The High Court has refused a company director’s application to represent Aqua Fresh Fish Limited in its defence of a bank’s claim for possession of mortgaged lands in County Louth.
Mr Justice Keane ruled on 27 March 2015 that Adrian Flynn, the company’s managing director and principal shareholder, had not shown rare and exceptional circumstances that would justify allowing him to act as an unqualified advocate. The ruling concerned who could represent the company; it did not determine the bank’s underlying claim for possession or sale of the property.
Allied Irish Banks plc says the company mortgaged the lands to secure its debts and borrowed €155,615 for working capital in March 2011. In an affidavit supporting the bank’s proceedings, an assistant manager said that by 15 June 2012 the company owed €170,880.82, including interest and a current-account balance. The bank says it demanded repayment and possession in July 2012, but the company did not pay or give up possession. These are claims set out in the bank’s evidence, not findings made in this ruling.
Flynn had previously been refused permission to represent the company by the High Court in May 2013. The Supreme Court later allowed him to enter an appearance for the company and sent the question of any further representation back to the High Court, directing that the bank be given notice of a new application. Flynn entered what he called a conditional appearance in February 2014 and brought the application considered by Mr Justice Keane on notice to the bank.
Flynn said the company could not afford a solicitor or barrister and had a “strong and valid defence”. At the hearing, he supplied a document setting out 33 proposed grounds, including technical challenges to the mortgage, loan and repayment demand, and assertions of a collateral agreement, bank negligence and a conflict of interest involving the bank’s solicitors. The judgment records that the company did not deny borrowing the disputed money, mortgaging the lands or failing to repay it. The court found no evidence supporting the factual assertions and concluded that the proposed grounds did not show a real or bona fide defence with a reasonable chance of success.
The judge accepted for the purpose of the application that neither the company nor its directors or shareholders could fund legal representation. But he said lack of funds was common and, on its own, did not establish an exceptional case. He also considered the potential costs to the bank and the absence of professional oversight if Flynn conducted the defence as a lay advocate.
The court held that the established rule generally prevents a company director from representing a company in court, while recognising a narrow residual discretion in rare cases. It rejected Flynn’s argument that the EU Charter had changed that rule, finding no demonstrated connection between the mortgage proceedings and the implementation of EU law. The application was refused.