The High Court has struck out Allied Irish Banks plc’s proceedings against three defendants over a €50,000 guarantee, ruling that the balance of justice favoured ending the case after a five-year period without progress.
In a judgment delivered on 27 February 2017, Mr Justice Eagar ruled on an application by the third defendant, Mark O’Driscoll, to strike out the proceedings for want of prosecution and delay. The underlying case had been listed for plenary hearing on 14 February 2017; the court heard the strike-out motion first.
AIB’s 2009 summary summons sought €50,000 from the defendants under a joint and several guarantee dated 25 February 2008. The guarantee related to sums owed by Marbud Construction Limited, up to that limit, with interest. The claim was later adjourned for plenary hearing by consent.
O’Driscoll’s defence disputed whether the guarantee was valid and enforceable against him. He alleged that he had been induced to sign it by a bank official’s false assertion that he had already signed an earlier €20,000 guarantee. He said he relied on what bank officials told him and signed the €50,000 guarantee and a waiver of legal advice. AIB denied making the alleged representation and disputed that there had been misrepresentation.
The court considered the principles in Primor v Stokes Kennedy Crowley, which require a court to assess whether delay was inordinate and inexcusable, then decide whether the balance of justice favours dismissal. AIB’s counsel accepted that the delay was inordinate. The bank gave no explanation for the period after pleadings closed on 14 March 2011. The judge noted that five years passed before the next step by the bank.
O’Driscoll’s counsel argued that the delay caused prejudice, including that former bank official Sean Hearne could no longer be located and that oral evidence about the discussions with bank officials would be needed years after the events. AIB’s counsel said a witness was in court and argued that the strike-out application came late, after steps to bring the case to trial.
The judge said the guarantee was the principal documentary evidence, but the dispute also involved conversations with bank officials and required oral evidence. Given the elapsed time, the court concluded that the balance of justice favoured striking out the proceedings for want of prosecution. The ruling addressed the procedural delay application; it did not decide whether the guarantee was valid or whether the alleged misrepresentation occurred.