Neutral Citation: [2015] IEHC 603
THE HIGH COURT
COMMERCIAL
[2011 No. 1548 S]
[2011 No. 86 COM]
BETWEEN
LSREF III STONE INVESTMENTS LIMITED
PLAINTIFF
DEFENDANT
JUDGMENT of Ms. Justice Costello delivered on 5th day of October, 2015
1. This is an application for judgment in the amount of €30,180,489. There have been a number of previous hearings in relation to this matter which has proceeded by way of a modular trial. During the course of the previous five substantive judgments delivered initially by Finlay Geoghegan J. and laterally by myself, it has been determined that the monies, the subject of this application, were advanced by Anglo Irish Bank Corporation Plc (“the Bank”) to the defendant and that it was entitled to call in the loans advanced when it did. There was no fiduciary relationship between the Bank and the defendant. The Counterclaim raised by the defendant has been dismissed. The quantum due on foot of the loans was decided by Finlay Geoghegan J. as of 4th June, 2014, in her judgment on quantum (save that allowance has to be made for any receipts received by the plaintiff from the Receiver appointed over the properties, the subject matter of the facility).
2. In calculating the quantum due, Finlay Geoghegan J. has given credit for overcharging of interest by the Bank both during the duration of the facilities and after the commencement of the proceedings. Despite the fact that there was overcharging in the sum of €143,676.64, Finlay Geoghegan J. held that the sum of €31,542,125.93 was due and owing by the defendant to the Bank’s successor in title, Irish Bank Resolution Corporation (In Special Liquidation).
3. The only reason judgment was not entered in favour of IBRC (In Special Liquidation) on that date was because in March, 2014, it had entered into a loan sale agreement with the plaintiff for the sale of various facilities which included the facility the subject matter of these proceedings. IBRC (In Special Liquidation) says it transferred the facilities to the plaintiff by a deed of transfer dated 11th July, 2014. The legality of this Deed and the effectiveness of the Assignment was the subject of the hearing before this Court on 21st July, 2014.
4. The latter part of the litigation has been concerned with the validity of the sale and subsequent assignment of the defendant’s loan facilities and the plaintiff’s right to recover judgment against the defendant in these proceedings. The defendant has argued that the Loan Sale Agreement was void on the basis that it amounted to trafficking in litigation and the Agreement was champertous. This argument was rejected by Finlay Geoghegan J. The plaintiff was substituted as the plaintiff in the proceedings in lieu of IBRC (In Special Liquidation) by Order dated 10th November, 2014. The Summary Summons was amended to reflect the fact that the plaintiff had been substituted as the plaintiff in the proceedings and the defendant was directed to file a defence to that Amended Summary Summons in respect of the remaining issue in the case. Finlay Geoghegan J. indicated that the remaining issue in the case related to the validity of the Assignment of the defendant’s facility to the plaintiff.
5. In January, 2015, the defendant delivered a very lengthy defence and counterclaim. He also issued separate plenary proceedings against, inter alia, the plaintiff, IBRC (In Special Liquidation), Ireland and the Attorney General and delivered a lengthy statement of claim in those proceedings. Motions were issued by the plaintiff in these proceedings (“the debt proceedings”) and by the defendants (other than the state defendants) in the plenary proceedings (“the plenary proceedings”), seeking to strike out all or part of the pleadings on the basis that the defendant in the debt proceedings/plaintiff in the plenary proceedings was seeking to raise matters which had been the subject of prior decisions of Finlay Geoghegan J. in the debt proceedings or which, for a variety of reasons, could not properly be maintained by the defendant.
6. I delivered two related judgments on 11th March, 2015. I struck out the vast portions of the Amended Defence and Counterclaim in the debt proceedings on the basis that they related to matters which had either been determined by Finlay Geoghegan J. or it was not open to the defendant to raise at this point in time for the reasons set out in that judgment. I directed that the Defence in the debt proceedings was to proceed on the basis of specified paragraphs which I did not strike out and these were collated in an addendum to the Defence.
7. The addendum to the Defence delimited the sole grounds upon which the defendant was permitted to defend the case and to challenge the plaintiff’s entitlement to judgment pursuant to the Assignment of 11th July, 2014.
8. In relation to the plenary proceedings, I also ruled that most of it was to be struck out on the basis that it offended against the rule in Henderson v. Henderson or had already been determined by Finlay Geoghegan J. in her prior rulings in the debt proceedings. The sole matter remaining to be determined in the plenary proceedings related to the constitutionality of s. 12 of the Irish Bank Resolution Corporation Act 2013.
9. The defendant in the debt proceedings pleaded that insofar as the plaintiff relied upon s. 12 of the Act of 2013 to establish the validity of the Assignment of the defendant’s loans and the benefit of the litigation that the section was unconstitutional. In my two related judgments of 11th March, 2015, I held that the defendant in the debt proceedings/plaintiff in the plenary proceedings was entitled to maintain this plea but that he could only do so in one set of proceedings. He must decide whether he wished to raise the issue in the debt proceedings by way of defence or whether he wished to maintain it in the plenary proceedings, in which case he could not rely upon it as a defence in the debt proceedings. He was asked to consider whether he wished to have the matter dealt with in the debt proceedings, in which case he would need to comply with the requirements of O. 60 of the Rules of the Superior Courts and discontinue the plenary proceedings. He could not continue the plea in both proceedings.
10. In the event, the defendant herein failed to clarify his position. In effect, he continued to maintain the plea in both the debt proceedings and the plenary proceedings. At a hearing for directions in relation to the debt proceedings, McGovern J. directed in the circumstances that the defendant could maintain his challenge to the constitutionality of s. 12 of the Act of 2013, in the plenary proceedings and he could not maintain it as a defence in the debt proceedings. When the matter came back before me on a motion for discovery, I refused to reverse the directions of McGovern J. It is to be noted that the plaintiff undertook that in the event that judgment is awarded to the plaintiff in the debt proceedings and if the judgment is based upon the s. 12 of the Irish Bank Resolution Corporation Act 2013, that it will not seek to enforce the judgment until the issue of the constitutionality of the section has been determined in the plenary proceedings.
11. Accordingly, the hearing before me proceeded on the basis that the constitutional challenge to s. 12 was not being pursued in these proceedings. It was to be maintained in the plenary proceedings and those proceedings remain to be determined.
12. Thus, there were two matters for resolution when the matter came before this Court for hearing:-
The assignment
13. I shall deal with the question of the assignment first. Mr. Jeffrey Johnston gave evidence in the case. He said he was an employee of the Lone Star International Finance Limited and a director of the plaintiff. Mr. Johnston confirmed that there was an agreement by IBRC (In Special Liquidation) to sell a particular tranche of loans to the plaintiff including the defendant’s loans, the subject of the debt proceedings. He confirmed that the plaintiff held board meetings prior to the execution of the Loan Sale Agreement of March, 2014 and the Deed of Transfer of July, 2014, to authorise the transactions. Mr. Johnston was given the Original Deed of Transfer. He confirmed that he executed the Deed on behalf of the plaintiff and that the signature on the Deed was his signature. He confirmed that he signed multiple copies of the Deed and that there was more than one effective copy of the Deed. Clause 7 of the Deed provided:-
“This Deed (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which when so executed will be deemed an original but all of which together shall be deemed the same Deed.”
14. Mr. Johnston confirmed that the Deed had been executed by the other parties to the Deed on 7th July, 2014, and the Deed had been held in escrow until the parties agreed that the Deed would become operative on 11th July, 2014. There was no challenge to his evidence that the Deed was executed by IBRC (In Special Liquidation). In the circumstances, I accept that there is evidence of due execution of the Deed and that it took effect from 11th July, 2014.
Relevant terms of the Deed
“3. TRANSFER
3.1. Subject to the terms of Clauses 3.2-3.4 and Clause 4 (Trust) below the Assignor unconditionally, irrevocably and absolutely transfers, conveys and assigns to the Assignee, all such rights, title, interests, benefits, liabilities, duties and obligations as the Assignor may have in and to the Assets (subject to and with the benefit in each case of the related Finance Agreement) with effect from the date of this Deed.
3.2 The Assignee agrees that it shall accept the transfer and assignment referred to in Clause 3.1.
3.3 The Parties agree that Assets that are Property Collateral governed by the laws of Ireland (excluding the Scheduled Assets) will transfer pursuant to the Irish Transfer Deeds.
3.4 The Parties agree that all assets shall transfer under this Deed except to the extent they will transfer pursuant to the Irish Transfer Deeds, the Non-Irish Transfer Deeds, any Hedging Transactions Novation Deed, any Hedging Transactions Transfer Deed or any Receiver Novation Deed and excluding the Specified Hedging Agreements.”
15. The assignor is IBRC (In Special Liquidation) and the assignee is LSREF III Stone Investments Limited. Mr. Kieran Wallace and Mr. Eamonn Richardson acting solely in their capacity as joint Special Liquidators to the assignor (acting jointly or individually) are parties to the Deed.
“Assets means all of the rights, title, interest and benefits in and to (and only such rights, title, interest and benefits as the Assignor may have):
(a) all Facilities;
(b) all Related Security;
…
(d) any and all of the Assignor’s rights, title, interest and benefits in and to the Finance Agreements;
…
(f) all Ancillary Rights and Claims;
(g) the Scheduled Facility Letters;
…
Facilities means all principal amounts, accrued interest including capitalised interest and any other amounts outstanding and/or owing under or in connection with all loans, facilities…advances… and all other amounts payable by a Borrower…under, in connection with or related to the Finance Agreements, including the account numbers listed in Schedule Three hereto together with all other loans, facilities, credit…advances…or other contracts or agreements and all other amounts that are to be transferred to the Assignee pursuant to the Loan Sale Deed, and Facility means any one of them, as the context requires;
Finance Agreements means, in respect of a Facility, all documentation of the relevant Facility…together with the Assignor’s, amongst others, applicable standard terms and conditions…
Ancillary rights and Claims means…all claims, suits, causes of action, and any other rights (in each case whether in contract, tort (including negligence), equity, at common law or otherwise and including all rights, title and interest of whatever nature in any judgment) of the Assignor, whether known or unknown, against any Obligors…that arise under or in connection with or relate directly to the Assets…
Obligor means any Borrower or Borrower Guarantor and if more than one, each Borrower or Borrower Guarantor (as the case may be)”.
16. In Schedule Three the defendant is identified by name and by reference to five account numbers: 2228098; 2487944; 2488419; 2501839; and 2560700. The Facility Letter dated 2nd February, 2009, is also specifically identified in the Schedule.
17. It is clear from the terms cited above that the Deed operates as an absolute assignment of the Bank’s rights and interest in the loan facilities and in this litigation to enforce the repayments of the monies which Finlay Geoghegan J. has held to be repayable by the defendant.
The contractual right to assign
18. The case is brought on foot of the Facility Letter of 2nd February, 2009, which was proved in the first module of the modular trial before Finlay Geoghegan J. Clause 18 of the general conditions attaching to that Facility provides as follows:-
“18. Disclosure of Information
18.1 The Bank may make appropriate enquiries in relation to the Borrower and may register the existence of the Agreement and/or Security Documents with, and disclose information relating hereto and to the performance by the Borrower of the obligations hereunder or thereunder to the Irish Credit Bureau Limited and to any other credit reference bureau or agency. The Bank is hereby authorised to disclose any information to the Agreement, the Security Documents, the Borrower, and/or the performance of the Borrower’s obligations hereunder or thereunder to any person acting as agent of the Bank in connection herewith.
18.2 The Bank may at any time transfer, assign or dispose of the benefit of the Agreement and the Security Documents to any person on such terms as the Bank may think fit whether as part of a loan transfer or securitisation scheme or otherwise without notice to the Borrower or any other person.
18.3 The Borrower hereby consents for the purpose of the Data Protection Act, 1988 to the disclosure of personal data relating to the Borrower provided to the Bank in connection with the Agreement or the Security Documents or the parties thereto to the Irish Credit Bureau Limited or to any other credit reference bureau or agency or to any proposed transferee or their agents or to any person proposing to participate in any such transfer without notice to the Borrower whether as part of a loan transfer or securitisation scheme or otherwise.” (Emphasis added)
19. The terms of the Clause 18.2 are clear and explicit. Under the contract entered into by the defendant with the Bank, the Bank is expressly entitled to assign the benefit of the Agreement and the security documents to any person as part of a loan transfer without notice to the defendant. In fact, the defendant was put on notice of the intended transfer by the Special Liquidators prior to the entering into of the Loan Sale Agreement. However, that is, in fact, irrelevant to the legal position. The Bank (albeit in special liquidation) was entitled to transfer the defendant’s facilities including the right to recover on foot of the loan advanced and this is what occurred in this case.
20. The defendant argued that by reason of the fact that Clause 18.2 appeared in the middle of Clause 18 which in turn was headed “Disclosure of Information” that the import of this clause was concealed from the defendant and furthermore, that this amounted to a reason why this term of the contract could not be relied upon by either the Bank, its successor in title or the plaintiff. No authority was advanced in support of this proposition. I do not accept this argument. The term of the contract is clear on its face and it was a term accepted by the defendant when he accepted the monies advanced pursuant to the Facility of 2nd February, 2009.
21. The defendant also argued that the Notice of the Assignment in this case was invalid and accordingly, the Assignment was void. This submission can have no relevance to the validity of the Assignment pursuant to the contractual term in view of the fact that the contractual term expressly states that the Bank may transfer or assign the benefit of the Agreement without notice to the borrower or any other person.
22. I hold that the Deed of Transfer of 11th July, 2014, operated as a valid transfer of the defendant’s loan and associated rights including the right to recover monies due on foot of the loan pursuant to this litigation pursuant to Clause 18.2 of the General Terms and Conditions of the Bank which were incorporated into the terms of the Facility of 2nd February, 2009. On this basis, the plaintiff is entitled to the sum found to be due and owing by Finlay Geoghegan J. in June, 2014, subject to the credit in favour of the defendant which I will discuss below.
The Supreme Court of Judicature (Ireland) Act 1877
23. The plaintiff also relies upon s. 28(6) of the Supreme Court of Judicature (Ireland) Act 1877 which provides as follows:-
“[a]ny absolute assignment, by writing under the hand of the assignor (not purporting to be by way of charge only), of any debt or other legal chose in action, of which express notice in writing shall have been given to the debtor, trustee, or other person from whom the assignor would have been entitled to receive or claim such debt or chose in action, shall be and be deemed to have been effectual in law (subject to all equities which would have been entitled to priority over the right of the assignee if this Act had not passed,) to pass and transfer the legal right to such debt or chose in action from the date of such notice, and all legal and other remedies for the same, and the power to give a good discharge for the same, without the concurrence of the assignor…”
24. In O’Rourke v. Considine [2011] IEHC 191, Finlay Geoghegan J. identified, at para. 18, the four conditions to be met for an assignment to be valid under s. 28(6) as follows:-
“(a) The assignment was of a debt or other legal chose in action.
(b) The assignment was absolute and was not by way of charge only.
(c) It was in writing under the hand of the assignor.
(d) Express notice in writing thereof was given to the debtors.”
25. The plaintiff submitted that these four conditions summarised by Finlay Geoghegan J. were met in the present case as follows:-
“(a) IBRC assigned the debts in issue in this matter to the Stone Investments by the Deed of Transfer executed on 11 July 2014.
(b) It is clear from the terms of the Deed of Transfer that IBRC) has absolutely assigned the debts, the subject matter of these proceedings.
(c) The assignment was done in writing under the hand of the assignor, IBRC, the assignment being effective on 11 July 2014.
(d) The Defendant was given express written notice of the assignment.”
The defendant’s objections to the validity of the Assignment
26. The validity of the Deed of Transfer was challenged by the defendant on the basis that the original Deed in Court was not bound but was held together by a bulldog clip and that it was not stamped. Neither of these objections can be accepted. No law was opened to show that this transaction was subject to stamp duty. In any event, the former practice of the courts that a party would not be entitled to rely upon an unstamped deed in court no longer applies as stamp duty is now a mandatory and not a voluntary tax.
27. No authority was advanced for the proposition that a document could not constitute a deed if it was not bound but rather was held together by a clip. The important point is that the complete deed be identified and that the execution of the Deed executes the document in its entirety. Mr. Johnston gave evidence that he executed the Deed which was produced to the Court and that it was executed by the other parties to the Deed. I am satisfied that this constitutes evidence that the entire Deed as bound by the bulldog clip was duly executed by the parties. He was not cross-examined to suggest that the Deed was incomplete.
28. In any event, there is no requirement that an assignment of a loan, such as occurred on 11th July, 2014, in respect of the defendant’s facilities must be by way of a deed. On the contrary, the requirement simply is that it be in writing under the hand of the assignor. It clearly was in writing under the hand of IBRC (In Special Liquidation) and the hand of Mr. Kieran Wallace, one of the Special Liquidators.
29. The defendant also objected to the validity of the Assignment on the basis that the Deed was not sealed by the plaintiff. As there is no requirement that the assignment be even signed by the assignee, this argument also must be rejected.
30. The defendant argued that the Assignment was invalid as there was no notice of assignment given to him as required by s. 28(6) of the Act of 1877.
Notice of the Assignment
31. The plaintiff’s evidence was that notice of the Assignment was given in the following way by the following documents. On 17th July, 2014, the plaintiff wrote to the defendant at Kavanagh Fennell, Simmonscourt House, Simmonscourt Road, Ballsbridge, Dublin 4, in relation to his loan facilities in respect of the numbered account which are the subject of these proceedings with IBRC (In Special Liquidation). Mr. Tom Kavanagh of Kavanagh Fennell was the Receiver appointed over the security granted by the defendant to the Bank under the Facilities. The appointment of Mr. Kavanagh as Receiver had been proved in a previous module in this case. The letter provided:-
“Dear Sirs,
We refer to the previous correspondence that you have received from IBRC in which IBRC informed you that if it sold amounts owing to it in respect of your Facilities and/or obligations owed to it including any facility letter(s), guarantee(s), security documents and all other rights and obligations relating to your Facilities (the Facility Documents) to LSREF III Stone Investments Limited (the Sale) with effect from 11 July 2014 (the Transfer Date).”
32. The letter was signed on behalf of the plaintiff by Mr. Johnston. He referred to this document as the “hello letter”.
33. Enclosed with this letter was a document headed “NOTICE OF ASSIGNMENT”, it provided as follows:-
“To: John Morrissey
Kavanagh Fennell
Simmonscourt House
Simmonscourt Road
Ballsbridge Dublin 4
From:LSREF III Stone Investments Limited
(the ‘Assignee’)
Date: 17 July, 2014
Dear Sir/Madam,
Re: loan facility(ies) with Irish Bank Resolution Corporation Limited (in special liquidation) (to include any predecessor in title thereto) (‘IBRC’) under account numbers(s) 2228098, 2487944, 2488419, 2501839 and 2560700 (the ‘Facilities’) and certain related security and/or guarantees
1. We refer to previous correspondence that you have received from IBRC in respect of the Facilities and hereby give you notice that with effect from _______ July 2014, IBRC has assigned or otherwise transferred to the Assignee all of its rights, title and interest in all amounts owing to it in respect of the Facilities, as well as the related facility letters (including those listed in the Schedule hereto), security documents, and/or guarantees (the ‘Finance Agreements’), the security interests and/or guarantees and other items constituted by the Finance Agreements (the ‘Related Security’) and any other ancillary rights (the ‘Ancillary Rights’). The Facilities, the Finance Agreements the Related Security and the Ancillary Rights are collectively referred to in the attached acknowledgment of assignment as the ‘Assigned Assets’.
2. The details of the Assignee’s registered office are as follows:
LSREF III Stone Investments Limited
First Floor, 25-28 Adelaide Road
Dublin 2
Ireland.”
The schedule to that Notice included the Facility Letter of 2nd February, 2009, between the Bank and the defendant.
34. There was a letter from the IBRC (In Special Liquidation) dated 18th July, 2014, addressed to the defendant at Kavanagh Fennell which Mr. Johnston identified as the “goodbye letter”. This identified the facilities by way of reference to the account numbers as set out above. It read:-
“Dear Mr. Morrissey,
On 28 March 2014 (the Sale Date), IBRC agreed to sell amounts owing to it in respect of your Facilities and the facility letter(s), guarantee(s), security and all other rights (including any judgments) and obligations relating to your Facilities with IBRC (‘the Facility Documents’) to LSF Irish Holdings XLVIII Limited (‘the Purchaser’) in accordance with the Facility Documents (‘the Sale’). The transfer of your Facilities took effect on 11 July 2014 (‘the Transfer Date’). From the Transfer Date, amounts and obligations owing in respect of your Facilities are owed to the Purchaser.
…
For the avoidance of doubt the amounts owed under the facility have been transfer to the Purchaser and continue to be payable.
The Facility Documents will remain in place until all amounts payable under the Facility Documents have been irrevocably and unconditionally paid in full, but from the Transfer Date, your obligations will be owed to the Purchaser rather than IBRC.”
35. Mr. Johnston confirmed that the plaintiff’s name had changed to LSREF III Stone Investments Limited after the date of the Loan Sale Agreement of March, 2014.
36. By email dated 23rd July, 2014, Mr. Neil Mullarkey of Kavanagh Fennell emailed the two letters and the Notice of Assignment to Mr. Morrissey. By a further email dated 28th July, 2014, Mr. Mullarkey re-sent the documents as he understood that previously one page was missing.
37. On 11th August, 2014, the plaintiff brought a motion seeking to be substituted as plaintiff in the proceedings for IBRC (In Special Liquidation). The affidavit grounding the application was sworn by Mr. Richard Willis, solicitor, for the plaintiff on 8th August, 2014. At exhibit RW3, Mr. Willis exhibited a redacted copy of the Deed of Transfer of 11th July, 2014, and at exhibit RW4, he exhibited the correspondence from the plaintiff, IBRC (In Special Liquidation), the Notice of Assignment and the two emails from Kavanagh Fennell to the defendant. The defendant’s solicitor, Mr. Gerard Black, swore an affidavit on 29th August, 2014, in which he replied to the affidavit of Mr. Willis. He acknowledged that the exhibits had been received by his offices. In submissions to this Court, counsel for the defendant acknowledged that the defendant received these documents. While the Deed of Transfer was redacted in respect of the information pertaining to other customers of the Bank and commercially sensitive aspects of the transaction, the defendant was clearly identified in Schedule Three and the operative paragraph, para. 3 was not the subject of any redaction. The defendant had these documents before the hearing of the Motion to substitute the assignee as plaintiff for the assignor and before the Order substituting the plaintiff as plaintiff. The plaintiff argued that each of these communications or, alternatively, together these communications satisfied the statutory requirement that the debtor, the defendant here, be notified of the assignment of the debt.
38. The defendant argued that the purported Notice of Assignment was invalid on three grounds. He pointed to the fact that the date in the body of the document referred to as “NOTICE OF ASSIGNMENT” was blank; he said that service of the Notice of Assignment on Kavanagh Fennell was not a valid form of service and argued that Kavanagh Fennell did not have authority to accept service of the document on behalf of the defendant; and thirdly, he argued that the Notice did not refer to a specific sum as being due and owing and accordingly was an invalid notice of assignment.
39. The plaintiff argued that the requirement of the statute was to give notice of the assignment not “a notice”. No particular form of notice was required. In this regard, it relied upon the decision of Van Lynn Developments Ltd. v. Pelias Construction Co. Ltd. [1969] 1 QB 607. Widgery L. J. stated at p. 615:-
“I agree and would point out that the only formality required by the section is that express notice in writing be giving to the debtor. The section does not speak of ‘a notice: it speaks of ‘notice’. Accordingly, it is wrong to suppose that a separate document purposely prepared as a notice, and described as such, is necessary in order to satisfy the statute. The statute only requires that information relative to the assignment shall be conveyed to the debtor, and that it should be conveyed in writing.”
40. It was submitted that this meant that the plaintiff was not obliged to rely upon the document headed “NOTICE OF ASSIGNENT”. The defendant’s objections to that document as an effective notice of the Assignment on the basis that it left the date of the Deed of Transfer blank, therefore, did not mean that there was, in fact, no proper notice of the assignment given to the defendant. The two letters, described by Mr. Johnston as the “hello letter” and “goodbye letter”, each confirmed that the date of the Deed of Transfer was 11th July, 2014, and each constituted notice of the Assignment for the purpose of the Act. The defendant was, in fact, served with a redacted copy of the Deed of Assignment when he received Mr. Willis’s affidavit of 8th August, 2014, and thus was in no doubt whatsoever that the date of the Deed of Assignment was 11th July, 2014. The plaintiff said that no better notice of the assignment could be given than furnishing a copy of the actual Deed of Assignment, as occurred in this case. If there could be any doubt as to whether or not the defendant received the emails from Mr. Mullarkey of Kavanagh Fennell forwarding the letters of 17th and 18th July, 2014, and the Notice of Assignment, this was overtaken by the service of Mr. Willis’s affidavit exhibiting those letters in addition to the Deed of Assignment.
41. The plaintiff points out that there is no necessity that notice of the assignment be given at any particular time. The only requirement is that it be given before the assignee seeks to sue on foot of the assignment. In Guest on the Law of Assignment, 2nd ed. (London: Sweet & Maxwell, 2015) at para. 2-25 the author states that the section does not prescribe any limit of time within which notice must be given. Provided the notice is given before the commencement of proceedings to recover the debt or thing in action, it maybe given at any time. In this case, the plaintiff was substituted as plaintiff in these proceedings by Order of Finlay Geoghegan J. on 10th November, 2014. At the very latest, the defendant had notice of the assignment by the time Mr. Black swore his affidavit on 29th August, 2014. It is submitted that the defendant, therefore, had notice of the assignment within the meaning of the Act long before the plaintiff was a party to the proceedings. I accept that this is correct and I hold that the defendant had notice of the assignment within the meaning of the Act prior to the plaintiff being substituted as plaintiff in the proceedings. The fact that the document headed “NOTICE OF ASSIGNMENT” gave no date for the assignment does not mean that no proper notice of the assignment was given in this case as the plaintiff is entitled to rely upon the other documents which referred to above which clearly did identify the date of the assignment.
42. In relation to the absence of the date on the document headed “NOTICE OF ASSIGNMENT”, the plaintiff submitted that the lack of a date in the document did not invalidate the document as a valid notice for the purposes of the Act. There is no actual requirement that the date of the actual assignment be given to the debtor. A notice of an assignment is only bad if it gives a date that predates the actual assignment. In Van Lynn Developments Ltd., Denning M.R. stated at p. 613:-
“[i]t seems to me to be unnecessary that [the notice of assignment] should give the date of the assignment so long as it makes plain that there has in fact been an assignment so that the debtor knows to whom he has to pay the debt in the future… But the notice itself is good, even though it gives no date.”
Clearly, this did not apply in this case. In any event as I have already held, the other letters and the Deed expressly give the correct date and they constitute notice of the assignment sufficient to comply with the requirements of the Act. The fact that they are not called ‘notice of assignment’ does not mean that they do not constitute perfectly valid notices of the assignment. I accept these submissions on behalf of the plaintiff as reflecting the law in relation to dating notices of assignments. Accordingly, the defendant’s objection to the Notice of Assignment on this ground must be rejected.
43. There are no particular requirements in relation to service of notice of an assignment other than that the debtor receives it. Therefore, there is no requirement that Kavanagh Fennell had authority to accept service of the letters and documents constituting notice of the assignment. However, for the purpose of this judgment it is not necessary to rely upon the “hello letter” and “goodbye letter” addressed to the defendant and sent to Kavanagh Fennell or the emails from Kavanagh Fennell to the defendant forwarding the letters and the notice of assignment. The plaintiff pointed to the authority of Guest on the Law of Assignment at para. 2-27 where the author notes that there appears to be no reported case law dealing with whether “notice in writing” can validly be served electronically but expresses the opinion that notice given by email or other means of electronic communication capable of being reproduced in visible form would suffice as written notice. The plaintiff also relied upon para. 2 -22 to the effect that notice of an assignment may be served upon a debtor’s solicitor. In this case, it clearly was served upon the defendant’s solicitor and I accept that this was sufficient service of notice of the Assignment as required by the Act. Therefore, it is not necessary to determine whether or not service of notice of an assignment upon the defendant at Kavanagh Fennell is sufficient. Therefore, this argument must also fail.
44. Finally, the defendant said the Notice of Assignment was not valid and it did not specify the amount due and owing by the debtor to the assignor. The plaintiff argued that there was no requirement that a notice specify the amount due and owing as of the date of the Assignment. It was pointed out that in this particular case, Finlay Geoghegan J. had reserved judgment on the question of the quantum due and owing by the defendant on foot of the Facilities. It therefore would have been completely inappropriate, if not impossible, for the plaintiff to have specified the sum due and owing given that it was clear that there had been a degree of overcharging of interest and it was a question for the Court to assess the credit to be afforded to the defendant in the circumstances. There was no authority opened to the Court to support the proposition that notice the assignment must specify the amount due and owing as of the date of assignment. The Act does not require it. It is clear from the authorities that the courts have upheld many notices of assignment as valid which have not given any amount as due and owing by the debtor in the notice. I therefore reject this argument also.
45. In my judgment, the defendant was given valid notice of the assignment as required by s. 28(6) of the Supreme Court of Judicature (Ireland) Act 1877, at the very latest, by the service upon his solicitors of Mr. Willis’s affidavit of 8th August, 2014. There was a valid assignment pursuant to the terms of that Act and the plaintiff is entitled to judgment against the defendant on the basis of an assignment satisfying the requirements of s. 28(6) of the Act of 1877.
Credits due arising out of the receivership
46. Mr. Colin Gaynor, a senior manager with Deloitte, gave evidence in relation to the receipts and realisations and expenses of the receivership in June, 2014 before Finlay Geoghegan J. He updated the evidence to 13th July, 2015. In the intervening period there had been certain realisations by the Receiver which were credited against the sum found to be due and owing as of 4th June, 2014. The closing balance of the Receiver’s account as of 13th July, 2015, was €27,138.00. The plaintiff waived its claim to interest accruing on the sum due and owing as of the 4th June, 2015, until date of judgment. Thus the plaintiff is entitled to judgment against the defendant in the sum €31,180,489.
Other matters
46. Much of the argument at the hearing before the Court concerned the right of the defendant to challenge the provisions of s. 12 of the Irish Bank Resolution Corporation Act 2013, in light of the history of the two sets of the proceedings and the ruling of McGovern J. As I have found in favour of the plaintiff on the basis that the assignment of the chose in action was valid, and I have done so without relying upon the provisions of s. 12 of the Act of 2013, it is neither necessary nor appropriate to consider the constitutionality of the section.
47. The defendant sought to raise arguments based upon alleged breaches of the European Charter of Fundamental Rights and Freedoms. These arguments had previously been ruled out by me in my judgment of 11th March, 2015, and accordingly I refused to permit them to be advanced at the hearing of 21st July, 2015.
48. Finally, the defendant requested that I refer certain questions to the Court of Justice of the European Union. This was based on a new argument which the defendant sought to introduce in his written submissions prepared for the hearing and in oral arguments before this Court. This was despite the fact that there had been a hearing and a judgment delimiting the precise parameters of the matters remaining to be determined in the case and specifically limiting the scope of the pleadings relevant to those issues. He sought to raise arguments that the liquidation of Irish Bank Resolution Corporation Limited, some two years after the Commission of the European Union approved the State Aid afforded by the State to the Bank, infringed or otherwise violated the rules governing the provision of State Aid. This was not an issue that had been raised at any time in the proceedings or indeed in the plenary proceedings. It clearly was not on notice to the appropriate parties, not least the State and I have no hesitation in holding that this issue did not arise in the proceedings. I am in a position to dispose of all issues properly before the Court. Accordingly, it is not necessary to refer any question to the Court of Justice of the European Union for a preliminary ruling and I decline to do so.
