The High Court has temporarily blocked the sale of a commercial and residential development on Main Street, Cavan, after its owner raised a supported allegation that his signature on a key AIB facility letter was forged.
Charles McGuinness sought a series of injunctions against AIB, Everyday Finance and receiver Damien Harper concerning the property at 32 Main Street.
AIB had provided a €1.4 million facility in 2003 to assist construction of seven apartments and three commercial units. A mortgage over the property was executed in November 2005. Further facility letters followed, including one dated December 18, 2008.
McGuinness says he never agreed to that 2008 letter and that the signature appearing on it is not his. He produced a forensic document examiner’s report which found that the disputed signature differed markedly from known examples and provided some evidence that he was not responsible for it.
Mr Justice Conor Dignam held that McGuinness had established a strong case on that issue. This did not mean he had no obligation to repay money received from AIB. Rather, the issue was whether Everyday and the receiver could enforce the loan and security by relying on the disputed 2008 facility letter.
The court also found a strong case that the receiver had not taken possession peaceably because locks had been changed without McGuinness’s consent or a court order. Separately, the proposed sale documentation had incorrectly described the extent of the property being sold, creating a strong case that the best reasonably obtainable price might not be achieved.
However, Dignam J refused to order Everyday and Harper to surrender possession or the keys. He also declined to order an interim account of rent. Any loss arising from possession or rent could, the court held, be addressed financially if McGuinness ultimately succeeds.
The judge placed particular weight on the public-policy implications if a property were sold in reliance on a forged signature. He therefore restrained Everyday and Harper from advertising, selling or disposing of the Main Street property pending trial. No interlocutory relief was granted against AIB.