The High Court has granted Allied Irish Banks plc (AIB) summary judgment on a €2.18 million guarantee against Mary Corkery, sued as personal representative of the estate of Gerard Corkery.
In a judgment delivered on 27 March 2019, Mr Justice Twomey said the estate had not shown a fair or reasonable probability of a real or bona fide defence that would justify a plenary hearing. The court rejected the undue influence and fiduciary duty arguments advanced against summary judgment, and found no separate evidential basis for the negligence counterclaim mentioned at the hearing.
Gerard Corkery, who died in December 2015, was a director and shareholder of G.R.O. Oil Ltd. He and other company directors signed a joint and several guarantee on 4 April 2008, capped at €2.18 million, for the company’s AIB borrowing. The €2.18 million loan was connected with G.R.O. Oil’s plan to acquire a site in Thurles, Co Tipperary, for a biodiesel manufacturing plant. The judgment said the loan fell into arrears and demand was made under the guarantee; the debt and demand were not disputed in this application.
The estate argued that Corkery had signed under undue influence and that AIB owed him a fiduciary duty because of his alleged vulnerability. His widow’s affidavits referred to Asperger’s Syndrome, dyslexia and attention deficit disorder, but the judge noted that no medical evidence had been provided. The court also considered Corkery’s own affidavit, which described his farming and business activities and did not refer to those conditions.
Corkery had said he believed his personal exposure was limited to €100,000, based on his understanding of the minimum security figure and the number of directors. He also described the guarantee being presented for signature at a company investor open day and said its joint and several terms had not been explained. The judge noted that the case advanced for the estate was undue influence, rather than the duress Corkery had described in his affidavit. The court found the evidence did not credibly support undue influence, including because Corkery had a commercial interest in the company whose borrowing he guaranteed.
The judge also found insufficient evidence to support a fiduciary duty or negligence defence. He said the ordinary lender-borrower relationship does not generally impose fiduciary duties, and that the account’s transfer between bank branches did not establish vulnerability or such a duty.
The judgment noted that AIB had already obtained judgment against G.R.O. Oil and certain other defendants, while proceedings against remaining guarantors continued and an appeal was pending over a ruling on the extent of their liability. Those matters were distinct from the application against Corkery’s estate decided in this judgment.