The National Bank v Diffely

• Jurisdiction: Ireland
• Judge: M. R.
• Judgment Date: 18 November 1909
• Court: Chancery Division (Ireland)
• Docket Number: (1908. No. 955.)
• Date: 18 November 1909

National Bank

and

Diffely.

M. R.

(1908. No. 955.)

CASES

DETERMINED BY

THE CHANCERY DIVISION

OF

The HIGH COURT OF JUSTICE IN IRELAND,

AND BY

THE IRISH LAND COMMISSION,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL.

1910.

Land Purchase Acts — Irish Land Act, 1903 (3 Edw. 7, c. 37), s. 54 (3) — Holding subject to land purchase annuity — Restriction on mortgaging — Equitable mortgage by eposit of title-deeds.

Section 54, sub-section 3, of the Irish Land Act, 1903, is confined to instruments of mortgage or charge, and does not apply to an equitable deposit of title-deeds unaccompanied by any writing.

Trial of Action.

This action was brought against Patrick Diffely, Michael M‘Cornick, and Alexander Knox M’ Entire and Martin Fitzgerald the official and creditors’ assignees of John M'Cormick, a bankrupt—(1) to have an account taken of what was due to he plaintiffs for principal, interest, and costs on foot of an equitable mortgage of a plot of ground with buildings thereon, situate at the cross-roads in the townland of Cloonfad, parish of Kiltullagh, county of Roscommon, containing 3 roods and 7 perches statute measure (1 rood 27 perches Irish), made by John M'Cormick in favour of the plaintiffs on August 10th, 1904, and on foot of a mortgage of the said lands and premises, dated January 4th, 1907, made by John M‘Cormick to the plaintiffs, and that the said mortgages might be enforced by sale; (2) to have it declared that an indenture of lease dated December 7th, 1907, and purporting to be made between the defendant, Michael M'ormick, of the first part, the said John M'Cormick, of the second part, and the defendant Patrick Diffely, of the third part, of a messuage and licensed house in Cloonfad in the said county (being portion of the premises comprised in the said mortgages) for a term of fifteen years at the yearly rent of £50 was null and void, and should be set aside and delivered up to be cancelled.

The facts of the case material to the report were as follows:—

John M'Cormick, the bankrupt, held the premises in question under a lease of September 4th, 1878, from Hannah Charlotte O'Beirne, for the term of thirty-five years, from May 1st, 1878, subject to the yearly rent of £2. There were a dwelling-house and a licensed public-house on the plot of ground. On May 6th, 1904, John M'Cormick signed an agreement to purchase the premises comprised in the. lease from the lessor under the Irish Land Act, 1903, through the Irish Land Commission, for the sum of £15, repayable by a purchase annuity of 9s. 10d. On August 15th, 1904, John M'Cormick deposited, by way of equitable mortgage, the lease with the plaintiffs at their Dunmore branch in the county of Galway, to secure payment of all sums then due by him to the plaintiffs, and also all such sums as should thereafter become due from him to them, together with interest at £6 per cent, per annum. No writing accompanied the deposit of the lease. On December 6th, 1906, the Land Commission, in pursuance of the agreement of May 6th, 1904, vested the said premises in John M'Cormick, as owner in fee-simple, by a vesting order of that date. On January 4th, 1907, John M'Cormick executed a legal mortgage by way of sub-demise to the plaintiffs of the premises comprised in the lease, to secure payment of the balance on account from time to time due by him to them, without prejudice to the said equitable mortgage. On October 14th, 1907, John M'Cormick assigned the premises to the defendant Michael M'Cormick. On December 7th, 1907, Michael M'Cormick, with the approval and at the request of the said John M'Cormick demised the messuage and licensed house as then in the occupation of John M'Cormick, but not including the dwelling-house and garden attached thereto adjoining the licensed premises, to Patrick Diffely, for the term of fifteen years, subject to the yearly rent of £50. This lease was made without the consent of the plaintiffs, and they had not consented in writing to it. On January 14th, 1908, John M'Cormick was adjudicated a bankrupt, and the defendant, Martin Fitzgerald, was appointed creditors’ assignee in the matter. The lands comprised in the vesting order were, pursuant to the Local Registration of Title (Ireland) Act, entered on the folio No. 6150, of the register for the county of Roscommon, and John M'Cormick, was registered as owner in fee-simple of the said lands, subject to an annuity of 9s. 10d., commencing to run upon June 1st, 1907, and payable half-yearly to the Irish Land Commission, until an advance of £15 should have been repaid, and subject also to the said mortgage to the plaintiffs of January 4th, 1907. The...