The High Court has adjourned a mortgage possession appeal to a plenary hearing, leaving unresolved whether the lender calculated interest in line with the loan agreement and whether it complied with an earlier discovery order.
The appeal concerns a 2007 loan from Start Mortgages DAC to John and Gertrude Keating, secured on their family home. The 24-year loan required monthly interest-only payments, with principal due at the end of the term. The borrowers dispute the lender’s entitlement to demand repayment, arguing that interest was overcharged and that, on the correct calculation, they were not in arrears.
A special condition said the rate would vary with market interest rates and be “directly affected by the rise and fall” of EURIBOR. The borrowers say the rate should have tracked EURIBOR, and rely in part on a recorded phone conversation that they say referred to a 2.65 percentage-point margin. The lender says it retained discretion over the rate, while accepting that EURIBOR must affect it to some extent. These are the parties’ positions, not findings on the contract’s meaning.
The Circuit Court granted the lender an order for possession in December 2016. The borrowers appealed. In 2017, the High Court ordered discovery of documents about the loan’s interest rates and their calculation, as well as a specified conversation. The lender later provided an affidavit of discovery. The borrowers contend that the production was inadequate; that question had not been decided.
In a judgment delivered on 11 May 2021, Mr Justice Garrett Simons declined to determine the appeal summarily. He said evidence was needed about the meaning of terms in the special condition, the relationship between the loan rate and EURIBOR, and information available to consumers when the loan was agreed. The alleged margin and recorded conversation also raised factual questions that, he said, required oral evidence and cross-examination. He considered that exchanged pleadings would help define the parties’ legal arguments.
The court directed a plenary hearing before the High Court under Order 5B, rule 8 of the Circuit Court Rules. It set deadlines for the lender’s points of claim, the borrowers’ points of defence and any reply, and listed the case for further case management on 31 August 2021. The discovery-compliance issue remains undetermined; the borrowers were directed to say at that hearing whether they wished to pursue their motion. The judgment did not decide the proper interest rate, whether arrears were due, or the lender’s ultimate entitlement to possession.