The High Court has directed that Bank of Ireland’s claim against Elizabeth Mellon proceed by plenary hearing, after finding that two bank letters raised issues that may support an arguable defence to the claim. The court was considering the bank’s application for summary judgment against Mellon; it did not decide the underlying liability dispute.
The judgment, delivered by Mr Justice Eagar on 28 July 2017, concerned loans made to David and Elizabeth Mellon. The bank’s evidence was that it advanced €2.95 million in July 2007, followed by facilities to restructure the borrowing in 2008. It said repayments had been made but that €2,064,883 remained due. David Mellon’s proceedings had been compromised; the application before the court was against Elizabeth Mellon alone.
Elizabeth Mellon disputed that she was personally liable for the full balance. In affidavits, she said her involvement was limited to providing security over her interests in Churchtown Park House and 72 Roebuck Road. She said she had not sought credit, had no capacity to repay commercial borrowing, and understood that her exposure was confined to those properties. The bank argued that the loans were made jointly to both defendants and relied on loan offer letters signed by them.
The court considered letters from bank managers Jane McGrath and Emer Deegan. McGrath’s letter of 14 August 2008 said recourse to Mellon’s personal guarantee was limited to her interest in “Cherry Trees”, 72 Roebuck Road, and Churchtown Park House. Deegan’s letter of 2 October 2008 similarly stated that the guarantee was limited to her interest in those properties.
Eagar found no evidence of undue influence by David Mellon. However, he said the two letters raised issues that may indicate an arguable defence. He also noted the absence of affidavit evidence from Deegan, McGrath or bank manager Sean Byrne. The court therefore directed that the matter be heard by plenary proceedings, where the issues can be considered beyond the summary judgment procedure.
The judgment did not determine whether Elizabeth Mellon was liable for the balance or finally establish the scope of any guarantee. It directed a fuller hearing of the dispute.