The High Court has ruled that Ulster Bank is entitled to judgment against Brian, Kenneth and Maurice McDonagh for the unpaid loan balance without a further reduction for its settlement with property valuer CBRE. The court also rejected Brian McDonagh’s challenge to the appointment of joint receivers over the Kilpeddar site.
The supplemental judgment, delivered by Mr Justice Twomey on 23 June 2020, follows the court’s principal judgment of 6 April 2020. That earlier ruling found Ulster Bank prima facie entitled to €22,090,302.64, subject to clarification of the Civil Liability Act 1961 issue. The loan had financed the purchase of the Kilpeddar site in County Wicklow for a proposed data centre. The bank had received €5 million from CBRE in settlement of separate proceedings, reducing the amount it sought from the McDonaghs from about €27 million to about €22 million.
The McDonaghs argued that CBRE was a concurrent wrongdoer and that, if they paid the bank, they could recover the full amount from CBRE. They said the bank’s settlement should therefore reduce or discharge their liability under section 17(2) of the 1961 Act. The bank disputed that the Act affected its claim and argued there was no evidence CBRE was a concurrent wrongdoer.
Justice Twomey held that the McDonaghs bore the burden of proving their defence. The court had no evidence that CBRE’s €56 million valuation of the site was negligent: the settlement was made without an admission of liability, and the McDonaghs had not produced expert evidence on negligence. The judge also found no evidence that the valuation caused the loan’s non-repayment or that CBRE was responsible for more than the 18 per cent of the bank’s loss represented by its €5 million settlement. The bank’s claims against CBRE and the fact that it credited the settlement against the loan did not establish causation or liability, the judgment said.
The court separately rejected Brian McDonagh’s arguments that title issues or the absence of express wording permitting “joint” receivers invalidated their appointment. He had accepted expert evidence that there was no title flaw. Citing the Supreme Court decision in Taite v Beades, the judge held that the mortgage’s authorisation to appoint “receivers” permitted their joint appointment.
The court concluded that section 17(2) did not reduce the McDonaghs’ liability and that Ulster Bank was entitled to judgment without a deduction on that basis. It said it would hear from the parties on the final orders and other matters arising from this judgment and the principal judgment; the supplemental judgment did not state that final orders had yet been made.