The High Court has entered judgment for Bank of Ireland Mortgage Bank Unlimited Company against Gerry Conneely for €602,277.80, after finding that he had raised no arguable defence to the bank’s claim for outstanding loan debt.
In an ex tempore decision dated 5 May 2023, Mr Justice Cian Ferriter considered the bank’s application for summary judgment. The question was whether, assuming the bank’s proofs were in order, there was a fair or reasonable probability of a real or bona fide defence that would require the case to proceed to a plenary hearing.
The claim arose from two loans secured on a property at Castle Ellen, Athenry, County Galway: an €800,000 facility entered in 2004 and a €200,000 facility entered in 2005. The loans defaulted in 2009. The property was sold for €440,000 in November 2021. Net proceeds of €428,285 were applied first to clear the 2005 loan, with the balance applied to the 2004 loan.
Conneely argued that the bank should have agreed to an earlier sale. The judge said there was no evidence establishing the necessary basis for that defence, including a credible offer at the eventual sale price from 2016 onwards and an unambiguous agreement to apply the proceeds towards the debt while leaving the remainder owing. The judgment records that the bank consented to a €440,000 sale in November 2019 and that subsequent issues delayed its completion.
He also argued that the bank had breached conditions in the 2004 loan offer by accepting his engineer’s certificates as construction funds were drawn down. The house later proved, according to expert reports submitted by Conneely, to have structural deficiencies and to breach building and planning requirements. The judge said those reports supported his claims about the building, but found no prima facie evidence that the engineer lacked proper qualifications or that the bank knew of incompetence when funds were advanced.
The judge rejected Conneely’s proposed interpretations of both the condition precedent and the special condition governing staged drawdowns. He found that neither arguably required the bank to supervise the engineer’s work or ensure the engineer performed competently. The decision also noted that there is no tort of reckless lending in Irish law.
The court concluded that no arguable defence had been raised and entered judgment for the bank for €602,277.80. The ruling determined the summary judgment application; it did not decide the merits of a separate claim against the engineer.