Supreme Court

First National Commercial Bank plc.
				(Plaintiff)

v.

John Joseph Francis Anglin, also known as Sean Anglin
				(Defendant)

No.154 of 1989
[27th June, 1996]

Status: Reported at [1996] 1 IR 75 

Hamilton C.J.	
I agree with the judgment to be delivered by Murphy J.

Denham J.
I also agree.

Murphy J.
The proceedings herein were commenced by summary summons issued on the 28th July, 1992, in which the plaintiff claimed as against the defendant the sum of Stg. £950,000 together with interest on foot of a guarantee dated the 1st February, 1989, whereby the defendant purported to guarantee the payment by Thousand Oaks Ltd. of all or any monies due by that company to the plaintiff up to, but not exceeding the sum of Stg. £950,000 together with interest thereon.
The matter came before the Master of the High Court pursuant to notice of motion dated the 28th October, 1994, grounded upon the said summons and the affidavit of Derek William Hawkins sworn therein on the 18th October, 1994.
In an affidavit sworn on the 20th January, 1995, the defendant disputed the plaintiff's claim herein on grounds which included the following:-
“3.	I firstly beg to refer to the guarantee which was entered herein dated the 1st February, 1989. I note that the guarantee is under seal. I also note that my signature is on the guarantee. I have to say first of all, that I did not sign this guarantee on the 1st February, 1989. On that occasion, and for a considerable period of time thereon, I was out of the United Kingdom and in Austria on business during that whole week in February of 1989. I further say that I signed no document in the company of Andre Axelsen, who is the company secretary of the Merrion Group, which was the holding company of Thousand Oaks Ltd. Accordingly, I say and believe that the guarantee which is purported to be entered herein is defective relating to two material aspects.
And therefore I say and believe and have been informed by my legal advisors that it is void and inoperative. I say at the very least, that since I could not have signed the guarantee in the presence or in the witness of the said person, or on the date the guarantee is purported to be signed, that this matter should go to plenary hearing.”
The Master of the High Court directed that the case be placed in the judges list, and prior or subsequent to that direction further affidavits were sworn in the matter before the case came before the President of the High Court on the 20th February, 1996. Costello J. (as he then was) rejected the contention that there was credible evidence of a real bona fide defence to the plaintiff’s claim and held that the plaintiff was entitled to judgment in the amount claimed.
The agreed note of the ex tempore judgment of the President of the High Court identifies seven possible defences which the Court had distilled from the voluminous documentation submitted to it. Those suggested defences included the following:-
1.	Fraud by the plaintiff.
2.	Forgery by the plaintiff of the guarantee.
3.	The allegation that the guarantee was not executed until September, 1989.
4.	The defence of “non est factum”.
5.	The absence of independent legal advice for the defendant as to the effect of the guarantee.
6.	That the bank was in breach of a duty to the plaintiff in respect of security given by the principal debtor.
7.	That the transaction was an improvident one.
On the appeal to this Court, counsel on behalf of the defendant relied exclusively on the contention that his client had executed the guarantee not in February but in September, 1989. He contended that there was evidence that such was the case and if accepted, it followed that the guarantee was void as having been given for a past consideration. Counsel - rightly in my view - abandoned the other grounds which had been relied upon before the President of the High Court. Not merely were those grounds wholly unsustainable but they involved an allegation that the plaintiff was guilty of fraud and that the two distinguished firms of solicitors who acted in the matter were at least guilty of gross negligence if not actual fraud. I would like to think that the potential defence to the effect that the defendant did not understand the nature of a guarantee or his potential liability on foot thereof was equally improbable.
For the court to grant summary judgment to a plaintiff and to refuse leave to defend it is not sufficient that the court should have reason to doubt the bona fides of the defendant or to doubt whether the defendant has a genuine cause of action (see Irish Dunlop Co. Ltd. v. Ralph (1958) 95 I.L.T.R. 70).
In my view the test to be applied is that laid down in Banque de Paris v. de Naray [1984] 1 Lloyd’s Law Rep. 21, which was referred to in the judgment of the President of the High Court and reaffirmed in National Westminster Bank Plc v. Daniel [1993] 1 W.L.R. 1453. The principle laid down in the Banque de Paris case is summarised in the headnote thereto in the following terms:-
“The mere assertion in an affidavit of a given situation which was to be the basis of a defence did not of itself provide leave to defend; the Court had to look at the whole situation to see whether the defendant had satisfied the Court that there was a fair or reasonable probability of the defendants having a real or bona fide defence.”
In the National Westminster Bank case, Glidewell L.J. identified two questions to be posed in determining whether leave to defend should be given. He expressed the matter as follows:-
 “I think it right to ask, using the words of Ackner L.J. in the Banque de Paris case, at p. 23, ‘Is there a fair or reasonable probability of the defendants having a real or bona fide defence?’ The test posed by Lloyd L.J. in the Standard chartered Bank case, Court of Appeal (Civil Division), Transcript No. 699 of 1990 ‘Is what the defendant says credible?’, amounts to much the same thing as I see it. If it is not credible, then there is no fair or reasonable probability of the defendant having a defence.”
I turn then to apply those principles to the facts of the present case.
The defendant is a civil engineer. At all material times he was the chairman of Thousand Oaks Ltd. and managing director of its parent company. The guarantee the subject matter of these proceedings, was required by the plaintiff as part of the security for a loan of £4,050,000 to Thousand Oaks Ltd. to enable that company develop, or re-finance the development, of 17/21 Dod Street, London E.14, and to develop the site into ten self-contained commercial units. This substantial transaction was negotiated over a period of time. The facility letter from the plaintiff to Thousand Oaks Ltd. dated the 12th October, 1988, expressly and unequivocally refers to the personal guarantee of John Joseph Francis Anglin (known as Sean Anglin) for Stg. £950,000 and a further personal guarantee of one Osmond Kilkenny for Stg. £50,000. That facility was accepted by a resolution of Thousand Oaks Ltd. and a certificate of that resolution signed by Mr. Anglin as chairman of the company and Andrew Axelsen as secretary thereof and dated the 25th October, 1988, was furnished to the plaintiff. Thereafter Messrs. Berwin Leighton and Theodore Goddard dealt with the legal documentation as solicitors on behalf of the plaintiff and the borrowers respectively. On the 15th December, 1988, Messrs. Berwin Leighton forwarded draft security documents to Theodore Goddard for their consideration. These included what was described as an “unlimited guarantee” for John Joseph Francis Anglin and a request that Mr. Anglin should sign his name in the two forms which he used namely, “John Joseph Francis Anglin” and also “Sean Anglin”. That letter incidentally sought confirmation that the individual guarantors understood the nature of the obligations they were undertaking by executing said documents. In their reply of the 16th December, 1988, Theodore Goddard explained that both guarantors had previously given guarantees and it was felt that they were fully conversant with the obligation that they were taking upon themselves. On the 19th December, Messrs. Berwin Leighton forwarded to Theodore Goddard – at the latter’s request – schedules to the two draft guarantees limiting the figures to be included therein to the sum of £50,000 in the case of Mr. Kilkenny and £950,000 in the case of Mr. Anglin. On the 20th December, 1988, and again on the 23rd December, 1988, facility letters were reissued by the plaintiff, in each case referring to a guarantee by Mr. John Joseph Francis Anglin in the sum of £950,000. The later of these facility letters was accepted by the directors of Merrion Property Developments Ltd., again in a resolution certified by Mr. Anglin. The facility letter was accepted on behalf of Thousand Oaks Ltd. by an endorsement thereon which appears to have been signed by Mr. Anglin, in the presence of Mr. Axelsen, on the 12th January, 1989.
In a letter which bears date the 13th February, 1989, Theodore Goddard returned to Messrs. Berwin Leighton all of the required legal documentation including a guarantee by “J.J.F. Anglin” expressed to be “executed in escrow”.
Mr. Simon John Kildahl a partner in the firm of Berwin Leighton who handled the transaction on their behalf has sworn that the letter bearing date the 13th February, 1989, was in fact received by his firm on the 13th January, 1989, at 4.20 p.m. Understandably, the defendant in these proceedings has expressed surprise that such an error could be made. Notwithstanding the improbable nature of such an error, it seems to me that the internal evidence does confirm the sworn evidence of Mr. Kildahl in this behalf. The reality of the transaction was that the lawyers on behalf of the lenders and the borrowers were drafting, checking and, where appropriate, executing all the documentation and putting it in place to enable the transaction to be completed by the draw down, at the earliest practicable date, of a sum in excess of £750,000. Clearly the arrangement between the solicitors was to have the documentation in place in the office of the lenders’ solicitors and held by them in escrow subject to and conditional upon the advance being made. The internal evidence shows that the draw down was planned for the 1st February; that it took place on that date and subsequent to it, that correspondence took place between the solicitors seeking and providing copies of the documentation that had been executed. In particular Messrs. Theodore Goddard wrote on the 7th February, requesting copies of the security documentation given at the completion meeting of the 1st February, and that letter crossed one from Messrs. Berwin Leighton forwarding the documentation dated the 3rd February, 1989, which claims to have included all of the relevant documents and an index thereto which expressly identifies the guarantee given by the defendant and dated in that index as of the 1st February, 1989.
I would have no difficulty in accepting that the defendant did not sign the guarantee on the 1st February, 1989. I doubt that he was at the meeting between the solicitors which completed the transaction. Indeed it would be to avoid the necessity for inconveniencing the businessmen that these documents would be made available in advance and then dated as of the date when the transaction was perfected. Obviously the solicitors on behalf of the borrowers knew that the documents were undated when transmitted by them (as the completion date had not been then determined) and clearly they knew when they were returned to them on the 3rd February, 1989, that they had been dated as of the completion date. That no objection was made to that course confirms my understanding that it was the implicit, if not express, arrangement between the solicitors on behalf of their respective clients that this is the course that properly would be adopted. I have no doubt but that the guarantee was executed by Mr. Anglin not on, but before, the 1st February, and indeed before the 13th January, 1989. I believe there is no question whatever of that document having been executed subsequent to the 1st February, 1989, and certainly not as late as September of that year. In my view there is no credible evidence for the defence which the defendant seeks to assert. Furthermore it is in my view at least questionable whether the guarantee would have been invalidated if executed subsequent to the drawn down of the funds lent by the plaintiff to the principal debtor. In the first place, the loan was made expressly and unequivocally on terms that the guarantee would be given by Mr. Anglin in the sum of £950,000 as he recognises and, secondly, the guarantee in its terms extends to present as well as future indebtedness of the principal debtor.
In my view the defendant has not established on the facts, or on the law, a probable defence to the plaintiff’s claim herein. Accordingly I would dismiss the appeal and affirm the decision of the learned President of the High Court.