The High Court has ruled that Ulster Bank Ireland Limited validly appointed joint receivers over three properties secured to it by mortgages and charges, and said the plaintiff’s claim based on challenges to those appointments was bound to fail.
In a judgment delivered on 21 February 2017, Ms Justice Baker considered the legal basis of the claims and motions by the bank and the receivers to strike them out. She concluded that the security instruments gave the bank a contractual power to appoint receivers, exercisable after demand, and that sufficient demand had been made.
The properties were the Milltown Unit in Co Monaghan, Old Cross in Monaghan town, and lands in Co Wexford. The bank appointed the second and third defendants as joint receivers over the Milltown Unit in March 2013, Old Cross in November 2013, and the Wexford lands in August 2013. The Wexford lands were later sold, with the purchaser registered as full owner in January 2015.
The plaintiff argued that the security documents contained no express power to appoint a receiver, and that no such power could be implied. He also challenged the effect of the repeal of provisions of the Conveyancing and Law of Property Act 1881, the timing of registration of the bank’s charge over the Milltown Unit, and the execution of the appointment deeds. Claims alleging fraud, conspiracy or deceit had been abandoned.
Justice Baker followed an earlier High Court ruling that statutory provisions on receiver appointments could be read into a mortgage of the same form as these security instruments. She held that the contractual power was not dependent on the continued force of the 1881 Act provisions. The bank’s application to register its charge over the Milltown Unit had been made in March 2009, before the receivers were appointed; the court also said registration was deemed effective from the application date. In any event, the contractual power did not require the bank to be registered as charge owner when it appointed the receivers.
The court also found that the appointment deeds were validly executed by people authorised under powers of attorney. It rejected the argument that the bank’s corporate seal was required.
Justice Baker said the plaintiff had not established a stateable basis to maintain the action on the legal arguments before her. She concluded that the claim was bound to fail and ought to be struck out. The judgment addressed the legal bases of the claims; it did not record a separate order directing the plaintiff to vacate the lis pendens registered on the Milltown Unit and Old Cross, although the defendants had sought that relief.