Vincent & Beatty LLP recently appeared in the Court of Appeal on behalf of the Legal Personal Representative of deceased barrister Marcus Daly Senior.
In a decision of Donnelly J of 6 April 2022 in Bank of Ireland Mortgage Bank v Ethel Daly  IECA 88, the Court of Appeal overturned the Summary Judgments granted in the High Court in December 2020 totalling €675,000 against the estate of the deceased.
The appeal arose after an Order of the High Court granting the Plaintiff, Bank of Ireland Mortgage Bank, (Hereinafter ‘’the Bank’’) summary judgment against the Deceased (Hereinafter ‘’the Appellant’’) arising from a guarantee for €300,000 and a further loan of €350,000 entered into by the deceased to cover debts owed by his son and daughter-in-law to the Bank (hereinafter ‘’the Borrowers’’).
The Bank brought proceedings against the estate over default on the deceased’s repayment of the loan and guarantee facilities provided to him.
This appeal addressed whether an arguable defence may arise on the specific facts concerning the extent of the duty of disclosure, if any, required to be given to a guarantor to any change (compared with an earlier loan offer seen by the guarantor) in the Conditions Precedent in the loan offer related to the Borrowers’ creditworthiness.
Two loans offers were made between February and May 2010 to the Borrowers.
The loan facility of February 2010 contained conditions precedent relating to establishing the Borrowers creditworthiness which was to be complied with in full to the lenders satisfaction before the loan could proceed. It was submitted that the Bank had actively engaged with the deceased in respect of the preconditions contained in the February 2010 offer.
According to the Bank, these preconditions were complied with to their satisfaction
The Appellant contended the deceased was not informed that the Borrowers did not meet some of these preconditions, including their salary and tax requirements, which it was argued would offer protection to a guarantor.
In May 2010 a further loan offer was issued by the Bank and accepted by the Borrowers but with the preconditions of the February 2010 offer removed. It was contended that the deceased had entered into such guarantee having not being aware of the change in those preconditions affecting him as a guarantor, which were initially present in the previous offer.
Donnelly J stated that it was arguable that if the change in the conditions contained in the second loan offer had been pointed out to him, the deceased may not have entered the guarantee.
Donnelly J. took the view that it was irrelevant as a matter of law as to whether the deceased had received the February 2010 loan offer to the Borrowers or the May 2010 loan offer to the Borrowers
The essence of the claim made on behalf of the Appellant depended entirely on the crucial contention that the deceased was only aware of the February 2010 loan offer and not the May 2010 offer.
Donnelly J. said the Court may only grant summary judgment, which comes without a full trial of the action, where it is “very clear” that there is no arguable defence.
The role of the Court hearing a motion for summary judgment is to adjudicate in the first instance whether the plaintiff has made out a prima facie case for judgment, and thereafter the Court may only grant summary judgment where there is no arguable defence.
The Court of Appeal ruled that sum of €162,663.85 that was drawn down in respect of the loan was repayable and must be paid in full prior to the Appellant being granted leave to defend.
Given that the Appellant had successfully appealed against the order for summary judgment against her, the Court awarded the Appellant the costs for her appeal.
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