The Supreme Court has dismissed an appeal by Rockrohan Estate Limited in a dispute over Ulster Investment Bank’s right to sell about 120 acres of land in County Cork.
The Court ruled that Rockrohan’s occupation of the lands after a 1987 High Court order for sale was not adverse to the bank. It also held that the bank’s later application for possession to facilitate the sale was supplementary to the original proceedings, rather than a new action to recover land that was barred by the Statute of Limitations.
The dispute arose from a guarantee debenture dated 22 September 1981, connected to borrowing by Bula Limited for a proposed mining project. After Bula defaulted, the bank called on Rockrohan to meet its obligations under the guarantee. On 16 February 1987, the High Court declared the secured principal, interest and costs well charged on Rockrohan’s interest in the lands and ordered that they be sold if payment was not made. It did not grant the bank possession, finding there was no evidence that possession was needed to enable a sale.
Rockrohan had asked the court to defer enforcement while related litigation proceeded. The Supreme Court found that the bank held off pursuing the sale in light of Rockrohan’s position that the other cases could succeed and generate funds to pay the debt. That litigation concluded unsuccessfully for those bringing it in 2005.
The bank’s 2008 application sought possession for the purposes of sale. Rockrohan responded by seeking a declaration that the bank had no interest in the lands or right to enter, possess or sell them. It argued that more than 12 years had passed and that it had acquired title through adverse possession.
The Court said occupation by a mortgagor can, depending on the circumstances, become adverse to a mortgagee. But it found that Rockrohan remained in possession with the bank’s consent while the parties awaited the outcome of the related litigation. It also found a shared understanding that the bank would hold off until that litigation had ended. The Court said it would be inequitable for Rockrohan to withdraw from that understanding.
The judgment concluded that time had not begun to run against the bank under the 1957 Act because Rockrohan’s occupation was not adverse. It further held that the action to recover the land had already taken place in the proceedings that resulted in the 1987 sale order. The appeal was dismissed. The judgment does not set out a separate new sale order; it dismisses the appeal concerning the bank’s application for possession for the purpose of sale.