The High Court has refused a debtor’s application to extend the deadline for challenging a bankruptcy summons, despite finding that his counterclaim against the creditor raised a real and substantial issue for trial. The debtor can still rely on that claim when opposing the creditor’s bankruptcy petition.
Mr Justice Liam Kennedy delivered the judgment on 13 December 2024. The application concerned a summons based on unpaid rent for a property leased to the debtor in July 2011. A Residential Tenancies Board determination, later reflected in a District Court order, directed him to pay €32,414.50 in arrears and €650 in costs. The debtor did not appeal or set aside those orders, and the judge said their validity was not in issue in this application.
The debtor’s separate High Court proceedings allege that the parties expected he would buy the property and agreed his spending on maintenance and upgrades would be reimbursed or credited against rent or the purchase price. The judgment records a spreadsheet listing expenditure of €182,132.97, with a further €15,000 to €18,000 in other spending. The debtor’s plenary claim seeks €507,799.97 in damages, as well as other relief. These remain allegations; the creditor denied them in general terms and had not filed a defence to the plenary claim.
The judge concluded that the counterclaim could not have been raised in the RTB or District Court proceedings, and was not a collateral challenge to their orders. Taking the debtor’s evidence at its height, it was a real and substantial issue. The judge also said the creditor’s application for the bankruptcy summons should have disclosed the related plenary proceedings. He considered that the summons probably would have been dismissed on these grounds if challenged in time.
But the summons was served in or around late January 2023, and the debtor’s application was issued on 14 December 2023, more than 10 months later. The debtor gave no adequate explanation for missing the 14-day deadline. The judge found that negotiation attempts, the later eviction and the creditor’s failure to copy the debtor’s solicitor did not justify extending time; the debtor had promptly forwarded the documents to that solicitor.
The court refused the extension and ruled that the debtor was out of time to apply to dismiss the summons. It did not decide the merits of the counterclaim or dismiss the bankruptcy petition. The judgment says the debtor may raise the same counterclaim in opposition to the petition, and directs that the matter be listed for directions in the first Bankruptcy List of the new legal term.