The High Court refused a creditor’s application for an order to sell a Ranelagh home in a dispute over the priority of a judgment mortgage and a family-law property order. Ms Justice Dunne held that the wife’s interest under the earlier order ranked ahead of the creditor’s interest.
Dovebid Netherlands BV had obtained judgment against William Phelan, trading as the Phelan Partnership, for €173,994.40, plus €402.60 in costs. The judgment was registered against his interest in the property on or about 1 December 2005. The home was jointly owned, and Denise O’Byrne was joined to the proceedings because of her interest in it. Phelan did not appear at the High Court hearing.
Family-law proceedings between Phelan and O’Byrne began in 2001 and concluded with a Circuit Family Court order dated 9 March 2007. Made under section 9 of the Family Law Act 1995, it directed Phelan to transfer his entire legal and beneficial interest in the home to O’Byrne for her sole use and benefit. The couple had settled those proceedings.
Dovebid argued that it had not been allowed to make representations in the family-law proceedings about whether the property adjustment order should be made, despite a provision in the Act concerning an opportunity for certain interested parties to make representations. It submitted that the order should not affect the priority of its judgment mortgage. O’Byrne’s counsel argued that the section 9 order was binding and left no interest to which the mortgage could attach.
The judge said the Circuit Family Court had been asked to make an order reflecting the parties’ settlement. She did not decide whether the Circuit Court’s approach to Dovebid’s request to make representations was correct. The issue before her was whether Dovebid could obtain an order for sale in lieu of partition over unregistered land despite the section 9 order.
Relying on principles from earlier cases, the judge said a judgment mortgagee is a volunteer and takes subject to prior unregistered rights. She held that proceedings concerning the land, begun before registration of the judgment mortgage, could rank ahead of it. The fact that the land was unregistered did not change that priority analysis.
The judge said Dovebid was aggrieved that the family-law order had been made by consent without its representations, but she had to deal with the existing section 9 order. She concluded that O’Byrne’s interest ranked ahead of Dovebid’s and refused the order for sale sought. The judgment did not make a sale order.