The High Court ruled that lenders AIB Mortgage Bank and Allied Irish Bank PLC were entitled to judgment against Paul Hayden and Shoshanna Hayden on four loan agreements, but directed a plenary hearing on a separate fifth loan. The court did not set out the judgment amounts in its decision and invited counsel to provide the sums then outstanding.
In a judgment delivered on 12 June 2020, Mr Justice Meenan considered the lenders’ application for summary judgment. The parties did not dispute that money had been advanced under the loans and not repaid. The judge concluded that he could determine several legal issues on summary judgment without injustice, while directing a full hearing on the factual dispute concerning the fifth loan.
The four loans covered two mortgages and two overdraft facilities. The mortgages were secured against properties in Greystones and Delgany, County Wicklow. The court held that the lenders had provided sufficient detail of the sums claimed, including bank statements, and rejected the borrowers’ argument that the Central Bank’s Code of Conduct on Mortgage Arrears formed part of the loan contracts. It also rejected their arguments that new overdraft agreements were required after the overdraft accounts had been cleared and that they should have been offered tracker rates when initial interest rates expired.
The fifth loan, made to Paul Hayden and secured against a buy-to-let property in Delgany, was different. In an affidavit, he said a lender employee had told him that if the properties linked to the loans were sold and the proceeds applied to the balances, the lenders would not pursue any remaining debt. The lenders disputed the account, arguing it was only an assertion and that accepting a lesser sum would not ordinarily discharge the full debt.
Justice Meenan found that naming the employee and describing the alleged conversation took the claim beyond a bare assertion. He said that even if an arrangement were proved, the borrowers might still face the rule that a creditor’s acceptance of a lesser sum does not discharge the whole debt. But evidence at a full hearing could disclose circumstances affecting how that rule applied. The plenary hearing is limited to whether the alleged write-off agreement was made and its legal consequences.
The lenders were not pursuing a sixth loan, which the judgment said involved an outstanding issue concerning tracker interest rates. The court invited submissions on consequential orders, including costs.