The Governor and Company of Bank of Ireland v Ward

• Jurisdiction: Ireland
• Court: High Court
• Judge: Mr. Justice MacGrath
• Judgment Date: 11 March 2020
• Neutral Citation: [2020] IEHC 249
• Docket Number: [2017 No. 487 S]
• Date: 11 March 2020

BETWEEN

THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND

PLAINTIFF

AND

GERRY WARD

DEFENDANT

[2020] IEHC 249

MacGrath J.

[2017 No. 487 S]

THE HIGH COURT

Summary judgment – Mortgage loans – Indorsement of claim – Plaintiff seeking summary judgment – Whether the plaintiff had established its case on a prima facie basis

Facts: The plaintiff, the Governor and Company of Bank of Ireland, applied to the High Court seeking judgment against the defendant, Mr Ward, in the sum of €776,024.34 in respect of monies alleged due on foot of two mortgage loans. The plaintiff was the successor in title of Irish Civil Service Building Society (ICS). By a scheme of transfer approved by the Minister for Finance pursuant the Central Bank Act 1971 (Approval of Scheme of Transfer between ICS Building Society and The Governor and Company of the Bank of Ireland) Order, 2014, implemented by S.I. No. 257 of 2014, certain assets and liabilities of the ICS, including the mortgages the subject matter of the proceedings, were transferred to the plaintiff on 1st September, 2014.

Held by MacGrath J that the indorsement of claim was not in accordance with the requirements of O. 4 r. 4 of the Rules of the Superior Courts, as clarified in Bank of Ireland Mortgage Bank v Joseph O’Malley [2019] IESC 84, and therefore the plaintiff had not established its case on a prima facie basis. MacGrath J held that, insofar as the indorsement of claim referred to letters of demand or indeed the loan agreement or the loan offer, while a considerable amount of information was supplied as to the basis upon which the parties had entered into a contractual arrangement, it could not be said that the letter of demand provided any clearer detail of how the sum referred to in those letters was calculated, or the basis for such calculation. It seemed to MacGrath J that the same may be said of the letters before action of 1st March, 2017; they did not provide any greater detail of how the sum claimed was calculated. MacGrath J held that the application would be refused and that it was unnecessary to consider the grounds of defence or other issues raised by Mr Ward.

MacGrath J held that the justice of the situation was best addressed by granting the plaintiff liberty to bring an application to amend the indorsement of claim in the summons and to tender such further evidence as may be appropriate “to fill the evidential gap identified”.

Application refused. Liberty to bring an application to amend the indorsement of claim granted.

JUDGMENT of Mr. Justice MacGrath delivered on the 11th day of March, 2020.

1 The plaintiff seeks judgment against the defendant in the sum of €776,024.34 in respect of monies alleged due on foot of two mortgage loans. The plaintiff is the successor in title of Irish Civil Service Building Society (“ICS”). By a scheme of transfer approved by the Minister for Finance pursuant the Central Bank Act, 1971 (Approval of Scheme of Transfer between ICS Building Society and The Governor and Company of the Bank of Ireland) Order, 2014, implemented by S.I. No. 257 of 2014, certain assets and liabilities of the ICS, including the mortgages the subject matter of these proceedings, were transferred to the plaintiff on 1st September, 2014.

The pleadings

2 The summary summons was issued by the plaintiff on 21st March, 2017. By notice of motion dated 25th July, 2017, application was brought for liberty to seek final judgment against the defendant.

3 The procedural history of this matter has been addressed by the court in a previous judgment. The matter came before the Master of the High Court and ultimately was transferred to this Court. A number of motions were brought by Mr. Ward in the proceedings, relating to the jurisdiction of this Court and to cross-examination of deponents who have sworn affidavits on behalf of the plaintiff in these proceedings. This Court delivered judgments on the 8th February, 2019 and 9th April, 2019. The court also held that it has jurisdiction to deal with the case.

4 This application is grounded on the affidavit of Mr. Sean Buckley, a manager working with the plaintiff in its Arrears Support Unit. Further affidavits have also been filed in support.

5 In his affidavit sworn on 14th June, 2017, Mr. Buckley outlines the background to the case. He details of the scheme of transfer between ICS and the plaintiff. He avers that the plaintiff is a bank for the purposes of the Bankers’ Book Evidence Act, 1879 and that the books were kept in the ordinary course of the bank's business and under its control. This is further elaborated upon by Ms. Jacinta White in affidavits sworn on 14th June, 2017, and 14th February, 2018. Ms. Marie Carey, legal case manager, has also sworn a similar affidavit.

6 Mr. Buckley avers that the defendant was indebted to the ICS in respect of two mortgage loan facilities which had been provided by the Building Society to him. Particulars of the sum alleged to be due were extracted from the original Banker's Book, a computerised mortgage account system known as “MAS”. This is confirmed by Ms. Enright in her affidavit. The MAS at all times was the only and ordinary Banker's Book of ICS, now the plaintiff, for the purposes of recording the defendant's liabilities and compiling the statements of interest to which Mr. Buckley refers in his affidavit. He avers that all entries on the MAS in relation to the defendant's liabilities were made in the usual and ordinary course of business of ICS, now the plaintiff, and that the MAS is and has at all material times been in the control of ICS and now of the plaintiff.

7 Mr. Buckley avers that the loans arise by mortgage loan offer letters of 13th December, 2006 and 15th December, 2006. In the former, the ICS offered the defendant a facility in the sum of €510,000 through account number ending 806 by which the defendant agreed to repay the sums due in accordance with the terms of the said letter. The loan offer was subject to general conditions. The funds were drawn down. Mr. Ward agreed to the terms of the loan offer and signed a form of acceptance of those terms. It is averred that he is in default of payment in respect of the loan and demand for repayment was made on 3rd December, 2014. At that time Mr. Ward was indebted to the plaintiff in the sum of €530,611.48 representing the principal amount together with loan interest and loan arrears amounting to €49,680.67. A further letter issued on 1st March, 2017 demanding repayment in the sum of €541,701.81. No payment has been made. As of 29th May, 2017, the sum due on that account, according to Mr. Buckley, is €542,915.28.

8 Similarly, in respect of the second mortgage loan offer of 15th December, 2006, the amount of this facility is €220,000 (account ending 408). Copies of the loan offer documentation are exhibited by Mr. Buckley, who avers that the funds were drawn down and Mr. Ward is in default on this account also. In accordance with the conditions of the loan offer, on 25th November, 2014, demand was made for repayment of the sum of €229,513.16 and on 1st March, 2017 a solicitor representing the plaintiff wrote to the defendant demanding repayment of the sum of €234,322.53. Despite demand, Mr. Ward has failed to pay the sums due. As of the date of the swearing of his affidavit on 14th June, 2017, the total sum of €777,762.70 is alleged to be due and owing by the defendant to the plaintiff.

9 From a perusal of the loans it seems that the monies were advanced to the defendant by the ICS, with a specified repayment period of 20 years and were provided in respect of the acquisition and/or funding of properties in Dublin 18 and Cherry Orchard, Dublin 10.

10 On 14th February, 2018, Mr. Buckley swore a further affidavit in which he exhibited copies of the entries in the Banker's Book as they relate to the loans the subject matter of these proceedings. Mr. Buckley avers that at no stage has the defendant engaged with the bank in a meaningful way with regard to the settlement of the claims and no payments have been made since a payment of €700 was made on 20th March, 2013; being a payment of €400 into one account and €300 into the other. He confirms that when the bank makes a decision to issue proceedings it relies on simple interest statements, as opposed to customer statements, giving the defendant the benefit of a lesser sum based on simple interest, rather than compound interest. He also exhibits a table calculating the simple interest for both accounts. The total sum outstanding as of the date of swearing of his affidavit was €782,482.27. Mr. Buckley also exhibits statement of accounts, which appear to have been generated on 2nd February, 2018. As of 31st January, 2018, the sums due in respect of the two accounts were €546,209.76 and €236,272.50 respectively. Each of these sums was calculated on the basis of the principal and interest due on 29th May, 2017, as claimed in the summary summons, but updated to include interest accruing since that time. The statements which are exhibited in respect of each of the accounts, which are in the name of the defendant, are stated to commence in 2007, with a drawdown of €510,000 on 25th January, 2007 in respect of account ending 406, and drawdown of €220,000, on 19th February, 2007 in respect of account ending 408. The accounts are detailed and show the interest as calculated on a monthly basis. Given the date of the generation of the statement, it cannot be the case that Mr. Ward received these particular statements prior to the proceedings.

11 Mr. Buckley exhibits two simple interest statement of accounts which show the balance due as of 31st December, 2016. They state the amount of interest which accrued between that date and the institution of the proceedings on 29th May, 2017 (149 days) at an interest rate of 0.9%; and the interest which has accrued between 29th May, 2017 and 31st January, 2018, again all...