The Court of Appeal has refused Muintir Skibbereen Credit Union’s applications to sell two jointly owned family homes to satisfy judgment debts owed by Cornelius Crowley and Brendan Hamilton. It dismissed the credit union’s appeals against a High Court decision refusing sale orders under section 31 of the Land and Conveyancing Law Reform Act 2009.
The appeals were heard together. The court, in a judgment delivered by Mr Justice Gerard Hogan on 13 July 2016, said the homes were jointly owned by each defendant and his wife. The credit union had obtained judgments against the husbands after loans for small-scale property development in West Cork went unpaid following the property collapse in 2008. The wives had not signed documents offering the homes as security and were not involved in their husbands’ loan applications.
The High Court had refused the requested well-charging orders and sales. It cited the homes’ status as family homes, the wives’ lack of involvement in the loans, family circumstances including dependent children in the Crowley household and ill health in the Hamilton household, and a finding that each wife’s half of the net sale proceeds would be insufficient to buy another family home.
The Court of Appeal said section 31 gives a judgment mortgagee the right to apply for orders concerning co-owned land, including a sale, but leaves the court discretion to grant or refuse relief. That discretion must respect competing constitutional rights, including the property rights of creditors and spouses, and be exercised consistently with the objectives of the Family Home Protection Act 1976.
The court concluded that ordering sale in these circumstances would put the homes at risk over the wishes of spouses who were not parties to the loan transactions and had not formally consented to them. It held that the High Court was entitled to find that the wives’ shares of the proceeds would not fund alternative family homes. The Court of Appeal did not decide whether sufficient proceeds to buy another home could be relevant in a different case, saying that question should await a more appropriate case.
The court confirmed that the credit union was entitled to appropriate well-charging orders over both properties. It declined to order their sale under section 31(2)(c) and otherwise dismissed the appeals.