The High Court has granted a receiver interim possession and control of a Dublin rental property owned by Brian and Irene Reilly, allowing him to continue the receivership and pursue a sale before the full case is heard.
In a judgment delivered on 12 October 2023, Ms Justice Butler found Ken Fennell had a strong arguable case that he was validly appointed receiver by Promontoria (Oyster) DAC (PODAC), and that the mortgage gave him powers to take possession and sell the house. She also found the balance of justice comprehensively favoured granting the interlocutory relief.
The ruling does not finally determine the defendants’ claims about the loan transfer, an alleged 2011 restructuring agreement or their right to redeem the mortgage. The judge noted that the orders could lead to a sale before trial, but concluded that damages would be an adequate remedy if the defendants later succeeded.
The Reillys borrowed from Ulster Bank in 2007 and mortgaged the house, which they had bought in 1990, to help fund an apartment purchase. The house became a rental property. Their loan was transferred to PODAC in December 2016, and the court record showed the mortgage transfer registered on 9 March 2017. No payment on the mortgage had been made since March 2017, the judgment said. PODAC appointed Fennell receiver in October 2017 after demanding repayment.
The defendants disputed the transfer and the receiver’s authority, and pleaded that Ulster Bank had agreed to a restructuring in 2011. Justice Butler said the alleged agreement’s terms had varied over time and were unsupported by evidence before her. She also found the defendants had not established that they could redeem the mortgage. A letter concerning €850,000 held to the order of Columbia Ventures Corporation was conditional on further arrangements and a loan agreement, and fell short of the €957,541.82 redemption figure given for April 2022.
The judgment recounts evidence that tenants who cooperated with the receivership faced harassment and intimidation, including a reported death threat against a property manager. The judge said the first defendant had not denied the allegations in his affidavit. She found interference with the receivership was a joint enterprise for the defendants’ mutual benefit.
Justice Butler ordered the relief sought in paragraphs 1 to 5 of the receiver’s motion. The judgment does not reproduce those paragraphs, so their exact terms are not specified in the decision. The judge also proposed an order for the receiver’s costs against both defendants, stayed until the proceedings are determined, with four weeks for submissions seeking a different costs order.