The High Court ruled that Ulster Bank of Ireland Limited validly appointed a receiver over property connected to a €12 million loan, despite the appointment deed not being sealed in fact. Mr Justice Hogan delivered judgment on 27 May 2014.
The dispute arose from a July 2006 loan facility to businessmen Charles McGuinness and Noel Mulligan to help buy a 50-acre site on Farnham Road, Cavan. The bank later called in the loan. On 1 November 2010, the court entered judgment for €12 million against the two plaintiffs and two others. A further judgment, for €1.652 million, was entered on 22 November 2010 against Mulligan and another person. Neither judgment had been discharged.
In January 2012, the bank purported to appoint David O’Connor as receiver under a mortgage deed dated 14 August 2006. The deed required the appointment to be made under seal or under the hand of a duly authorised bank officer. The supplementary deed appointing O’Connor was signed and delivered by senior bank official Michael McNaughton under a power of attorney. It was not sealed.
The plaintiffs challenged the appointment’s validity. The bank argued that section 17 of the Powers of Attorney Act 1996 and section 64 of the Land and Conveyancing Law Reform Act 2009 meant the deed had the same legal effect as one executed under seal.
Hogan held that section 17 applied because McNaughton acted in his own name under the bank’s authority, and the statutory wording gave the instrument the effect it would have had if executed with the bank’s signature and seal. He also concluded that section 64 independently produced the same result: the appointment deed was signed and attested as required, and the section deemed a qualifying deed to have effect as if executed under seal.
The court’s ruling addressed the sealing requirement and the validity of O’Connor’s appointment. It held the January 2012 supplementary deed effective for that purpose and adjudged the receiver’s appointment valid.