Summary judgment granted against one director but refused for another due to missing guarantee documents.

[2019] IEHC 331

THE HIGH COURT

[RECORD NO. 2015 1767 S]

BETWEEN

DEUTSCHE BANK AG

PLAINTIFF

V. H.B. DENNIS MOTORS (FAIRVIEW) LTD. AND PETER DENNIS

DEFENDANTS

[RECORD NO. 2017 251 S]

DEUTSCHE BANK AG

PLAINTIFF

V. H.B. DENNIS MOTORS LTD. AND JOHN DENNIS

DEFENDANTS

JUDGMENT of Mr. Justice Robert Eagar delivered on the 20th day of May, 2019

1. The Court proposes to give judgment in relation to these matters together as essentially the same issues arise with each of the

second named defendants, Peter Dennis and John Dennis, respectively.

2. The Court would make these remarks at the outset of its judgment: -

(i) These two cases were called on in the non-jury list for one hour by counsel on behalf of all parties.

(ii) This was clearly a very careless estimation as this Court has set aside nearly two days in relation to these cases.

(iii) This Court insisted upon brief written submissions on behalf of the plaintiff setting out his claim on the basis of same,

and the defendants setting out what they say are defences which are raised for the purposes of the jurisprudence in

relation to summary judgements.

(iv) This Court has been submerged with various submissions with the defendants appropriately serving their submissions

in relation to their defences on the plaintiffs eighteen – page submissions in relation to the nature of the claim. The Court

is very unsatisfied with the way this matter has been presented by all parties.

3. The background of the case is that the plaintiff is a credit institute, the first named defendant is a limited company, the second

named defendant in relation to 2015 1767 S is Peter Dennis and the second named defendant in 2017 251 S is John Dennis. Both were

company directors of the first named defendant, and a receiver was appointed to the first named defendant in or about May 2012.

Peter Dennis

4. Firstly, the Court will deal with the case of the second named defendant, Peter Dennis, and will in turn deal with the second named

defendant, John Dennis.

5. The proceedings against Peter Dennis were commenced by summary summons issued on the 15th September 2015 setting out the

claim and seeking judgment as against the second named defendant in the sum of €1,568,607.17 and the costs in respect of the

proceedings. On the 18th July 2012 the company and the first named defendant were in receivership.

6. On the 17th November 2017, a notice of motion for liberty to enter final judgment as against the second named defendant was

entered. This was grounded on the affidavit of Martin Leonard.

Affidavit of Martin Leonard

7. Mr. Leonard introduced himself as being the lending manager with First Citizen Finance DAC (hereinafter FCF), an agent of the

plaintiff, Deutsche Bank AG, and was duly authorised by the plaintiff to make this affidavit.

8. He said that prior to working with FCF he was a lending manager with Permanent TSB Finance Ltd until the 24th December 2012. It

is in that capacity and in his later capacity with FCF that he is familiar with the subject matter of the proceedings including the loans,

guarantees, defaults and demands and that he has further fully examined the relevant books and records relating to the defendant

herein. Those books and records were compiled and used in the usual and ordinary course of business.

The loans and personal guarantees

9. By letter of offer dated the 10th October 2011, Permanent TSB Finance Ltd. (hereinafter PTSBF) offered to advance to the first

named defendant a sum of €391,000 for the purpose and subject to the terms and conditions set out in the letter of offer. In relation

to the security required, a personal guarantee of Peter Dennis was sought.

10. On the 7th July 2008, the board of H.B. Dennis (Fairview) Ltd. agreed that it was in the best interests of the company that the

credit facility should be accepted and it was resolved that Peter Dennis and John Dennis were authorised to complete the formal

acceptance of the said letter of offer and counter indemnity. By guarantee in writing dated the 7th July 2008, (the 2008 guarantee)

the second named defendant unconditionally and irrevocably guaranteed to discharge on demand all sums of money then or at any

time owing or remaining unpaid by the first named defendant to PTSBF under the facility letter dated the 4th July 2008 plus interest

and expenses from the date of such demand. It was noted: -

“1. The Guarantor hereby irrevocably and unconditionally guarantees on demand to pay to PTSBF all sums of money due

under the attached facility letter dated the 4th July 2008 (hereinafter the ultimate balance) which now or at any time

shall be owing or remain unpaid to PTSBF by the customer anywhere and/or whether on any banking or other account or

otherwise in any manner whatsoever.

2. The Guarantee shall be in addition to and not in substitution for any other guarantee of the customer given to PTSBF

by the guarantor and shall be deemed to be an indemnity.

3. The liability of the Guarantor shall not be affected nor shall this guarantee be discharged or diminished by reason of 311

any present or future bill, note, guarantee, indemnity, mortgage, charge, pledge, lien or other security or right or remedy

held by or available to PTSBF being or becoming wholly or in part void, voidable or unenforceable on any ground

whatsoever by PTSBF from time to time dealing with exchanging varying, realising or failing to enforce any of these

same”.

11. By letter of offer dated the 26th May 2010, PTSBF offered to advance to the first named defendant the sum of €1,641,340 and

by Board Resolution of the 9th June 2010, by H.B. Dennis Ltd. of Fairview, it is agreed that the best interests of the company that

credit facilities should be accepted and it was resolved that Peter Dennis and John Dennis be and are hereby authorised to complete

the formal acceptance of the said letter of offer.

12. PTSBF advanced to the first named defendant the sum of €1,641,340 on or about the 15th June 2010 and by guarantee in writing

dated the 9th June 2010, Peter Dennis unconditionally and irrevocably guaranteed to discharge on demand all sums of money then or

at any time owing or remaining unpaid by the first named defendant to PTSBF.

13. The Court notes the following, found stipulated in the formal guarantee in bold capitals on the last page prior to the signature of

Peter Dennis:–

“WARNING AS GUARANTOR OF THIS LOAN YOU WILL HAVE TO PAY OFF THE LOAN, THE INTEREST AND ALL

ASSOCIATED CHARGES IF THE BORROWER DOES NOT. BEFORE YOU SIGN THIS GUARANTEE YOU SHOULD GET

INDEPENDENT LEGAL ADVICE.” (this Court’s emphasis)

Further, the guarantee continues: -

“The Guarantor hereby confirms that: -

(i) He is fully aware of the nature of this guarantee, the effect of which had been explained to, and understood by

him.

(ii) He has been advised to take and has been given the due opportunity to take separate independent legal advice

on the effect of this guarantee.

(iii) He is now willing to be legally bound by the terms of this guarantee.

There is no evidence before the court as to whether or not Peter Dennis took legal advice.

14. On the 22nd October 2012 the second named defendant gave his written consent to the assignment or transfer of the benefit of

the guarantees to any third party. The terms of the consent letter were: -

“Dear Sirs,

I refer to the Guarantee(s) and any other Guarantees provided by me to PTSBF in connection with the provision of credit

and/or banking facilities and other accommodation to H.B. Dennis Motors Fairview Ltd. (the Guarantees).

I hereby irrevocably consent to the assignment or transfer of the benefit of the Guarantees: (i) By PTSBF to any other

persons including a company (as assignee) and; (ii) By an assignee and any subsequent assignees to any other person

including a company.

Signed,

Guarantor name: Peter Dennis,

Guarantor address, 114 Howth Road, Dublin.”

This irrevocable consent to the assignment was signed by Peter Dennis. On or about the 24th December 2012, PTSBF assigned all its

rights and interests and benefits in respect of the loan agreements and all of its rights relating to the said loan agreements including

the benefit of the personal guarantees given by the second named defendant to the plaintiff as well as relevant documentation.

15. By letter dated the 24th December 2012, the first and second named defendants were informed of the assignment of rights to the

plaintiff. The matters were sent to the directors of H.B. Dennis Motors Fairview Ltd., and to Peter Dennis at 114 Howth Road,

Clontarf, Dublin 3. Neither the first named nor the second named defendant Peter Dennis made any reply to these letters.

16. The assignment made between PTSBF and Deutsche Bank is serviced by FCF, a firm regulated by the Central Bank of Ireland.

Pursuant to Power of Attorney dated the 22nd March 2013, the 28th March 2015 and the 28th March 2017, the plaintiff gave to FCF

the power on its behalf to facilitate the recovery of all amounts from time to time due and to become due in respect of the

agreements entered into by the defendants with PTSBF.

Demands

17. The first named defendant was indebted to the plaintiff in the sum of €1,568,607.17 including interest on foot of the loan

agreement as of the 21st July 2014. By letter dated 31st July 2014, FCF acting as an agent of the plaintiff wrote to the secretary of

the first named defendant on behalf of the plaintiff stating that at close of business that day that sum was due and owing, and made

a formal demand for the sum. This letter was signed by Mr. Leonard as a duly authorised officer for and on behalf of the plaintiff.

18. By letter dated the 5th August 2014, FCF acting as an agent of Deutsche Bank wrote to Peter Dennis stating that on the 31st

July 2014 it had written to the first named defendant making formal demand for payment forthwith for the payment of the sum of

€1,568,607.17 on foot of the loan agreements and that no payment had been received following such demand. The said letter

proceeded to make formal demand for payment of the sum which was due and owing from the second named defendant. This letter

was signed by Mr. Leonard. By letter dated the 14th November 2014, the solicitors for the plaintiff wrote to the first and second

named defendants noting that each of them had failed refused or neglected to pay the amount outstanding. The letter also stated

that legal proceedings would be initiated unless the amount was paid or acceptable proposals received in respect of the debt.

19. In spite of the letters of formal demand, both the first named and the second named defendant refused to honour the demands

and discharge the sum due and owing to the plaintiff.

Summary Judgement Procedure

20. Having set out the principal affidavits seeking summary judgment in both cases, I now propose to set out the jurisprudence in

respect of applications for summary judgment. The starting point of the modern case law in this area is the decision in First

Commercial Bank plc. v. Anglin [1996] 1 IR 75 [hereinafter Anglin]. In this case, the Master directed that the case should be placed in

the judge’s list. However, Costello J. refused to give the defendants leave to defend the action on the basis that there was no

credible evidence of a real bona fide defence to the plaintiffs’ claims and granted summary judgment to the plaintiff. On appeal by the

defendant to the Supreme Court, in a judgment delivered by Murphy J., it was held that for the court to grant summary judgment and

refuse leave to defend was not sufficient that the court should have reason to doubt the bona fides of the defendant or to doubt

whether the defendant has a genuine defence and he adopted the test laid down in the Banque de Paris v. de Naray [1984] 1 Lloyd’s

Reports Rep. 21. This test was reaffirmed in the National Westminster Bank plc. v. Daniel [1993] 1 WLR 1453, namely that in deciding

whether to grant summary judgment to a plaintiff and to refuse leave to defend, the court has to look at the whole situation to see

whether the defendant has satisfied the court that there is a fair and reasonable probability of the defendant having a real or bona

fide defence or whether what the defendant has said in his defence was credible. In this regard, the mere assertion on affidavit in a

given situation which was to form the basis of the defence did not, of itself, constitute a ground for granting leave to defend. Murphy

J. concluded, in dismissing the defendant’s appeal, that there was no credible evidence for the defence which he had sought to

assert and that he had failed to establish either on the law or on the facts the probable defence to the plaintiff’s claim.

21. The principles set out by Murphy J. were endorsed by the Supreme Court in Aer Rianta Cpt v. Ryanair Ltd [2001] 4 IR 607. The

plaintiff brought an application for summary judgment against the defendant for monies due in respect of landing charges and other

fees at Dublin Airport. In the High Court, Kelly J. (as he then was) held that the defendant had not demonstrated that there was a

fair or reasonable probability of it having a real or bona fide defence and he granted the plaintiff liberty to enter summary judgment.

That decision was overturned on appeal and in her judgment McGuinness J. endorsed the test laid down in First National Commercial

Bank plc. v. Anglin and identified the task for the court as being: -

“To decide whether... the defence set out in the affidavits… is credible, or in other words, whether there is a fair or

reasonable probability that the defendant having a real or bona fide defence”.

She pointed out that the question for the court was not whether the defendants or the plaintiff’s version of events was the more

probable but rather whether the proposed defence is so farfetched or so self-contradictory as not to be credible. She was of the

view that the probability remained open that the defendant had a real or bona fide defence and what was put forward by the

defendant was credible. In the same case, Hardiman J. delivered a concurring judgment in which he engaged in a comprehensive

review of the authorities relating to the jurisdiction to grant summary judgment. He referred with approval to a number of English

judgments where the jurisdiction to enter summary judgment “must be used with great care” and that a “defendant ought not to be

shut out from defending unless it was very clear indeed that he had no case.” He also endorsed the statement of Sir Peter O’Brien

C.J. in Crawford v. Gillmor [1891] LR Ir 238, that: -

“. . . final judgment should not be given on a motion for final judgment in any case where any serious conflict as to the

matter of fact or any real difficulty as to the matter of law arises”.

Hardiman J. stated that: -

“The defendants hurdle on a motion for judgment such as this is a low one and the jurisdiction is one to be used with

great care”.

He further stated that the test of “fair and reasonable probability of the defendants having a real or bona fide defence” is “. . .not

the same thing as a defence which will probably succeed, or even a defence whose success was not improbable”.

22. McKechnie J. in Harrisrange Ltd. v. Duncan [2003] 4 IR 1 sets out a clear identification of the principles which must be applied by

a judge as follows: -

“(i) the power to grant summary judgment should be exercised with discernible caution,

(ii) in deciding upon this issue the Court should look at the entirety of the situation and consider the particular facts of

each individual case, there being several ways in which this may best be done,

(iii) in so doing the Court should assess not only the Defendant's response, but also in the context of that response, the

cogency of the evidence adduced on behalf of the Plaintiff, being mindful at all times of the unavoidable limitations which

are inherent on any conflicting Affidavit evidence,

(iv) where truly, there are no issue or issues of simplicity only or issues easily determinable, then this procedure is suitable

for use,

(v) where however, there are issues of fact which in themselves are material to success or failure, then their resolution is

unsuitable for this procedure,

(vi) where there are issues of law, this summary process may be appropriate but only so, if it is clear that fuller argument

and greater thought, is evidently not required for a better determination of such issues,

(vii) the test to be applied, as now formulated is whether the Defendant has satisfied the Court that he has a fair or

reasonable probability of having a real or bona fide defence; or as it is sometimes put, “is what the Defendant says

credible?”, - which latter phrase I would take as having as against the former an equivalence of both meaning and result,

(viii) this test is not the same as and should be not elevated into a threshold of a Defendant having to prove that his

defence will probably succeed or that success is not improbable, it being sufficient if there is an arguable defence,

(ix) leave to defend should be granted unless it is very clear that there is no defence,

(x) leave to defend should not be refused only because the Court has reason to doubt the bona fides of the Defendant or

has reason to doubt whether he has a genuine cause of action,

(xi) leave should not be granted where the only relevant averment in the totality of the evidence, is a mere assertion of a

given situation which is to form the basis of a defence and finally,

(xii) the overriding determinative factor, bearing in mind the constitutional basis of a person's right of access to justice

either to assert or respond to litigation, is the achievement of a just result whether that be liberty to enter Judgment or

leave to defend, as the case may be”.

23. In McGrath v. O’Driscoll [2006] IEHC 195, Clarke J. (as he then was) referred to the decision in Aer Rianta, and laid out the

approach to be taken when issues of fact arise: -

“So far as factual issues are concerned it is clear, therefore, that a mere assertion of a defence is insufficient but any

evidence of fact which would, if true, arguably give rise to a defence will, in the ordinary way, be sufficient to require

that leave to defend be given so that that issue of fact can be resolved”.

24. Subsequently, in GE Woodchester Ltd. v. Aktiv Kapital Asset Investment Ltd. [2009] IEHC 512, he elaborated on the extent of the

plaintiff on the defendant to adduce factual evidence to support an alleged defence at the stage of the application for summary

judgment, stating that a defendant will not necessarily be in a position to put or have to put affidavit evidence before the court to

establish a factual basis for that defence. He noted that the factual basis for the defence may not derive from facts within the

defendant’s own knowledge.

25. The general principle that mere assertion is not sufficient to establish a bona fide defence was outlined by Charleton J. in National

Asset Loan Management Ltd. v. Barden [2013] 2 IR 28 where he stated: -

“The mere assertion on affidavit of a defence is insufficient. A defence must, if the matter is to be remitted to plenary

hearing, have some reasonable foundation”.

26. In Irish Bank Resolution Corporation v. McCaughey [2014] IESC 517, Clarke J. (as he then was) set out the principles in relation

to “credibility” of the defence in summary summons proceedings: -

“It is important, therefore, to reemphasise what is meant by the credibility of a defence. A defence is not incredible simply

because the judge is not inclined to believe the defendant. It must, as Hardiman J. pointed out in Aer Rianta, be clear

that the defendant has no defence. . . . .

. . . Insofar as facts are put forward, then, subject to a very narrow limitation, the Court will be required, for the

purposes of the summary judgment application, to accept that facts of which the defendant gives evidence, or facts in

respect of which the defendant puts forward a credible basis for believing that evidence may be forthcoming, are as the

defendant asserts them to be. The sort of factual assertions, which may not provide an arguable defence, are facts

which amount to a mere assertion unsupported either by evidence or by any realistic suggestion that evidence might be

available, or, facts which are in themselves contradictory and inconsistent with uncontested documentation or other

similar circumstances such as those analysed by Hardiman J. in Aer Rianta. . . . . It needs to be emphasised again that it

is no function of the Court on a summary judgment motion to form any general view as to the credibility of the evidence

put forward by the defendant”.

27. However, Baker J. held that while the court cannot resolve a dispute of facts, it can assess the evidence, including the

documentation exhibited to the affidavits and come to a view as to whether the defendants had made out a bona fide and credible

defence. On the facts of the case before her, Baker J. found that the assertions made by the defendants which were alleged to give

rise to a bona fide defence, were not consistent with the documentary evidence and as such were not credible.

28. Finally, Charleton J. in Danske Bank v. Durkan New Homes [2009] IEHC said: -

“If the addition of evidence can assist in any material way in the construction of a document then, I agree, the matter

should be put for plenary hearing. If, on the other hand the question of law arising on affidavit evidence can be as well

considered on a motion for summary judgment as at a plenary hearing, then I feel it is the obligation of the court to

resolve it on hearing that motion”.

Affidavit of Peter Dennis

29. The defence raised by Mr. Dennis in this affidavit is: -

(i) Misrepresentation in that he says that PTSBF informed the first named defendant of which he was a director that the

subject loan was for the purpose of regularising the long term lending relationship between PTSBF and the first named

defendant for their mutual benefit. He says that this was a misrepresentation for the true purpose of the loan and that he

alleges that the loans were consolidated in order to make the subject loan easier for PTSBF to sell to a special purpose

vehicle.

30. The Court notes from the form of guarantee which was signed by Mr. Dennis that it was clear that he was encouraged to get

independent legal advice. The terms are bold in the guarantee form: “Before you sign this guarantee you should get independent legal

advice.” He continues by suggesting that if he had known the true purpose of the written consent he would never have executed it.

He referred to Permanent TSB Group Holdings plc. announcing to the Irish Stock Exchange that it had agreed to the disposal of the

majority of the loan assets of PTSBF to Consumer Auto Receivables Finance Ltd. (CAR). The company separately agreed to sell the

business platform of PTSBF to First Citizen Finance Ltd. (First Citizen). He refers to the transfer of certain loans to Spinnaker and said

that he was not informed of loans transferred to Spinnaker. He further makes the point that PTSBF advanced at least fifteen separate

facilities to the first named defendant including the first loan agreement dated the 4th July 2008, and he said that it appeared that

the actual purpose of PTSBF in preferring the subject loan dated the 26th May 2010 was to consolidate various unsecured loans into

one loan agreement secured by a part of the personal guarantee executed by him. He also makes the point that in respect of a

judgment mortgage registered by PTSBF over property owned by the first named defendant that this judgment mortgage was clearly

registered outside of any agreement that PTSBF had either with H.B. Dennis Motors Ltd. or H.B. Dennis Motors (Fairview) Ltd. He also

states that he did not receive either of the demand letters sent by the solicitors for the plaintiff. Mr. Dennis stated that FCF was

established and owned by members of the former management team of PTSBF. CAR entered into a contract with FCF for the servicing

of the acquired loan assets.

31. Mr. Dennis claims that the plaintiff is not acting as a bank in these proceedings, but its sole purpose is acquiring the subject loan

for the purpose of enforcing it or in this case the purported personal guarantees executed by Mr. Dennis and he says that the powers

of attorney executed by it in favour of First Citizen are specifically limited: -

(i) “To initiate and maintain all claims, actions, demands and proceedings (including any proceedings for the enforcement

of any judgment) for the purpose of enforcing facilities or any related guarantee or other security for the purpose of

recovering any amount from time to time outstanding thereunder.

(ii) To retain solicitors and counsel to prepare and swear all affidavits, to make all filings, to give evidence in court and to

execute and deliver all deeds, agreements, instruments, matters or other documents as are necessary in connection with

any proceedings.

(iii) To repossess and sell any vehicle or other property the subject of any default facility”.

Mr. Dennis also makes the point that Mr. Leonard’s evidence is hearsay and inadmissible on the grounds that Mr. Leonard confirms

that the transfer of the subject loan and purported ancillary personal guarantees relied upon by the plaintiff would not take effect

until two months later, on the 26th February 2013. On that date the subject loan between the first named defendant and PTSBF was

purportedly transferred to the plaintiff. Mr. Leonard could not have known what sum was allegedly outstanding by the first named

defendant. Both second named defendants, Mr. Peter Dennis, and Mr. John Dennis states that Mr. Leonard cannot as a matter of fact

positively aver to the sum allegedly due on the actual transfer date.

Second affidavit of Martin Leonard

32. He seeks to deal with the matters raised by Peter Dennis. He said that on the 17th November 2009 the first named defendant

acknowledged in a letter signed by the second named defendant that it owed PTSBF Ltd. the sum of €2,086,636.67 that it consented

to judgment being given against it. Having referred to fifteen of the loans which were Chattel Mortgages whereby PTSBF had a

registered charge over an individual car or cars. Once the car was sold the first named defendant was obliged to pay PTSBF the

amount lent against that car or cars. PTSBF discovered that the cars had been sold but the sale proceeds had been retained by the

first named defendant and the amount involved was over €1.3m. He makes the point that the second named defendant made no

reference to this debt. He said the subject loan was made for administrative purposes, it reduced 20 loans to two loans, and set new

repayment terms which were not met by the first named defendant. He also stated that the consent signed by the second named

defendant permitted PTSBF to assign or transfer the benefit of the guarantee to any party it wished to. He referred to the affidavit of

Cathal McCarthy which the court will deal with later. He states that there was no sale of the subject loan to Spinnaker. He also

denies the allegations regarding misrepresentations and suggested they are extremely vague and un – particularised. Having obtained

the judgment on 25th February 2010 for over €2,000,000 against the first named defendant, PTSBF registered judgment against three

properties, the third property which was not in the name of H.B. Dennis (Fairview) Motors Ltd. and H.B. Dennis Motors Ltd. but a third

company of which Mark Dennis was a director. He also denied there was any sale to a special purpose vehicle and that the subject

loan was transferred to the plaintiff which was a bank. He referred to the letters sent on the 24th December 2012 to the defendants

and in particular the second named defendant as the first named defendant was not solvent and the demand letters that were sent

were not returned by the postal authorities. He also refers to the 20 directorships held by the second named defendant, identifying

him as a businessman.

Affidavit of Cathal McCarthy

33. Mr. McCarthy is a solicitor of Bloom Solicitors who act on behalf of the plaintiff and identified the history of the Irish Permanent

Building Society, its acquisition of Irish Life plc., and of Trustee Savings Bank. He refers to the 31st March 2011 after the Government

of Ireland had entered into an agreement with the European Central Bank, the European Convention, and the International Monetary

Fund to finance the Irish State. He said that PTSBF was a wholly owned subsidiary of Irish Permanent Building Society and he said

that no loans to dealers are sold or form part of the securitisation which was known as the Spinnaker securitisation. He said that the

subject loan was made for administrative purposes because there were nineteen loans to the first named defendant on which PTSBF

had obtained judgment on the 25th February 2010 in the sum of €2,086,636.67. He said the plaintiff is a large branch of Deutsche

Bank, a leading European bank. The loan, which is the subject matter of the proceedings had never been sold to a special purpose

vehicle and that the second named defendant appeared to have made an assumption which was incorrect in relation to the Spinnaker

securitisation.

Second affidavit of Peter Dennis

34. In relation to Cathal McCarthy’s affidavit, he states that the content is remarkable and raises a fundamental issue with regard to

Mr. McCarthy and the firm of Bloom Solicitors representing the plaintiff in the case.

35. He makes the case that the first named defendant never purchased any money at all from the plaintiff but the plaintiff is a debt

purchaser who is engaged for the clear purpose of debt recovery.

Third affidavit of Peter Dennis

36. The third affidavit of Peter Dennis was sworn on the 28th February 2019 and in this affidavit he said that throughout the long

course of the first named defendant’s dealings with PTSBF he regularly signed finance contracts on behalf of the first named

defendant. He said the frequency was monthly and naturally more often. He then refers to the Chattel Mortgages on stock vehicles.

He says he always dealt with the same sales representative, whom he identified as Alan McGuckian. He said the circumstances of the

execution of the consent which the plaintiff’s case rests in its entirety is because the document was distinct from the other financial

documents.

37. The final affidavits sworn in relation to Peter Dennis was that of Alan McGuckian, who described his role as a “sales

representative”. He said that he did not deal with him in relation to the consent of the assignment of his personal guarantees. He also

said that Peter Dennis did not query with him the purpose of the consent nor did he make clear to him the representations asserted

by Mr. Dennis. Mr McGukian finds it surprising that Mr. Dennis asserted and maintained that he did not receive certain correspondence

that was sent to him in circumstances where he believes that Martin Leonard met with Mr. Dennis after the transfer of the loans.

Submissions of the second named defendant

38. Counsel on behalf of the second named defendant said he wanted to highlight the relevant legal principles to the matter, the

second issue was to highlight the question of “consideration” and the third issue was the issue of misrepresentation and counsel for

the second named defendant quoted from the relevant legal authorities.

39. His primary defence was that there was a lack of consideration. The plaintiff asserts that consideration was not required. He said

there was a clear legal dispute between the parties and he refers in particular to the decision of McKechnie J. in Harrisrange Ltd. v.

Durcan (previously cited) where McKechnie J. stated: -

“Where there are issues of law, this summary process may be appropriate but only so, if it is clear that fuller argument

and greater thought, is evidently not required for a better determination of such issues”.

40. The second issue was that of misrepresentation and he submitted that the representation on the basis of the consent or

assignment was made through Alan McGuckian was false and implied in this defence was the fact that there was a dispute between

Alan McGuckian and Peter Dennis as to what took place.

41. The submissions of the plaintiff suggested that each defence was an attempt by the defendant to generate complexity on the

application and he referred to McGovern J. in NAMA v. Breslin [2017] IEHC 350, where McGovern J. stated: -

“The raising of complex arguments in answer to an application for summary judgment will not avail a defendant unless

those arguments address the basis of the claim and provide an arguable defence to the claim as pleaded. Just as mere

assertions, without proof, do not afford a defence to a claim for summary judgment, neither will the raising of complex

issues of fact or law…”.

42. In relation to the issue of consideration, counsel on behalf of the plaintiff said that consent is not a new contract, it is not a

promise, neither is it an amendment, rather it is the activation of Clause 9 of the Guarantee and accordingly there was no requirement

for consideration to the consent to the assignment of the Guarantee.

43. He submitted that in relation to consideration each of the Dennis brothers were consulted on the subject loan and consented to it

because they actually agreed to the subject loan on behalf of each company. In relation to the alleged misrepresentation, however, it

is stated that the alleged representations were only identified late in the day but no material conflict of fact arises. He submitted that

the defendants had raised various issues and none of them reached the threshold for leave to defend.

Discussion in respect of Peter Dennis

44. Points which the second named defendant intends to be a framing of his intention and preparedness to defend the proceedings.

(i) The second named defendant did not borrow money from the plaintiff in the proceedings. This is correct. Peter Dennis

acted as guarantor for the first named defendant in relation to a loan from PTSBF which was then transferred by way of

assignment to the plaintiff with the consent of Peter Dennis.

(ii) The second named defendant did not at any time provide personal guarantees in respect of any monies borrowed by

any party from the plaintiff. The consent upon which the plaintiff seeks to rely on dated the 22nd October 2012 is

expressly in respect of the guarantees provided by the second named defendant to PTSBF “in connection with the

provision of credit and/or banking facilities or other accommodation to H.B. Dennis Motors Ltd. It is the second named

defendant’s position that the said consent to assign all transfers provided solely on the basis of representations made by

Alan McGuckian, a servant or agent of PTSBF. This named individual whom the second named defendant will maintain

misrepresented the necessity and basis for requesting the said consent is a person whose evidence will be required and

tested in plenary hearings should the court grant leave to defend the within proceedings. The second named defendant is

entitled to full information in relation to the provision of personal guarantees to a non – party, which the plaintiffs sought

to rely on, on the face of the summary summons.

(iii) PTSBF misrepresented that the purpose of the subject loan was to regularise a long term lending relationship between

PTSBF and the first named defendant. The two purposes of the subject loan were to consolidate several loans so they

could be more easily sold as a package and to seek enforcement as against the second named defendant. The demand

letters being relied upon by the plaintiff in respect of the second named defendant were not received by him.

(iv) In “consolidating” the loans in respect of the first named defendant it is noteworthy that the subject loan expressly

provides that PTSBF was free to assign it to any other entity without the consent of the borrower.

(v) The plaintiff’s case is that PTSBF loaned money to the first named defendant, the primary borrower, and that it

obtained guarantees from the second named defendant in relation to these loans. His case is that the primary borrower

defaulted and PTSBF decided to sell those defaulting loans which it did to the plaintiff. However, there was clearly a

problem, mainly the loans were worth nothing when the primary borrower was insolvent and incapable of paying them

back, the only asset held by PTSBF worth anything were the second named defendant’s personal guarantees. These could

not be sold without the second named defendant’s written consent.

45. The plaintiff’s case is that the second named defendant freely consented to the assignment of his personal guarantees to the

plaintiff. The only facility that the assignment ought to be provided but that it could be enforced against him. That transfer is the

bedrock of the plaintiff’s stated case.

46. Furthermore, it is submitted that they fundamentally altered the contracts in respect of PTSBF and ultimately the plaintiff and the

second named defendant received no consideration for this amendment to his contract.

Decision of the court in respect of the claim against Peter Dennis (2015 1767 S)

47. The second named defendant was an experienced businessman and was also a director of H.B. Dennis Motors (Fairview) Ltd., the

first named defendant in these proceedings. What is clear from the documentation in the case is that the directors of H.B. Dennis

Motors (Fairview) Ltd. agreed that it was in the best interests of the company that the credit facility up to a maximum €391,000 in

the case of a Chattel Mortgage facility could be accepted. It was also clear by the letter dated the 4th July 2008 that the security

required was inter alia a personal guarantee of Peter Dennis. This decision of the company was dated the 7th July 2008, and the

Memorandum of Acceptance indicated as follows: -

“We hereby accept the foregoing terms and conditions of the facility on behalf of H.B. Dennis Motors (Fairview) Ltd. and

acknowledge that this letter supersedes all previous letters in relation to the facility”.

The next document is a guarantee which is signed by Peter Dennis which is dated the 7th July 2008 and it was agreed: -

“In consideration of PTSBF granting or continuing to make available credit and/or banking facilities and/or other

accommodation to H.B. Dennis (Fairview) Ltd. the guarantor irrevocably and unconditionally guarantees on demand to pay

PTSBF all sums of money due under the attached facility letter dated the 4th July 2008”.

48. On the 26th May 2010 PTSBF stated “following on from our negotiations” which has not been denied by the second named

defendant, he was a director of the first named defendant, a facility in the amount of €1,641,314 was to be used to pay off the

facilities including the payment of sold vehicles in the sum of €1,348,529. Among the securities required was a personal guarantee of

Peter Dennis. Again, on the 9th June 2010, at a meeting of the directors of the above company, it was agreed that in the best

interest of the company the said credit facilities should be accepted and it was resolved that Peter Dennis was authorised to

complete the form of acceptance and this was signed by Peter Dennis. The guarantee in respect of the 9th June 2010 was in

consideration of PTSBF granting or continuing to make available credit and other contract lease facilities and this was signed by Peter

Dennis on the 9th June 2010. Further, on the 22nd October, Peter Dennis irrevocably consented to the assignment or transfer of the

benefit of the guarantee: -

(i) By PTSBF to any other person including a company (as assignee).

(ii) By an assignee and any subsequent assignees to any other person including a company.

The second named defendant claimed that is a misrepresentation in relation to the nature of this consent, but it is clear to this Court

that there must well be an allegation of misrepresentation.

49. The Court accepts the principles applied by McKechnie J. in Harrisrange Ltd v. Duncan and on the facts of the case before me,

the court adopts the decision of Baker J. in ACC Loan Management Ltd. v. Dolan, previously cited, in which she referred to the earlier

decision of Charleton J. in NAMA v. Barker where he said: -

“‘If an assertion of fact is made which is in the teeth of a written contract, then a particular scrutiny will be made of that

fact and how it is alleged to fit within the matrix that amounted to the contract between the plaintiff and the defendant.

Where a case is based on documents, a defendant must be in a position to show that the defence which they seek to

make is not totally undermined by the correspondence between the parties.”

50. This is such a case, and this case is based on documents.

51. When PTSBF sold its rights, titles, interests and benefits to the plaintiff, the second named defendant was written to at his home

address at 114, Howth Road, Clontarf, Dublin 3 and in respect of both loans he never sought to raise any issues which are now the

subject matter of purported defences.

52. When FCF wrote to both the secretary of H.B. Dennis Motors (Fairview) Ltd. by way of letter of demand, and to Mr. Dennis as

guarantor, and a reference made to the 9th June 2010 and 17th July 2008, formal demand was made for the amount outstanding on

the loan which was guaranteed.

53. It is also clear that the references in the affidavit of Peter Dennis to Spinnaker Securitisation was irrelevant and in the view of the

court, the attempt to add an amount of confusion to the issues before the court. It is clear that the first named company consented

to judgment in the sum of €2,086,636.67 on the 17th November 2009.

54. In all the circumstances of the case, the court will award summary judgment to the plaintiff in the sum of €1,568,560.89.

Deutsche Bank AG v. H.B. Dennis Motors Ltd. and John Dennis

55. The Court will now consider the case against John Dennis, which by notice of motion dated the 17th November 2017 sought

liberty to enter final judgment as against the first named defendant in the sum of €1,195,756.23 and a similar sum against the second

named defendant. Again the notice of motion was grounded on the affidavit of Martin Leonard.

56. In his affidavit, he indicated that on the 10th October 2011, PTSBF offered to advance to the first named defendant the sum of

€1,234,286. As part of the security required a personal guarantee of John Dennis was sought and noted that this was already held

under various all sums due guarantees dated the 3rd February 2006, the 8th August 2007, the 20th June 2006, and the 22nd

December 2008. Also, it is clear from the terms of the letter of offer that PTSBF without the consent of the borrower granted

participation in, assign, transfer or otherwise dispose of the whole or any part or parts of its rights benefits and obligations in respect

of the facility.

57. An extract from minutes of the meetings of the directors at H.B. Dennis Motors Ltd. noted that it was agreed that it was in the

best interest of the company that the said credit facility should be accepted and it was resolved that John Dennis was authorised to

complete the formal acceptance of the said letter of offer. This was signed by John Dennis and the Memorandum of Acceptance of

the agreement was also signed by John Dennis and the guarantee was duly signed by John Dennis. The Court notes again at para. 9

which includes the following quote: -

“ . . . PTSBF shall, upon prior written notice to the guarantor, be entitled to assign the benefit of this guarantee or any

part thereof to any subsidiary of any associated company of PTSBF or any other company with the prior written consent

of the guarantor and the guarantee was duly signed by John Dennis on the 8th August 2007.”

58. By letter dated the 22nd October 2012, Mr. Dennis as guarantor referred to the guarantee and irrevocably consented to the

assignment and transfer of the benefit of the guarantees (i) by PTSBF to any other person including a company (as assignee) and (ii)

by an assignee and any subsequent assignees to any other person including a company. Mr. Leonard then refers to the resolution of

PTSBF to transfer the debt to the plaintiffs, and by letter dated the 24th December 2012, Mr. Dennis was written to at 128, Castle

Avenue, Clontarf, Dublin 3 in relation to the loan agreements. A formal demand was made to the secretary of H.B. Dennis Motors Ltd.

and in a letter dated the 31st July 2014, and by letter dated the 5th August 2014, Mr. John Dennis was written to, care of H.B.

Dennis Motors Ltd., Airside Motor Park, Swords Co. Dublin. The letter was sent to John Dennis at the same address by Bloom Solicitors

on behalf of the plaintiffs.

59. Again, Mr. John Dennis states that the subject loan was for the purpose of regularising the long-time lending relationship between

PTSBF and the first named defendant and that this was a clear message of representation.

60. He also advises that he is satisfied that the plaintiff cannot claim that the subject loan dated the 10th October for €1,234,286

can be secured in part or in full by the personal guarantee which predated the subject loan by more than four years.

61. Before proceeding any further, the Court notes that it is quite clear that the plaintiffs are lacking in their proofs in respect of two

of the guarantees. The court refers to the letter signed by John Dennis of the 22nd October 2012 consenting to the assignment to

transfer.

62. Again, there is a reference to the Spinnaker securitization. The Court believes they took no part in the subject loan, however the

Court does note that the following personal guarantees were not produced before the Court: -

(i) Personal guarantee dated 28th June 2008.

(ii) Personal guarantee dated 22nd December 2008

The only guarantees that are produced are one dated the 3rd February 2006 and the other dated the 8th August 2007.

63. In all the circumstances the Court is not satisfied to grant summary judgment against John Dennis in respect of the failure to

produce these personal guarantees. The Court has clearly indicated that this case is based on documents.

64. The Court will direct that this matter be heard by plenary hearing.

Decision of the court

65. The Court is satisfied to grant summary judgment against Peter Dennis in the proceedings 2015 1767 S, but refuses to grant

summary judgment in relation to John Dennis in the proceedings 2017 251 S, and will direct that it be heard by plenary hearing.