The High Court has sent a €1,089,847.88 loan claim against Aidan Foy and Philip Foy to a plenary hearing, finding that the defendants had raised an arguable defence to the summary judgment application.
Mr Justice Barr delivered the judgment on 27 July 2016. The plaintiff, LSREF III Stone Investments Limited, sought judgment jointly and severally against the defendants for the debt, excluding default interest. The defendants did not dispute that the loan had been advanced or that it was repayable, but argued that an alleged agreement with Irish Bank Resolution Corporation (IBRC) about selling two properties affected what could now be recovered.
According to Philip Foy’s affidavit, the bank had agreed in January or February 2013 that a property at 114 Mount Merrion Avenue, Blackrock, would be sold for €550,000 to his sister, who operated a crèche there, and an apartment at 12 The Turnstiles, Thornwood, for €490,000. He said the proposed sales would have cleared the loan and left a small surplus. The defendants alleged that IBRC failed to provide title deeds in time, the sales fell through, and interest continued to accrue. These were the defendants’ allegations; the court did not determine whether the agreement was made or whether IBRC breached it.
The loan facilities had been assigned to the plaintiff in 2014. The plaintiff argued that the alleged wrongdoing was attributed to IBRC, which was not a party to the proceedings, and that this did not provide a defence to the plaintiff’s claim. It also challenged the detail and evidential support for the defendants’ account.
Mr Justice Barr held that an assignee could not have greater rights against the defendants than IBRC, and that the defendants could raise any defence that would have been available against the bank. He understood their case to be that the failed sales caused them loss, including further interest and the loss of a surplus, and that the plaintiff was similarly limited in what it could recover. The court found that this amounted to an arguable defence under the cautious test for summary judgment.
The court did not decide the truth of the alleged agreement, negligence or breach of contract, nor fix the amount ultimately due. It refused to determine the claim summarily and remitted the action to plenary hearing. The judgment does not record a final award or other resolution of the debt claim.