The High Court has ordered that receiver Ken Fennell be allowed to take possession of two residential investment properties in Donegal Town while proceedings continue. The order followed a contested application by Fennell against Denis Slevin, Danny McMenamin and Siobhan Gallagher.
The properties are 33 and 34 Marian Villas. They were secured under mortgages in favour of Ulster Bank: all three defendants signed the mortgage for No. 34 in 2004, while Slevin and McMenamin signed the mortgage for No. 33 in 2006. The judgment records that Promontoria (Finn) Limited (PFL) later became the registered owner of the charges and appointed Fennell receiver.
The defendants resisted the application. Their submissions challenged the demands for repayment, the transfers of the loans and security to PFL, and Fennell’s appointment. They also raised issues including hearsay evidence, limitation, stamp duty and the effect of a charge in favour of U.S. Bank Trustees Limited. The court rejected the preliminary hearsay objection for the purpose of this interlocutory application and found the other arguments did not prevent the relief sought at this stage.
Justice Mark Sanfey said the requested orders were mandatory because they would enable Fennell to take possession. He therefore required a strong case likely to succeed at trial. He found that Fennell had established a strong arguable case, while stressing that the defendants could still succeed at trial and that a trial judge might reach a different conclusion.
The court also found that the balance of convenience favoured interim control by the receiver. The properties’ current occupation and condition were unknown, and the defendants had not proposed repaying the loans or placing funds in escrow pending determination of the dispute. The court noted that the properties were investment properties, not the defendants’ family homes.
The court granted the interlocutory orders sought in paragraphs 1 to 6 of the motion. They restrain the defendants from obstructing the receiver’s access, possession, security and collection of rent; bar the defendants from attending at the properties; and require delivery of keys, access devices, title documents and records. These are interim orders pending trial, not a final determination of the parties’ claims.
Because tenants might be paying rent in good faith, the court directed Fennell to write to occupants at the properties with copies of the order and judgment, and expected him to try to regularise any bona fide tenancies. The parties were given until 6 January 2021 to make written submissions on costs and whether a stay to facilitate tenants was appropriate. The court said it would finalise the order after receiving those submissions; it did not determine costs in this judgment.