The High Court has dismissed Allied Irish Banks Plc’s application to vary or discharge a certificate that recorded its claim against the proceeds of a property sale had not been admitted.
The application concerned a certificate issued by the High Court Examiner on 3 October 2018. It recorded that the bank’s claim was not admitted under an Assistant Examiner’s ruling made in October 2013. Mr Justice Quinn held that the bank had not established the “special circumstances” required under Order 55 Rule 50 to change a certificate that had become binding.
The dispute arose from the sale of property in Folio 684, County Waterford. A well-charging order and order for sale had been made in proceedings brought by ADM Londis Limited in 2012. The property was ultimately sold for €110,000.
AIB said it held a mortgage granted in January 2007 and registered in October 2009, and argued that it should rank ahead of ADM Londis’s later judgment mortgage. The court accepted that a prior charge ordinarily takes priority over a later judgment mortgage. But it said the Examiner’s process required claimants to prove their debt and security to the Examiner before proceeds could be distributed.
At a 2013 sitting, the Assistant Examiner was not satisfied with AIB’s proofs and directed it to provide further documents and clarification. AIB filed a supplemental affidavit, but its claim was not admitted at the adjourned sitting on 8 October. The judgment records that AIB submitted no further proofs and did not ask the court to review the ruling at that time.
AIB later relied on correspondence between the parties, including a 2017 proposal to share sale costs in proportion to expected proceeds. The proposal was not accepted. The judge found that the communications did not amount to a concluded agreement or release AIB from the obligation to prove its claim. A letter referring to AIB potentially receiving most of the proceeds also made that possibility subject to claims being admitted.
The judge said registration of the mortgage was not disputed, but registration alone did not prove the debt and security in the proceedings. AIB had known of the Examiner’s ruling and the progress of the sale, yet had not taken further steps to establish its claim for five years.
The court dismissed the application to discharge or vary the certificate. It did not decide the merits of AIB’s claim through a fresh examination; the ruling left the certificate in place for distribution of the sale proceeds.