The High Court has refused a receiver’s application for interim orders that would have allowed him to take possession of a pub and farmland in County Cavan while a dispute over his appointment proceeds to a full hearing.
Mr Justice Binchy ruled on 25 November 2014 that there was a serious issue to be tried over whether Danske Bank had sent a demand letter to borrower Thomas Michael Hill in November 2013. The bank’s receiver, Declan McDonald, said the letter was sent before the bank appointed him. Mr Hill said he never received it, and the court said the receiver could not prove with certainty that it had been sent.
The bank had advanced €583,000 to Mr Hill in 2007 to buy Fiona’s Bar in Kilnaleck. The loan was secured against the pub and about 57 acres at Larrigan, Carrickaboy. The pub later operated as TM’s Vintage Bar. Mr Hill and his wife ran the licensed premises, and the judgment records that he derived his livelihood from the pub and the lands.
The bank appointed Mr McDonald as receiver over the properties in April 2014. The receiver then sought orders preventing Mr Hill from interfering with the receivership, requiring him to hand over access devices, and allowing the receiver to enter the properties and collect rent or licence fees. The application followed the defendant’s refusal to deliver vacant possession.
The mortgage terms required a demand to be sent before the bank could exercise its power to appoint a receiver. The court said the bank did not have to prove the letter was received, but the dispute was whether it had been sent. A bank manager said he signed and put the 22 November 2013 letter into the bank’s internal postage process. The court found there was no definitive proof of posting, such as a certificate of posting or evidence from the person who posted it. A later demand letter, sent in July 2014, had a posting record, but the bank maintained that it had already sent the earlier letter.
The judge concluded that the question required a full hearing. He also found damages would not adequately address the potential harm to Mr Hill’s reputation, dignity and livelihood if the receiver took control before trial. The balance of convenience favoured refusing the orders: granting them could deprive Mr Hill of his livelihood almost immediately, while the receiver described any harm from waiting only in general terms.
The court refused the interlocutory relief. It did not decide whether the November 2013 demand was sent or whether the receiver’s appointment was valid. Other disputes, including whether the pub was Mr Hill’s family home and whether a dwelling had been built on part of the lands without bank consent, were left for later consideration.