The Court of Appeal has allowed two appeals by Promontoria (Oyster) DAC, ruling that registered liens over land can secure later loan advances where the parties agreed to that arrangement.
The appeals concerned John Fox and Thomas Lynn, whose loans from Ulster Bank were later pursued by Promontoria. The lender sought well charging orders, which can support enforcement against land. The central question was whether liens registered under section 73 of the Registration of Deeds and Title Act 2006 could secure advances made after 31 December 2009, when the registration period for older liens expired.
The High Court had held that the liens could not secure lending made after that date. Promontoria appealed, arguing that the debts advanced under later facility letters were covered by the registered security. The Court of Appeal said it was not disputed that the advances were made on the facility terms or that the borrowers were in default; the dispute was whether the debts were secured as a matter of law.
The court said section 73 provided a way to register existing liens that had previously been maintained through possession of land certificates. It found nothing in the section preventing a lien registered during the statutory period from securing later advances agreed by the parties. The judgment said the change ended the creation of new liens of this kind after 2009, but did not prevent an existing registered lien from securing subsequent advances.
The appeals were allowed and the High Court judgment in the Fox proceedings was set aside. The judgment identifies the Lynn appeal as arising from the same underlying decision. It did not itself make final orders for sale of the lands; the issue before the Court of Appeal was the legal capacity of the registered liens to secure the later lending.
On costs, the court gave a provisional view that Promontoria should receive the costs of both appeals, limited to one set. The respondents may file written submissions seeking a different order within 14 days; Promontoria may respond within a further 14 days. If no submissions are filed, the proposed costs order will be made.