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Ulster Bank v. Crawford [1999] IEHC 70 (20th December, 1999)

THE HIGH COURT

1994 No. 378 Sp.

BETWEEN

ULSTER BANK LIMITED

PLAINTIFF

AND

NEIL CRAWFORD AND CATHAL CRAWFORD

DEFENDANTS

Judgment of Ms. Justice Laffoy delivered the 20th day of December, 1999 .

1. The Primary Order in this mortgage suit was made by Murphy J. on 17th October, 1994 and was amended by Shanley J. by order dated 10th March, 1997. The effect of the Primary Order, as so amended, was to declare the principal monies and interest secured by an Equitable Mortgage created by the deposit of the land certificates in relation to Folio 9790 of the Register of Freeholders, County Donegal well charged on the interests of the Defendants in the said lands and to order the sale of the said lands in the event of default by the Defendants in the payment to the Plaintiff of the sums for principal and interest therein found due within the time specified therein. The Plaintiff and the Defendants settled their differences earlier this year when the Plaintiff accepted the sum of £46,500 in full and final settlement of the Defendants' liabilities to it. Subsequently, on 8th July, 1999 the Plaintiff issued a motion in these proceedings seeking an order discharging the Primary Order of 17th October, 1994.

2. A certified copy of Folio 9790 certified by the Land Registry as at 14th December, 1999 discloses the following:-

(1) Each of the Defendants was registered as full owner as tenant in common of an undivided moiety of the lands on 2nd January, 1990. In the relevant entries on the folio, each of the Defendants was described as "contractor".

(2) On 27th January, 1993 a judgment mortgage was registered by Allied Irish Banks Plc. against the interests of both Defendants on the folio.

(3) On 10th March, 1994 a judgment mortgage was registered by Charles Kelly Limited (the Notice Party) against the interest of both Defendants "trading as Crawford Construction" on the folio, on foot of an affidavit sworn by Alfonsa Duff Kelly.

3. In accordance with the usual practice, the Plaintiff's notice of motion of 8th July, 1999 was served on the solicitor for Allied Irish Banks Plc. and the solicitors for the Notice Party. There is evidence before the Court that the claim of Allied Irish Banks Plc. against the Defendants has been settled and that it has no objection to the Plaintiff's application.

4. The position adopted by the Notice Party is that the sum secured by its judgment mortgage, £51,024.58 together with interest at the Court rate, that is to say, 8%, from 2nd December, 1993 is still owing and that it should be permitted to take over the carriage of the proceedings from the Plaintiff. In accordance with the usual practice, the Notice Party has filed an affidavit with a view to establishing that it is entitled to a declaration that the sums secured by the registration of the judgment mortgage are well-charged on the interests of the Defendants in the lands registered on Folio 9790. The Defendants contend that the Notice Party is not entitled to such a declaration. At the hearing of the motion the only ground pursued by the Defendants in support of this contention was that the title, trade or profession of each of the Defendants was mistakenly given in the affidavit of Alfonsa Duff Kelly as "proprietor", rather than as "building contractor", which it is contended each was at the date of the swearing of the affidavit.

5. Section 6 of the Judgments (Ireland) Act, 1850 requires that an affidavit to register a judgment mortgage shall state, inter alia:-

"...the name or title of the cause or matter, and the Court in which such Judgment.... has been entered up.... and the date of such Judgment.... and the usual or last known place of abode and the title, trade or profession of the plaintiff (if there be such) and of the defendant or person whose estate is intended to be affected by the registration, as hereafter mentioned, of such affidavit, and the amount of the debt...."

6. The affidavit of Alfonsa Duff Kelly, which was sworn on 24th February, 1994, proved, inter alia, the following facts:-

(a) That on 2nd December, 1993 the Notice Party obtained and entered up a judgment in the High Court against the Defendants, trading as Crawford Construction, for the sum of £50,843.58 besides the sum of £181 for costs, making together £51,024.58.

(b) The name and title of the action in which the judgment was obtained and entered was "The High Court 1993 Record No. 425 Between Charles Kelly Limited Plaintiff and Cathal Crawford and Neil Crawford, trading as Crawford Construction, Defendants".

(c) The registered office of the Notice Party at the date of the entry of the judgment and at the date of the affidavit was Letterkenny Mills, Letterkenny, Co. Donegal and on both dates it was a limited liability company.

(d) The names of the Defendants at the date of the swearing of the affidavit and at the date of the entry of judgment were Cathal Crawford and Neil Crawford trading as Crawford Construction; and

(e) "That the title, trade or profession of the said Defendants are Proprietors and at the time when the said judgment was obtained was Proprietors".

7. Counsel on behalf of the Defendants has urged that the Court should follow a line of authority in which the Courts have required the requirements of section 6 of the Act of 1850 to be strictly complied with, in particular, the unreported judgment of Kenny J. delivered on 11th July, 1974 in Dardis and Dunns Seeds Limited -v- Hickey , (Record No. 1972 No. 116 Sp.) and the decision of this Court (Denham J.) in Allied Irish Banks Plc. -v- Griffin, (1992) 2 I.R. 70. Counsel for the Notice Party has submitted that, as suggested in Wylies Irish Land Law , 3rd Edition, at paragraph 13.173, a strict interpretation of the statutory requirements runs counter to the modern approach of giving the statute a purposive interpretation and of not allowing technical flaws which do not mislead to invalidate the judgment mortgage and that the modern approach as exemplified by the decisions of this Court and the Supreme Court in Irish Bank of Commerce Limited -v- O'Hara should be followed.

At issue in Irish Bank of Commerce Limited -v- O'Hara was whether the requirements of section 6 of the Act of 1850 in relation to the description of the lands the subject of the judgment mortgage were complied with and, in particular, whether the omission of the parish in which the lands were situated amounted to non-compliance with the requirements. In the High Court, Costello J., as he then was, in his judgment delivered on 10th May, 1989 stated as follows:-

"To see whether non-compliance with the section will result in invalidity, I think the Court should first consider the purpose of the statutory requirement. If the judgment mortgage affidavit actually filed achieves the purpose which the legislature sought there is no reason why the Court should construe the section as requiring strict compliance with its provisions, particularly in a case like the present one when to do so would be to offend against both common-sense and justice. This approach, I think, accords with the views advanced in a judgment in the House of Lords in a case involving a challenge to a judgment mortgage affidavit on the grounds that the particulars of the defendant's address were not given as required by the section."

8. Having quoted from the judgment of Chelmsford LC in Thorp -v- Browne , (1867) L.R. 2 H.L. 220 at 232, Costello J. continued as follows:-

"If non-compliance with the section arises from a misdescription then it is very likely that this would be fatal to the judgment mortgage. But if non-compliance arises from a mere omission of a statutory requirement this will not automatically invalidate the judgment mortgage. The purpose of the requirement relating to the location of the lands is to identify with precision the location of the lands affected by the judgment mortgage and to enable persons subsequently dealing with the judgment debtor and his lands to be warned of its existence. The whole affidavit should be looked at, including any additional information it may contain which is not prescribed by the section. If the particulars actually given achieve this purpose then there is nothing in the statute which would require the Court to invalidate the transaction."

9. Applying the foregoing principles to the facts of the case before him, Costello J. found that the omission of a reference to the parish in which the lands were situated did not invalidate the judgment mortgage.

10. The decision of Costello J. in Irish Bank of Commerce -v- O'Hara was appealed to the Supreme Court. In his judgment delivered on 7th April, 1992, with which O'Flaherty J. concurred, Finlay C.J. concluded that, in the circumstances of that case, the absence of a specification of the parish was not any form of non-compliance with the Act of 1850 and that the appeal failed on that account. However, he went on to consider the approach adopted by Costello J. in the High Court and stated as follows:-

"I am satisfied that Costello J. was correct in applying to the interpretation of section 6 of the Act of 1850 the principles laid down in Thorp -v- Browne .... That was a case concerning section 6 of the Act of 1850 and was an appeal from the Master of the Rolls in Ireland. The issue which arose was an allegation of an insufficient description of the place of abode of the judgment debtor that being one of the requirements of section 6. In the course of his judgment, at page 232, Chelmsford L. C. stated as follows:-

'It appears to me, my Lords, as I have already stated, that the original affidavit in this case was sufficient. We have to look to what the object and intention of the legislature were in requiring that there should be these particulars describing the judgment debtor with his place of abode. It was clearly for the purpose of identification. It was not that there should be an exact description of the very place where he was residing, so that any person might resort to him there, and ascertain any particulars. It was for the purpose of distinguishing him from all other persons, and leaving no doubt whatever as to the identity of the person against whom the judgment which was to be a charge upon the lands had been obtained.'

11. Though relating to the question of requirement for identification of the judgment debtor and his place of abode, the statement would appear to be of, at least, potential general application.

12. A similar approach, though not articulated in quite the same way, had been made by the Irish courts to the interpretation of section 6 and, in particular, to the broad question as to whether there must be rigid adherence to it or, what is described as a more common-sense and reasonable approach to adherence to the terms of the statute...."

13. Finlay C.J. then went on to consider a number of decisions of the Irish Courts in which the same approach had been adopted as had been adopted by the House of Lords in Thorp -v- Browne . He also considered two cases which went against what appeared to be a consistent authority in Ireland over 100 years: the decision of the former Supreme Court in In Re Murphy & McCormack , [1930] I.R. 322 and the decision of the High Court (Kenny J.) in In Re Flannery , [1971] I.R. 10. He summarised his conclusions in relation to the authorities as follows:-

"Having carefully considered the decision of this Court in Credit Finance Limited -v- Grace , which was subsequent to the decisions in Murphy -v- McCormack and in Flannery, though neither of them is dealt with in the judgment of the former Chief Justice, I come to the conclusion that whereas in applying the principles laid down in Thorp -v- Browne and in the other earlier cases to which I have referred, all of which concern the identity of the judgment debtor or of his place of abode to the question of the specifications creating an identity to the lands, greater care may have to be taken in any individual case to ensure that no possibility of mistake can occur by reason of any non-compliance with the strict terms of the section in identifying the lands that might be relevant in questions as to the identification of the judgment debtor, there are no reasons why the principle must not in general apply and that I should follow the decision of this Court, which was a full Court, in Credit Finance Limited -v- Grace ."

14. Earlier in his judgment, Finlay C.J. had stated that a reserved judgment had been delivered by O'Dalaigh C.J. in Credit Finance Limited -v- Grace on 9th June, 1972 and that it constituted the unanimous decision of a full Court.

15. Although the foregoing observations of Finlay C.J. were obiter dicta, I must have regard to them. It seems to me that the approach I should adopt is to consider whether the affidavit of Alfonsa Duff Kelly leaves any doubt whatever as to the identity of the persons against whom the judgment which was to be a charge upon the lands registered on Folio 9790 had been obtained, the test posited by the Lord Chancellor in Thorp -v- Browne . In my view, no doubt whatever is left by the affidavit of Alfonsa Duff Kelly from which it is clear that the judgment was obtained against the Defendants as the proprietors of the business which traded as Crawford Construction. The word "proprietor" is defined in "The New Oxford Dictionary of English" (Oxford University Press 1998) as "the owner of a business".

16. Having regard to the entirety of the evidence before the Court, it is clear that the point taken by the Defendants is very much a technical point. At the end of 1998 the Defendants sought to set aside the judgment of the Notice Party against them, but were unsuccessful.

17. Being satisfied that the Notice Party has a valid judgment mortgage registered against the interests of both Defendants in the lands registered on Folio 9790, I propose making the following orders:-

(a) an order substituting the Notice Party as Plaintiff instead of Ulster Bank Limited; and

(b) a declaration that the sum of £51,024.58 due by the Defendants to the Plaintiff on foot of the judgment of this Court of 2nd December, 1993 together with interest at the Court rate from 2nd December, 1993 stand well-charged on the interests of both Defendants in the said lands.