The High Court has set aside a €309,054.73 default judgment entered against George Ward over a commercial property loan after finding exceptional circumstances surrounding his former solicitor’s failure to defend the case.
The proceedings arose from a €224,000 loan advanced by Bank of Scotland (Ireland) Ltd in 2006 and secured on Unit 2, Ringwood Centre, Damastown, Dublin 15. The secured property was later sold by a receiver for €55,000, with net proceeds of €33,018.96 credited against the loan.
Proceedings seeking the remaining debt were issued in 2018. Mr Ward instructed solicitor Patrick Delaney to defend them, but no appearance was entered and judgment was obtained in November 2018. Mr Delaney was subsequently struck off the Roll of Solicitors following findings of serious professional misconduct involving misuse of client funds linked to a gambling addiction.
Ms Justice Siobhán Phelan found that the judgment had technically been regularly obtained because the proceedings were properly served and no appearance had been filed. The court therefore rejected Mr Ward’s argument that it had to be set aside automatically as an irregular judgment.
However, the judge found special circumstances justifying the exercise of the court’s discretion to reopen the case.
Evidence showed that Mr Ward had instructed his solicitor to defend the proceedings and that his accountant had told the solicitor of an alleged agreement to settle the debt for €32,000. A November 2018 letter from Mr Delaney to the lender’s solicitors also referred to that claimed settlement.
The court criticised contradictory affidavit evidence from the plaintiff’s side which initially denied any correspondence with Mr Delaney before the letter was eventually produced.
Despite a delay of about seven years in seeking to overturn the judgment, the court found Mr Ward had identified real, arguable defences, including the alleged settlement, the calculation of the debt and proof of ownership of the loan.
The judgment will therefore be set aside, allowing Mr Ward to defend the proceedings. Final orders and consequential issues were left for a later hearing.