The Court of Appeal has dismissed a property developer’s appeal against the refusal of an injunction aimed at stopping the proposed online auction of three unfinished properties in County Donegal. It affirmed the High Court order refusing the requested interlocutory relief. The ruling did not determine the claims for damages made in the underlying proceedings.
M & J Duddy Developments Limited had mortgaged a house at Ray, Kilmacrennan, and charged properties at Ballymagowan Lower and Knockbrack, both near Kerrykeel, as security for borrowing from Allied Irish Banks. The debt and security were later transferred to Everyday Finance DAC. The properties had been vacant since work stopped, and the judgment described them as unfinished and incapable of being let.
Everyday appointed Andrew Dolliver as receiver in July 2022. The mortgage documents gave the receiver no power of sale. Two months later, Everyday separately appointed him as its agent to maintain and market the properties and contract to sell them, subject to exclusions for work within his receiver role. He arranged for Wilsons Auctioneers to market the properties by online auction. The proposed February 2023 auction was advertised with combined minimum values of €360,000. The judgment recorded evidence that the company’s liabilities to Everyday exceeded €2.27 million; the reported estimated combined property values ranged from €330,000 to €480,000.
The company sought an injunction, arguing that Dolliver could not act as Everyday’s agent while also serving as receiver, a role in which he was deemed to act as the borrower’s agent. The Court of Appeal said the evidence showed that Dolliver marketed the properties as Everyday’s agent, but had done nothing as receiver and was not alleged to have exercised, or threatened to exercise, receiver powers. The court distinguished the potential for a conflict between roles from an actual conflict on these facts. It held that the company had not shown a fair question to be tried that the dual appointment necessarily created a conflict.
The court also noted that the company had not argued that the sale would achieve less than the best price reasonably obtainable, challenged the sale method or conditions, or identified what loss the sale would cause. Given its conclusion on the fair-question issue, the court did not need to decide what it would have done had that threshold been met. It dismissed the appeal and affirmed the High Court’s order. The respondents were awarded their appeal costs, subject to a 10-day period for the company to make a short written submission seeking a different costs order, with a further 10 days for any response.