The High Court has refused Michael Neary leave to defend Bank of Ireland Mortgage Bank’s summary claim for money owed under a mortgage loan. The ruling concerns Neary’s position only; the proceedings also name Margaret McDonald as a defendant.
In a judgment delivered on 15 March 2019, Mr Justice Garrett Simons said Neary had not shown a real or bona fide defence. The court therefore proposed to grant the relief sought in the bank’s motion. The judgment does not set out the terms of that relief, and the application before the court was confined to Neary.
The bank loaned the two defendants €345,000 in 2007, secured on a property at 48 Seaview, Kilcoole, Co Wicklow. The loan terms made each borrower jointly and severally liable. The bank’s January 2015 demand stated a redemption balance of €337,283.51 and arrears of €96,538.93. A further solicitor’s letter in November 2016 said €343,393.03 was due, including arrears of €133,058.84.
Neary argued that the 2015 demand was ambiguous and had not called in the principal. The judge rejected that argument, finding that the letter clearly demanded early repayment and that the separate figures for arrears and the redemption balance served different purposes. He said the November 2016 letter was also a valid demand.
Neary also relied on the bank’s inability to produce individual notices of changes to the variable interest rate. The bank said those computer-generated letters were not retained, but it supplied annual interest certificates. Simons said Neary had not sworn that he failed to receive notices, alleged an overcharge, or shown that the agreed interest calculation had not been followed. The loan terms also allowed notice by newspaper advertisement.
A further argument was that the bank should have accepted Neary’s 2012 offer to surrender his half share in the property, or acted sooner to sell the security and limit the debt. The bank had said it could not accept the offer without the other borrower’s agreement. The judge held that the bank was entitled to pursue Neary for the debt without first enforcing the mortgage. He said surrendering an interest in the property did not discharge the contractual obligation to repay the loan and accrued interest.
The judgment also addressed the Conduct for Mortgage Arrears. The judge said the case was for debt recovery, not possession, and Neary had stated that he never lived at the property. He concluded that the Code did not provide a defence in these proceedings.