Ulster Bank Ireland Ltd v O'Brien

JudgeMr. Justice John MacMenamin,Mr Justice Charleton,Ms. Justice Laffoy
Judgment Date16 December 2015
Neutral Citation[2015] IESC 96
CourtSupreme Court
Docket NumberSupreme Court No. 114 of 2014,[S.C. No. 114 of 2014],[Appeal No. 114/2014]
Date16 December 2015
Ulster Bank Ireland Ltd.
Rory O'Brien, Danny O'Brien & Michael McDermott

[2015] IESC 96

MacMenamin J.

Laffoy J.

Charleton J.

[Appeal No. 114/2014]


Contract — Banking — Loan — Default — Evidence — Hearsay — Admission

Facts: The appellants were indebted to the respondent bank for almost €890,000. The respondent alleged they had defaulted on the loan, and brought proceedings seeking judgment in that regard. The appellants contended an affidavit relied upon by the respondent in the proceedings was inadmissible hearsay evidence. A Master of the High Court had agreed, but this decision was reversed by Hedigan J in the High Court. The matter now came before the Supreme Court.

Held by Charleton J, the other Justices concurring and also giving their own judgments, that the appeal would be dismissed. The appellants' argument that they had an entitlement to make no denial to sworn testimony based in fact and reason was without merit. A failure to reply where a denial was clearly required could equate to an admission. Where that was the case, the Court would act.

Judgment of Mr. Justice John MacMenamin dated the 16th day of December, 2015

I agree with both judgments which have been delivered today. I would wish to make a few observations on the burden and standard of proof.


What is in issue in summary judgment applications is whether or not a prima facie case can be made out by the plaintiff. The burden of proof is on the party who asserts the debt is owed. As a general principle, a prima facie case will be made out when, on the evidence available, it would be open to a tribunal of fact, if no other evidence was given, or if that tribunal accepted that evidence even though contradicted in its material facts, to enter a verdict for that party (See O'Toole v. Heavey [1993] ILRM 343 at 344).


As described in the judgments of my colleagues, when one is dealing with applications for summary judgment the test is somewhat nuanced for the protection of a defendant. If there is a real conflict on the facts or law, the matter must be remitted for plenary hearing. I would point out that a simple, bald, denial of indebtedness, whether in correspondence, or on affidavit, will not be sufficient to discharge the burden, so far as a defendant is concerned. A defendant's evidence must set out in a clear way why the sum claimed is said not to be due and owing to a plaintiff.


I turn to the instant case. There was no conflict whatever on the facts. No affidavit was filed by the defendant/appellant. Ms. Mary Murray, an Ulster Bank official, swore an affidavit for the plaintiff. She deposed that she, herself, was one of the signatories of the bank's letter of demand dated the 1st February, 2013. This letter demanded immediate repayment of the sums due and owing on foot of the facility letters. Ms. Murray's testimony was primary evidence of her own actions. By no stretch of the imagination, could this be characterised as ' hearsay' evidence. This was, rather, first hand evidence adduced by the main plaintiff's deponent, as a signatory of the letter. As described in the judgments of my colleagues, the plaintiff's threshold test in this case is satisfied. Here it is also satisfied, particularly by virtue of the fact that the Bank's deponent can herself testify that the letter was written and sent, which letter contained the averments as to the defendants' indebtedness. Ms. Murray was in a position to swear there was no response to that letter. There is no suggestion it was not received. As Charleton J. points out in his judgment herein, these were the assertions in that letter which, under the rules of evidence, called for a denial. In the absence of such a denial, a court will be entitled to act on the evidence, and grant summary judgment.


I mention this feature to illustrate the simple point that, if a plaintiff's deponent is the author of a letter of demand, then there can be no question of hearsay evidence. As Laffoy J. points out, in her judgment herein, the facts of this case are, therefore, are quite distinct from Criminal Assets Bureau v. Hunt [2003] 2 I.R. 168, and Ulster Bank v. Dermody [2014] IESC 140. If there is no response to the letter of demand, a plaintiff's case is proved.


When seen from these perspectives, the highly technical argument advanced on behalf of the defendants/appellants, and described in my colleagues' judgments, becomes entirely untenable. The plaintiff's case is not based on hearsay. It is only common sense that, if a plaintiff makes out a prima facie case, and a defendant does not adduce any, or any meaningful, evidence to rebut it, a plaintiff will be found to have discharged the burden of proof devolving upon it. Similarly, if the facts do not support a legal argument, a defence based on that legal argument will fail, and summary judgment may be granted. Here there was a demand, and the only response was the legal defence put forward, and addressed in the other judgments herein.


The summary judgment evidential tests are, by now, well established. I reiterate them here for convenience. The fundamental question is whether there is a fair and reasonable probability of a defendant having a real or bona fide defence, either in law, or on the facts, or both? It is not necessary to show that the defence will succeed, or even will probably succeed. The questions, therefore, can be reduced to the following: First, is it very clear that a defendant has no case? Second, are the issues simple and easily determined? Third, has a defendant disclosed even an arguable defence? Fourth, where there is no notice to cross-examine, can a court be confident, on the affidavit evidence alone, where the justice of the case lies? These tests are set out in more detail in the three leading authorities, viz. First National Commercial Bank v. Anglin [1996] 1 I.R. 75, per Murphy J; Aer Rianta c.p.t. v. Ryanair [2001] 4 I.R. 607, McGuinness J. and Hardiman J.; Harrisrange Ltd. v. Duncan [2003] 4 I.R. 1, per McKechnie J.. As emphasised in each of these decisions, in exercising this jurisdiction, a court should proceed with care and caution.


I, too, would dismiss the appeal.

Judgment of Mr Justice Charleton delivered on Wednesday the 16th day of December 2015

This appeal concerns the admissibility of hearsay evidence within the particular commercial context of default on a bank loan.


By a summary summons issued on the 26th August 2013, the plaintiff/respondent Ulster Bank sought judgment against Rory O'Brien, Danny O'Brien and Michael McDermott, the defendants/appellants, in the sum of €888,920.89. An appearance was entered on behalf of the defendants apart from Michael McDermott on the 19th September 2013. Judgment was sought against Michael McDermott in the Central Office of the High Court. In accordance with the procedure chosen by Ulster Bank to pursue its claim, a notice of motion was issued on the 16th October 2013, returnable before the Master of the High Court, seeking judgment in that regard against the other two alleged debtors. The notice of motion was supported by an affidavit of Mary Murray, sworn on the 15th October 2013, describing herself as 'Senior Relationship Manager with the Global Restructuring Group of Ulster Bank'. All quotes in this judgment are as written and uncorrected as to grammar including the clear misuse of lower or upper case letters. That affidavit purported to prove the loan to the defendants/appellants by exhibiting relevant correspondence, extracts from computer records and a letter of demand. Her affidavit was not replied to by the defendants/appellants, just as the letter of demand addressed to each of them prior to the issue of proceedings remained unanswered. On the 14th November 2013, the Master of the High Court refused to grant summary judgment for Ulster Bank, but he acceded to an argument on behalf of two of the defendants/appellants, Michael McDermott not then being represented, that the affidavit constituted inadmissible hearsay evidence. Consequently, it was ordered by the Master that 'the said Motion be and the same is hereby dismissed' and that Ulster Bank pay the costs of Rory O'Brien and Danny O'Brien. That order was appealed by notice of motion, dated the 18th November 2013, and it came on for hearing before Hedigan J on the 3rd March 2014 in the High Court. The appeal was allowed and it was ordered that Ulster Bank should recover the sum claimed against the first and second named defendants/appellants, and it was further ordered that they should pay the costs of the plaintiff in the High Court and of the motion before the Master. The agreed note of the ex tempore judgment of Hedigan J reads:

The Affidavit of Ms Mary Murray sworn on the 15th day of October 2013 and the averments therein referring to entries in the books of the Plaintiff bank did not amount to inadmissible hearsay.

The Deponent's averments were similar in form and content to those frequently appearing in Affidavits grounding such applications and they provide a sufficient evidential basis for granting the Plaintiff's application for liberty to enter final judgment against the Defendants.

The error contained in the Deponent's Affidavit highlighted by Defence Counsel did not amount to grounds for denying the relief sought. Affidavits are frequently presented to the Court which contain minor technical errors.

The Defendants were not denying that the sums claimed were owed by them.

There was little benefit to the Defendants in stringing things out further and in the circumstances the Court would grant the Plaintiff bank the relief sought. ...[C]osts of the motion and of the earlier Master's hearing [are awarded] to the plaintiff.


A stay of five weeks was put on the consequential monetary judgment, by...

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