by Pamela Fitzpatrick March-13-2019 in Litigation & Dispute Resolution
In the recent case of Promontoria (Aran) Limited v Burns [2019] IEHC 7, the High Court (Mr Justice Noonan) considered the evidential requirements of an application for summary judgment in the context of credit servicing firms and the Bankers’ Book Evidence Acts (the “Acts”).
Facts
The plaintiff’s application was for liberty to enter summary judgment against the defendant in the sum of €27,644,377.23 together with accrued interest. The defendant had obtained a number of loans from Ulster Bank Limited (“Ulster”) on foot of various facility letters. The defendant also executed four guarantees in respect of the liabilities of four separate companies. The Plaintiff acquired Ulster’s rights to the loans and guarantees as a result of a loan portfolio sale.
The plaintiff’s application was grounded upon the affidavit of a senior asset manager employed by a third party credit servicing firm, Link ASI Limited (“Link”), which had responsibility for managing the loans owned by the Plaintiff. The Defendant did not seek to challenge the Plaintiff’s title to the loans and guarantees. However, the issue before the Court was the admissibility of the evidence supporting the Plaintiff’s claim in circumstances where the affidavit exhibiting the documents was sworn by an employee of Link.
Order 37, Rule 1 of the Rules of the Superior Courts
Order 37, Rule 1 of the Rules of the Superior Courts (the “RSC”) stipulates that a motion for judgment must be supported by an affidavit sworn by “a person who can swear positively to the facts” showing that the plaintiff is entitled to the relief claimed. In considering the admissibility of the affidavit grounding the plaintiff’s application, Noonan J reviewed the recent case law in relation to Order 37, Rule 1 of the RSC.
The first case considered by Noonan J was Bank of Scotland v Stapleton [2012] IEHC 549, which case was also relied upon by the defendant. In that case, the Court found that an employee of Certus, a third party company engaged by the plaintiff to provide customer support and administration services, could not provide the evidence required under the Acts.
The second case considered by Noonan J was Promontoria (Arrow) Limited v Burke & Ors [2018] IEHC 773. In that case, the Court found that a credit servicing firm was sufficiently qualified for the purposes of Order 37, Rule 1 of the RSC. The deponent averred that she had access to the books and records relating to the defendant’s accounts and their alleged liability. Further, the facility letters had been exhibited by both the deponent and the defendant and on this basis, the defendant was deemed to have accepted the facility letters as evidence. The Court also stated that it was relevant that the credit servicing firm had issued the letters of demand following the acquisition of the title to the loans.
In considering Burke, Noonan J distinguished it from the case before him in that no reference is made in the senior asset manager’s affidavit as to the books and records of the plaintiff and whether or not he had access to them. Noonan J also noted that no reference was made to the precise relationship between Link and the plaintiff.
Practical Approach
In considering all of the available evidence, Noonan J found that there was no material distinction between Stapleton and this case and that the affidavit sworn by the senior asset manager in Link did not meet the requirements of Order 37, Rule 1 of the RSC. On this basis, Noonan J found that the evidence before the Court was insufficient to enable him to grant judgment for the plaintiff.
However, Noonan J noted that in accordance with Order 37, Rule 7 of the RSC, the Court has the option to make “such order for determination of the questions in issue in the action as may seem just”. Noonan J also noted the costs of adjourning the summary application to plenary hearing in circumstances where the plaintiff’s title was not in issue and the main issue of the admissibility of evidence could be remedied by a further affidavit from the plaintiff.
In adopting a practical approach, Noonan J proposed to discuss further with the parties whether they wished to put any further evidence before the Court.
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About the Author
Pamela Fitzpatrick
Pamela is a senior associate solicitor in the Commercial and Business team at Hayes solicitors. She specialises in commercial litigation and dispute resolution acting for financial institutions, private equity funds, private companies and individuals in a variety of matters including enforcement and recovery actions, landlord and tenant disputes and general litigation cases. Pamela also provides advice on a wide range of commercial and business law matters, including data protection law and the review and drafting of commercial contracts.