this case considers whether the current proceedings should be dismissed as an abuse of process and whether an Isaac Wunder Order should be made against Mrs. Smith and Ms. Smith preventing the institution of future proceedings in relation to this dispute. In these proceedings Mrs. Smith and Ms. Smith have been assisted by a McKenzie Friend, Mr. William Murphy. In the context of the claim that these current proceedings are an abuse of process upon a pervious abuse of process by the plaintiffs, this case also considers whether in these circumstances this Court should grant an order restricting Mr. Murphy from acting as a McKenzie Friend in the future, an issue that does not appear to have been considered by the Irish courts to date.

Background facts
3

This case involves two motions by ACC, in very similar terms, to strike out proceedings issued by Mrs. Smith and proceedings issued by her daughter Ms. Smith. Both sets of proceedings are against, inter alia, ACC in relation to a farm in County Laois which was mortgaged to ACC by Mrs. Smith and Mr. Smith as security for borrowings which were not repaid by Mr. and Mrs. Smith. Judgment was obtained by ACC in respect of these borrowings from Kelly J. on the 29th February, 2012, against Mr. and Mrs. Smith in the sum of almost €2 million.

4

ACC appointed Mr. Shane McCarthy of KPMG as a receiver (the ‘Receiver’) to the farm on the 27th March, 2014. He has entered into a contract for the sale of part of the farm to a third party. ACC has recently received a completion notice from the intended purchaser. However, lites pendentes were registered against ACC's interest in the farm by Mrs. Smith and Ms. Smith on the back of the two sets of proceedings issued by Mrs. Smith and Ms. Smith against ACC.

5

Ms. Smith's proceedings were issued on the 24th March, 2017, against ACC and Mr. Smith. These proceedings seek an order to the effect that Ms. Smith is the owner of the said farm, as well as a permanent injunction against ACC preventing it from entering or selling the farm.

6

Mrs. Smith's proceedings were issued on the 5th July, 2016, against ACC, KPMG, Shane McCarthy (the Receiver), Martin Feely (an employee of ACC), Sean Farrell (a former employee of ACC) and John Cummins (a former employee of ACC). These proceedings seek orders, inter alia, that Mrs. Smith is the owner of the farm, orders setting aside the appointment of the Receiver and orders prohibiting the sale of the lands by the defendants.

7

After issuing these proceedings, Mrs. Smith registered lites pendentes in respect of ACC's interest in the lands. As these lites pendentes were frustrating the sale of the farm, ACC applied to Gilligan J. for; an order striking out Mrs Smith's proceedings, an order vacating the lites pendentes, and for an Isaac Wunder order against Mrs. Smith. On the 7th March, 2017, Gilligan J. vacated the lites pendentes registered by Mrs. Smith. The balance of the reliefs were adjourned to await the judgment of the Court of Appeal in relation to an appeal by Mrs. Smith of the dismissal of her previous proceedings against ACC referred already. Mrs. Smith's appeal was dismissed by the Court of Appeal on the 17th May, 2017.

8

Accordingly, this hearing is a first hearing of the motion against Ms. Smith in which ACC seeks, inter alia, an order vacating the lites pendentes registered by her. This hearing is also a resumption of the motion against Mrs. Smith to deal with the remainder of the matters not dealt with by Gilligan J. on the 7th March, 2017.

9

During the course of the hearing, this Court was advised that Mrs. Smith had issued a Notice of Motion in her proceedings before this Court, which is returnable to the 16th October, 2017. This Notice of Motion seeks to set aside all Orders made by Gilligan J. in previous proceedings involving the parties and relating to the farm the subject of these proceedings, on the grounds that there is a reasonable perception of objective bias on the part of Gilligan J. This claim is based on the allegation that Gilligan J. was involved as a passive investor with 19 others in relation to commercial property in Dublin, with one of those other investors being alleged to be a director or former director of ACC. Mrs. Smith confirmed to the Court that her McKenzie Friend, Mr. William Murphy, assisted her in the drafting of this Notice of Motion.

10

Rather than delaying the hearing of the present motion against Mrs. Smith, until the 16th October, 2017, this Court has determined that if it grants an Order against Mrs. Smith on the second motion before this Court, any such Order will lapse if Mrs. Smith is successful in her motion to be heard on the 16th October, 2017.

11

This judgment therefore deals with the two motions in relation to the two different sets of proceedings.

The two motions
12

The first motion seeks an order dismissing Ms. Smith's proceedings on the grounds that they are frivolous and/or vexatious and/or discloses no reasonable cause of action and/or amount to an abuse of process. That motion also seeks an order vacating the lites pendentes registered by Ms. Smith in respect of the farm and an Isaac Wunder Order against her which restrains her from issuing proceedings and from registering any further lites pendentes in relation to the farm.

13

The second motion seeks an order dismissing Mrs. Smith's proceedings on the grounds that they are frivolous and/or vexatious and/or disclose no reasonable cause of action and/or amount to an abuse of process. That part of the motion seeking an order vacating the lites pendentes registered by Mrs. Smith in respect of the farm is spent, since as already noted, that order was granted by Gilligan J. on the 7th March, 2017. The other relief sought in the second motion is an Isaac Wunder Order against Mrs. Smith, since Mrs. Smith is already subject to an order from Gilligan J. on the 25th April, 2017 prohibiting her from registering any further lites pendentes against the farm.

The first motion and the previous proceedings involving Ms. Smith
14

The farm which is the subject matter of these proceedings has already been the subject of numerous proceedings and it is not proposed to refer to these in detail, since they have been outlined in the Court of Appeal judgment from only two months ago in Jane Smith v Shane McCarthy, ACC Loan Management Limited, Michael Collins & Company Solicitors and James Smith [2017] IECA 167...

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1 cases
  • Smith v Ireland
    • Ireland
    • High Court
    • 25 October 2017
    ...unsuccessful litigation since 2012 has been outlined previously in this Court's judgment of June Smith v. ACC Loan Management Limited [2017] IEHC 505 (which was joined with Jane Smith v. ACC Loan Management Limited, a case involving her daughter in almost identical and equally unsuccessful ......
1 firm's commentaries
  • Assisting Lay Litigants: Recent Guidance
    • Ireland
    • Mondaq Ireland
    • 13 November 2017
    ...3 WLR 472. (2) Coffey v The Environmental Protection Agency [2014] 2 IR 125. (3) [2017] IECA 77. (4) Smith v ACC Loan Management Ltd [2017] IEHC 505. The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific...

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