The High Court has sent ACC Bank plc’s claims against Mike O’Dwyer Motors Limited and its guarantors for a full hearing after finding they had raised arguable defences to summary judgment. The court did not decide the disputed issues or determine whether the bank is owed the amounts claimed.
ACC sought summary judgment of €1,959,678.79, plus interest from 1 May 2012, against the company. It also sought €1,945,273.87, plus interest from that date, from Michael O’Dwyer and Caroline O’Dwyer under guarantees and indemnities. The claims arose from four lending facilities granted between 2003 and 2007. The company trades in motors from premises in Limerick; the judgment describes the O’Dwyers as its directors and shareholders.
ACC said the facilities were in arrears and repayable on demand. A demand letter dated 2 November 2011 sought a total of €1,925,463.25 within seven days. No payment followed, and proceedings issued in May 2012.
The company’s principal defence was that ACC had represented that principal on the first two facilities would not have to be repaid until the company’s premises were sold, and was therefore prevented from demanding principal earlier. Michael O’Dwyer said the company could afford only interest payments and that he and Caroline O’Dwyer relied on the alleged representation when agreeing to the loans and guarantees. The written 2003 terms instead provided for interest-only payments for 12 months, followed by monthly payments of principal and interest.
The parties also disputed the treatment of later lending. ACC said a €106,000 facility granted in 2007 was working capital. Michael O’Dwyer said it repaid principal previously charged to the company contrary to the alleged interest-only arrangement. The judge noted a letter from ACC confirming a two-year interest-only period from October 2007 and saying a refund of principal would be requested and credited. She said the purpose and character of the 2007 arrangements required resolution at a full hearing.
ACC also argued that missed interest payments allowed it to demand principal under the facilities’ general conditions. The judge said that if the company established its asserted restriction on repayment of principal, the parties’ 2009 communications would need to be considered before deciding whether ACC could rely on those conditions.
Justice Finlay Geoghegan ruled that the company and both guarantors had raised arguable defences warranting a plenary hearing. She made no determination of the parties’ substantive disputes. The claim, including the claims against the guarantors, was remitted for plenary hearing, with further directions to be addressed.