The High Court has refused Yolanda Limited’s application to strike out proceedings brought by D&L Properties Limited, ruling that the company’s claim was not shown to be bound to fail.
The judgment, delivered by Mr Justice Brian J. McGovern on 20 October 2015, concerns a dispute over an alleged loan. D&L says it agreed to advance up to €3.8 million to Yolanda and that €2.2 million was advanced under an agreement made in or around November 2008. It says the money was transferred from the bank account of Derek O’Leary and Linda O’Leary to Yolanda’s account.
D&L seeks judgment for €9,739,880, as well as damages for alleged breaches of contract, duty, statutory duty and fiduciary duty, misrepresentation and conversion. These are claims made in its statement of claim; the court did not determine their merits in this ruling.
Yolanda denied receiving money from D&L. It argued that any loan was made personally by Derek O’Leary under an agreement with Yolanda, and also disputed the other claims. It asked the court to dismiss the proceedings under Order 19, rule 28 of the Rules of the Superior Courts or under the court’s inherent jurisdiction.
The judge said that under Order 19, rule 28, frivolity or vexation must appear from the pleadings alone. He found that Yolanda had not met that test. Applying the separate test for the court’s inherent jurisdiction, he said the question was whether the claim was bound to fail, not whether it was likely to fail. Disputed factual issues had to be considered in D&L’s favour at this stage.
The judgment noted conflicting material about who was the contracting party. D&L maintained that O’Leary advanced the money on its behalf. Yolanda relied on documentary evidence and pointed to D&L’s 2008 accounts, which recorded a directors’ current account of €2.26 million and stated that O’Leary had advanced that amount to the company. The judge said it was not necessary to resolve conflicts or apparent improbabilities on this application.
The court also considered Yolanda’s arguments about the Statute of Frauds and part performance. The judge described the evidence of a written note or memorandum as tenuous, but said it was sufficient to resist an application of this kind. He said the question of whether any part performance was by D&L or by O’Leary could be tested at trial.
The court dismissed Yolanda’s application to strike out the proceedings and refused its motion. The ruling allowed the claim to proceed; it did not establish that D&L was the lender or that Yolanda owed the amount claimed.