By Clara Finn
The High Court has entered judgment against property investor David Grant for €663,059.62 after the sale of a mortgaged house and land near Newtownmountkennedy in County Wicklow failed to clear his borrowings from ICS Building Society.
Grant bought the countryside property in 2002 for £293,000, equivalent to €372,033.26. It was reached by a narrow right of way across neighbouring land and was considered to have possible development potential.
He subsequently borrowed €788,000 from ICS in October 2003 and a further €92,000 in November 2004, secured by mortgage over the property. The bank had valued it for mortgage purposes at €1.1 million.
By May 2007, Grant had arrears of €22,679.37 and a redemption balance of €811,028.66. Following a possession order made in July 2008 with a four-month stay, the bank repossessed the property in December 2008.
It was sold in September 2009 for €355,000. The court accepted that three parties had shown interest, that the property had been properly advertised and that the sale achieved the best price reasonably obtainable.
After allowing for the sale proceeds, clearing costs and the bank's waiver of nine months' interest, the remaining debt was calculated at €663,059.62.
Grant argued that requiring repayment was unfair and said he had reasonably expected to develop the property and make a profit. He also questioned why he should have to repay the debt when banks generally were being supported by Irish taxpayers.
Mr Justice Charleton held that the written loan agreements required Grant to repay the money borrowed. A mortgage did not mean the bank had agreed to accept whatever the property later realised on sale as full settlement of the debt.
The judge also rejected the broader argument of “reckless lending”. He held that no such tort, or civil wrong, existed in Irish law and said the court could not create one. Any such change was a matter for the Oireachtas.
Judgment was therefore entered for ICS Building Society.