The High Court has refused an application by Lorraine McCrann to dismiss Bank of Ireland’s claim against her over guarantees for two companies, despite finding that the bank’s five-year delay in progressing the proceedings was “certainly an inordinate delay”.
Mr Justice Barr ruled on 3 December 2019 that the delay was excusable in the circumstances. He also said that, even if it were not, the balance of justice favoured allowing the action to continue because the case would turn almost entirely on documents and Ms McCrann had not established that the delay prejudiced her defence.
The bank began proceedings against Ms McCrann and Mark McCrann in March 2012. The claim concerns guarantees signed in 2007 and 2008 for debts of McCrann Roofing Limited and North Irish Powder Coating Limited. The judgment records that the bank’s first application for liberty to enter final judgment was dismissed by the High Court Master in July 2012 because the bank’s proofs were not in order.
The bank took no further step in the proceedings until it issued a notice of intention to proceed in May 2017. It later sought summary judgment against Ms McCrann alone. She applied in February 2019 to have the action against her dismissed, citing delay and the separate two-year inactivity rule in Order 122, rule 11 of the Rules of the Superior Courts.
The bank accepted there had been a period of inaction. It argued that it had pursued other security, including appointing a receiver over land in County Roscommon and selling it in September 2015, with the proceeds reducing the debt. It also relied on negotiations between the parties’ solicitors from April 2016 to May 2017. The judge found that Ms McCrann had been kept informed about the security process and had participated through her solicitor in genuine efforts to reach a compromise. He concluded she had not been led to believe the proceedings had been abandoned.
The judge said the claim would require the bank to prove the guarantees, the companies’ indebtedness, valid demands for payment and any failure to pay. He found no evidence that critical witnesses had become unavailable or that fading memories would impair a fair hearing. He also rejected the argument that Mark McCrann’s bankruptcy in 2017 tipped the balance in favour of dismissal, saying it did not affect the bank’s right to pursue Ms McCrann or her ability to defend herself.
The court refused both applications to dismiss the action: the application under its inherent jurisdiction and the request under Order 122, rule 11. The judgment addresses only whether the claim should be dismissed for delay; it does not decide the underlying guarantee claim or enter judgment for the bank.