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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> David Swinburne v Eric Geary & Anor [2013] IEHC 412 (19 August 2013)
URL: http://www.bailii.org/ie/cases/IEHC/2013/H412.html
Cite as: [2013] IEHC 412
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Judgment Title: David Swinburne v Eric Geary & Anor Neutral Citation: [2013] IEHC 412 High Court Record Number: 2013 7810 P Date of Delivery: 19/08/2013 Court: High Court Composition of Court: Judgment by: Mac Eochaidh J. Status of Judgment: Approved |
Neutral Citation: [2013] IEHC 412 THE HIGH COURT [2013 No. 7810 P] BETWEEN DAVID SWINBURNE PLAINTIFF AND
ERIC GEARY AND ANITA GEARY DEFENDANTS JUDGMENT of Mr. Justice Colm Mac Eochaidh delivered on the 19th day of August 2013 1. This is an application for interlocutory relief by a receiver appointed on foot of a mortgage seeking to prevent the defendants from trespassing on a holiday home known as 'Everest' in Baltimore, County Cork. The plaintiff receiver has secured a buyer for the property and is required to answer a completion notice in early course. The defendants do not deny that they have recently changed the locks on the property. 2. The defendants consented to a judgment of €1,227,047.98 in summary proceedings entitled 'ACC Bank plc. v. Eric Geary and Anita Geary' for monies owed to ACC Bank borrowed to buy properties in Cork including the holiday home which is the subject matter of these proceedings. The receiver did not object to the defendants using the holiday home during the recent winter months as it was not intended to place it on the market until the spring of 2013. The defendants gave keys of the property to the receiver to facilitate its sale. 3. In May 2013, the defendants employed a Mr. O'Driscoll to advise them about certain alleged overcharging by an unidentified financial institution. Mr. O'Driscoll has been referred to in these proceedings - wrongly - as 'a McKenzie friend'. My understanding is that a McKenzie friend assists a lay litigant in court. The defendants were represented by a solicitor and counsel in this application. 4. The receiver found a purchaser for the property and by letter of 11th July 2013, the first named defendant was asked to arrange for the removal of contents from the holiday home by Wednesday 17th July 2013. The contents were not removed. On 17th July 2013, Mr. O'Driscoll left a voice message with the receiver on behalf of the defendants warning against any "illegal eviction." By letter of 18th July 2013, the plaintiff receiver wrote to the defendants to say that they were not entitled to be in possession of the property. On 22nd July 2013, the first named defendant wrote to the plaintiff and alleged that the mortgage had been forged. The letter was signed by Mr. O'Driscoll. This allegation against could scarcely be more serious. 5. The Deed of Mortgage on foot of which the receiver was appointed is dated 2nd March 2007. The signing page is blank. However, an indenture supplemental to the Deed of Mortgage is signed by the defendants. Clause D thereof provides:
6. The amount owing in respect of the holiday home on 21st February 2011, was €661,799.67 with a daily accrual rate of €43.38. The summary proceedings to recover this sum came before the Master of the High Court on five occasions and no complaint was made about the efficacy of the mortgage. 7. The first named defendant swore a replying affidavit to argue that the receiver has no legal rights in respect of the holiday home because the Deed of Mortgage of 2nd March 2007 was not executed by the defendants. At the hearing of this application, I enquired why the defendants objected to the proposed sale of the holiday home by the receiver, apart from asserting that the mortgage deed was invalid. Counsel for the defendants, Mr. McEntagart B.L., informed me that the defendants were convinced that they could obtain a better price. No evidence as to attempts by the defendants to sell the property or investigate the market was put before the court. The defendants' belief is in the realm of speculation. 8. In an attempt to draw out the true attitude of the defendants to these proceedings, I enquired what might happen if the court permitted the defendants to sell the property. Arising from the fact that the defendants do not deny that they owe the outstanding loans, I enquired whether the defendants would use the sale proceeds to pay down the unpaid borrowings. Mr. McEntagart took instructions on this point and informed the court that if so permitted, their solicitor would have carriage of the sale of the property and would give the all the proceeds of sale directly to the bank. From this concession, it is clear that the defendants acknowledge, not only their indebtedness to the bank, but also the fact that the holiday home they purchased constitutes security for the loans. In other words, the defendants effectively accept the validity of the mortgage. 9. I should emphasise that even without such concession by the defendants, I accept that the Deed of Mortgage has been lawfully executed by the defendants by virtue of the signatures which appear on the supplemental Deed of Indenture incorporating an acknowledgement and an acceptance of the validity of the Deed of Mortgage to which it is attached. Therefore, I reject any argument as to the absence of an executed document for the purposes of the Statute of Frauds. 10. A second argument was addressed to me by counsel for the defendants to the effect that the charge created by the Deed of Mortgage refers to Folios 433860 and 11682. These folios, according to counsel, do not comprise the holiday home and therfore it is not charged. 11. The holiday home appears to be represented by Folio 132808F County Cork which has resulted from a merger transaction in respect of earlier folios. Folio 132808F records the defendants as full owners of the holiday home on 24th December 2007, and also records a charge in favour of ACC Bank of the same date. Tracing the numbers from folio to folio, the plaintiff has persuaded me to the standard required in an application such as this, that the existing folio number of the holiday home (132808F) has been created from CK132806F which is created from CK132808F and from CK11682. For the purposes of this application I accept that the charge which exists on Folio 132808F is the same charge which was created in respect of folio 132682 by the Deed of Mortgage in March 2007. 12. I accept therefore that the plaintiff has presented a serious issue to be tried in respect of the rights of the receiver and the trespass of the defendants. Are damages an adequate remedy?
While fully accepting, therefore, that the primary consideration of the court in assessing the adequacy or otherwise of damages at the interlocutory stage is the loss that might be sustained in the period between the refusal of interlocutory injunction (or indeed its grant and the reliance by a defendant upon the undertaking as to damages given to secure it), on the trial, I am nonetheless of the view that in accessing the adequacy or otherwise of such damages as a remedy, the court can and should have regard to the question of whether the right sought to be enforced or protected by interlocutory injunction is one which is of a type which the court will normally protect by injunction even though it might, in one sense, be possible to value the extinguishment or diminution of that right in monetary terms."
44. The reality of the situation in this case is that there is no evidence before the Court that if an interlocutory injunction is refused, and following the hearing of the substantive action, the Receiver is found to be entitled to compensation for the period over which he has been deprived of possession and receipt of the rents and profits of the Premises, such compensation could be actually realised against any of the defendants. On the other hand, again by analogy to the decision of Lynch J. in ICC Plc v Verling, if the interlocutory relief sought by the Receiver is granted and it subsequently transpires that it should not have been granted, then the Receiver's undertaking as to damages will be capable of compensating each of the defendants who is able to establish that he or it suffered damage as a result of the grant of an interlocutory injunction." The balance of convenience 18. The plaintiff is entitled to interlocutory injunctions in the terms sought in paragraphs 1 to 5 of the Notice of Motion.
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