The High Court has refused John Hale and Mary Hale’s applications to set aside bankruptcy petitions brought by Cheldon Property Finance DAC, ruling that their motions did not meet the procedural requirements for relief under Order 124 of the Rules of the Superior Courts.
In a judgment delivered on 10 July 2019, Ms Justice Pilkington said the notices of motion did not state the objections relied on, as required by Order 124(3), and had no supporting affidavits. The Hales relied instead on affidavits filed in the underlying bankruptcy petition proceedings.
The judge said the interlocutory motions could not serve as an alternative hearing on whether the Hales should be adjudicated bankrupt. She also held that they could not be used to challenge the bankruptcy summonses: no proper application to set those summonses aside had been made.
The petitions followed a 2017 High Court order in separate proceedings awarding Cheldon €1,903,548.20 against John and Mary Hale jointly and severally, plus costs. The judgment records that they appealed, but neither had obtained a stay from the Court of Appeal, and none of the debt had been discharged. Bankruptcy summonses issued in June 2018, followed by petitions in September.
The Hales raised objections including an incorrect year on the petitions, errors in affidavits concerning service of demands, alleged omissions about security held by Cheldon, and the contention that the bankruptcy criteria had not been met. Cheldon said the date was a clerical error and the service errors had been explained in later affidavits. The judge accepted the explanations concerning security and service and described the date error as trivial.
Pilkington said the substantive questions about compliance with bankruptcy legislation belonged in the petition proceedings. She found that the motions did not identify the relevant court rules for most of the objections and did not comply with Order 124(3). To the extent that issues had been raised about the petitions themselves, she exercised her discretion not to set them aside and permitted them to proceed to adjudication.
The motions were refused. The judge said she would hear the parties on any further orders required. The judgment did not itself adjudicate either applicant bankrupt.