Court of Appeal dismisses mortgage loan appeal, allowing cross-appeal regarding ECB MRO rate defence.

APPROVED

NO REDACTION NEEDED

THE COURT OF APPEAL

Neutral Citation Number: [2025] IECA 220

Record Number: 2024/10

Faherty J. Pilkington J. Meenan J.

BETWEEN/

AIB MORTGAGE BANK u.c.

PLAINTIFF/RESPONDENT

- AND -

DESMOND GROGAN AND MARY GROGAN

DEFENDANTS/APPELLANTS

Judgment of Ms. Justice Faherty delivered on the 13th day of November 2025

1. The appellants appeal from the ex-tempore judgment and Order of the High Court (O’Regan J.) of 7 December 2023 (as perfected on 18 December 2023) entering summary judgment in favour of the respondent (hereafter “the Bank”) against the appellants in the sum of €459,794.61 together with costs. The Bank cross-appeals against the said High Court Order insofar as it adjourned the balance of the Bank’s claim for €103,716.21 to plenary hearing.

Background

2. The appellants borrowed the sum of €1,100,000 from the Bank’s predecessor in title pursuant to a letter of offer of mortgage loan dated 25 June 2004. The mortgage loan was a housing loan secured on a named residential property in Dublin. The term of the mortgage loan was 20 years and the interest rate applying to same was the Bank’s varying rate, being 2.95% as of the date of the mortgage loan, including a margin of 0.95% over the Bank’s tracker rate, which was then 2%. The mortgage loan was duly drawn down by the appellants on loan account no. XXXXXXXXXX1000 (hereafter “account no. XXX1000” for ease of reference) on or about 19 August 2004. It is common case that the appellants had a number of other loans with the Bank in addition to account no. XXX1000.

3. It is not in dispute that difficulties arose for the appellants circa 2010 in respect of the mortgage loan account no. 4281000 and their other loans. This was followed by a series of meetings between the appellants and the Bank at which alternative payment arrangements were made. In or around 2013/2014 the parties’ relationship soured and no repayments were made by the appellants in respect of account no. XXX1000 after June 2014.

4. After advising the appellants in writing that the mortgage loan account was in arrears, the Bank ultimately demanded payment of the balance of capital and interest then outstanding on account no. XXX1000 from each of the appellants by way of separate notices dated 11 May 2020. There was in fact a prior demand made in 2014 to which I will refer in more detail later.

The proceedings

5. By summary summons issued on 15 May 2020, the Bank sought judgment against the appellants for the sum of €563,510.82, representing the balance of capital and interest said to be then outstanding on account no. XXX1000.

6. An appearance was entered by the first appellant on 7 April 2021 and by the second appellant on 19 July 2022.

7. By notice of motion issued on 1 November 2021, the Bank applied for summary judgment against the appellants in the sum of €568,094.63. This application was grounded on the affidavit of Mr. Cathal Hardiman of the Bank filed on 1 November 2021 in which he deposes, inter alia, to the loan in question, the drawdown of same by the appellants and their ultimate default and to the appellants’ indebtedness on foot of said loan. At para. 26, he avers to his belief that the appellants have no bona fide defence to the Bank’s claim.

8. On 15 December 2021 the first appellant issued a notice of motion seeking a variety of reliefs directed towards the denial of the Bank’s motion for summary judgment including: the striking out of the Bank’s summons and motion; a direction that the summons be amended; a direction that a breakdown of the sum sought in the Bank’s motion be provided; and orders effectively requiring that the application for judgment be heard by means of a plenary trial. This application was grounded on an affidavit sworn by the first appellant on 15 December 2021.

9. The appellants’ response to the contents of Mr. Hardiman’s affidavit is found in an affidavit sworn by the first appellant and filed on 5 September 2022. Therein, in aid of the appellants’ application for leave to defend the Bank’s proceedings, the first appellant avers variously to the Bank having overcharged interest on their loan accounts and having taken “a seven-figure sum in repayments to which they were not entitled”; to having improperly removed the appellants from their tracker rate and having separately applied interest in a manner other than provided for in the loan agreements. He avers, at paras. 3 and 21, to the appellants having been forced to sell three unencumbered properties in 2010 and 2011 in order to maintain their mortgage repayments and reduce outstanding balances. At para. 4, he avers that any default or arrears was caused by the Bank’s overcharging and breach of loan agreements.

10. At para. 5, the first appellant avers to the appellants’ relationship with the Bank having soured at the time of the financial crisis and banking collapse by reason of the Bank having removed the appellants’ tracker rate and overcharging interest, a time, he avers, at which “the base interest rate in each of our loans ceased to exist”. The first appellant goes on to aver that in 2016, one of his loan accounts was subject to the Central Bank’s Tracker Mortgage Examination where it was found that the Bank had overcharged interest. It is common case that the Bank repaid the overcharged amount to that account together with compensation and legal fees and that subsequently a further sum in compensation was paid by the Bank.

11. The first appellant revisits this issue at para. 38 where he avers to the Bank (in 2017) having repaid overcharged interest of €202,427.01 in respect of loan account no. XXXX6018, and later a further sum of €36,409.97 in 2020 in respect of same account after, it is said, the first appellant challenged the Bank that the overcharging was more than had been acknowledged. At para. 10, the first appellant takes issue with the Bank only having acknowledged the wrongful removal of the tracker rate from one account only.

12. At para. 7, he avers to the Bank having appointed a receiver over the appellants’ properties in 2016.

13. Paras. 16-33 of the affidavit address meetings the appellants had with the Bank between 2010 and 2013. It is averred that the purpose of a meeting on 4 August 2010 with two of the Bank’s employees was, as recorded by the Bank, to “discuss…possible restructure of clients (sic) borrowings”. The first appellant says that this meeting was arranged following an earlier meeting in July 2010 where “the Bank were concerned about my health and capacity to manage my affairs”. It is averred, however, that the Bank’s behaviour at the meeting on 4 August 2010 was not consistent with the expression of concern it had expressed after the earlier meeting. The first appellant avers that on 4 August 2010 he and his family were threatened by the one of the two Bank employees in attendance at the meeting, and that the employee in question had said that she would see the first appellant and his family “living in a ditch” which intemperate remarks, it is averred, the first appellant recorded on the note of the meeting he subsequently received from the Bank.

14. The first appellant goes on to describe a further meeting on 20 September 2011 with the Bank as “a more productive meeting” where the sale of properties was discussed and where it was agreed that there would be a period of interest only repayments. It was at this meeting that the first appellant had requested that the appellants’ tracker rate be restored. He says that he was requested by the Bank to put that request in writing which he duly did. According to the first appellant, the Bank’s note of the meeting shows that the Bank was allowing the appellants time to deal with their indebtedness by disposing of their properties, although the reference in the note to the appellants’ wish to have their tracker rate restored differed to the first appellant’s recollection of how that issue was to be progressed.

15. At para. 26, the first appellant refers to his expectation, post the meeting of 20 September 2011, that the tracker rate would be restored and that the Bank would agree to a period of interest only payments. He avers that he wrote to the Bank on 19 December 2011 as the Bank “had not implemented the agreement”. The Bank did not reply following which the first appellant wrote again on 19 January 2012 and twice on 14 February 2012.

16. At para. 28, the first appellant avers to the Bank’s ultimate reply on 5 March 2012 which offered the appellants an alternative repayment arrangement, which referred to arrears on two accounts (account nos. XXXX6281 and XXXX6364) and which acknowledged that the appellants had made overpayments in respect of those accounts following which the Bank made refunds of €6,449.75 and €3,489.33. The Bank, however, refused to restore the tracker rate and stated in its letter that the issue of the tracker rate had been “fully investigated” and the matter was now closed. As we see, however, that issue was not closed, as per para. 5 of the first appellant’s affidavit, and in respect of which the Bank does not demur.

17. At para. 30, the first appellant avers to a further meeting with the Bank on 7 June 2013 at which it was agreed that interest only repayments would continue to December 2013. He avers, however, at para. 32, that matters did not improve and that the appellants remained firmly of the view that that interest had been overcharged. It appears that the interest only arrangement came to an end at the end of December 2013 without a new arrangement being reached.

18. It will be recalled that at para. 5 of his affidavit, the first appellant made reference to “the base interest rate in each of our loans ceased to exist”. At paras. 39-44, he returns to this theme. He avers that as the ECB “Minimum Bid Rate” (to which the tracker rate applicable to the loan in question in these proceedings was aligned) ceased to exist in October 2008, the first appellant is “not sure on what basis the Bank may apply interest…”. He avers to four different rates set by the ECB including “3. Main Refinancing Operations -Variable Rate Tenders-Minimum Bid Rate”.

19. Specifically, the first appellant avers: -

“41. I say and am advised that the European Central Bank Main Refinancing Operations Minimum Bid Rate as referred to in the Special Conditions of the Mortgage Loan Offer is clearly option 3… …

44. I say that ECB Main Refinancing Operations -Variable Rate Tenders Minimum Bid Rate ceased to exist on 15th October 2008.”

20. On 30 September 2022, Mr. David Coleman, Manager of the Bank, swore an affidavit in response to certain averments in the first appellant’s affidavit. In relation to the alleged wrongful removal of the tracker rate, he avers that the tracker rate provided for in the loan offer in respect of account no. XXX1000 (the loan account in issue here) continued to be applied by the Bank throughout the remainder of the term of the loan and that the first appellant had failed to explain that the mortgage loan (account no. XXXX6018) from which the tracker rate had been removed “has nothing to do with the proceedings”. He acknowledges, however, that the appellants were deprived of a tracker mortgage on account no. XXXX6018 and that the Bank, after having undertaken an investigation, had identified the potentially wrongful removal of a tracker mortgage rate on that loan but had also concluded that all other mortgage loans advanced to the appellants were unaffected by the tracker mortgage issue in that the agreed margin over the ECB reference rate was charged at all material times. As the first appellant had deposed to, Mr. Coleman acknowledged that the appellants were reimbursed by the Bank for the overcharging on account no. XXXX6018. This was achieved by the balance on the relevant account being reduced to reflect the overcharging that had occurred (para. 8). At para. 9, Mr. Coleman deposes to other sums paid to the appellants by way of compensation and to cover the costs of professional advice.

21. At para. 11, he avers that whilst the first appellant appears to imply that the appellants were overcharged interest on account no. XXX1000 (the loan account the subject of the within proceedings), the first appellant had not set out either on affidavit or in reasoned correspondence any evidence for that proposition. In those circumstances, and where the appellants had defaulted on their liabilities regarding the said loan account, Mr. Coleman did not understand how the removal of a tracker rate on a different mortgage account could constitute a defence to the within proceedings.

22. Paras. 14-15 address the first appellant’s allegations regarding the alleged behaviour of a named employee of the Bank. Mr Coleman avers that the Bank has no record of the alleged words being spoken (save from an affidavit sworn by the first appellant in proceedings (bearing record no. 2021/6283P) issued by the receiver for injunctive relief). He further avers that the employee in question no longer works for the Bank.

23. At para. 16, Mr. Coleman refutes the contention that the Bank forced the appellants to sell three unencumbered properties albeit he acknowledges that the Bank had encouraged the sales which he says were “voluntary in nature”. Insofar as the appellants claim that the sales which took place in 2012 were forced, he avers, at para. 17, that that claim is now statute barred.

24. Mr. Coleman goes on to address the first appellant’s claim that the interest rate pertaining to account no. XXX1000 ceased to exist in October 2008. He avers as follows: - “18. Between paragraphs 39 and 45 of the Affidavit, Mr Grogan discusses the European Central Bank Main Financing Operations Minimum Bid Rate (the “MRO rate”). While he nowhere expressly articulates what he alleges to be the consequence of the MRO Rate alleging ceasing to exist, it appears that he contends that the Plaintiff was not entitled to charge any interest at all on the mortgage loan the subject of these proceedings at any time after October 2008. Accordingly, his case appears to be that the Defendants have been entitled to the benefit of an interest-free loan since that date.

19. There is no dispute between the parties that there was a change in the calculation of the ECB MRO Rate from a variable rate tender procedure to a fixed rate tender procedure in October 2008. I have set out below an overview of the ECB MRO Rate and the change to its calculation that was brought about in October 2008.

20. The important point to stress at the outset, however, is that the ECB MRO Rate never ‘ceased to exist’ as Mr Grogan claims at para. 40 of the Affidavit. The interest rate applied to the mortgage loan facility the subject matter of these proceedings at all material times comprised ECB MRO Rate plus the contractually agreed margin.

21. The ECB’s Main Refinancing Operations (“MROs”) are the regular liquidity providing transactions conducted by the central Banking system of the Euro area. This is the manner by which the ECB provides liquidity to the commercial Banks throughout the Eurozone.

22. The ECB sets the Reference Rate of the MRO…and it is one of the key policy rates within the Eurosystem.

23. The Reference Rate set by the ECB reflects the actual interest rate for fixed tenders or the minimum interest rate for variable tenders which banks have to pay when they borrow money for the ECB.

24. When the Defendants first entered into the mortgage loan, the ECB Reference Rate was calculated using a “minimum bid” variable tender procedure and this method of calculation is referred to in the relevant letter of mortgage loan offer.

25. The variable rate tender/minimum bid rate allowed for the banks to bid for a pool of money that the ECB was prepared to lend into the system. Each bank would bid at a margin above the prevailing ECB Reference Rate and the available funding would be provided to the highest bidders.

26. As a result of the extraordinary pressure placed on the global financial system in September and October 2008, a decision was taken on 08 October 2008 by the ECB to change the method by which it would conduct its Main Refinancing Operations.”

25. In the latter regard, Mr Coleman referred to two press releases from the ECB dated 8 October 2008.

26. The first press release is headed “Monetary Policy Decisions”. It refers, inter alia, to the “current financial crisis” and that “[t]he minimum bid rate on the main refinancing operations of the Euro system will be reduced by 50 basis points to 3.75%, with effect from the main refinancing operation to be settled on 15 October 2008”.

27. The second press release headed “Changes in tender procedure and in the standing facilities corridor” shows that the ECB took a decision that: - “…As from the operation settled on 15 October, the weekly main refinancing operations will be carried out through a fixed rate tender procedure with full allotment at the interest rate on the main refinancing operation, i.e. currently 3.75%. …As of 9 October, the ECB will reduce the corridor of standing facilities from 200 basis points to 100 basis points around the interest rate on the main refinancing operation. Therefore, as of 9 October, the rate of the marginal lending facility will be reduced from 100 to 50 basis points above the interest rate on the main refinancing operation, i.e. currently to 4.25%, and the rate of the deposit facility will be increased from 100 to 50 basis points below the interest rate on the main refinancing operation, i.e. currently to 3.25%...”.

28. As deposed to by Mr. Coleman, the ECB continued to describe the rate applicable to fixed rate tenders as “the minimum bid rate on the refinancing of the financing operations of the Eurosystem” until December 2008 when the description was changed to the interest rate on the main refinancing operations of the Euro system. This, Mr. Coleman says, is evident from an ECB press release dated 6 November 2008 which announced a rate cut of

50 basis points to 3.25%. He further points out that when on 4 December 2008 the ECB announced another rate of 75 basis points to 2.5%, the applicable rate for the fixed tender process was described as “the interest rate on the main refinancing operations of the Eurosystem”.

29. Mr Coleman goes on, at para. 33, to state: -

“The reference in the Defendants’ letter of mortgage loan offer to the ‘Minimum Bid’ MRO rate was simply a reference to the rate at which MRO was calculated at the time. The MRO Rate continued to exist after October 2008 and was applied to the Defendants’ loan in accordance with the terms of the mortgage loan facility.”

30. At para. 34, Mr. Coleman avers that the first appellant, beyond implying that the bank could not charge interest at all on the loan after October 2008, had made no attempt to demonstrate what consequences followed from the proposition he advances.

31. The first appellant filed a supplemental affidavit on 4 November 2022 in which, inter alia, he took issue with Mr. Coleman’s depiction of the tracker mortgage issue and disputed his claim that the loan, the subject of the within proceedings, had not been affected by the overcharging that had occurred, averring that the overcharging in respect of loan account no. XXXX6018 had a “domino” effect on the other loans (para. 8). He further disputed Mr. Coleman’s contention that he had not made the Bank aware of the intemperate remarks of the named employee, stating that he had written to the Bank in this regard on 24 February 2014. As regards Mr. Coleman’s averment that the employee in question no longer worked for the Bank, the first appellant describes Mr. Coleman’s remarks as “an admission that the [Bank] has a difficulty with witnesses”. He goes on at para. 14: - “A long time has passed, the demand was made by letter dated 15th December 2014 and not May, 2020 as set out in the grounding affidavit. The [Bank] is pushing forward with an application for summary judgment eight years after the demand was made and with a six year gap between demand and the issue of a summons as they are not in a position to present a key witness. The inability of the [Bank] to present a key witness prejudices [the appellants].”

32. The first appellant next addressed Mr. Coleman’s affidavit evidence regarding the “Minimum Bid Rate”, averring to his belief effect that Mr. Coleman was not qualified to comment definitively on the ECB MRO rate issue. This was because Mr. Coleman had described himself only as a manager of the Bank. The first appellant avers that “evidence is required from someone suitably qualified in this area and such evidence must be tested at trial. The [Bank’s] word on matters pertaining to interest rates must be considered in the context of the Central Bank’s findings.” (para. 16)

33. At para. 18, the first appellant deposes that there is no provision in the appellants’ mortgage and loan agreements which allows the Bank to unilaterally use a different base rate to calculate interest. At para. 19, the first appellant puts the matter in the following terms: “Each of the loans is a tracker rate with margins over the [ECB’s] main refinancing operations minimum Bid Rate. On the 15th of October, 2008, the [ECB] ceased using the main refinancing operations Minimum Bid Rate and instead commenced using the main refinancing operations fixed rate. There is no condition in the loans which allows this, the [Bank] maintains that the refinancing operations fixed rate is the same as the rate set out in the loan agreements it is the method of calculation which is different, the ECB rate was calculated by a minimum bid process and is now calculated by a fixed tender process however the loan agreements specify the rate and method of calculation and the matter remains to be determined.”

The High Court judgment

34. The motion for summary judgment came on for hearing before the Judge on 7 December 2023. In circumstances where the appellants’ motion of 15 December 2021 effectively sought nothing of substance other than the denial of the Bank’s motion for summary judgment, it was addressed by the Judge as part of her consideration of the Bank’s motion.

35. As is clear from the transcript of the Judge’s decision on the day, at the outset of the hearing the appellants made an argument – which was not subtended by any motion or other form of notice to the Bank – that the Bank’s proceedings should be dismissed for delay and/or want of prosecution. The alleged delay was said by the appellants to be inordinate and inexcusable, and it was contended that the balance of justice weighed in favour of striking out the Bank’s claim.

36. As appears from the transcript, whilst the Judge duly considered the merits of the appellants’ application to have the proceedings struck out with reference to the applicable case law (Primor v. Stokes Kennedy Crowley [1996] 2 I.R. 459, Cave Projects Limited v. Gilhooley & Ors [2022] IECA 245), ultimately, she did not see the delay as amounting to inordinate and inexcusable. Importantly, however, she went on to state, even assuming that the delay was inordinate and that no excuse was proffered, that the difficulty for the appellants was the very fact that the Bank had come to court not knowing the nature of the argument that was going to be made (and was made) by the appellants on the issue of delay and, so, there was no affidavit before her from the Bank addressing the alleged delay which, she said, “is a matter of basic fairness”. Whilst rehearsing her view that the delay might have been inordinate, the Judge could not say whether it was inexcusable or not having regard to the fact that the Bank had not been given advance notice of the application and, thus, had no opportunity to adduce evidence in rebuttal of the appellants’ argument as to delay.

37. Nevertheless, the Judge considered where the balance of justice might lie. As regards certain arguments advanced by the first appellant regarding what was alleged to have been said by a named Bank employee, and the likely prejudice to the appellants in the event that the Bank employee was not available to the Bank as a witness, the Judge did not understand why this would hamper the first appellant’s ability to give his own evidence as to what the Bank employee said at the meeting. Moreover, no attempt had been made by the first appellant to locate the witness in question and, so, the Judge was not satisfied that the Bank employee was in fact unavailable as a witness. Whilst she might no longer be employed by the Bank, that, in the Judge’s opinion, was “a whole different ballgame” to not being available as a witness. The Judge went on to observe that in any event, the unavailability of the employee was more of a problem for the Bank than the first appellant because the Bank would be “hampered in its attempt to dilute or exclude the suggestion of what [the witness] had said to [the first appellant]”.

38. The Judge was also not satisfied that the alleged delay on the part of the Bank had impacted on the first appellant’s health issues, the Judge noting that his health issues predated the Bank’s proceedings and observing that it was not appropriate for the appellants’ counsel to give evidence that the first appellant’s heath had deteriorated by reason of the alleged delay.

39. Overall, the Judge was not satisfied that the balance of justice favoured the striking out of the Bank’s proceedings.

40. The Judge went on to consider the Bank’s application for summary judgment. She was satisfied to award judgment in favour of the Bank in the sum of €459,794.61, the sum which represented the amount originally advanced pursuant to the mortgage loan less all repayments made whether characterised as capital or interest. She again noted that “the fact of the loan, the drawdown of the loan has not been disputed”. As had been deposed to in the affidavit of Mr. Coleman of the Bank, the sum representing principal was €459,794.61 and “there has been no defence to that figure”. That being the case, “[i]t was not within the privilege of this Court to deny summary judgment in part…”.

41. The Judge was however sympathetic to the arguments advanced by the appellants in relation to the Minimum Bid Rate issue. Accordingly, she ordered that the balance of the Bank’s claim, representing interest in the sum of €103,116.21, be adjourned to plenary hearing.

The Appeal

42. By notice of appeal dated 11 January 2024, the appellants appealed the order of the Judge granting judgment against them. As already referred to, in its respondent notice opposing the appeal, the Bank has cross-appealed against the decision of the High Court to remit the balance of the Bank’s claim representing interest in the sum of €103,716.21 to plenary hearing.

The Issues

43. It is agreed by the parties that the issues to be decided on this appeal are set out in the Bank’s written submissions, as follows: -

(i) Whether or not the judgment against the appellants for the capital sum borrowed, less all repayments, ought to stand.

(ii) Whether the appellants’ application for the dismissal of the Bank’s proceedings on grounds of delay and want of prosecution was properly before the High Court.

(iii) In the event that this Court finds that the application on the grounds of delay and want of prosecution was properly brought and that its outcome can be appealed, whether the application was well-founded.

(iv) Whether the Bank is entitled to summary judgment against the appellants for the interest on the mortgage loan (the Bank’s cross-appeal in relation to the Minimum Bid Rate issue). Each of those issues are addressed below although not necessarily in the order in which they appear in the Bank’s written submissions.

Discussion and Decision

Issues (ii) and (iii): Whether the appellants’ application for the dismissal of the Bank’s proceedings on the grounds of delay and want of prosecution was properly before the High Court?

44. As the appellants themselves observe in their written submissions, the High Court found that the application to dismiss was not properly brought, and so refused the relief sought by the appellants on that basis. However, Grounds 4 -7 inclusive of the appellants’ notice of appeal assert that the Judge erred in law and in fact in finding that the application to dismiss the proceedings on grounds of delay was not properly before the High Court and also erred in law and in fact in finding that there was no inordinate or inexcusable delay on the part of the Bank and in finding that the balance of justice did not favour the dismissal of the claim.

45. By reference to the applicable case law (including Primor and Cave), the appellants’ written submissions set out why, they say, the Judge erred in not finding that the Bank was guilty of inordinate and inexcusable delay and in not finding that the balance of justice favoured the appellants. Notably, however, in their written submissions, the appellants do not address the Judge’s primary finding on the delay issue, namely that the appellants could not succeed on their “inexcusable delay” argument because the Bank had no notice of the application to strike out its proceedings until the morning of the hearing.

46. In his oral submissions to the Court, whilst acknowledging that one way or another, the Bank was not on notice that the appellants were going to seek to strike out its proceedings on grounds of delay and that the appellants’ failure to give the Bank notice may be “fatal”, counsel nevertheless submits that the facts upon which the appellants relied to show delay were set out in the affidavit the first appellant swore in response to the Bank’s motion for summary judgment. He also points to the fact that on the day of the hearing, counsel for the Bank in fact made submissions to the High Court on the alleged delay.

47. As to the delay contended for, the appellants points to para. 17 of Mr. Hardiman’s affidavit which grounded the Bank’s application, wherein reference is made to “previous demand letters” issued to the appellants dated 15 December 2014, and to Mr. Hardiman’s next averment that “by separate notices dated 11 May 2020, [the Bank] demanded the balance of capital and interest due and owing…”. They point to the fact that the summary summons issued on 15 May 2020, some five and a half years after the 2014 demand letter. Counsel for the appellants submits that there is no explanation for this delay in any of the Bank’s affidavits. Whilst it is accepted that in the separate proceedings brought by the receiver (bearing record no. 2021/6283P), the High Court (Roberts J.) refused to strike out the proceedings on grounds of delay and want of prosecution as she found that the Bank had explained the delay, the appellants’ contention is that that factor cannot assist the Bank in the within proceedings since the explanation (the tracker mortgage investigation) proffered by the Bank in the 2021/6283P proceedings does not apply to the within proceedings. Counsel also relies on the 2021/6283P proceedings to show that the Bank could not have been blindsided in the within proceedings by the fact that the appellants raised the issue of delay only on the day of the hearing.

48. The Bank’s position, on the other hand, is that the Judge did not err in refusing to dismiss the proceedings, and it contends that she did not err in finding that the application to dismiss for delay and want of prosecution was not properly before the High Court. At para. 4.2 of its respondent’s notice, the Bank asserts that it was “deprived of the opportunity to adduce evidence in response to the application to dismiss for inordinate and inexcusable delay, and accordingly the application was not properly before the Court”.

49. The Bank returns to this theme in its written submissions which highlight the fact that no notice of motion was ever issued by the appellants seeking the dismissal of the proceedings on grounds of delay or want of prosecution, and that, furthermore, in advance of the hearing of the motion for summary judgment on 7 December 2023, no other form of notice-whether written or otherwisewas provided to the Bank of the appellants’ intention to seek the dismissal of the proceedings.

50. Citing Delany and McGrath on Civil Procedure, 5th ed., at 15-01, which identifies the four bases upon which an application to dismiss for delay can be brought, the Bank assert that as none of Order 27, r.11, Order 36, r.1, or Order 122, r.11 apply here, the appellants were left with the option of bringing an application pursuant to the inherent jurisdiction of the court. It says that, as a matter of practice, an application pursuant to the inherent jurisdiction of the court requires to be brought by way of notice of motion grounded on affidavit, to which the opposing party will have an opportunity to reply. It submits that in the absence of an opportunity for an opposing party to puts its position as to whether there is any excuse for such delay as may have arisen, and as to where the balance of justice lies, a court cannot fairly determine such an application. In the present case, the delay issue was only brought up by the appellants on the day of the High Court hearing such that the Bank was effectively “ambushed”, with no opportunity given to the Bank prior to the hearing to address this matter. That, the Bank says, was unfair, procedurally and substantively. Essentially, the Bank queries how a court could analyse whether the delay, if there was such, was excusable or inexcusable if the party charged with such delay had no opportunity to put its side on affidavit.

51. As to the alleged delay itself, counsel for the Bank submits that the within proceedings were issued on 15 May 2020 within the statutory limitation period. He submits that the only delay post the commencement of the proceedings, was the delay that ensued until the notice of motion seeking summary judgment was issued in November 2021. He says that this 18-month delay is explained by the fact of the Covid pandemic during which there was an agreed moratorium, and the need for the Bank to have recourse to substituted service of its proceedings. Counsel submits that in those circumstances, there was no meaningful delay. He further submits that even if there was delay, the balance of justice favoured the refusal of the appellants’ application. This, it is said, is in circumstances where the appellants do not dispute that they had drawn the monies lent in 2004 or that they had not made repayments for almost ten years. Furthermore, insofar as the first appellant in his replying affidavit referred to his ill health (in respect of which there were no medical reports before the High Court), it is submitted on the part of the Bank that there is no evidence to suggest that the Bank’s alleged delay contributed to the first appellant’s ill health. Counsel for the Bank also argues that insofar as the appellants suggest that the Bank will not have witnesses available, there is no evidence that that is the case. He submits that even if it were to transpire that certain witnesses would not be available at the trial, any prejudice regarding that would be to the Bank and not the appellants.

52. In my view, as regards this aspect of the appellant’s appeal (i.e. the Judge’s refusal to strike out the Bank’s proceedings for delay), the salient issue for this Court is whether the appellants were entitled to canvass the Bank’s alleged delay in the manner they did on 7 December 2023. In arguing that they were not so entitled, the Bank cites KBC Bank Ireland plc v. Corrigan [2021] IECA 9 where, writing for this Court, Whelan J. opined at para. 81: - “Basic fairness requires that a respondent ought not to be blindsided by the launch of unheralded novel points at an appeal hearing without even an application for leave being brought.”

53. By analogy, as far as what occurred in the court below is concerned, the Bank contends that basic fairness requires that a court should not proceed to dismiss a plaintiff’s case without giving the plaintiff an opportunity to explain its position and to proffer any excuse which might be warranted.

54. I agree with the Bank’s argument in this regard. Indeed, this was acknowledged by the Judge in her decision when she stated: - “The reason I have difficulty there, by the way, about inexcusable is the very fact that we came to court this morning not knowing that this was the nature of the argument that was going to be made, and so of course then, there is no affidavit before me addressing that argument, which I accept is a matter of basic fairness.”

55. In all of those circumstances, the appellants’ application to dismiss the Bank’s proceedings cannot be said to have been properly before the High Court and as such the outcome of that application (which was against the appellants) cannot properly be said to be the subject of the within appeal. Consequently, as the application to dismiss was not properly before the High Court, any arguments the appellants now seek to canvass as to alleged errors made by the Judge in not finding that the delay was inordinate and inexcusable and that the balance of justice lay with the appellants, do not require to be addressed by this Court. In summary, the appellants have not made out their grounds of appeal in relation to Issues (ii) and (iii). Issue (i): Whether the judgment against the appellants for the capital sum borrowed less all repayments ought to stand.

56. The principles applicable to an application for summary judgment are well established. In Aer Rianta v. Ryanair [2001] 4 I.R. 607, Hardiman J. articulated the fundamental question in the following terms: - “Is it very clear that the defendant has no case? Was there either no issue to be tried or only issues which were simple and easily determined. Did the defendant’s affidavits fail to disclose even an arguable defence?”

57. In Harrisrange v. Duncan [2003] 4 I.R. 1, at p. 7, McKechnie J. helpfully distilled the approach to be taken by a court by outlining twelve principles (which are too well established to need rehearsing here) to be taken account of by a court, with the overriding determinative factor being the “achievement of a just result whether that be liberty to enter judgment or leave to defend, as the case may be”. More recently, in AIB PLC v. Grove Oil (Roscrea) Limited [2018] IEHC 793, MacGrath J. put it as follows: - “Thus leave to defend ought to be granted unless it is very clear that there is no defence. Leave should not be granted where the only relevant averment is a mere assertion of a given situation which is stated to form the basis of the defence”. (para. 25)

58. It is against the backdrop of the established jurisprudence that the Judge’s decision to grant the Bank final judgment in respect of the capital sum must be assessed.

59. The appellants contend that the Judge erred by granting the Bank leave to enter summary judgment for the capital amount in circumstances where, they say, they have both an arguable defence and a counterclaim to the Bank’s proceedings.

60. In advocating that the Judge erred in failing to let the capital issue go to plenary hearing, the appellants say that the history of the matter is relevant. They say that the case they seek to make is that the terms of the loan were departed from by the Bank following which the parties’ relationship broke down. This breakdown was followed by a demand from the Bank in December 2014 for the repayment of capital and interest.

61. The appellants also point to the fact that in 2016, the Bank appointed a receiver over property owned by them. The receiver sought interlocutory relief (the 2021/ 6283P proceedings). The appellants point out that in her decision in the High Court ([2022] IEHC 697) refusing such relief Roberts J. was satisfied that “the defendants’ arguments regarding the interest calculations on its indebtedness, whether that be in relation to the overcharging of interest or the operation of the Minimum Bid Rate, are issues that will need to be determined at trial following oral evidence”.

62. In response to questions from the Court, counsel for the appellants accepted that nothing happened in 2013/2014 in respect of loan account no. XXX1000 to relieve the appellants of their obligation to repay the amount originally lent. However, in response to the Court’s observation that the first appellant’s replying affidavit does not dispute the principal sum borrowed, counsel for the appellants submitted that the question in December 2014 was whether the Bank was entitled to call in the loan at issue in the within proceedings. He submitted that in circumstances where the appellants had raised the issue of the overcharging of interest on their loans and where, ultimately, in 2016/2017 the Bank conceded that it had overcharged interest on some of the loans and had repaid such overcharged interest to the appellants, that that was sufficient for the appellants to cease making repayments on the loan in issue here.

63. Whilst not arguing that the overcharging of interest in respect of the appellants’ other loans had created an estoppel on the principal sum due in respect of loan account no. XXX1000, counsel for the appellants nevertheless suggests that the Judge was wrong to ignore the fact that some €250,000 to €300,000 or so had been overpaid by the appellants in interest on their other loans. It is submitted that in those circumstances, and where the appellants are now saying that they have an arguable defence to the Bank’s claim in respect of the within loan by reason of the ECB main refinancing operations Minimum Bid Rate issue, that the Judge erred in limiting the appellants’ defence to part of the Bank’s claim only. In other words, the appellants’ case is that summary judgment of the capital sum in this case was not suitable given the context, the history between the parties, and the fact that a statutory redress scheme had been set up in respect of the tracker issue regarding some of the appellants’ other loans. For these reasons, appellants contend that all issues pertaining to loan account no. XXX1000 should have been let go to plenary hearing.

64. Hence, the nub of the appellants’ case is that once there was any issue between the parties, there should have been no summary judgment, and the entire matter should have been remitted to plenary hearing. That is so, counsel for the appellant says, even where the Bank’s cross-appeal asserts that there is no arguable case made by the appellants on the ECB Minimum Bid Rate issue.

65. Insofar as the appellants maintain via the first appellant’s affidavits they have a counterclaim against the Bank (the nature and substance of which is not addressed at all in the appellants’ written submissions to the Court), the counterclaim appears to relate to the damage allegedly caused to the appellants by dint of the Bank, in breach of contract having overcharged interest on a number of loans such that the appellants were forced to sell a number of properties. It is the case that in his grounding affidavit, the first appellant avers that the alleged losses were twofold namely, (i) loss in rental income since the sale of the three properties and (ii) the loss of increase in value in the properties, which the first appellant says is very significant.

66. The Bank’s position as regards Issue (i) is that the appellants’ submissions disclose no meaningful grounds to support their contention that judgment should not have been granted against them for the €459,794.61 capital sum.

67. As far as the asserted counterclaim is concerned, the Bank’s contention, as set out in its written submissions, is that any such counterclaim is statute barred as it accrued more than six years prior to the issuing of the within proceedings. Insofar as the appellants appear to contend that some (unspecified) overcharging occurred at some unspecified time on the loan account the subject of the within proceedings, the Bank says that that is a mere assertion on the part of the appellants which they have at no stage supported by credible evidence. In those circumstances, the Bank contends that there should be no stay on the judgment pending the outcome of any counterclaim.

68. In reliance on Prendergast v. Biddle, (Unreported, Supreme Court, 31st July, 1957), it is contended by the Bank that the factors to be taken into account in assessing whether to grant a stay include “the conduct of the parties and the promptitude with which they have asserted their claims, the nature of their claims and also the financial position of the parties”. Having regard to those dicta, the Bank says that the following factors support the refusal of the stay sought by the appellants in this case:

(i) The appellants waited for many years before asserting their claims which are asserted only for the first time in the first appellant’s replying affidavit in these proceedings.

(ii) The claims are vague and not supported by any credible evidence.

(iii) The Bank is a financial institution and likely to be a mark for damages, whereas the appellants appear to be impecunious.

69. As we see, the nub of the appellants’ case in respect of Issue (i) is that the Judge erred in limiting their defence to part of the Bank’s claim only, and in awarding judgment where a counterclaim had been raised. They argue that leave to enter summary judgment should not have been granted “where the affidavits disclose a lot of issues of controversy which are not reconciled”.

70. In my view, the difficulty which presents for the appellants is that their submissions do not identify any specific feature of the evidence relating to the capital sum in respect of which the Judge is said to have erred. The appellants do not dispute that they drew down the loan facility in issue here or that they made no repayments in respect of the same since June 2014. Nor do they challenge the Bank’s calculation of the amount of capital remaining due under the loan facility.

71. Essentially, as the Bank contends, the appellants have not done what Charleton J. in Ryanair Ltd v. Billigfluege de Gmbh [2015] IESC 11 and McDonagh v. Sunday Newspapers Ltd [2018] 2 I.R. 1 says is required of them, namely, “ an appellant arguing for the reversal of any judgment founded on a rigorous analysis of affidavit evidence as to facts bears a heavy burden in seeking to demonstrate that a trial judge has fallen into such error that the decision made is untenable”.

72. It is well established that mere assertion is not sufficient to establish a bona fide defence. As far as the capital sum in issue here is concerned, beyond mere assertion, the appellants have not raised any meaningful dispute regarding any of the essential elements of proof entitling the Bank to summary judgment in respect of the capital sum.

73. It is important to note that the factual matrix upon which the appellants rely for the arguments they advance (including their asserted counterclaim) largely concern a portfolio of other loans which the appellants had with the Bank. It is common case that following an investigation by the Central Bank, and upon subsequent examination by the Bank itself, it was discovered that there was overcharging on some of those loans in relation to the tracker rate. That overcharging, however, did not relate to the mortgage loan the subject of the within proceedings.

74. It is also common case that matters were halted by the Bank in respect of the mortgage loan in issue here during the currency of the tracker mortgage investigation. However, once that investigation was concluded, the Bank issued a new demand in respect of the within loan on 11 May 2020 and the summary summons then issued on 15 May 2020. As counsel for the Bank points out, it is the 11 May 2020 demand which underlies the within summary judgment proceedings.

75. It will be recalled that the case put by the first appellant to the High Court in relation to the motion for summary judgment is that the Bank had no right since October 2008 to charge interest at all on the loan in question because the ECB main financing rate ceased to exist in October 2008. In effect, the appellants’ asserted defence to the motion for summary judgment is that they were entitled to an interest free loan since October 2008. (This assertion is at the heart of Issue (iv) in this appeal which is considered below).

76. Whilst the Bank does not accept that there is any merit in the appellants’ ECB argument, it acknowledges that the first appellant’s contention that the ECB main refinancing rate ceased to exist in October 2008 (which the Judge found to be an arguable defence to the Bank’s claim as regards interest on the loan) explains why the Judge was able to enter summary judgment on the principal sum drawn down by the appellants in 2004, and why she was satisfied to let the interest rate issue go to plenary hearing. In this regard, counsel for the Bank points to the affidavit sworn by Mr Coleman of the Bank on

30 September 2022. At para. 36, he avers as follows: -

“…While it is not accepted that there is any merit to the Plaintiff’s assertions about the ECB minimum bid rate, even if a ‘zero’ interest rate were applied to the account from November 2008 onwards and all loan repayments applied to the accruing capital instalments, the sum due at the date of the commencement of proceedings (and since, given no repayments in the meantime), would be €459,794.61, and the assertions about the minimum bid rate have no application to that sum, only to the remainder of the sum claimed (i.e. €103,716.21 at the date of issuance of the proceedings, and €116,803,52 as of 29 September 2022).”

77. It is worth rehearsing that it was only the principal lent in 2004 that was the beneficiary of the Judge’s order for summary judgment. Of course, the demand made by the Bank on 11 May 2020 was for both capital and interest. The Bank’s submission is that the fact that the demand that was made was for both capital and interest in circumstances where the interest portion of the amount claimed is sought to be impugned by the appellants that does not mean that the Bank could not get summary judgment just for the capital sum. Notwithstanding the appellants’ arguments to the contrary, I accept the Bank’s submission. In advocating its position, the Bank relied on the decision of Sanfey J. in Fennell v Slevin [2020] IEHC 677.

78. In that case, certain arguments advanced on behalf of the defendants/borrowers in respect of alleged overcharging of interest. Sanfey J. found that “a letter of demand which overstates the amount due is still a valid demand” (para. 102). In this regard he cited the dicta of Cregan J. in Flynn v National Asset Loan Management Limited [2014] IEHC 408 at paras. 231-237, and the decision in Vivier Mortgages Limited v Lehane [2017] IEHC

605 in which Baker J, at para.16 of her judgment, endorsed the view of Cregan J in Flynn v. National Asset Loan Management Limited. Sanfey J. also opined, at para. 103, that “the defendants can hardly impugn the appointment of the receiver on this ground with any credibility, given that they have not made a payment against the original loans in over ten years.”

79. I am satisfied that the approach taken by Sanfey J. should apply here. I see no basis to distinguish Fennell v. Slevin solely on the basis, as urged by counsel for the appellants, that what was in issue in that case was an application by the receiver for possession.

80. Even if the demand that was made here by the Bank is alleged by the appellants to be for more than what was due by reason of the Bank having applied an interest rate that had ceased to exist since October 2008 (and I will shortly come to the ECB interest rate when addressing Issue (iv)), that does not invalidate the demand that was made for the repayment of the capital sum lent. The capital and interest sums are easily divisible in this case in circumstances where the appellants, beyond mere assertions, have not raised any credible defence to the Bank’s claim for repayment of the capital sum. Accordingly, as there is no credible basis put forward by the appellants to challenge the bank’s claim as regards the capital sum lent, I am satisfied that the Judge did not err in her decision to grant the Bank leave to enter summary judgment in circumstances where she restricted summary judgment to the principal sum only which, it is admitted, the appellants drew down, and in respect of which they made no repayments since 2014. In all the circumstances, the appellants have not made out their grounds of appeal in respect of Issue (i).

81. I now turn to the question of whether the Judge was correct in restricting summary judgment to the capital sum which is the subject of the Bank’s cross-appeal.

The Cross-Appeal

Issue (iv): Whether the Bank is entitled to summary judgment against the appellants for the interest on the mortgage loan (the Bank’s cross-appeal in relation to the Minimum Bid Rate issue).

82. It will be recalled that the interest rate in respect of loan account no. XXX1000 was set out in the letter of offer in the following terms: - “Applicable Interest Rate (at Offer Date) 2.95% varying – including margin of 0.95% over Tracker Rate (currently 2.00%). APR 2.983%” Under the heading “Special Conditions” the letter of offer stated, inter alia: - “The Tracker Rate will equal the European Central Bank’s Main Refinancing Operations Minimum Bid Rate. This rate will change within [] working days of an ECB rate change.” (Emphasis added)

83. The appellants argue that they have a credible argument that the ECB MRO Minimum Bid rate ceased in October 2008, such that no interest can be charged after that date. As we see, the Judge was “sympathetic to the minimum bid rate point” and so adjourned that issue to plenary hearing.

84. In its cross-appeal, the Bank contends that the Judge erred in law and in fact in adjourning the balance of its claim for €103,716.21 to plenary hearing, and in particular that the Judge erred in law and in fact in holding that the appellants had established an arguable defence on the ground that the Bank had no entitlement to charge interest because the ECB main refinancing operations Minimum Bid Rate referred to in the underlying loan facility letter had ceased to exist. It is submitted that this argument is not capable of constituting a credible defence to the claim for interest.

85. The Bank points to its affidavit evidence which is to the effect that the ECB’s change from a variable rate tender procedure to a fixed rate tender procedure, culminating in the redescription of the rate as “the minimum bid rate on the refinancing of the financing operations of the Eurosystem”, did not mean that “The European Central Bank’s main refinancing operations Minimum Bid Rate” - being the tracker rate identified in the letter of loan offer in respect of loan account no. XXX1000 - ceased to exist. It is said that this tracker rate continues to exist and to be applied in accordance with the loan facility.

86. In essence, the Bank contends that on 8 October 2008 the ECB said that there would not be a system whereby the Minimum Bid Rate was 3% and the banks would then bid at the rate they were willing to take the money. Rather, there would just be a lending rate of 3.75%. Furthermore, in December 2008 the ECB stopped calling the rate the Minimum Bid Rate and the description was changed to the interest rate on the main refinancing operations of the Euro system. Counsel points to what Mr. Coleman deposes to at para. 33 of his affidavit, namely that the reference in the appellants’ mortgage loan offer to the ECB’s MRO “Minimum Bid” Rate was simply a reference to the manner in which the MRO Rate was calculated at the time. Contrary to the first appellant’s contention, the Bank’s position is that ECB MRO Rate continued to exist after October 2008. It is said that the difference post-October 2008 was that there were to be no bids, rather just a flat rate.

87. The Bank accepts that there are a series of High Court judgments where the point the appellants raise here was found that it was arguable, on the basis of evidence in those cases. It argues, however, that there is now objective expert evidence supported by documentary evidence that the first appellant’s point has no merit. Specifically, counsel for the Bank points to the fact that this Court, in two decisions, has already decided that there is no arguable point to be made that the ECM MRO Rate has ceased to exist. He submits the present case is in no way distinguishable from those two decisions.

88. In the first instance, the Bank points to the judgment of Costello J. (as she then was) in Bank of Ireland v. Reilly [2023] IECA 196 which, it says, constitutes binding authority for the proposition that the ECB’s main refinancing operations (MRO) Rate did not cease to exist in October 2008, or thereafter.

89. In Bank of Ireland v. Reilly, it was alleged in an affidavit sworn by the defendants’ solicitor that the ECB MRO Minimum Bid Rate ceased to exist in its entirety in October 2008. It was contended that the “natural conclusion” from that was that as the ECB MRO Minimum Rate was the applicable rate to the mortgage loan account in issue in the case, and where no certificate was ever furnished by the Bank to the contrary, no interest whatsoever accrued to the mortgage loan account post-October 2008.

90. Two deponents swore affidavits on behalf of the bank explaining the position regarding the ECB main refinancing operations interest rate. The first affidavit was that of a Mr. Morley of the bank who averred that he was personally familiar with the detail and operation of the ECB’s refinancing operations. As recorded in the judgment of Costello J., in disputing the defendants’ solicitor’s argument, Mr. Morley averred, inter alia, that there:- “has only ever been one ‘…interest rate on the main refinancing operations (MRO)…’, or ECB MRO Interest Rate, at a timeand what the two sub columns [in the exhibit] differentiate between are the tender processes (fixed or variable) through which the ECM manages the allocation of its MRO lending and between which it switches from time to time as it considers appropriate in its management of the liquidity within the Eurosystem.” Mr. Morley explained that in October 2008 it was the ECB’s allocation mechanism for the making available of liquidity to the Euro system via the ECB’s MRO that changed, not the interest rate. In addition, Mr. Morley referred to the fact that multiple documents readily available from the ECB’s website confirmed the existence of the ECB MRO interest rate after October 2008.

91. The second affidavit was sworn by Mr. Ciaran Rogers, an economist who was formally employed by the Central Bank of Ireland and then by the ECB. When working as an economist Mr. Rogers held the position, inter alia, of ECB Head of Liquidity Management. In 2005, he returned to the Central Bank of Ireland as Head of Market Operations Desk which involved acting as a liaison between Irish banks and the ECB in the implementation of the ECB’s main refinancing operations.

92. Mr. Rogers agreed with the contents of Mr. Morley’s affidavit evidence and confirmed as correct the explanations given by Mr. Morley in relation to the workings of the ECB MRO. In particular, he confirmed that the ECB MRO interest rate is variously known and referred to in the context of ECB MRO lending as the “MRO Refinancing Rate, the MRO minimum bid rate and the MRO REPO Rate” (Para. 49), all of which terms, he said, refer to the same one rate.

93. Mr. Rogers confirmed that the ECB MRO rate was never discontinued or abolished and it never “ceased to exist” as contended by the defendants in Reilly.

94. Mr. Morley’s affidavit was replied to by the defendants’ solicitor wherein it was again contended, inter alia, that “the Minimum Bid Rate” was what had been contracted for to apply to the loan “and not any other MRO Interest Rate”. He asserted that the Minimum Bid Rate had been “replaced with a fixed tender procedure”. He went on to aver: “17…However, for the purpose of the instant contract namely the loan offer, Repo Rate is defined specifically for the purposes of the contract as being the European Central Bank Main Re-Financing Operations Minimum Rate, which as set out above, should read ‘bid’ inserted into same. It is accordingly the case that the minimum bid rate is what was contracted for to apply to the loan for the term of the loan and not any other MRO interest rate which may be fixed or published by the European Central Bank.”

95. Mr. Rogers then replied to that affidavit averring, inter alia, that the solicitor’s affidavit “displays a fundamental misunderstanding of the monetary policy implementation framework of the ECB”. He went on to state, at para. 6: - “There is, and always has been, only one MRO Interest Rate at any point in time. It is not determined by the market but is set and published by the ECB’s Governing Council. Separately to that, the ECB’s Governing Council decides the quantum of liquidity to be made available and whether each MRO lending operation will be advanced through a Fixed Rate Tender procedure or through a Variable Rate Tender procedure. The allotment method of such an MRO operation is an entirely separate and distinct matter from the interest rate set for that operation.”

96. Mr. Rogers concluded his affidavit by stating: -

“… There is, and has at all material times been, just ‘the MRO Interest Rate’, one of the three key ECB interest rates, which is set by the ECB’s Governing Council which in turn, in organising its weekly MRO tenders, also chooses whether to operate through a Fixed or a Variable Rate Tender procedure. The change in 2008 to the use of a Fixed Rate Tender procedure, coupled with the unlimited quanta of liquidity being made available to qualifying participating banks, did not involve the abolition of any ECB interest rate.”

97. In her analysis of Mr. Rogers’ evidence, Costello J. was satisfied that his evidence “may fairly be characterised as expert evidence”. She noted that the defendants’ solicitor had accepted that expert evidence was required in relation to the matter and that he did not hold himself out as an expert. In those circumstances, Costello J. was satisfied that the trial judge was entitled to accept the evidence of Mr. Morley and Mr. Rogers and to conclude that the defendants had raised no arguable defence by reference to either the absence of any applicable rate or to the uncertainty as to the interest rate applicable to the loan facility. She went on to state: “54. … It is not open to a defendant to seek to raise an arguable defence by reference to expert evidence which is not before the Court but which the defendant hopes to adduce in the future if the proceedings are referred to plenary hearing. Such an approach necessarily would involve absolving a defendant of the requirement to establish an arguable defence as a condition to referring the proceedings to plenary hearing.

55. In my judgment, the only expert evidence on the topic clearly establishes that there only ever was, and there continued to be, one ECB REPO rate, that the REPO rate was applied to the defendants’ facility and that the appellant has not established an arguable ground of defence on this issue. Accordingly, I am of the view that this ground of appeal must be rejected.”

98. In the present case, counsel for the Bank says that the appellants here have not adduced any expert evidence for the proposition they put forward, whereas the Bank has put forward the evidence of Mr. Coleman of the Bank whose evidence, it contends, is essentially the same evidence as that given by Mr. Morley in Bank of Ireland v. Reilly whose evidence, in turn, was confirmed by Mr. Rogers who, in turn, was essentially accepted by Costello J. as an independent expert.

99. Counsel for the Bank also referred to the decision of this Court in Bank of Ireland Mortgage Bank v McCarthy [2023] IECA 96. In that case, again, one of the defences raised by the defendants to the bank’s motion for summary judgment was that the ECB MRO Minimum Bid Rate had been abolished with effect from October 2008 and in the absence of the bank having notified (as they were required to do) the defendants as to the newly applicable rate going forward, there was no longer any rate applicable to the defendants’ loan.

100. In that case, the High Court had again evidence from an independent witness (Mr. Rogers) who refuted the defendants’ contentions. On appeal, Binchy J. (writing for this Court) held that the trial Judge was correct to reject the second defendant’s (the appellant) evidence as being “extremely thin”. Binchy J. opined that “in truth” the second defendant “had offered no evidence at all on this issue”.

101. The second defendant, in the course of his appeal, had sought to rely on the decision in Bank of Ireland v Phelan [2020] IEHC 484, where MacGrath J., when considering a similar defence to that put forward here, opined: - “While there may be a strong ground for arguing that the expression ‘Minimum Bid Rate’ is referable to the tender process other than being a reference to a specific and separate interest rate, I do not believe that the issue raised by the defendant may safely be described as unarguable. I am satisfied that the conflicting views expressed are such that it would be inappropriate to determine this issue without further hearing. There is a clear conflict, which this Court is unable to resolve simply on a consideration on the contents of the affidavits.”

102. However, in the absence of his having raised Bank of Ireland v. Phelan in the High Court, Binchy J. held that the second defendant was not entitled to do so on appeal. In any event, Binchy J. went on to state that Bank of Ireland v. Phelan was of little assistance to the second defendant “for the simple reason that the opinion expressed by McGrath J. in that case was based on evidence adduced by the defendant in that case, whereas in this case the appellant proffered no evidence at all to the High Court in support of his assertions, and did not seek leave of this Court to do so for the purpose of this appeal notwithstanding that he had become aware of Phelan in the intervening period”. He stated: “The case the appellant wishes to make about the Rate cannot succeed without evidence, and since he has provided the Court with no evidence, it has no prospect of success.”

103. In the present case, counsel for the Bank submits that the appellants are in the same position and that the first appellant has made assertions without reference to any expert evidence and in circumstances where the first appellant has no means of knowledge of the contention he advances.

104. Notwithstanding the arguments canvassed on behalf of the appellants, I cannot ignore the fact that there are already two decisions of this Court where it has been found that what the appellants contend for does not amount to a bona fide defence. This is in circumstances where the independent expert evidence which was advanced in Bank of Ireland v. Reilly to the effect that the ECB MRO Rate did not cease to exist in October 2008 was confirmatory of the affidavit evidence of Mr. Morley of Bank of Ireland in that case. Costello J. was satisfied to accept Mr. Morley’s evidence. As far as the present case is concerned, I am satisfied that the affidavit evidence Mr. Coleman is essentially the same evidence as Mr. Morley and Mr. Rogers gave in Bank of Ireland v. Reilly.

105. I accept that, here, the Bank did not itself adduce expert evidence. It did, however, adduce the evidence of Mr. Coleman whose evidence, as I have just said, essentially replicates that of Mr. Morley and Mr Rogers in Bank of Ireland v. Reilly. Whilst I am conscious that some degree of deference has to be given by the Court to the manner in which the Judge exercised her discretion to allow the issue in question go to plenary hearing, I nevertheless consider that it would in all the circumstances be anomalous for the Court to say that the appellants have an arguable defence by reference to the ECB MRO Rate issue such that the issue should go to plenary hearing. Save the first appellant’s various averments which are contradicted by Mr. Coleman’s evidence, the appellants have not put anything before the Court such as might establish an arguable defence regarding the ECB MRO Rate issue.

106. For the reasons set out above, I am satisfied that the Bank’s cross-appeal has been made out.

Summary

107. For the reasons set out in the judgment, I would dismiss the appellants’ appeal and allow the Bank’s cross-appeal. By reason of the foregoing, no question of a stay on the High Court Order arises.

Costs

108. As the appellants have been unsuccessful in their appeal, and the Bank has succeeded in its cross-appeal, it would seem to follow that the Bank should be awarded its costs. If, however, either party wishes to seek some different costs order to that proposed they should so indicate to the Court of Appeal Office within 21 days of the receipt of the electronic delivery of this judgment, and a short costs hearing will be scheduled, if necessary. If no indication is received within the 21-day period, the order of the Court, including the proposed costs order, will be drawn and perfected.

109. As this judgment is being delivered electronically, Pilkington J. and Meenan J. have indicated their agreement therewith and the orders I have proposed.