The Court of Appeal has dismissed appeals by three brothers against High Court orders enforcing Ulster Bank Ireland DAC’s judgment mortgages over their homes. It also rejected their challenge to the refusal to cross-examine a bank witness, finding that no timely notice or application to extend time had been made and that the proposed questions were not relevant or necessary.
The appeals concerned special summonses seeking well charging orders over the respective homes of Brian, Maurice and Kenneth McDonagh. In Brian McDonagh’s case, the Bank also sought an order for sale. The High Court granted the orders in March 2023. The Court of Appeal’s decision, delivered by Mr Justice Noonan on 6 November 2023, dismissed all three appeals. It did not itself make an order for sale in the cases of Maurice or Kenneth; the Bank had said it was not then pursuing those forms of relief.
The underlying debt arose from loans of almost €22 million advanced in 2007 to buy about 80 acres at Kilpedder, County Wicklow, for a planned data centre. The development did not proceed. After earlier contested debt proceedings, a judgment of €22,947,202.85 was granted against the brothers and an appeal was rejected. The current proceedings concerned enforcement of judgment mortgages registered against their respective residences.
Before the High Court hearing, the brothers served notice that they wanted to cross-examine Ted Mahon, a senior Bank manager who had sworn affidavits. The notice was served on the morning the hearing began, months after the affidavit timetable had ended. Their counsel argued that cross-examination was needed to address the Bank’s failure to provide property valuations and its treatment of a profit participation agreement connected with the eventual sale of the Kilpedder land.
The Court of Appeal said the rules required notice within a set period after the time for replying affidavits expired, unless the court appointed another time. Although the court had power to extend that period, the brothers had not clearly applied for an extension in the High Court. The appeal court also found that the valuation and profit agreement issues did not make the proposed cross-examination relevant or necessary to deciding whether the Bank had established its entitlement to relief. The brothers had submitted no evidence of property values or their financial means.
The judgment said a judgment creditor was not required to prove that a sale would clear the whole debt, or first exhaust other possible recovery routes. The brothers had also known of the profit participation agreement and the absence of valuation evidence before the hearing, and could have made submissions on those matters without cross-examination.
The court said the Bank appeared entitled to its costs. The brothers were given 14 days to make written submissions proposing a different costs order; the Bank could respond within a further 14 days. If no alternative submission was received, the proposed costs order would be made.