High Court dismisses appeal against possession order where settlement agreement preserved original debt claim.

THE HIGH COURT

[2024] IEHC 648

[Record No. HCA 2024/154]

BETWEEN

MARS CAPITAL FINANCE IRELAND DAC

PLAINTIFF/RESPONDENT

AND

SAMUEL WALSH

DEFENDANT/APPELLANT

JUDGMENT of Mr Justice Barr delivered electronically on the 15th day of November 2024.

Introduction.

1. This is an appeal by the appellant/defendant (hereinafter ‘the defendant’) against an order for possession of certain property owned by the defendant, made in the Circuit Court on 12 June 2024, in favour of the respondent/plaintiff (hereinafter ‘the plaintiff’).

2. The issues in the case can be summarised as follows: The defendant accepts that he drew down a loan from the Educational Building Society in 2003; which was secured by a mortgage against his property situate at and known as Ballyvadden House, Kilmuckridge, Gorey, County Wexford (Folio no. WX8579F of County Wexford) (hereinafter ‘the property’).

3. The defendant accepts that with the exception of certain payments made in 2023, he had not made any repayments of the loan since 2007.

4. The defendant accepts that the EBS purported to transfer the loan and underlying security, being the mortgage, to the plaintiff by a mortgage sale agreement dated 18 February 2021 and by a global deed of transfer dated 30 April 2021.

5. These proceedings, seeking an order for possession of the property, were issued by the plaintiff on 03 August 2022. On 10 March 2023, the defendant signed a settlement agreement compromising the proceedings herein.

6. The defendant did not file any affidavit when the proceedings were heard before the Circuit Court, but he was represented thereat by solicitor and counsel. The defendant has filed an affidavit for the purposes of this appeal.

7. The defendant resists the plaintiff’s application for an order for possession of the property on three grounds as follows: (a) that the hearing in the Circuit Court should not have proceeded because the plaintiff had not established compliance with Practice Direction 17, which provides that there should be evidence of the service of the proceedings on the borrower and on any other persons in occupation of the property over 18 years of age; in circumstances where the proceedings were not served on the defendant’s mother, who had resided in the property for a considerable number of years; (b) that the purported transfer of the loan and mortgage from EBS to the plaintiff was void and illegal for failure to show compliance with the provisions of s.26 of the Building Societies Act 1989 (hereinafter ‘the 1989 Act’), which provides that on the sale of the property, the mortgagee shall ensure as far as is reasonably practicable that the property is sold at the best price reasonably obtainable; and (c) that the plaintiff’s action is statute barred having regard to the provisions of ss. 13(2)(a); 32(2)(a); 33 and 38 of the Statute of Limitations 1957.

8. The plaintiff submits that these grounds of challenge to its entitlement to an order for possession of the property are without substance. The grounds of their objection will be set out later in the judgment. Chronology of relevant dates.

9. The relevant dates in this application can be summarised as follows:

2003 The defendant drew down a loan from EBS, which was secured

by a mortgage over the property. 2007 Defendant makes last payment against the loan.

18 February 2021 Mortgage sale agreement between EBS and the plaintiff, which transferred the defendant’s mortgage to the plaintiff.

30 April 2021 Global deed of transfer between EBS and the plaintiff, which transferred the defendant’s loan with EBS to the plaintiff.

03 August 2022 Plaintiff issues a civil bill seeking possession of the property.

03 March 2023 A settlement agreement is drawn up compromising the proceedings. It was signed by the defendant on 10 March 2023.

12 June 2024 Order for possession of the property granted in the Circuit Court in favour of the plaintiff.

21 June 2024 Defendant lodges notice of appeal to the High Court.

The Evidence on the hearing of the Appeal.

10. As there was almost no disagreement between the parties on the facts of this case, it will suffice to give a brief summary of the evidence that was put before the court on the hearing of this appeal.

11. The grounding affidavit sworn on behalf of the plaintiff, was the affidavit sworn by Mr Ronan Hopkins, a manager employed by the plaintiff which was sworn on 27 July 2022. In the affidavit, Mr Hopkins gave details of the property and exhibited a copy of the relevant folio. He went on to state that to the best of his knowledge, information and belief, the defendant resided in the property. He stated that he did not know of any other person other than the defendant in actual possession of, or in receipt of the rents and profits of the said lands and premises, or any part thereof. He went on to give details of the mortgage that was executed between EBS and the plaintiff on 22 April 2004. He exhibited a copy of the mortgage. He noted that the mortgage had been registered as a charge on the folio on 01 May 2009. He further noted that clause 9 of the mortgage conditions provided that the defendant consented to any future transfer of the rights held by EBS under the mortgage.

12. Mr Hopkins went on to deal with the global deed of transfer dated 30 April 2021, between EBS and the plaintiff. He set out what was transferred to the plaintiff under the said deed. He exhibited a copy of the deed. He noted that in the schedule to the transfer deed, the defendant’s loans with EBS were identified as being part of the loans transferred under the deed from EBS to the plaintiff.

13. Mr Hopkins went on to state that on 18 June 2021, the plaintiff notified the defendant that the transfer of the loan facilities and related rights had occurred from EBS to the plaintiff. This is colloquially known as a “Hello Letter”. He exhibited a copy of the letter. He went on to state that the plaintiff’s ownership of the charge was registered on the folio on 30 June 2021.

14. Mr Hopkins stated that under the charge and mortgage conditions, the total debt as defined therein, became immediately payable, inter alia, in the event that the defendant defaulted in the making of three consecutive monthly repayments.

15. Mr Hopkins went on to deal with the original loan that had been given by EBS to the plaintiff pursuant to a letter of offer dated 08 August 2003, under which the sum of €350,000 repayable over 25 years subject to the terms and conditions as set out in and attached to the said letter, and to the special and general loan conditions of the building society, was made available to, and was accepted by the defendant. He exhibited a copy of that letter.

16. Mr Hopkins went on to deal with the default on the part of the defendant in complying with the repayment terms of the loan. He set out the arrears that had accrued on both loan accounts. He stated that by letter dated 05 May 2022, the plaintiff had written to the defendant formally demanding repayment of all outstanding arrears, which amounted at that time to the sum of €370,880. A further formal demand for repayment of the loan was issued by the plaintiff on 23 May 2022. A further letter of demand issued from the plaintiff’s solicitors on 28 June 2022. Finally by letter dated 21 July 2022, the plaintiff, through its solicitors, notified the defendant of the plaintiff’s intention to issue legal proceedings for possession of the property unless the debt was repaid. He exhibited copies of the relevant letters.

17. Mr Hopkins stated that despite demand, the defendant had failed, refused or neglected to repay the sums sought and same remained due and owing. He gave an update of the amount due as of 31 May 2022. He exhibited copy statements of account in respect of the two loan accounts.

18. Mr Hopkins detailed how the plaintiff had complied with the Code of Conduct on Mortgage Arrears as issued by the Central Bank in 2013. He concluded by stating that the defendant was desirous of exercising its power of sale and stated that it would be more difficult to sell the property as long as the defendant or any other person remained in possession of the property. Accordingly he prayed for an order for possession of the property in favour of the plaintiff.

19. On 22 May 2023, Mr Hopkins swore a supplemental affidavit, in which he stated that as of 30 April 2023, the total amount outstanding on the loan account was €523,427.21.

20. Mr Hopkins also stated that a compromise of the proceedings had been reached by virtue of an agreement letter dated 03 March 2023, which was signed by the plaintiff on 10 March 2023. In that agreement the defendant acknowledged that he was indebted to the plaintiff and that in the event of a breach by him of the terms of the settlement, the lender was entitled to pursue the defendant for an order for possession. He stated that the defendant had defaulted on the terms of the settlement. The plaintiff had issued a letter on 08 May 2023 notifying the defendant that he was in default of the settlement agreement. He exhibited a copy of the settlement agreement. In the affidavit, he went on to explain why redactions had been made to the copy of the mortgage sale agreement and the global deed of transfer which had been exhibited in his previous affidavits.

21. An affidavit was sworn by Mr Glen Hogan, a manager with the plaintiff, on 19 September 2023, in which he gave further details in relation to the total amount outstanding as of that date, being €661,804.01. He exhibited statements of account in respect of the two loan accounts. He also referred to the settlement agreement dated

03 March 2023. He referred to the aforementioned letter of 08 May 2023 and to subsequent correspondence of 26 July 2023, 02 August 2023 and 15 September 2023, by which the solicitor for the plaintiff had notified the defendant’s solicitor of the breach of the terms of the settlement agreement and of the plaintiff’s intention to apply for an order for possession of the property. He exhibited copies of the relevant correspondence.

22. After the hearing in the Circuit Court and for the purposes of the appeal to this Court, the defendant swore an affidavit on 11 October 2024, in which he set out his grounds of defence being (i) that the hearing before the Circuit Court had been held in breach of Practice Direction 17 of the Circuit Court; (ii) that the sale to the current plaintiff was void for breach of s.26 of the Building Societies Act 1989; and (iii) that any claim pursuant to the mortgage was statute barred.

23. The defendant stated that the last payment to the mortgage prior to the issuance of the within proceedings, was in or around 2007.

24. The defendant stated that at the hearing in the Circuit Court, different counsel who had been retained to represent him, had applied for an adjournment of the hearing. That application was refused. The defendant stated that the counsel who represented him on that occasion “was not in a position to make effective submissions to resist the application as he had not been fully briefed in the matter”. He went on to state that the papers before the Circuit Court had not included a full set of account statements and, therefore, the time bar issue had not been adverted to on that occasion. He stated that it was only when his current counsel had been instructed and inquiries had been made about the last payment made by the defendant, that the issue under the Statute of Limitations had come to the defendant’s attention.

25. The defendant stated that on 28 August 2024, the defendant’s solicitor had written to the plaintiff’s solicitor seeking a full copy of statements of account. He stated that as of the date of swearing of that affidavit, such statements of account had not been provided. He stated that in the absence of the full statements of account, the defendant had not been able to put proper evidence before the Circuit Court regarding the Statute of Limitations point. He stated that it was for that reason that the evidence had not been adduced before the Circuit Court. He sought leave of the High Court to admit this further evidence for the purpose of mounting his defence to the plaintiff’s application.

26. On 15 October 2024, the plaintiff’s solicitor swore an affidavit dealing with service of the proceedings on the occupants of the property. He stated that on 16 October 2023, the proceedings had been served on the occupants of the property. He referred to letters of that date which had been addressed to the defendant’s solicitor, and to the defendant himself, and to “the occupants” of the property, in which the addressees were advised that the plaintiff’s application for possession of the property had been adjourned to 16 November 2023, for hearing before the County Registrar.

27. The solicitor also referred to the settlement agreement dated 03 March 2023 and exhibited a copy thereof. He stated that pursuant to that agreement, the defendant had made two payments to one of the loan accounts in the sums of €1,000 made in April 2023 and €4,000 made in May 2023. He exhibited a copy of the statements of account for the relevant loan accounts.

28. The solicitor stated that on 16 October 2023, the defendant had attended before the County Registrar in County Wexford, when he had requested an adjournment on the basis that he was organising a refinancing of the loan through his solicitor. The County Registrar had agreed to adjourn the proceedings on that basis to allow for the application for refinancing of the loan to be completed.

29. Finally, there were a number of affidavits sworn which detailed attempts to effect service of documents on the defendant and which deposed to the effecting of service of documents on him; being the affidavit of attempted service sworn by Richard Ballagh on 04 November 2022; the two affidavits of service sworn by David McGrath on 11 March 2024; and the further affidavit sworn by Mr McGrath on 15 October 2024. It is not necessary to set out the content of these affidavits.

Relevant statutory provisions.

30. At the hearing of this appeal, the defendant relied upon s.26 of the Building Societies Act 1989. The relevant portions of that section are as follows: “26.—(1) Where any estate or interest in land mortgaged to a building society is sold by the society in exercise of a power of sale, the society shall ensure as far as is reasonably practicable that the property is sold at the best price reasonably obtainable.

…

(4) To the extent that any agreement relieves (or may have the effect of relieving) a society or any person from the obligation imposed by subsection (1) or (2) the agreement shall be void.”

31. The defendant also relied on the following provisions of the Statute of Limitations 1957: 13.—(2) The following provisions shall apply to an action by a person (other than a State authority) to recover land—

(a) subject to paragraph (b) of this subsection, no such action shall be brought after the expiration of twelve years from the date on which the right of action accrued to the person bringing it or, if it first accrued to some person through whom he claims, to that person.

32.—(2) The following provisions shall apply to an action by a person (other than a State authority) claiming the sale of land which is subject to a mortgage or charge:—

(a) subject to paragraph (b) of this subsection, no such action shall be brought after the expiration of twelve years from the date on which the right of action accrued to the person bringing it, or, if it first accrued to some person through whom he claims, to that person”

33. At the expiration of the period fixed by this Act for a mortgagee to bring an action claiming sale of the mortgaged land, the title of the mortgagee to the land shall be extinguished.

38. At the expiration of the period fixed by this Act for a mortgagee of land to bring an action to recover the land or for a person claiming as mortgagee or chargeant to bring an action claiming sale of the land, the right of the mortgagee or such person to the principal sum and interest secured by the mortgage or charge shall be extinguished.

Conclusions.

32. As already noted, there was almost no factual disagreement between the parties. The defendant accepted that he had drawn down a loan from EBS in 2003. He accepted that he had given a mortgage over the property as security for the loan.

33. The defendant accepted that the last repayment by him of the loan had occurred in 2007, save for the further payments made in 2023 in purported compliance with the settlement agreement dated 03 March 2023, which had been signed by him on 10 March 2023. The defendant accepted that he had signed that settlement agreement.

34. The defendant accepted that EBS had purported to transfer the loan and underlying security to the plaintiff in 2021 by virtue of the deeds of transfer executed in February and April 2021; although he asserts that the transfers are illegal and void for non-compliance with s.26 of the 1989 Act. These are the facts that are not contested by the defendant.

35. The first ground on which the defendant resists the orders sought by the plaintiff, is on the basis that the hearing should not have proceeded in the Circuit Court, because the plaintiff had not established compliance with Practice Direction 17 of the Circuit Court. In particular, it was asserted that the plaintiff had not established service of the proceedings on the defendant’s mother, who, the defendant contended had resided in the property since the 1950s.

36. PD 17 sets out in para. 3 thereof, a non-exhaustive list of proofs that are required when a party seeks an order for possession of property. The Practice Direction provides that when applying for an order for possession, the following proofs are required as a minimum at 3(a); evidence of service of the proceedings on the borrowers and on all persons in occupation over 18 years (if applicable). Affidavits or declarations of service should contain a statement that there are no persons in occupation other than those served. The Practice Direction further provides that precise particulars of the occupancy of the property should be provided.

37. I do not regard this submission as well founded for a number of reasons. First, I accept the evidence given by Mr Ballagh in his affidavit of attempted service sworn on 04 November 2022, that when he had made attempts to serve the defendant at the property, he found that the large gates at the entrance of the property were closed. There was no post-box at the gates, or any way to contact the property from the gates. I accept his evidence that on a subsequent occasion on 27 October 2022, when he was passing the property, he noticed that the gates were open. He drove up the long driveway to the property. He knocked on the door of the main house. He stated that a man came from behind the house from a smaller house on the property. He informed the deponent that the defendant was not present at that time.

38. Mr Ballagh went on to state that he left his contact details with the man on that occasion. However he had not received any contact from the defendant. He stated that he was unable to serve the defendant with a true copy of the civil bill for possession which was returnable for 17 October 2022. He stated that it was his belief that the defendant was evading service by not answering any of his calls to the property and by not making contact with him, his details having been provided to the man whom he had met at the defendant’s home on 27 October 2022.

39. I am satisfied that in the circumstances as described by Mr Ballagh, it would not have been possible for him, or anyone looking at the property, to be aware of who may have been residing in the property. Thus, it was not possible for the plaintiff to have been aware that the defendant’s mother resided in the property, if that was the case.

40. Secondly, at the hearing of the appeal, the court was advised by junior counsel for the plaintiff, who had been present in the Circuit Court, that when the matter was in the list before the Circuit Court judge, the judge indicated that the defendant’s mother had written to the court requesting an adjournment. A copy of that letter dated

06 June 2024, was furnished to the court. The Circuit Court judge had granted an adjournment on that occasion.

41. On the next occasion when the case was in the list for hearing, the defendant’s sister appeared on behalf of her mother, requesting a further adjournment. That application was refused by the Circuit Court judge.

42. In these circumstances, while the proceedings were not served on the defendant’s mother, it is clear that she was aware of the proceedings and had participated in them, albeit to a limited extent by writing to the court and by having her daughter make an application for a second adjournment on her behalf.

43. The court is satisfied that while the strict wording of PD17 may not have been complied with, in that the proceedings were not formally served on the defendant’s mother, she was aware of the proceedings she had and participated in them to a limited extent. In these circumstances, the objective of PD17 was complied with, in that the defendant’s mother was clearly made aware of the existence of the proceedings.

44. Thirdly, the defendant cannot raise this point, as PD17 is not intended for his benefit. It is intended for the benefit of other occupants of the property. As no issue was raised at the appeal by anyone acting on behalf of the defendant’s mother, the issue does not arise on this appeal. Furthermore, the defendant cannot complain about the lack of service on his mother, as he did not inform the plaintiff that she resided in the property.

45. Fourthly, breach of a practice direction in relation to a hearing in the Circuit Court, is not a good ground of appeal. It is only a practice direction. The Circuit Court judge was entitled to proceed in circumstances where the practice direction had not been formally complied with, if it was appropriate to do so. Even if the defendant was entitled to raise this point on the hearing of the appeal, I would hold against him, as it is clear that his mother was fully aware of the proceedings when they were before the Circuit Court.

46. Turning to the second ground of challenge raised by the defendant, being the submission that the purported transfer of the loan and mortgage from EBS to the plaintiff in 2021 was void for failure to show compliance with s.26 of the 1989 Act. I accept the submission made by Mr Marray SC on behalf of the plaintiff that this submission is misconceived, being based on a misconstruction of s.26 of the 1989 Act.

47. I hold that on a correct interpretation of the section, it is clear that it is a statutory provision which mirrors the duty that already existed at common law on a mortgagee, or a receiver acting on its behalf, to ensure as far as is reasonably practicable, that the property is sold at the best price reasonably obtainable.

48. I hold that this section is designed to protect the customer of the building society, who is the borrower, by ensuring that as far as practicable, the sale of the property is at the best price reasonably obtainable.

49. I hold that the section has nothing to do with a sale by the mortgagee of the loan or underlying security to another entity, which will hold the loan and security on the same terms as had existed between the borrower and the original lender.

50. The price that the original lender gets on the sale of the loan and mortgage to a third party, is immaterial to the borrower. It neither increases, nor decreases, the amount owed by the borrower under his contract of loan with the original lender. It merely transfers the loan and underlying security from one entity to another.

51. Accordingly, I hold that the provisions of s.26 of the 1989 Act did not apply to the sale of the loan and mortgage by EBS to the plaintiff in 2021. As EBS had a clear power to assign the loan and security under Clause 9 of its conditions, and as the defendant does not challenge the power of EBS to effect such assignment, there is no basis for holding that the assignment and mortgage is void.

52. The third ground on which it is asserted that an order for possession should not be made in favour of the plaintiff, was that having regard to the provisions of the Statute of Limitations 1957, and in particular to ss. 13(2)(a); 32(2)(a); 33 and 38 thereof; and having regard to the fact that no payment was made by the defendant in respect of the loan since 2007 and prior to the issuance of the civil bill herein, the loan and mortgage became extinguished in or about 2020/21.

53. Unlike many provisions in the Statute of Limitations, which bar the remedy, but not the right, the provisions in respect of mortgages seem to go significantly further. In particular, the effect of the sections relied upon by the defendant, support the proposition that upon the expiry of twelve years from the accrual of the cause of action on the mortgage, the mortgage itself is extinguished.

54. If the matter rested there, the defendant’s submission, while lacking any merits in justice, may have been legally sound. However, for such submission to be valid, one would have to ignore the settlement agreement that was entered into between the parties in March 2023. That was an agreement that was designed to compromise the present proceedings.

55. The relevant terms of that agreement are Clauses 2-5, which are in the following terms: - “2. I hereby acknowledge and confirm that I am indebted to the Lender in the full amount of the Secured Obligations and shall continue to be indebted for such amount until the conditions set out in the Settlement Letter have been satisfied to the Lender’s satisfaction. In the event of a breach by me of the terms of Acknowledgement or if I fail to satisfy the conditions set out in the Settlement Letter, I acknowledge the Lender is entitled to pursue me for the entire amount of the Secured Obligations less the Settlement Sum (to the extent paid).

3. I hereby undertake not to dispute the amount stated by the Lender to be owing. I confirm that in the event of my non-adherence with the terms of the Settlement Letter, I hereby acknowledge the Lender may enter a judgment against me in the amount of the Secured Obligations that are outstanding at the date of the non-adherence.

4. I confirm that in the event of my non-adherence to the terms of the Settlement Letter, I acknowledge that an application for an Order of Possession on any assets secured by the Lender will be made.

5. I hereby confirm that in consideration of the issue by the Lender of the Settlement Letter and, subject to the terms of the Settlement Letter, that I have no actual or pending claim or grounds for a claim (actual, current, contingent or otherwise) against the Lender, or the Lender’s predecessor in title and/or any of the Lender’s directors, agents, representatives, contractors, employees, affiliates or advisors insofar as such claim may arise from the Facilities.”

56. A number of things are clear from that agreement: First, the defendant acknowledged the existence of the debt and his obligation to repay it. The amount owing and the schedule for repayment was set out in the accompanying letter. While that letter was not exhibited, it was accepted that it set out the total amount owing by the defendant and set out a schedule for staged repayment of that amount. That is clear from the letter dated 08 May 2023 which was exhibited in the proceedings; which letter complained about non-payment of the first instalment, which had been due for payment on 17 March 2023. It is also accepted that the defendant made two payments in purported compliance with the settlement agreement in April and May 2023.

57. The settlement agreement makes it clear that it was completed by the defendant with the benefit of legal advice and was done in the context of settlement of the proceedings. In the agreement the defendant acknowledged that in default of compliance with its terms, the plaintiff could proceed inter alia by way of obtaining an order for possession of the property.

58. While s. 52 of the Statute of Limitations provides for the fresh accrual of a right of action on a mortgage were there has been an acknowledgment of the title, or of the underlying debt, I accept the submission made by Mr Marray SC that while a mere acknowledgement cannot revive an extinguished right of action, however, if it is contained in a written settlement agreement, it can give rise to an estoppel, which can prevent the debtor relying on the Statute of Limitations.

59. Support for the submission that a defendant can be estopped by his conduct or by representation from relying on a plea under the Statute of Limitations, is to be found in a number of decisions of the Court of Appeal of England and Wales. In Colchester Borough Council v Smith & Ors. [1992] Ch 421 the defendant, who had claimed that he had obtained title to the property by adverse possession, was held to be estopped from making that argument and relying on the English Statute of Limitations by virtue of an agreement wherein he had expressly acknowledged the plaintiff’s title to the land and that he had not gained any right, title or interest to, or in it, by adverse possession. Delivering the judgment of the court, Dillon LJ stated as follows at p.435: “In my judgment this was a bona fide compromise of a dispute and Mr. Tillson, who had the advice of his solicitors and signed the agreement through them, is estopped by the terms of the agreement he made from going behind it and litigating the antecedent dispute. That is as the judge held, and whether it be labelled estoppel by agreement or estoppel by convention is a matter of indifference. Mr. Lewison's primary contention therefore fails and it is unnecessary to express any opinion on his second submission about the French Kier land.”

60. In a concurring judgment, Butler-Sloss LJ emphasised the importance of upholding agreements reached to compromise litigation: “The compromise has to be genuine, entered into freely by all parties to it without concealment of essential information or undue advantage taken by one party of another party, and preferably with the assistance of lawyers. Consequently, an agreement to compromise an action or a dispute which may lead to litigation is binding and is enforceable against the party seeking subsequently to repudiate it. As Roskill L.J. said in Binder v. P Alachouzos [1972] 2 Q.B. 151, 160, "Any other course would cause very great difficulty in the administration of justice.”

61. In St Pancras & Humanist Housing Association Limited v Leonard [2008] EWCA Civ 1442, the Court of Appeal of England and Wales held that the defendant was estopped by virtue of representations that he had made at meetings of the management committee of the plaintiff association, in relation to his intentions and claims in relation to the land. He was held to be estopped from raising any point under the English Statute of Limitations.

62. See also the decision in Binder v Alachouzos [1972] 2 QB 151, which upheld the validity of a settlement agreement, which permitted the plaintiff to pursue the defendant in respect of a debt, notwithstanding that the debt was irrecoverable at law due to the fact that it constituted a loan by the plaintiff, who did not hold the requisite licence under the Moneylenders Acts. In the course of his judgment, Roskill LJ stated as follows:

“In my judgment it is the law of this country, as Lord Denning M.R. has said, where there is a bona fide compromise of an existing dispute and that compromise includes a compromise of what, as Mr. Joseph said, is basically an issue of fact, namely, whether or not there had in fact been unlawful moneylending, especially where the compromise has been reached under the advice of counsel and solicitors, that that compromise is enforceable against the party seeking subsequently to repudiate it. Any other course would cause very great difficulty in the administration of justice.”

63. In argument at the bar, Mr Walsh BL on behalf of the defendant, submitted that this Court should not follow the Colchester decision because it had been noted by Mr Canny BL in his book, “Limitation of Actions” (Thomson Reuters Round Hall, 3rd edn: December 2022), that the Colchester decision had been the subject of adverse academic criticism in the UK. However, counsel did not elaborate on what that criticism was. When one looks at para. 7-10 in Mr Canny’s book, while he notes that the decision in Colchester had been criticised in one text book, as giving rise to an “undesirable method” of circumventing the English Limitation Act 1980, he went on to note that the principles enunciated in that judgment, provide a useful and effective means of defeating the argument of an unscrupulous party where it would be unconscionable for him to argue that an admitted or proven acknowledgement was of no effect.

64. Thus, while it may be the case that the judgment in the Colchester case has been the subject of some adverse academic criticism, the fact remains that that judgment, which was a unanimous decision of the Court of Appeal of England and Wales in 1991, it has not been overruled in over 30 years.

65. While I am not bound to follow that decision, I am prepared to do so, as I can see merit in the judgment; particularly in the dicta which emphasise the importance of upholding settlement agreements reached between parties who are engaged in litigation.

66. I hold that by virtue of the settlement agreement signed by the defendant on 10 March 2023, he is estopped by conduct and by representation from disputing the existence of the debt, or from raising any point under the Statute of Limitations against the debt, or the mortgage.

67. Ordinarily where proceedings have been settled on the basis of an agreement, the original cause of action is subsumed into the settlement agreement, such that any cause of action thereafter must be on the settlement agreement rather than on the original right of action. However, when the settlement agreement itself makes provision for the continuation of the original cause of action in the event of dispute, it is possible for the plaintiff in the original proceedings to continue with his claim for the reliefs sought in the original proceedings. The settlement in this case had a provision that the plaintiff could proceed by way of an order for possession in the event of default by the defendant.

68. It is not disputed that the defendant did not honour the repayment schedule provided for in the settlement agreement. That being the case, the plaintiff is entitled to seek the reliefs sought in its civil bill issued on 03 August 2022.

69. The court is satisfied that the plaintiff has established its entitlement to an order for possession over the property. For the reasons set out in this judgment, I hold that the defendant has not established any defence to the order sought by the plaintiff in its civil bill. Accordingly, I propose that the final order should be in the following terms: -

(a) Dismiss the defendant’s appeal;

(b) affirm the order of the Circuit Court made on 12 June 2024, save that the court will place a stay of three months on the execution of the order for possession from the date hereof;

(c) affirm the order for costs made in the Circuit Court;

(d) award the costs of the appeal to the plaintiff against the defendant; such costs to be adjudicated in default of agreement.

70. As this judgment is being delivered electronically, the parties shall have two weeks within which to furnish brief written submissions on the terms of the final order and on costs and on any other matters that may arise.

71. The matter shall be listed for mention at 10.30 hours on 03 December 2024 for the purpose of making final orders.