Confusion over repossession rulings ‘must be resolved’

The confusion caused by two conflicting High Court judgments on the right of the Circuit Court to hear certain repossession cases must be resolved “as soon as possible”, say campaigners for distressed borrowers. The conflicting judgments were delivered by Ms Justice Deirdre Murphy in May and by Mr Justice Séamus Noonan last week.

In a third case, Mr Justice Michael White has reserved judgment so he can consider what has already been said by his two colleagues, before delivering his decision early in the new year.

Meanwhile, the confusion is leading to cases being adjourned and civil bills being redrafted. Barrister Paul O’Grady said the matter could be resolved by way of a Circuit Court judge referring it to the Court of Appeal or a High Court judge referring it to the Supreme Court.

David Hall of the Irish Mortgage Holders Organisation said the issue should be brought to the Supreme Court or the Court of Appeal "urgently". "It is a chaotic mess," he said. "This is not good news for anyone, but especially not for distressed borrowers with interest, arrears and costs mounting the longer this goes on."

Noeline Blackwell, director of the Free Legal Advice Centres, said the delays that would now be inevitable, as repossession cases were adjourned or struck out while banks seek clarity, would mean additional cost and stress to already stressed borrowers.

Affected cases are where the dwelling was built after May 2002, where the mortgage was entered into before December 1st, 2009, and where repossession proceedings against the borrowers had been initiated before July 31st, 2013.

This cohort, which Mr Hall says numbers in the “thousands”, falls between a series of legislative changes and reforms since 1978, when domestic rates were abolished. Since the Valuation Act 2001 became law in 2002, domestic dwellings are neither rated nor rateable.

The Land and Conveyancing Reform Act 2009 gave power to the Circuit Court in disputes over housing loans entered into after December 1st, 2009. The Act was not applicable to court cases initiated before 31st July 2013.

Jurisdiction

In May, Ms Justice Murphy ruled the Circuit Court did not have jurisdiction to hear a case in which Bank of Ireland Mortgage Bank sought to repossess the home of a Cavan couple, Laura Finnegan and Christopher Ward. The dwelling was not “rateable” and so the Circuit Court had no jurisdiction in the dispute, she ruled.

However on November 26th, Mr Justice Noonan upheld a repossession order granted to Bank of Ireland Mortgage Bank to repossess a buy-to-let property in Tuam, Co Galway, held by two men, Shane Hanley and Alan Giblin. The dwelling was not rateable and so the rateable valuation could not exceed €253.94, he said, and so the Circuit Court had jurisdiction.

Mr Justice Noonan said he was acutely aware that his conclusion was different to Ms Justice Murphy’s and that he had come to his decision with “considerable reluctance and hesitation” as it meant conflicting views in courts of equal jurisdiction. Because both cases were appeals from the Circuit Court, the decisions cannot be appealed to a higher court.