The High Court has refused to discharge the appointment of a receiver over certain bank accounts of a judgment debtor, rejecting his objections to the procedure used in this case.
In a ruling delivered on 16 March 2018, Mr Justice Brian McGovern said the appointment of solicitor Claire Callanan as receiver by way of equitable execution was necessary to assist Allied Irish Banks plc in enforcing its judgment against Seamus McQuaid. The court made no order discharging the receiver.
AIB obtained judgment against McQuaid for €3,256,217.49 plus interest in February 2017. A stay on execution was later lifted after McQuaid declined to provide undertakings sought by the bank. The bank had recovered no money under the judgment by the time of the ruling.
Callanan was appointed at an ex parte hearing on 7 February 2018. The application arose during the hearing, although the bank’s docket had sought other enforcement orders and did not include an application for a receiver. McQuaid’s solicitor later asked the court to set aside the appointment, arguing that there had been no affidavit addressing Callanan’s suitability, no written consent from her to act, and no evidence of the probable cost of the appointment.
The judge acknowledged those procedural omissions. He said the affidavit supporting the bank’s other enforcement applications covered the judgment, McQuaid’s failure to comply and previous enforcement steps. The court was also familiar with the difficulties in recovering the debt. McGovern said the evidence showed that enforcement could not be achieved without orders including a receiver. He noted that the ruling did not concern the two other defendants, who had been joined on allegations that they interfered with enforcement and helped put assets beyond creditors’ reach.
There was no signed consent or affidavit of suitability when Callanan was appointed. The judge said the court could infer her consent because she was present instructing counsel when the appointment was sought. He considered her, as a solicitor familiar with the case’s financial details, prima facie suitable. McQuaid had not challenged her actual suitability.
The judge also considered the absence of evidence estimating the receiver’s costs. He said the rules require the court to have regard to probable costs, but do not require an estimate in every case before appointing a receiver. Given Callanan’s existing knowledge of the case, he considered her involvement likely to make the process more efficient and keep costs reasonable. No evidence had been offered to suggest the costs warranted further inquiry.
McGovern stressed that his decision was specific to the circumstances before him. As a general rule, he said, applications to appoint a receiver should include an affidavit of suitability and the nominee’s written consent. He also noted that McQuaid had not given the notice required by the existing order for his application to discharge the appointment.