The High Court has dismissed claims by Vitgeson Ltd and William Farrelly challenging the transfer of their loan facilities and security to Promontoria (Arrow) Ltd and the appointment of Tom O’Brien as rent receiver. The judgment was delivered by Mr Justice Haughton on 9 November 2017 in a Commercial Court case.
The plaintiffs disputed whether Promontoria had acquired the loans and mortgages from National Asset Loan Management Ltd (NALM), and whether it could appoint a receiver before registration of charges over registered land was complete. Promontoria said it had acquired the facilities and security, that the plaintiffs were in default, and that it was entitled to appoint a receiver and recover the sums due.
Justice Haughton admitted a redacted copy of the 11 December 2015 transfer deed, finding that a witness had established it was a true copy. The judge concluded that the deed transferred NALM’s interests in the plaintiffs’ loans and security to Promontoria. He also found that written notices sent in December 2015 met the statutory notification requirements. The plaintiffs’ argument that their consent was required for the assignments was rejected.
The court held that the pre-2015 mortgage deeds gave the mortgagee a contractual power to appoint a receiver, including before registration of the charge transfer. It found O’Brien’s appointments as rent receiver valid and lawful. Because it found a contractual power, the judge said it was unnecessary to decide whether later registration could retrospectively validate appointments under statutory powers. The court also rejected the complaints that O’Brien’s marketing work was unlawful and that an inadvertently retained “For Sale” hoarding breached an undertaking in a way that could support damages.
The judge said the orders would include dismissal of the plaintiffs’ claim and judgment on Promontoria’s counterclaim. The judgment specified €11,383,442.86 against Vitgeson and €15,335,201.88 against Farrelly, excluding two loan accounts for which no demand had been made. The figures differed from sums discussed earlier in the judgment; the judge said an amended table should form part of the order to clarify the amounts and accounts. He said he would hear counsel further about the appropriate orders, so the judgment did not set out the final form of the order.