The Supreme Court has allowed Gerard Hannon’s appeal against a decision recognising Promontoria (Oyster) Designated Activity Company’s lien over five folios of land in County Sligo. It held that liens over registered land created by depositing land certificates ended at the close of 2009 unless registered during the statutory transition period.
The judgment, delivered by Chief Justice Clarke on 4 June 2019, concerned certificates Mr Hannon deposited with Ulster Bank on 7 June 2006 as security for present and future indebtedness. The High Court had found the certificates were deposited as security, not simply for safekeeping. Mr Hannon did not appeal that finding to the Court of Appeal.
Ulster Bank later sought to register liens with the Property Registration Authority under section 73 of the Registration of Deeds and Title Act 2006. The PRA acceded to the request. The validity of those registrations was not before the Supreme Court, and neither lower court had ruled on it.
Ulster Bank had brought proceedings in 2009 seeking to enforce the lien. The High Court ruled in its favour, and the Court of Appeal dismissed Mr Hannon’s appeal. Those courts considered the lien by deposit continued despite the 2006 Act. Ulster Bank transferred the loan asset and related security to Promontoria in 2016; Promontoria was substituted as plaintiff/respondent in February 2019.
The Supreme Court considered only whether the 2006 Act ended the lien by deposit over registered land. The Act abolished land certificates and gave holders three years from 1 January 2007 to apply to register liens. Chief Justice Clarke concluded that the statutory scheme required registration to preserve the security after the transition period, which ended on 31 December 2009.
The Court therefore determined that Promontoria did not have the benefit of a lien by deposit over the lands and allowed the appeal. It made no ruling on whether the purported registrations were valid or whether Promontoria had security on another basis. The Chief Justice proposed that counsel be heard further on whether additional orders were required.