The Court of Appeal has dismissed Philip Morrissey’s appeal over his bid to compel receivers of Dan Morrissey (Irl) Limited to lease him about 110 acres of agricultural land at Powerstown, Co Carlow.
The court upheld the High Court’s decision that it had no jurisdiction under section 438 of the Companies Act 2014 to force the receivers to grant the lease on the terms Mr Morrissey proposed: 10 years at €200 per acre. The judgment was delivered by Ms Justice Máire Whelan on 19 April 2023, with Justices Noonan and Haughton agreeing.
The appeal concerned a preliminary legal issue, not a determination of Mr Morrissey’s wider complaints about the receivership or the management of the land. The Court of Appeal said section 438 allows the court to give directions and determine rights in relation to a receiver’s functions, but does not give it a general power to alter established rights under corporate insolvency law. An applicant must also provide evidence of unfair prejudice to their actual rights.
Mr Morrissey, a company member and officer, argued that his shareholding and contributions to the company’s use of materials from his private land gave him an equitable interest in the land. He also relied on provisions of the 1877 Judicature Act and legal texts concerning receivers. The court found that a shareholding did not make him the beneficial owner of company property, and that he had not established a legal or equitable right to the lease. There was no evidence of an agreement with the receivers for a lease on the proposed terms.
The receivers were appointed by Allied Irish Banks in 2014 after the company defaulted on loans. AIB transferred its interest in the relevant security to Everyday Finance DAC in 2019. The receivers opposed the proposed lease and intended to sell assets to reduce the company’s debts. The judgment said their appointment was to be treated as valid unless a court with jurisdiction ruled otherwise.
The court also concluded there was no basis to join AIB to the motion, as it no longer held the security. It did not decide the separate, pending disputes about the validity of the receivers’ appointment or other allegations Mr Morrissey had made.
The appeal was dismissed on all grounds. The Court of Appeal indicated that the respondents were prima facie entitled to costs, but invited written submissions on any alternative costs order before making a final determination.