Distressed Assets: Possession and Damages

PATRICK HENNESSY V KEN TYRELL & EVERYDAY FINANCE DESIGNATED ACTIVITY COMPANY

This case was an emergency interlocutory application by the Plaintiff to prevent the Receiver Ken Tyrell and Everyday Finance from taking possession and selling his lands and from prohibiting an on-line action.  The urgency was that there was an auction scheduled to take place imminently.

By way of background the purchase of the property was funded by a loan from AIB and secured by a Charge over the lands.  The Plaintiff failed to meet his obligations in November 2016 and while he engaged with AIB, the loans were eventually transferred in 2019 to Everyday Finance.  Further engagement ensued between the Plaintiff and Everyday Finance however no resolution was found.

In September 2021 Everyday appointed Ken Tyrell as Receiver.  The Receiver’s power was limited to collection of the rents and profits.  The Plaintiff and his brother had a company called Hennessy Brothers Farming Limited which had licences to farm most of the lands subject to a €50,000 per annum payment which included a licence fee which was not paid over to the Receiver.  The Plaintiffs were unable to pay their debts or secure a restructuring of their debts.

The application for the injunction involved the restraining of the sale in the manner proposed by the Receiver and Everyday.  It was not contested that Everyday had a power of sale or that the power had arisen or that it was exercisable.  The Plaintiff said that he was shocked to be told that his lands were advertised for sale on a website.  The land appeared to have been first advertised for sale in early February 2022 with an auction date for the 24th February 2022 and the advertising campaign appeared to have been limited to those who might stumble on the listing on the website.

The Judge ultimately concluded that he did not believe that damages would be an adequate remedy.   Judge Allen referred to the issue of Everyday attempting to sell the lands with the Plaintiff in possession, but he did not go as far to say that Everyday were not entitled to offer the lands for sale without vacant possession.

Ultimately the Court concluded by granting the Orders sought essentially preventing the sale of the charged lands.  The Court did make directions to ensure the expedient exchange of Pleadings and early Trial date to minimise the risk of injustice to either party.

Vaginal Mesh

 

Vaginal Mesh

Have you or a loved one been affected by the vaginal mesh implant scandal?

Transvaginal mesh implant was a popular gynecological procedure carried out on women most commonly for the purposes of treating prolapse or stress urinary incontinence.

Unfortunately, a growing number of women have suffered with serious complications arising from this procedure being carried out and have developed chronic pain and other life altering problems.

For free confidential female led medico legal advice please contact MDM Law on 021 239 0620 or e-mail carrie.mcdermott@mdmsolicitors.ie or deirdre.rafferty@mdmsolicitors.ie

INTERPRETING “STRUCTURE” – HIGH COURT AFFIRMS OMBUDSMAN DECISION:

 

LLOYD’S INSURANCE COMPANY, FINANCIAL SERVICES AND PENSIONS OMBUDSMAN AND DONNELLY AND LUIJKX

The Facts:

This matter came before the High Court by way of Statutory Appeal taken by the Insurer against a decision of the Financial Services and Pension Ombudsman made in respect of a complaint concerning an insurance policy. The Policy provided cover against structural defects in the property.

Donnelly and Luijkx purchased a house in 2006 with the benefit of an insurance policy which covered against structural defects in the property. In 2010 it emerged that some of the houses in the development had sustained damage associated with pyrite in the in-fill. Further defects came to light in the property when it was found that deflecting roof trusses in the attic were causing gaps and cracks in the ceilings and walls of the house. The property owner’s engineer in their report stated that “we are of the opinion that the damage observed is a direct result of the structural inadequacy of the in-situ trusses”.

There were two separate issues, one being a pyrite related property damage and damage to the structure of the roof. The Provider gave cover in respect of the pyrite damage but did not accept that the damage relating to the roof involving deflecting roof trusses was covered. The basis for the Provider’s refusal was rooted in the view that the roof trusses themselves, which it was accepted was structural and therefore covered by the policy, were not inherently defective. It was maintained that the deflection to the roof trusses arose from the manner in which a water tank had been positioned in the attic area without adequate or properly placed load spreading supports which in turn caused an intended load to be applied to the trusses. The Provider maintained that this constituted damage “caused to the structure” which was outside of the Policy rather than damage inherent “in the structure” which was covered.

The Ombudsman decision:

Donnelly and Luijkx made a complaint to the Ombudsman who upheld their complaint on grounds that it was unreasonable, unjust and improper for the provider not to remediate the damage, and the Provider was also ordered to compensate them for inconvenience in the sum of €20,000. The entire complaint centred on the question of whether cover was properly declined having regard to the terms of the contract of the insurance and the evidence as to the cause of the damage. The Provider appealed the decision maintaining that the Ombudsman was guilty of serious and significant error in construing the definitions of “structure” in the policy.

The Ombudsman’s jurisdiction to consider and to determine complaints is created by part 5 of the Financial Services and Pensions Ombudsman Act 2017 and more particularly under Section 60. The Ombudsman may order redress including financial redress for the complainant as he considers appropriate. Any financial redress shall be such amount as the Ombudsman deems just and equitable having regard to all the circumstances which shall not exceed any actual loss of benefit under the scheme concerned or the statutory cap under Section 60(50). The Ombudsman noted that the fact of the application of the policy had to be subject of expert engineering analysis indicated the complexity of the contractual provision and he did not accept the provider’s position. He believed that any reasonable examination of the circumstances of the complaint indicated that the defect was with the structure.

The jurisdiction to order compensation by the Ombudsman is provided for in Section 60 (40) (d) which empowers the Ombudsman to pay an amount of compensation to the complainants for any loss, expense or inconvenience sustained by the complainants as a result of the conduct complained of. The level of compensation is however capped by this section at a monetary sum of €250,000. In this case a sum of €20,000 was awarded by the Ombudsman.

The Appeal:

On Appeal the decision of the Ombudsman was upheld and it noted that structure under the policy is defined as including “load bearing parts of … roofs” and accordingly that the trusses are part of the structure. The Court was satisfied that the Ombudsman was entitled to find that it was unreasonable for the provider not to accept that the damage was caused by a defect in the design, construction, material, components, and workmanship of the trusses and therefore covered by the policy. Furthermore, the Court was satisfied that the level of compensation ordered was within a range that was reasonable and they affirmed the decision and directions of the Ombudsman.

Niamh O’Connor| Partner

MDM Solicitors | 18 South Mall, Cork, T12 WR97

T: +353 (21) 239 0620

E: niamh.oconnor@mdmsolicitors.ie

W:www.mdmsolicitors.ie

Kinder Surprise Recall

The Food Safety Authority (“FSAI”)  has been contacted by consumers who have advised that they have purchased some Kinder Surprise Chocolate Eggs which are now being recalled due to a link with an outbreak of salmonella.

The Food Safety Authority of Ireland have said that there have been ten cases of food poisoning linked to the chocolate, a number which have involved young children.  The Irish cases have involved the same strain of salmonella that has been detected in the UK and outbreaks have also been reported in a number of other European countries.

The batches currently being recalled are the Kinder Surprise 20g egg, and the Kinder Surprise 20g 3-pack of eggs, with best before dates between the 11th July 2022 and the 7th October 2022.

The Chief Executive of the FSAI, Dr Pamela Byrne, has advised that if anyone has any of the affected product at home, not to eat it.  The FSAI has said it is liaising with the Department of Health and the investigation into the outbreak is ongoing.  The most common symptom of salmonella food poisoning is diarrhoea, which can sometimes be bloody, other symptoms may include fever, headache, and abdominal cramps.  The elderly, infants and those with impaired immune systems are more likely to have more severe illness.

Retailers are being asked to remove the implicated products from sale and display, points of sale,  wholesalers are requested to contact affected customers and customers have been urged not to consume such products.

If you have been affected, we at MDM can discuss this with you and advise you on your rights and can assist anyone affected.

If you are a wholesaler, retailer or consumer do not hesitate to contact our offices on 021 239 0620 or e-mail us at info@mdmsolicitors.ie for more information.

Defendant’s beware of SI 490/2021: Unless Orders

Defendant’s beware of SI 490/2021: Unless Orders

Statutory Instrument 490 of 2021 is due to commence on the 13th November 2021 and will introduce significant changes to the practice and procedure of High Court litigation.  It is anticipated that these reforms will significantly reduce delay in proceedings thereby reducing costs and standardise time limits for delivery of certain documents.

The amendments to the rules of the Superior Courts will apply to High Court proceedings whether they were issued before or after the commencement date.  They will not however apply to Motions issued in advance of the commencement date.  Section 2 (3) of the SI states that the old rules will still apply in respect of default Motions issued prior to the commencement date.

Key Amendments:

In particular the new rules provide for the following: –

Order 13 – Default of Appearance:          Order 13 requires the Plaintiff to serve notice in writing to the Defendant who has failed to enter an Appearance confirming their intention to proceed with an application for Judgment in Default of Appearance while also consenting to the late entry of an Appearance within 28 days of the date of the letter.  The Plaintiff can then issue a Motion provided that an Affidavit of Service in respect of the Summons and the letter is filed in the Central Office.  The Plaintiff will be required to serve the Motion on the Defendant in all applications for Judgment in Default of Appearance.  If the Plaintiff’s Motion is successful, the Court Order must be served within 28 days of the perfection of the Order.

Order 27 – Default of Defence:                  Where a party is in default with a delivery of a Defence, Judgment will be entered in a Motion for Judgment in Default except where justice requires an extension of time.  The current position is that it is extremely rare for Judgment to be granted on hearing of the First Motion.  Generally, it is only on the Second Motion that a Court shall grant Judgment unless it is satisfied that special circumstances exist which explain and justify the failure to deliver the Pleading.  Once the new rules, come into play, these matters will no longer be at the Courts discretion.  Where a party is in default with the delivery of a Defence, judgment will be entered in a Motion for Judgment in Default of Defence except where justice requires an extension of time.  In those circumstances the Court will make an “unless Order”.  Therefore, if the Defence is not delivered within the specified time period Judgment in Default will be granted,  requiring only one Court hearing.  Before Judgment for Default can be issued, a 28 day warning letter must be sent together with a letter consenting to the late delivery of the Defence within 28 days.  The Motion papers must then be served on the appropriate party no later than 10 days from the date it is filed.  If the party in default delivers a Defence within 21 days after the Motion is served and is lodged in the High Court Central Office within 10 days of the return date, the Motion will not be put into the Judge’s list and will be struck out with costs of €750 awarded to the party who issued the Motion.

Conclusion:

This Statutory Instrument introduces very significant and radical changes particularly for Practitioners representing Defendants who going forward will not be able to rely on judicial discretion allowing Motions for Judgment to be struck out with an Order extending time for delivery of a Defence.  The Court must now order Judgment in favour of the Plaintiff unless it is necessary in the interests of justice that an Order can be made extending the time for delivery of the Defence.  The amendments introduced by this Statutory Instrument intends to reduce the delay in proceedings which will have a knock on effect in relation to costs and to standardise time limits for the delivery of certain documents to encourage a more pro-active approach by all parties involved in addition to trying to reduce the Motion and Courts lists.