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Supreme Court to rule on jurisdiction on repossessions

Businessman argues properties have no rateable value so Circuit Court cannot order repossession

Permanent TSB branch. Photograph: Alan Betson

The Supreme Court will give judgment later on an appeal with implications for the ability of financial institutions to seek repossession orders where there is default on certain domestic property mortgages.

Permanent TSB has appealed a Court of Appeal decision of July 2016 which found the Circuit Court did not have jurisdiction to make possession orders for six Dublin properties mortgaged through PTSB by businessman David Langan. The central issue was that Mr Langan’s properties were built after 2001 when a new law dealing with the rateable valuation of property was passed.

The 2001 Valuation Act provided that domestic dwellings, subject to certain exceptions, were not rateable. For a lender to seek a repossession order in the Circuit Court, it had been the situation a property had to have a rateable valuation not exceeding €253.95. Valuations are set by a valuation commissioner. Mr Langan argued, in legal proceedings brought against him by PTSB, that the Circuit Court had no jurisdiction to order repossession because his properties were not rateable.

New laws were passed in 2009 and 2013 which resolved the Circuit Court jurisdiction issue. However, the Court of Appeal 2016 ruling meant properties built after 2001, and not falling within the exceptions created by the 2009 and 2013 laws, were not subject to the jurisdiction of the Circuit Court. In its appeal to the Supreme Court, PTSB argued, among other claims, the Court of Appeal decision means applications for repossession, in instances such as the Langan case would mean greater expense for litigants because they would have to go to the costlier High Court for them.

Brian Murray SC, for PTSB, said, if the properties concerned were not rateable and accordingly not rated, it followed their rateable valuation did not exceed €253 and so the Circuit Court had jurisdiction to deal with the case. Opposing the appeal, Louis McEntagart SC, for Mr Langan, argued the Court of Appeal decision should stand.

The Supreme Court should accept, as the Court of Appeal had, what is explicitly conferred on the Circuit Court under the laws governing its jurisdiction, he said. Eoin McCullough SC, for the Attorney General, who had asked to be brought into the case as an “intervening party”, argued the Court of Appeal decision was erroneous or at least too widely expressed.

It did not take into account Section 67 of the Valuation Act or its effects, he said. That provision meant certain properties, including agricultural land, can be valued but are not rateable. The five judge Supreme Court has reserved its decision to an unspecified date.