Vico Ltd v Bank of Ireland

• Jurisdiction: Ireland
• Judge: Ms. Justice Finlay Geoghegan
• Judgment Date: 12 October 2016
• Neutral Citation: [2016] IECA 273
• Court: Court of Appeal (Ireland)
• Docket Number: Appeal No.: 2015/424
• Date: 12 October 2016

VICO LIMITED, ALEXANDRA O'DONNELL, BLAISE O'DONNELL,

BRUCE O'DONNELL

AND

BLAKE O'DONNELL

APPELLANTS/PLAINTIFFS

AND

THE GOVERNOR AND COMPANY OF THE BANK OF IRELAND,

BANK OF IRELAND PRIVATE BANKING LIMITED, TOM KAVANAGH, DAVID HARRIS, GARY HEPBURN, DECLAN KENNY, KEVIN BROMLEY, KATHERINE GEORGINA HARDING, ELAINE HIGGINS, GETHIN TAYLOR, LYNDSEY LUDGATE, KEITH JONES,

FIRST NAMES TRUST COMPANY (ISLE OF MAN) LIMITED

AND

CHANCERY TRUSTEES LIMITED

RESPONDENTS/DEFENDANTS

[2016] IECA 273

Finlay Geoghegan J.

Finlay Geoghegan J.

Peart J.

Irvine J.

Appeal No.: 2015/424

THE COURT OF APPEAL

CIVIL

Abuse of process – Striking out – Recusal – Respondents seeking to strike out the claims of the appellants against the respondents – Whether the appellants’ claims are res judicata and/or an abuse of process

Facts: The first, second and third defendants/respondents, the Governor and Company of the Bank of Ireland, Bank of Ireland Private Banking Ltd and Mr Kavanagh, made an application seeking orders: 1) directing the vacating of a lis pendens registered on the application of the first plaintiff/appellant, Vico Ltd, in relation to the property and lands in Killiney Co. Dublin known as “Gorse Hill”; 2) striking out the claims of the plaintiffs/appellants against the defendant/respondents on the grounds that the claims are res judicata and/or an abuse of process; 3) in the alternative striking out the said claim pursuant to O. 19, rr. 27 and 28 of the Rules of the Superior Courts. On the 28th July, 2015, the High Court (McGovern J) ordered that the lis pendens registered against Gorse Hill be vacated and that the claims of the plaintiffs against the defendants be struck out and an order for costs was made in favour of the defendants against the plaintiffs. The plaintiffs appealed to the Court of Appeal against that order. By agreement between the parties to the appeal the Court of Appeal was asked to determine, as part of this appeal, the plaintiffs’ appeal against the refusal of the judge to recuse himself from these proceedings, such decision having been made on the 27th April, 2015. The plaintiffs did not contend that the legal principles identified by the High Court judge were incorrect. Rather they submitted that he incorrectly applied those principles to the facts. The defendants relied upon the High Court judgment as correctly stating the applicable principles and applying them correctly to the facts.

Held by Finlay Geoghegan J that that the trial judge both correctly identified the principles to be applied and correctly applied them to the facts in deciding to strike out the plaintiffs’ claims in these proceedings. Following the approach of Bingham LJ in Johnson v Gore Wood & Co [2002] 2 AC 1, Finlay Geoghegan J held that the High Court was correct in determining that in all the circumstances the plaintiffs, in commencing the proceedings, were abusing the process of the court by seeking to raise issues which either had been raised or could have been raised in the Gorse Hill proceedings. Finlay Geoghegan J held that in all the circumstances of the litigation the striking out of the proceedings was not excessive, unfair or disproportionate. Finlay Geoghegan J concluded that in light of her decision to uphold the substantive decision of the High Court on the defendants' motion to strike out that the Court should not determine the appeal against the decision of the High Court judge on 27th April, 2015, to refuse to recuse himself.

Finlay Geoghegan J held that the appeals against the order of the 28th July, 2015, and the recusal decision in the order of 27th April, 2015, should be dismissed.

Appeal dismissed.

JUDGMENT of Ms. Justice Finlay Geoghegan delivered on the 12th day of October 2016

1 This appeal as issued is against an order of the High Court (McGovern J.) of the 28th July, 2015, made pursuant to a written judgment delivered on the 24th July, 2015.

2 That judgment and order concerned an application made by the first, second and third named defendants (‘the defendants’) pursuant to a notice of motion dated the 17th April, seeking orders:-

1. Directing the vacating of a lis pendens registered on the application of Vico Limited (‘Vico’) in relation to the property and lands in Killiney Co. Dublin known as ‘Gorse Hill’.

2. An order striking out the claims of the plaintiffs against the defendants on the grounds that the claims are res judicata and/or an abuse of process.

3. In the alternative order striking out the said claim pursuant to O. 19, rr. 27 and 28 of the Rules of the Superior Courts.

3 The said motion was heard on affidavits sworn on behalf of the defendants and by the second to fifth named plaintiffs. Mr. Blake O'Donnell who is a solicitor admitted in England and Wales represented Vico and himself and his siblings relied upon his submissions. The order made by the High Court was that the lis pendens registered against Gorse Hill be vacated and that the claims of the plaintiffs against the defendants be struck out and an order for costs was made in favour of the defendants against the plaintiffs.

4 The remaining defendants did not participate in the motion before the High Court and are not respondents to the appeal and hence references in this judgment to ‘the defendants’ are unless otherwise stated, means the first, second and third defendants only.

5 The notice of appeal served on behalf of the plaintiffs also sought to appeal against a determination of the High Court judge that he should not recuse himself. That decision had been made on the 27th April, 2015. This Court has the transcript of that hearing. On that date the High Court judge considered and determined a number of matters in relation to the defendants' motion and the application for entry of the proceedings into the commercial list and related application for directions. These included directions in relation to further affidavits on the defendant's motion. No order of the High Court was drawn at that time. Subsequent to the lodging of the appeal from the order of 28th July, 2015, to this court, an order in respect of the decisions made on 27th April, 2015, was drawn and perfected on the 3rd November, 2015.

6 By agreement between the parties to the appeal this Court was asked to determine, as part of this appeal, the plaintiffs appeal against the refusal of the judge to recuse himself from these proceedings, such decision having been made on the 27th April, 2015.

Background

7 The issues raised by this appeal can only be understood in the context of the disputes between the first named defendant (‘the Bank’) and the third named defendant (‘the Receiver’) and the plaintiffs and the parents of the second to fifth named plaintiffs (‘Mr. and Mrs. O'Donnell’) and the related litigation. The second to fifth named plaintiffs have in a number of judgments, notwithstanding their majority, been referred to as ‘the O'Donnell Children’ and I propose continuing that appellation.

8 In 2010, the Bank commenced summary proceedings against Mr. and Mrs. O'Donnell in respect of joint and several borrowings. Ultimately in those proceedings there was a judgment in favour of the Bank against Mr. and Mrs. O'Donnell in December 2011, for a sum of approximately €71m. Vico had guaranteed the liabilities of Mr. and Mrs. O'Donnell to the Bank and granted security over property of which it undisputedly was the legal owner. The property at Vico Road, Killiney, is known as Gorse Hill. In June 2012, the Bank made demand on Vico and in default of payment appointed the third named defendant as Receiver over Gorse Hill.

9 On the 30th July, 2012, the O'Donnell Children commenced plenary proceedings (2012 No. 7554 P) against the Bank, Bank of Ireland Private Banking Limited (‘BOIPB’) and the Receiver seeking declarations that the deeds of mortgage, guarantees and indemnities executed by Vico in favour of the Bank were void and of no legal effect and related declarations. Those proceedings were heard by the High Court in July 2013 and by written judgment of the 31st July, 2013, the reliefs claimed were refused. Pursuant to that judgment by order of the 12th September, 2013, the High Court ordered, inter alia, that the O'Donnell Children vacate the premises at Gorse Hill by Monday the 21st October, 2013.

10 The O'Donnell Children appealed the High Court judgment and order and by agreement were not required to give up possession pending determination of the appeal. The appeal was dismissed for the reasons set out in a written judgment delivered by Laffoy J. on the 19th December, 2014.

11 Following a further hearing before the Supreme Court by order of the 2nd February, 2015, it ordered that the period in the High Court order of the 12th September, for the O'Donnell Children to vacate Gorse Hill be extended to 12.00 noon on Monday the 2nd March, 2015.

12 Throughout this period the O'Donnell Children, or some of them, had been living at Gorse Hill and Mr. and Mrs. O'Donnell had been living in England. Shortly prior to the 2nd March, Mr. and Mrs. O'Donnell returned to live at Gorse Hill.

13 On the 25th February, 2015, the present proceedings were issued by Vico and the O'Donnell Children (2015 No. 1553 P). The reliefs sought in the plenary summons include declarations that the guarantees, indemnities, mortgage and charges granted by Vico to the Bank are void and orders ‘overturning’ the orders made by the High Court on the 12th September, 2013 and the Supreme Court on the 2nd February, 2015, requiring the O'Donnell Children to vacate Gorse Hill by the 2nd March, 2015.

14 In these proceedings a motion was issued on the 25th February, 2015, by the plaintiffs seeking interlocutory injunctions restraining the Bank, BOIPB and the Receiver from taking possession of Gorse Hill and also seeking a stay on the order of the High Court of the 12th September, 2013,...