[Supreme Court Appeal No: 120/2018]
The judgment uploaded on the 5/2/2020 has been edited after an application pursuant to SC 17. This is the authoritative version.
JUDGMENT of Ms. Justice O'Malley delive re d on the 4th day of February 2020
The jurisdictional issue
The 33rd Amendment to the Constitution
4 1º The Court of Appeal shall –
i save as otherwise provided by this Article, and
ii with such exceptions and subject to such regulations as may be prescribed by law, have appellate jurisdiction from all decisions of the High Court, and shall also have appellate jurisdiction from such other courts as may be prescribed by law.
5 3º The Supreme Court shall, subject to such regulations as may be prescribed by law, have appellate jurisdiction from a decision of the Court of Appeal if the Supreme Court is satisfied that –
i the decision involves a matter of general public importance, or
ii in the interests of justice it is necessary that there be an appeal to the Supreme Court.
4º Notwithstanding section 4.1º hereof [i.e. the jurisdiction of the Court of Appeal], the Supreme Court shall, subject to such regulations as may be prescribed by law, have appellate jurisdiction from a decision of the High Court if the Supreme Court is satisfied that there are exceptional circumstances warranting a direct appeal to it, and a precondition for the Supreme Court being so satisfied is the presence of either or both of the following factors:
i the decision involves a matter of general public importance;
ii the interests of justice.
The decision in Grace and anor v. An Bórd Pleanála  IESC 10
"That provision must be seen in the light of that fact that, in order to obtain leave to appeal to this Court under the new regime, it is necessary that this Court be satisfied that a general issue of public importance [sic] arises or that the interests of justice require an appeal to this Court. The deliberate omission, in the constitutional amendment passed by the people, of an entitlement on the part of the Oireachtas to exclude an appeal to this Court under the new regime has to be seen in that context. Would it have been appropriate to allow the Oireachtas to prevent an appeal coming to this Court even though this Court was satisfied that the case raised an issue of general public importance or that the interests of justice required an appeal? But it seems to us to follow that any measure which prevents (rather than regulates) the exercise by this Court of its entitlement, under the 33rd Amendment, to consider whether a case meets that constitutional threshold must be considered to be an impermissible exclusion of the right of appeal to this Court. No express relevant measure has been introduced since the 33rd Amendment. Precisely what form of measure might be considered an exclusion rather than a regulation does not, therefore, fall for consideration in this case."
Submissions of the parties on jurisdiction
Conclusion on the jurisdictional issue
"Without prejudice to Article 34.5.4º of the Constitution, the decision of the High Court… shall be final and conclusive and not appealable."
The background facts
(i) That the borrowers would pay the secured monies, including the balances, interest and other sums due on foot of the loan facility at the times and in the manner provided for;
(ii) That the borrowers would secure the payment of the monies by charging the property in favour of the lender;
(iii) That the borrowers would pay the secured monies on demand;
(iv) That all monies remaining unpaid and secured by the mortgage would immediately become due and payable on demand, on the occurrence of any event of default including default in making payment of any monthly or other periodic payment;
(v) That the secured monies were deemed to have become due and payable, within the meaning and for all purposes of the Conveyancing Acts, on the execution of the mortgage;
(vi) That, at any time after the execution of the mortgage, the lender could without any further consent from or notice to the borrowers enter into possession of the mortgaged property or any part thereof; and
(vii) That the power of sale would be exercisable by the lender without the restrictions on its exercise imposed by s.20 of the Conveyancing Act 1881.
Submissions in the appeal
"In that regard, attention should be drawn to the importance, both for the Community legal order and national legal systems, of the principle of res judicata. In order to ensure both stability of the law and legal relations and the sound administration of justice, it is important that judicial decisions which have become definitive after all rights of appeal have been exhausted or after expiry of the time-limits provided for in that connection can no longer be called into question (Case C- 224/01 Kobler  ECR I-10239, paragraph 38).
Therefore, Community law does not require a national court to disapply rules of procedure conferring finality on a decision, even if to do so would enable it to remedy an infringement of Community law by the decision in issue (see, to that effect, Case C-126/97 Eco Swiss  ECR I-3055, paragraphs 46 and 47)."
The Directive and Court of Justice authorities
General approach to the Directive
"1. Without prejudice to Article 7 [not relevant here], the unfairness of a contractual term shall be assessed, taking into account the nature of the goods or services for which the contract was concluded and by referring, at the time of conclusion of the contract, to all the circumstances attending the conclusion of the contract and to all the other terms of the contract or of another contract on which it is dependent.
2. Assessment of the unfair nature of the terms shall relate neither to the definition of the main subject matter of the contract nor to the adequacy of the price and remuneration, on the one hand, as against the services or goods supplied in exchange, on the other, in so far as these terms are in plain intelligible language."
Procedural rules and appeals under the Directive
The Irish legislation and authorities
"10. First, the Court of Justice's observations appear to contemplate a court, even in an adversarial system of justice, acting in an inquisitorial manner.
11. Second, counsel for AIB suggested that the above-mentioned duty ought to be construed by reference to the particular facts of Aziz. However, it appears to the court that this, with respect, cannot be so. As is apparent even from the above-quoted text, Aziz is but the latest case in which the above-mentioned duty has been iterated. So the duty is clearly of more general application.
12. Third, a summary application for debt seems to the court to afford a classic example of proceedings in which the potentially ruinous consequences for a consumer of the court's judgment (Mr and Ms Counihan have indicated that the effect of judgment against them at this time would render them all but destitute) on the basis of relatively limited argument, requires that the abovementioned task be undertaken if consumers are to be protected in the manner contemplated by Directive 93/13/EEC (as now implemented).
13. Fourth, given the low threshold identified, for example, in Aer Rianta (considered below) for sending matters to plenary hearing and the limited form and scope of summary proceedings generally, it seems to the court that to conform with, inter alia, the decisions in Aer Rianta and Aziz, a three-part version of the task identified in Aziz necessarily arises whereby (i) the court faced with the summary application should identify whether it sees any terms of the loan agreement which may be unfair for the purposes of the Regulations of 1995, as amended, and which were they to be proven unfair and so not binding would, to borrow from the phraseology of Aer Rianta, yield an arguable defence to the summary claim presenting, (ii) to the extent that the court identifies any potential arguable defence which has not been the subject of argument at the summary application, it should invite the parties to make any further submissions that they may have to make concerning same, and (iii) assuming that (a) the answer to (i) is that there are one or more such potential arguable defences and (b) after hearing any further submissions as are referred to at (ii) it appears to the court that such potential arguable defences as it has posited to arise do in truth present, the matter ought to go to plenary hearing, it then being for the court at plenary hearing to decide, inter alia, (I) whether such terms as are identified by the court at summary hearing or other terms ('or other terms' because the court at plenary hearing likewise operates in the shadow of Aziz) are unfair, and (II) what consequences, if any, such a finding has as regards the debt recovery application before it.
14. Fifth, of some concern when it comes to the application of Aziz is how the task identified by the Court of Justice falls to be discharged in a common law system grounded upon, inter alia, the rules of precedent. If, for example, the court at summary hearing reviews particular terms and conditions and identifies clauses A, B, and C as potentially unfair, is a later court of equal or lesser jurisdiction precluded from finding that clauses X, Y and Z in the same terms and conditions present a difficulty in this regard? It seems to this Court that they could reasonably be contended not to be so bound because (a) each case will be decided to a great extent on its own facts, and/or (b) ultimately even the demands of precedent must yield to the supremacy of European Union law, where applicable, and/or (c) because of the precedential weight to be ascribed a judgment following summary hearing, as opposed to a judgment given after full plenary hearing."