Ulster Bank Ireland Ltd v Costelloe

• Jurisdiction: Ireland
• Judge: Ms. Justice Faherty
• Judgment Date: 12 April 2018
• Neutral Citation: [2018] IEHC 289
• Docket Number: [2016 No. 165 CA]
• Court: High Court
• Date: 12 April 2018

[2018] IEHC 289

THE HIGH COURT

CIRCUIT COURT APPEAL

Faherty J.

[2016 No. 165 CA]

BETWEEN

ULSTER BANK IRELAND LIMITED

PLAINTIFF

AND

LIAM COSTELLOE

AND

GABRIELLE BISHOP COSTELLOE

DEFENDANTS

Banking & Finance – Non-payment of loan – Order of possession – Execution of mortgage deed – Principal private residence

Facts: The defendants filed an appeal against the order of the Circuit Court whereby the Circuit Court had directed that the plaintiff should recover the possession of the subject property from the defendants. The plaintiff submitted that the defendants had failed to clear the mortgage debt and hence, they filed a civil bill for possession. The defendants had raised several objections such as the existence of the plaintiff as a legal entity, breach of s. 36 (2) of the Statute of Limitations Act 1957 and frailties in mortgage documentation.

Ms. Justice Faherty dismissed the appeal and affirmed the order of the Circuit Court. The Court held that the objections raised by the defendants were not supported by any evidence. The Court did not accept that the defendants were denied a fair trial in the Circuit Court as alleged. The Court noted that the defendants were given an opportunity to make submissions in the Circuit Court. The Court held that it would hear submissions on the issue of a stay on the order for possession or the execution as the subject premises were the principal private residence of the defendants.

JUDGMENT of Ms. Justice Faherty delivered on the 12th day of April, 2018

1 This is the defendants' appeal against an order of the Circuit Court dated 19th July, 2016 that the plaintiff recover from the defendants possession of a premises comprised in folio 70198F of the register Co. Mayo more commonly known as Knocknaboley, Kilmeena, Westport, Co. Mayo, hereinafter referred to as 'the premises'.

2 By notice of appeal dated 22nd July, 2016 the defendants appealed the said order.

3 By notices of motion dated 16th August, 2016 and 8th February, 2017, grounded respectively on affidavits sworn by the first defendant on 16th August, 2016, and 8th February, 2017, the defendants sought to have the Circuit Court Order vacated on the basis that the Circuit Court had no jurisdiction to determine the application for possession.

4 By Order of Barton J. of 27th February, 2017, the High Court refused to vacate the judgment of the Circuit Court for want of jurisdiction. Barton J. ruled that the premises, the subject matter of the within proceedings, constituted the principal private residence of the defendants and that the High Court had jurisdiction to hear and determine the matter.

5 Accordingly, I am satisfied that the issue of the Circuit Court's (and this Court's) jurisdiction to hear the plaintiff's claim for possession has been determined by the Order of Barton J.

6 The plaintiff's claim for possession of the premises is grounded, inter alia, on an affidavit sworn on 2nd February, 2016 by Mr. Conor Moore. The background to the within proceedings is set out therein.

7 Mr. Moore avers that in or about June 2008, First Active Plc agreed to make a loan facility to the defendants in the sum of €122,600 repayable by monthly instalments. On or about 16th June, 2008 the loan was drawn down by the defendants.

8 By way of security for the loan facility, on 17th August, 2012, the defendants executed a mortgage in favour of the plaintiff over ' ALL THAT the hereditaments and premises known as Knocknaboley, Kilmeena, Westport, Co. Mayo part of folio 24999F Co. Mayo under dealing no. D2003SM002285W and all that and those part of the lands of Folio 18509 Co. Mayo as delineated on the Map attached in transfer dated the 17th day of August 2012.'

9 On 13th November, 2012, the plaintiff was registered on folio 70198F as full owner of the charge.

10 It is common case that the Mortgage Deed was originally executed by the plaintiff and the defendants on 28th June, 2008. The Mortgage Deed, as exhibited in Mr. Moore's grounding affidavit, shows the manuscript date of 28th June, 2008 crossed out and the manuscript date of 17th August, 2012 inserted above the crossed out date. The issue of two dates appearing on the Mortgage Deed was raised by the learned President of the Circuit Court on 26th January, 2016. In a supplementary affidavit sworn on 4th May, 2016, Mr. Moore accounted for the two dates in the following terms:

'Having conducted a full review of the file, I can now confirm that the second date on the mortgage appears by virtue of a delay in registering same due to a difficulty with the mapping of the site/locus of the property in question. ... Ms. McHugh [the defendants' solicitor] wrote to the Bank on 24th July,2013 seeking release from her undertaking. In that letter, she explained that ' registration of the property was delayed for several years due to a mapping difficulty mapping query with regard to a small strip of land on our client's site, which has not been Included in the original transfer to our client. In order to rectify this, it was necessary to withdraw the dealing and re-lodge with the transfer of the strip so that it would be included in the Mortgage.'

11 Mr. Moore goes on to state:

'I say and believe that Ms McHugh was acting for and on behalf of the Defendants in the course of that transaction, and one would presume that they are therefore familiar with the reason for the delay in registering the property. I say and believe that, though the loan was advanced in 2008, the mortgage deed was not finalised until 2012, hence the difference in the two dates thereon.'

12 Folio 70198F Co. Mayo on which the plaintiff is registered as the holder of a charge over the premises is not mentioned in the Mortgage Deed. This is accounted for in an affidavit sworn on 11th December, 2017 by Ms. Erica Conlon, a manager in the plaintiff's Arrears Support Unit. She avers, inter alia, as follows:

[Folio 70198F] derives from two earlier folios, namely MY18509 and MY69401F. The former of these two folios, (part of which was ultimately transferred into the present folio in 2012), is duly listed on the mortgage deed. However, the latter folio is not. Instead, we see that folio MY24999F is listed on the deed. This is because, in 2003, part of MY24999F was transferred into MY69401F under dealing number D2003SM002285W, and this is how that part of the property is being described in the deed. In 2012, MY69401F was closed, with the title transferred into the present folio. ... In summary, parts of folio MY18509 and MY24999F have been consolidated into the present folio MY70198F. The Property Registration Authority have accepted these dealings, have registered the Plaintiff's charge on the present folio, and have duly stamped the mortgage deed at page 20 thereof, recording registration of the mortgage/charge as a burden on folio MY70198F. I believe and have been so advised that the register is ' conclusive evidence of the title of the owner to the land as appearing on the register and of any right, privilege, appurtenance of burden as appearing thereon', in accordance with section 31(1) of the Registration of Title Act 1964'.

13 At para. 8 of his affidavit sworn 2nd February, 2015, Mr. Moore avers that the defendants defaulted on the terms of the loan facility by failing to make repayments in accordance with the terms of the loan facility.

14 A statement of account exhibited in Mr. Moore's affidavit shows that the last monthly instalment of €740 credited to the defendants was on 25th October, 2012.

15 On 29th July, 2014, in the wake of arrears on the loan account, the plaintiff wrote to the defendants calling on them, inter alia, to make contact withy the plaintiff to discuss their account and to complete a Standard Financial Statement (SFS), to be returned to the plaintiff within twenty business days, in default of which the defendants would be at risk of being classified as not cooperating, as defined in the Central Bank's Code of Conduct on Mortgage Arrears (CCMA). The defendants did not complete a SFS.

16 On 29th August, 2014, the plaintiffs wrote to the defendants advising that as a result of their failure to engage, they were outside of the Mortgage Arrears Resolution Process (MARP), and advising of the threat of legal proceedings for repossession of their primary residence – the security for the mortgage.

17 On 3rd September, 2014 the plaintiff wrote to the defendants by way of formal demand for the mortgage debt which at that stage stood at €94,398.93, including arrears of €10,292.98, and advising of the threat of legal action including seeking an order for possession.

18 The Civil Bill for possession issued on 18th February, 2015. By order of the Circuit Court of 27th April, 2015, the Civil Bill was served on the defendants by way of ordinary prepaid post.

19 In a supplemental affidavit sworn on 16th November, 2015, Mr. Moore avers, inter alia, that as the premises constituted a principal private residence it was therefore subject to the MARP process. He avers that by virtue of its attempts to engage with the defendants on 29th July, 2014 and 29th August, 2014, the plaintiff complied with the CCMA.

20 The defendants' defence to the within application for possession is set out in an affidavit sworn by the first defendant on 23rd February, 2017, and which is by an large replicated in a later affidavit sworn 28th November, 2017. The first defendant raises a number of matters by way of resistance to the plaintiff's application for possession. Each of the issues raised by the first defendant will be considered in turn.

Alleged failure of the plaintiff to establish that it exists as a legal entity

21 The first defendant avers that the Circuit Court erred in law and in fact in allowing the plaintiff to pursue the defendants through the courts in circumstances where the plaintiff had not established that it existed as a legal...