The High Court has ordered the reinstatement of an Allied Irish Banks (AIB) charge on a Sligo property after finding it was discharged by mistake before a transfer to purchasers was executed.
Ms Justice Miriam O’Regan ruled on an application under section 31 of the Registration of Title Act 1964 concerning Folio 1237L, for Apartment 11, Block 2, Gateway Apartments, Ballinode, County Sligo. The charge had been removed from the folio by electronic discharge on 12 June 2017. AIB applied in May 2020 to have it restored.
The application was opposed by Vincent Kelly, legal personal representative in the estate of Liam Kelly. Liam Kelly had registered a judgment mortgage against Shane Tully’s interest in the property. If AIB’s charge remained discharged, that judgment mortgage would rank first among the encumbrances described in the judgment. Mr Kelly argued that the documents showed a sale by the Tullys to Claire and Michael Conroy, with provision to discharge AIB’s charge, and did not record an agreement for AIB to transfer the property as mortgagee in possession. He also disputed that the statutory mistake jurisdiction applied in the circumstances.
The judge acknowledged that the correspondence and sale contract left “some scope for confusion”. The contract, signed by the Tullys and the Conroys in January 2017, named the Tullys as vendors. But the court found uncontroverted evidence that the electronic discharge had been filed before a transfer to the Conroys by mistake. It accepted evidence that the Tullys believed AIB would complete the transaction as mortgagee in possession, and that the parties intended the Conroys to receive the property free of the judgment mortgage encumbrances.
The judge held that the mistake was central to the transaction and serious enough to be remedied under section 31. Without reinstatement, the Conroys could not achieve the bargain the court found they understood they were to receive. The court did not decide whether AIB was a mortgagee in possession at the time or is one now.
The order reinstates AIB’s charge, which the judgment says was originally registered on 30 December 2004 and removed by mistake on 12 June 2017. The judgment also sets out a process for written submissions on costs: any party seeking a costs order must file within 14 days of electronic delivery, with any response due within a further 14 days. Otherwise, oral submissions may be made when the matter is next listed.