The Court of Appeal has dismissed Pentire Property Finance DAC’s appeal against an injunction preventing it from enforcing a mortgage over four units in Dublin 10, including by appointing a receiver. The injunction remains in place pending trial of the borrowers’ claims; the appeal court did not decide those claims on their merits.
Roderic and Cormac O’Beirne had borrowed €630,000 from Bank of Scotland (Ireland) Limited in 2003, secured against the units at 333/337 Le Fanu Road. The loan and mortgage rights were later assigned to Pentire. The borrowers said that, while arranging to refinance with Bank of Ireland, they learned that 17 of 35 title documents held in connection with the mortgage were missing, including two root-of-title documents. The judgment says Pentire did not dispute that the documents were unavailable, but denied liability for their loss.
The borrowers argued that the missing documents delayed refinancing and that surcharge interest charged on the loan should be deducted from the redemption sum. Pentire demanded repayment in December 2017 and threatened enforcement. The borrowers then sought an injunction. At an initial hearing, the High Court made an interim order. After later hearings, the High Court granted an interlocutory injunction in July 2018, restraining enforcement and awarding the borrowers their costs of the application, with execution of those costs stayed pending determination of the proceedings.
Pentire appealed, arguing, among other things, that the borrowers had failed to disclose material information when seeking interim relief, that damages would be an adequate remedy and that the High Court mishandled Pentire’s settlement proposal. The Court of Appeal rejected those grounds. It found that the key refinancing information had been put before the judge at the initial hearing and that the alleged omissions did not amount to material non-disclosure.
The appeal court held there were serious questions for trial, including whether the demand was valid, what sum was properly due on redemption, whether Pentire could charge the disputed surcharge, and what legal consequences followed from the missing deeds. It stressed that these were not final findings on liability or the amount owed. It concluded that the High Court was entitled to find damages inadequate and to keep enforcement restrained while the dispute is determined.
The court also upheld the High Court’s costs order. It ordered Pentire to pay the borrowers’ appeal costs, to be assessed if not agreed, and joined Pepper Finance Corporation (Ireland) DAC as a co-defendant and co-appellant. Pepper was ordered to be jointly and severally bound by orders made against Pentire. The underlying claims remain for determination at trial.