The High Court has ordered interim possession of three properties to a receiver appointed over them after a borrower defaulted on commercial loans. It also ruled that a company occupying one of the properties could not rely on its later lease against the receiver.
In a judgment delivered on 17 February 2017, Ms Justice Costello considered two motions together: the receiver’s application for interlocutory injunctions requiring surrender of vacant possession, and his application to remove lis pendens registered by the borrower’s mother and partner. The court did not decide the underlying claims at trial. It assessed whether the receiver had made a strong case likely to succeed and whether interim relief was appropriate.
The properties were 1A and 1B Swan Lake in Dublin and Summer Cove in Wexford. The loans originated with Anglo Irish Bank in 2006, were later acquired by Launceston Property Finance, and were secured against the properties. The facilities had expired without repayment. After a demand for €2,603,732.40 plus interest went unpaid, Launceston appointed the receiver in August 2016. The appointment’s validity was not disputed at the hearing.
The borrower argued that assurances from Launceston’s agent about planning permission and retaining a Swan Lake home prevented the receiver from seeking possession. The judge found the evidence did not establish a clear promise capable of supporting that defence; in any event, any concession had been withdrawn after notice. The borrower also argued that mortgage arrears procedures applied because his family lived at 1B Swan Lake. The court concluded that acknowledged claims to interests in the secured properties breached the mortgage terms, allowing proceedings under an exception in the relevant code. It did not decide whether the code applied to the receiver or Launceston.
The court granted the receiver’s requested injunctions against the borrower concerning all three properties, together with ancillary relief. It also granted an injunction against Rope Walk Car Park Limited, which occupied Summer Cove. The original lease, dating from 2011, was binding on the bank after rent was paid directly to it at its request. The later lease, granted in 2016 after the earlier lease expired, was not binding on the receiver.
On the lis pendens applications, the court removed any notice asserted by the partner over 1A and 1B Swan Lake, finding her claimed priority interest in those properties was bound to fail. It refused to remove her lis pendens over Summer Cove: her claimed equitable interest there could not be ruled out on the motion, and the court did not find her claim was being pursued in bad faith. The ruling therefore left that claim for later determination.