The High Court has referred AIB Mortgage Bank’s claim against Samuel and Zelda Van Eeden for the unpaid balance of a €1.65 million mortgage loan to a plenary hearing, because a limitation issue could not be resolved on the evidence before it.
In a judgment delivered on 5 April 2016, Mr Justice Max Barrett said the borrowers had disclosed an arguable defence on that point. The court did not decide whether the claim was out of time or whether the limitation defence would succeed. It referred the matter for a full hearing and left the Van Eedens free to raise any arguments there.
AIB advanced the loan in February 2007 for the purchase of a residential property in Malahide. The Van Eedens defaulted on repayments in or about August 2008. AIB demanded repayment in October 2009, and the Circuit Court granted it possession of the property in March 2010. AIB sold the property in May 2012 for €305,000, then issued a summary summons in May 2015 seeking the remaining loan balance.
The borrowers argued that the claim belonged at a full hearing for several reasons. The judgment rejected their arguments that the loan agreement lacked a term allowing the full balance to be demanded after default, that the claim improperly included other credit arrangements, and that references to an “other Lender” or the arrears interest surcharge undermined AIB’s claim. It also said the borrowers remained liable for debt left unpaid after the security was sold. The court saw no basis in the material before it for their contention that AIB was estopped from claiming the shortfall because of the sale price.
The limitation question was different. The Van Eedens argued that AIB had six years from default to sue and that the period had expired before the May 2015 summons. AIB said missed monthly payments constituted continuing defaults, bringing its application within time. Justice Barrett said the court lacked detail about the earlier Circuit Court proceedings and the evidence did not adequately clarify the limitation issue. He concluded that it was for a trial judge at a plenary hearing to determine where the truth lay.
The ruling therefore refused summary judgment at this stage and sent the matter to plenary hearing on the limitation issue. The judgment did not determine the outstanding balance or make a final finding on the borrowers’ liability.