The High Court has awarded Danske Bank A/S €1,206,719.65 in a business-loan case after rejecting the defendants’ argument that the bank could not sue because it lacked an Irish Central Bank licence.
In a judgment delivered on 9 September 2015, President of the High Court Kearns held that the bank was entitled to the relief sought. The judgment says the proceedings were brought by summary summons in March 2013 over three loan facilities made in 2006 and 2007. The defendants did not deny that the loans had been advanced or that repayments had fallen due and remained unpaid.
The bank’s evidence was that the loans were originally granted by National Irish Bank and transferred to Danske under a scheme approved by the Minister for Finance. The transfer took effect on 1 April 2007. The bank said the loans formed part of the transferred banking business and were not among the agreement’s excluded business.
The defendants, who represented themselves at the hearing, argued that the transfer was invalid because Danske had not been licensed by the Central Bank of Ireland. They also disputed the bank’s reliance on the 1992 regulations governing credit institutions authorised in another EU member state. The first defendant’s affidavit said the couple had not consented to the mortgage being transferred.
The court accepted the bank’s submission that the 1992 regulations had expanded the operation of section 33 of the Central Bank Act 1971. It found that, from 1 January 1993, a bank party to a business-transfer scheme did not need a licence issued by the Irish Central Bank if it was authorised as a credit institution in another member state. The court concluded that the Minister was entitled to approve the transfer to Danske under the 2007 instrument and described the defendants’ challenge to its validity as misconceived.
The judgment records that the bank had originally demanded €1,221,621.32 for principal and interest, and that it waived interest from 8 March 2013. The final order was judgment for the sum claimed, €1,206,719.65. The judgment does not specify any further order.