The High Court refused an investor’s application to lift a statutory stay on his claim against Anglo Irish Bank Corporation Limited and Mainland Venturers Corporation. The ruling means the claim cannot proceed at this stage; the court did not decide the investor’s underlying damages claim in this application.
The plaintiff had sought rescission of a 2006 commitment agreement and damages over an investment in a fund for renovating hotels in New York. His January 2015 motion also sought permission to add a party, amend his statement of claim and consolidate his case with related debt collection proceedings. The court said both sides accepted that the stay had to be lifted before those additional forms of relief could be considered.
The judge, Ms Justice O’Regan, said the court had discretion under the Irish Bank Resolution Corporation Act 2013 to lift the stay where doing so was right and fair in the circumstances. She considered the plaintiff’s proposed arguments about zoning and consumer status.
On zoning, the court noted that related “pathfinder” proceedings had already addressed the issue. In those proceedings, the High Court found that the pathfinder plaintiff had not established fraud or any of the other grounds advanced for liability. The Supreme Court later upheld the order, including the finding about that plaintiff’s state of mind on zoning. The present plaintiff had agreed to be bound by the pathfinder findings, subject to a qualification for matters applying only to the pathfinder plaintiff. Justice O’Regan said he had advanced no facts showing that the zoning findings were specific to that plaintiff, so it would not be right and fair to lift the stay to argue the issue again.
The plaintiff also said he was a consumer and therefore entitled to protections that could affect provisions of the commitment agreement. The court considered his documents, including an investor declaration stating that he wished to be treated as a professional client and had experience, or access to professional advice, to understand the transactions. An investor questionnaire described him as an accredited investor and stated that he owned at least US$5 million in investments. The judge said the plaintiff had offered only a bare assertion that he was a consumer and had not explained the nature of his business or businesses.
Justice O’Regan adopted the approach to consumer status taken in an earlier High Court case involving AIB, rather than a different approach in another case cited by the plaintiff. She concluded that the plaintiff had not raised a statable argument or triable issue on consumer status. She also said that even if he established consumer status, it would not overcome the earlier finding that the pathfinder plaintiff had failed to establish negligence.
The court therefore refused to lift the stay under section 6(2)(a) of the 2013 Act. It made no order on the plaintiff’s other requested reliefs.