The Court of Appeal has granted summary judgment to The Governor and Company of the Bank of Ireland for €290,282.84 against Peter and Barbara O’Grady over a guarantee they signed in 2000 for the debts of Lewis Stores Limited.
In a judgment delivered on 20 June 2018, Ms Justice Irvine allowed the bank’s appeal from a High Court order that had adjourned the summary summons proceedings for a plenary hearing. The High Court had reserved the costs of the summary judgment application to the trial judge. The Court of Appeal instead entered judgment for the bank for the sum claimed.
The bank’s claim was based on a guarantee and indemnity dated 27 November 2000. The O’Gradys, who were directors of Lewis Stores, argued that they understood the guarantee to secure only any payment that might become due under a life policy, rather than the company’s liabilities generally. They relied on wording in a 24 November 2000 facility letter referring to life cover and saying a guarantee would be requested because the policy was in their personal names.
The Court of Appeal found that the guarantee’s terms were clear: it covered the company’s liabilities, was unconditional and was additional to other security. The policy was not mentioned in the guarantee. The court also said the facility letter itself twice described the guarantee as covering the company’s liabilities. Later facility letters recorded the personal guarantee as security for those liabilities alongside the life policy.
The court held that the O’Gradys had not established a fair or reasonable probability of a real or bona fide defence. Their asserted understanding was unsupported by other documentary or objective evidence, including evidence from the solicitor who they said had advised them before signing. Both had certified that they received independent legal advice on the guarantee’s nature and terms.
The judgment also rejected reliance on non est factum at this stage: the O’Gradys knew they were signing a guarantee, and their dispute concerned its legal effect. The Court of Appeal concluded that this could not support that defence. The appeal concerned whether the claim could be resolved summarily; the court did not remit the matter for a plenary hearing, and it ordered summary judgment for the bank.