Court of Appeal: Defendant ‘blindsided’ bank with submissions and must pay half costs of the hearing
The Court of Appeal has upheld a defendant’s appeal in part and remitted summary proceedings to the High Court to allow a bank to amend its summons with proper particulars of the debt, in line with the Supreme Court ruling in Bank of Ireland Mortgage Bank v. O’Malley  IESC 84. However, the defendant was required to pay 50 per cent of the bank’s costs for the hearing because the defendant failed to raise the O’Malley point in her notice of appeal.
About this case:
Citation: IECA 9
Court:Court of Appeal
Judge:Ms Justice Máire Whelan
The defendant’s original notice of appeal claimed that the trial judge erred in rulings relating to the filing of affidavits by the parties and the presentation of a further authority by the bank on the morning of the hearing. Despite the defendant failing to raise the issue of the proper particularisation of the debt at both the High Court hearing and her notice of appeal, the “justice of the case,” required the matter to be remitted to the High Court for an amendment to the proceedings, the court said.
The plaintiff, KBC Bank Ireland Plc, issued summary proceedings against Hugh Corrigan and Anita Corrigan in 2016 on foot of a mortgage loan given to the couple in 2007. The motion for judgment was originally listed for October 2018, but the defendant failed to attend, citing health reasons. Adjourning the case, the trial judge directed that Ms Corrigan be prevented from filing further affidavits in the matter.
The bank’s motion for judgment was heard on 11 July 2019, where Mr Justice Seamus Noonan granted judgment for €363,445.52 for the bank. The court said it was clear that Ms Corrigan was actively involved in the mortgage loan and that all the documents showed that she owed a debt to the bank. The allegations of undue influence against her then-husband Mr Corrigan were not supported by evidence of any kind, the court ruled.
Ms Corrigan appealed the trial judge’s decision, claiming that she should have been entitled to file further affidavits in the case, that the bank should not have been allowed file a further affidavit updating the debt owed and that the bank should not have been allowed to present a further authority to the court on the morning of the hearing. Ms Corrigan sought orders setting aside the trial judge’s ruling and remitting the case to plenary hearing.
Court of Appeal
Following Mr Justice Noonan’s decision in July 2019, the Supreme Court delivered its judgment in O’Malley in November 2019, which required a plaintiff in debt cases to provide full details of the debt that was owed. This included providing a breakdown of the level of principal, interest and charges of the monies claimed. No application was made by Ms Corrigan to amend her notice of appeal to include a point about the proper particularisation of the debt. However, in her written submissions delivered three months after the notice of appeal, the defendant quoted at length from the O’Malley judgment, claiming that the circumstances of the judgment mirrored her case.
In July 2020, the bank wrote to the defendant offering to remit the matter back to the High Court to allow the bank to amend the summons. This was rejected by the defendant, who insisted that the matter proceed to a full hearing in the Court of Appeal.
At the hearing, counsel for the defendant submitted points which were outside the scope of the notice of appeal. Relying on the decision in O’Malley, the defendant claimed that it was not appropriate to remit the proceedings back to the High Court to be amended and that it was unfair to allow the bank to produce “fresh evidence” at this late stage. As such, it was argued that the proceedings should be struck out entirely.
In response, KBC noted that the application to strike out the proceedings was not contained in the notice of appeal and that the defendant had “essentially abandoned” the original grounds of appeal in favour of arguments relating to the O’Malley judgment. To strike out the proceedings would “visit an extraordinary injustice” on the bank and that the usual approach was to remit the proceedings back to the High Court to be amended.
Giving the judgment of the court, Ms Justice Máire Whelan first dealt with the grounds of appeal which were in the notice of appeal. The court said that the defendant did not appeal the directions of the judge which were made 8 months prior to the hearing and there was no suggestion that she had applied to put in a further affidavit. As such, there was no unfairness in the direction that the defendant could not file a further affidavit. Further, there was no evidence before the trial judge to conclude that a plea of undue influence was established.
On the issue of the submissions relating to the O’Malley judgment, the court accepted that a defendant is generally not entitled to raise this point on appeal if it was not raised at the High Court hearing. The court said that “basic fairness requires that a respondent ought not be blindsided by the launch of unheralded novel points at an appeal hearing without even an application for leave being brought.” However, given that the bank conceded that O’Malley was applicable to the case, the court said that the balance of justice favoured setting aside the High Court order and remitting the matter to the High Court to allow the bank to amend its summons.
On the issue of costs, the court noted that the bank had offered to remit the case for an amendment prior to the appeal and it was the defendant who had insisted on pursuing the full hearing. This led directly to additional wasted costs in the case, the court said. In light of Chubb European Group SE v. The Health Insurance Authority  IECA 183, the court made no order for costs up until 1 September 2020. The court ordered Ms Corrigan to pay half of the bank’s costs which were incurred after 1 September 2020, which included the appeal hearing.
The grounds raised by Ms Corrigan in her notice of appeal were dismissed. However, the case was remitted to the High Court to allow a motion to amend the summons, with the defendant being entitled to file a replying affidavit in response to the amendment.