The High Court has rejected a debtor’s appeal against an order allowing Ulster Bank Ireland DAC more time to object to a proposed personal insolvency arrangement (PIA).
In a judgment delivered on 6 April 2017, Ms Justice Baker held that the 14-day period for a creditor to lodge a notice of objection under section 115A(3) of the Personal Insolvency Acts was directory rather than mandatory. She said the legislation did not clearly rule out an extension, and creditors’ property rights and entitlement to be heard at the PIA hearing had to be considered.
The debtor’s proposed PIA was rejected at a creditors’ meeting on 4 January 2017. That day, the personal insolvency practitioner applied for court approval of the arrangement despite the rejection. The Circuit Court specialist judge later extended the time for Ulster Bank, the objecting creditor, to lodge its notice of objection. The debtor appealed that order.
The High Court also found that the specialist judge had statutory authority to extend time. Specialist judges have the powers of a County Registrar, and the relevant legislation expressly permits an order enlarging the time to take a step in a matter. The court noted that this power is constrained where another statutory provision says otherwise, as it does for the debtor’s own 14-day deadline to bring a section 115A application.
The bank’s explanation, presented to the Circuit Court through counsel, was that Watch Portfolio Management (Ireland) Limited had been authorised to handle procedural requirements and received the relevant documents. An email forwarded by Watch to the bank was not delivered because of the number and size of its attachments, although Watch’s email server classified it as delivered. The bank said it wished to object and offered affidavit evidence in support.
Justice Baker observed that no affidavit evidence had been before the Circuit Court when it made the extension order. She said the test used for extending time to appeal was not a useful guide here: a notice of objection functions more like a pleading identifying the basis of a creditor’s opposition than an appeal.
The judge said an extension should be considered within a broad discretionary framework. Relevant matters may include the explanation for delay, whether an extension is sought merely to delay proceedings, whether the creditor voted against the PIA, and whether it had lodged a proof of debt and engaged in the process. She declined to set a general rule for extensions.
The appeal concerned only the order extending the time to object. The High Court rejected the appeal and upheld that order; it did not decide whether the PIA should be approved.