The Court of Appeal has dismissed an appeal by Elektron Holdings Limited and Ann Keane against the striking out of their 2015 proceedings concerning a receiver’s appointment over Aberdeen Lodge in Sandymount, Dublin 4.
In a judgment delivered on 9 May 2018, Ms Justice Finlay Geoghegan said the claims could and should have been raised in earlier proceedings. The appeal was against a High Court order made on 27 July 2016 striking out the case as an abuse of process. The Court of Appeal upheld that result; it did not determine the underlying claims about the guarantee or the loan sale.
Elektron owns Aberdeen Lodge, which the judgment describes as a hotel or guest house and the family home of Ms Keane, her partner Patrick Halpin and their children. The 2015 case sought, among other relief, a declaration that the receiver was not validly appointed and an order requiring Kenmare Property Finance Limited to release or vacate security over the property.
The plaintiffs advanced two grounds. They contended that Elektron’s guarantee of borrowings by Crossplan Investments Limited breached section 31 of the Companies Act 1990 and had been avoided by a company resolution in September 2014. They also argued that the receiver’s appointment ceased to have effect when the loans and related securities were sold by IBRC to Kenmare in 2014. These were claims made by the plaintiffs, not findings on their merits in this appeal.
Earlier proceedings began in 2012, including a motion seeking confirmation of the receiver’s appointment and possession proceedings concerning Aberdeen Lodge. The High Court upheld the appointment in 2013 and ordered possession for the receiver. The Supreme Court later dismissed the appeal in the possession proceedings and affirmed that order, with a stay continuing until 6 May 2016.
The Court of Appeal concluded that the relevant facts for the section 31 claim were known in 2012 and that the challenge could have been raised in the earlier cases. It also held that the loan-sale claim could and should have been put before the Supreme Court through an application to admit fresh evidence. The court said it was unnecessary to decide what the Supreme Court would have done if such an application had been made.
The appeal court found the 2015 proceedings amounted to a collateral attack on the Supreme Court’s possession order and were an abuse of process. It dismissed the appeal. The judgment said it was unnecessary to consider whether the High Court had been right to rely on alleged tactical decisions or earlier Supreme Court comments about Mr Halpin.