High Court dismisses borrower's fraud and negligence claims, upholding judgment for bank and assignee.

[2025] IEHC 515

[2010 No. 2596S]

BETWEEN:

AILLED IRISH BANKS P.L.C and EVERYDAY FINANCE DAC

Plaintiffs

-AND-

THOMAS DORAN

Defendant

JUDGMENT of The Hon. Mr. Justice Alexander Owens delivered on the 31 day of

July 2025

1. This litigation is centred on an effort by Thomas Doran to avoid liability to repay money which he borrowed from Allied Irish Banks plc (AIB Bank) to buy two blocks of farmland at Irishtown, Mullingar, close to St Finian’s College, in 2006 and 2007.

2. This land was perceived at that time to have development potential. It was not zoned for residential development in the 2002 County Westmeath development plan.

3. Thomas Doran claimed that an AIB Bank official agreed to get valuations to establish for him that these land purchases represented value for money. He claimed that he was deceived by her into thinking that these valuations had been received by her and that he acted on this by committing to buy these lands.

4. He claimed that documents put on the bank’s file prior to draw-down of his loans which purported to be valuations were not genuine.

5. He also claimed that AIB Bank was negligent and breached its contract with him by not getting reliable valuations before it advanced him the money.

6. Thomas Doran is a canny businessman. I have concluded that he has revisited his memory of what happened. His evidence to me was a mixture of what he was thinking, doing, saying and being told back in 2005, 2006 and 2007 and wishful thinking.

7. I did not accept Thomas Doran’s evidence that an official of AIB Bank promised that she would get valuations which would assist him in deciding whether to buy either of these two tranches of land at the vendors’ asking prices.

8. I concluded that Thomas Doran was not interested in getting valuations when he bought these lands. He did not rely on any representation relating to either their existence or content. He was not deceived into taking any step which he would not otherwise have taken. I also concluded that he knew that he had contractually committed to buy the second tranche of land before he approached AIB Bank for a loan to buy it.

9. Neither the terms of the facility letters governing these loans, nor the circumstances of the relationship between AIB Bank and Thomas Doran, were such as to impose any contractual or other obligation on that bank to provide him with advice or assurance that what he paid for this land represented value for money.

10. Lending terms which made AIB Bank’s consent to draw-down of Thomas Doran’s loans conditional on receiving valuations were not promises by that Bank to refuse to lend without receiving valuations.

11. These terms did not impose any obligation on AIB Bank to advise either that a valuation had not been obtained or of any deficiencies or weaknesses in a valuation.

They did not contain any promise to provide valuation advice.

12. The bank decides whether the valuation which it receives is satisfactory for its purposes. A bank would be entitled to loan the money even if it regarded its valuation as objectively unsatisfactory. Any valuations were for the bank.

13. Thomas Doran has failed to prove that he suffered loss as a result of the alleged deceit, negligence and breach of contract of AIB Bank.

14. I am rejecting all of these claims by Thomas Doran and giving judgment against him for what he owes on his two loans.

15. I do not accept Thomas Doran’s evidence on a subsidiary issue. He claimed that he was told that the AIB Bank “Prime” rate of interest applicable to commercial lending was the ECB lending rate. At most, he was told that this rate of interest was the AIB Bank base rate.

16. The conversations relating to interest rates which Thomas Doran relied on were superseded by written contracts embodying the AIB Bank “General Terms and Conditions Relating to Business Lending.” These terms could not be interpreted as equating the AIB “Prime” rate of interest on commercial loans with the ECB lending rate. These terms governed his loan contracts. The conversations which he relied on were not admissible to add to, vary or contradict the content of those general terms and conditions.

17. In 2006 and 2007 Thomas Doran was a successful developer in London. He also had some interests in racehorses or shares in racehorses. He is now a landlord in London.

18. Thomas Doran borrowed sums of €926,500 and €2,600,000 from AIB Bank on the terms of two facility letters dated 3 January 2006 and 23 July 2007 to buy the two blocks of land at Irishtown.

19. Both of these blocks of land were part of a farm owned by a brother and sister. Their farm adjoined land on the outskirts of Mullingar which was zoned for residential development. Another developer was in the course of completing a housing estate called “College Park” on a block of land which was formerly part of this farm.

20. Thomas Doran gave charges to AIB Bank over these lands and other properties to secure repayment of his loans. AIB Bank sold Thomas Doran’s loans and charges to Everyday Finance DAC (Everyday) in 2018. Everyday has been joined in this action as a second plaintiff.

21. In late 2005, Thomas Doran agreed to buy the first block of land comprising twentytwo and a half acres for €850,000. The purchase price and stamp duty were financed in full by Thomas Doran’s borrowing of €926,500 from AIB Bank. This land had road frontage on a minor road close to Lough Owel which connects with the old Longford Road to the north-west of Mullingar. This purchase was completed in early 2006.

22. In April 2007, Thomas Doran agreed to buy a further block of land comprising thirty acres for €3,000,000. This land adjoined his existing twenty-two and a half acre holding along part of its northern boundary. It also adjoined College Park along part of its southern boundary. It had a point of access into College Park through a farm gate at the end of an estate road within College Park. Thomas Doran funded part of the cost of this land by borrowing €2,600,000 from AIB Bank.

23. The facility letter dated 3 January 2006 specified that the offer of the loan of €926,500 was “subject to the terms and conditions set out in this letter and subject also to the Bank’s General Terms and Conditions Governing Business Lending as set out in the Booklet dated May, 2004, a copy of which is enclosed.” The facility letter dated 23 July 2007 was in similar terms and referred to “a current copy of which is enclosed.”

24. The facility letter dated 3 January 2006 specified that: “Interest shall be payable on all sums drawn on the facility at a margin of 1.5% per annum over the Bank’s Prime rate of funds for the appropriate interest period. (Indication rate of 4.5% based on today’s Prime rate of 3%).” The facility letter dated 23 July 2007 specified “Prime rate varying, plus 1.8% per annum, currently 6.425% per annum.”

25. The facility letter dated 3 January 2006 specified in the “special conditions” as follows: “Independent valuations on the land at Clonard, Enfield (42 Acres) and land being purchased at Mullingar to be received prior to drawdown.” This facility letter did not specify any minimum valuation of “land being purchased at Mullingar” or the land at Clonard which would be acceptable to the bank.

26. The term of this loan was “On demand and at the pleasure of the Bank subject to clearance in full in 2 years.” The special conditions provided that interest only was payable on this loan during the two year period and had to be met quarterly in the interim.

27. The facility letter dated 23 July 2007 specified in the special conditions as follows:

“1. Independent Professional Valuation by a Bank appointed valuer to be provided on the following properties: a) ….Rathfarnham, D14 confirming minimum value of EUR900,000. b) 22.5 acres at Irishtown, Mullingar Co Westmeath confirming a minimum value of EUR1,500,000 (existing holding) c)

42 acres at …Clonard, Enfield. Co Meath confirming a minimum value of EUR1,000,000 d) 30 acres at Irishtown, Mullingar, Co Westmeath confirming a minimum value of EUR3,000,000(new holding).”

It was an implied term of this facility letter that these valuations be forthcoming prior to draw-down.

28. This loan was specified to be repayable at the pleasure of the bank, subject to clearance in full twelve months from date of draw-down by refinance or otherwise, with interest to be met as it fell. The properties specified in special condition 1 were to be provided as security, along with a policy assignment and a lien on a credit balance. The bank relied on existing all sums charges over the lands at Clonard and the twenty-two and a half acres at Irishtown. It required that charges over the house in Rathfarnham and the thirty acres at Irishtown be in place before draw-down.

29. The general terms and conditions relating to interest rates were identical in relation to both of these loans. Clause 5.1.3 specified that: “The bank’s interest rate categories are, at present, as follows: (i) A,AA or Charity (as appropriate to the particular facility) (ii) Premium business (iii) Prime (iv) Business Credit Line (v)

Farmer Credit Line (vi) Evergreen Credit Line and (vii) Market Related. These interest rates are not exhaustive and the Bank will be at liberty at any time to extend or modify them. Any such changes and the dates applicable will be notified to Borrowers in such a manner which the Bank deems appropriate.”

30. At Clause 5.2.4 “Prime, Business Credit Line, Farmer Credit Line and Evergreen Credit Line Rates are set by the bank weekly or more or less frequently as the bank may see fit. Variations will be effective from the first working day of each week.”

Clauses 5.3.2, 5.3.3 and 5.3.4 deal with facilities sanctioned by reference to a “Market Related” rate. Clause 5.6 specified that, except in the case of facilities sanctioned by reference to a “Market Related” rate, “Interest is debited to accounts quarterly in March, June, September and December in each year… and up to the date of final repayment of the facility”. Clauses 5.8.1 and 5.8.2 specify that this is compound interest and that interest debited to accounts itself bears interest until paid and further provide and that compound interest continues to accrue on all balances until the full amount has been repaid, notwithstanding any demand or the issue of proceedings.

31. These offers were accepted by Thomas Doran. He signed the first facility letter and dated his signature 10 January 2006. He signed the second one and dated his signature on 30 July 2007. The second was a revision of an earlier facility letter which he and his wife signed in June 2007.

32. Thomas Doran defaulted on repayment of these loans. AIB Bank sued him for repayment. Thomas Doran retains ownership of these blocks of land.

33. Thomas Doran claimed that he should not have to repay his loans. He claimed that he was induced to buy these lands and to borrow by assurances from AIB Bank that it would get valuations to satisfy him that he was paying market value and that it had got valuations which showed this.

34. He claimed that he borrowed money from AIB Bank to buy the first block of these lands when he did not need to do so and could have paid for them out of his own resources.

35. He claimed that AIB Bank did not get valuations and that he was hoodwinked into buying and borrowing and because his bank left him under the impression that it had obtained proper valuations which showed that the prices which he was prepared to pay represented market value.

36. He claimed that purported valuations on his bank file were neither genuine nor the sort of valuations which could be relied on. He claimed that AIB Bank breached its contract with him and was negligent by allowing him to borrow without having acceptable valuations. This led to him entering into binding commitments to buy these blocks of land.

37. He claimed that he did not waive preconditions in his facility letters which required that AIB Bank have these valuations before it allowed him to draw-down funds.

38. He claimed that if valuations were carried out, they were not independent and overvalued these lands.

39. He claimed that his obligations under his loan contracts terminated because AIB Bank did not hold valid valuations which showed that what he paid for these lands represented market value.

40. He counterclaimed for damages for deceit, negligence and breach of contract. He sought rescission of his loan contracts. He wanted AIB Bank to compensate him for loss suffered as a result of these alleged deceptions, misstatements, negligent omissions and breaches of contract. This included all interest paid on his loans and money which he used to buy the second block of land.

41. Thomas Doran gave evidence that prior to committing to buying each of these blocks of land he told Sharon Scanlon, the official in AIB Bank who handled his loan applications, that he was concerned that he was paying too much and intended to get valuations. He said that she told him not to do so because any valuation which he got would not be acceptable to the bank and said that the bank would get these valuations.

42. Thomas Doran claimed he did not get his own valuations in reliance on the assurances.

43. The background of Thomas Doran’s relationship with Sharon Scanlon was that she is a daughter of his erstwhile friend and business associate, Thomas Scanlon. Thomas Scanlon is a businessman and builder. He owned a house with Thomas Doran and they also owned racehorses together. Thomas Scanlon introduced Thomas Doran to the prospect of buying the two blocks of land at Irishtown.

44. Sharon Scanlon’s brother, who was not an estate agent, worked in the firm of estate agents in Mullingar which provided Sharon Scanlon with the valuations on the lands at Irishtown and on other properties of Thomas Doran, which he claims are inauthentic.

45. Thomas Doran claimed that on being told that he could draw his loans he committed to buy these blocks of land at the prices agreed by him with the vendors. He claimed that if he knew that the bank did not hold proper valuations showing that he was paying market value he would not have bought these lands at these prices. He gave evidence that he would have got his own valuations and re-negotiated with the vendors for reduced prices in accordance with those valuations.

46. He claimed that when Sharon Scanlon told him that she had valuations, or when she confirmed that he could draw-down his loans, he assumed that AIB Bank held valuations which showed that the lands were worth the asking prices. He had no specific recollection of any conversation with her on this topic and relied on her averment in an affidavit that she told him that she had a valuation for the second block of land at Irishtown.

47. He claimed that the bank did not hold genuine valuations when it advanced these loans to him.

48. AIB Bank owed Thomas Doran a duty not to mislead him into paying for a valuation which it knew to be not genuine or otherwise a dud by telling him that he could rely on such a valuation.

49. However, proof that a valuation was a dud would not of itself be sufficient to establish a cause of action against AIB Bank in deceit or impose a duty of care if Thomas Doran placed no reliance on either existence or content of valuations when he bought this land and draw-down his loans.

50. Consumers who borrow to buy their houses and apartments may rely on survey reports commissioned by their lending bank. Typically, these borrowers do not commission their own reports. A lender who commissions a survey may be taken by this type of borrower as investing its money in property as a mark of its condition and value. These reports may deal with aspects of the condition of property which an intending buyer may not be aware of.

51. A duty of care exists in these circumstances without any express representation by a lender because of a common expectation that the lender will commission a report on the property for both lender and purchaser. This establishes the necessary proximity.

52. In these consumer relationships it is fair and reasonable for the law to impose a duty and foreseeable that the borrower will rely on any report obtained: see Ward v.

McMaster [1988] I.R. 337; Wildgust v. Bank of Ireland [2006] 1 I.R. 570 ([2006] IESC 16). If a lender does not follow up by obtaining a proper report, it will be liable for loss sustained by a borrower who proceeds to commit to purchase which arises from any matter which a proper report would have identified.

53. This duty is a limited one. A lender is not responsible for ensuring that its customer has driven a good bargain. Potential buyers of property cannot complain that their lenders should have put a stop to their gallop merely because there may be evidence that they should have offered less.

54. A bank’s ordinary business is that of lender and not of valuer, surveyor, planning consultant, conveyancing solicitor or property adviser. In general, a bank does not owe any duty to business borrowers, such as property developers or speculators, to ensure or offer a view on whether the cost of land which they acquire with bank finance represents value for money, adequate security for a loan, is suitable for intended development, has good title or will be rezoned to permit development.

Genesis 4.9-16 (AV) applies to the relationship between banks and these types of borrowers; not Luke 10:25-37 (AV).

55. These borrowers must do their own due diligence in relation to intended purchases.

They can and should get their own legal advice, valuations and planning or structural surveys to ensure that they are likely to get planning permission or rezoning, and that they have access for passage and connection to public services. They should arrange their affairs so that they do not enter into binding commitments on an assumption that they can rely on a bank or any adviser engaged by that bank to research on their behalf factors relevant to value or development potential of land.

56. Absent any contractual term or a duty of care arising from some special circumstance of their relationship, a bank has no contractual or other obligation to consider the financial interests of a customer: see Kennedy v. Allied Irish Banks plc [1998] 2 I.R. 48, ([1996] IESC 9).

57. A bank may be treated by the law as having assumed responsibility for ensuring for a borrower that a valuation or other report shows that a property is worth what that borrower intends to pay for it or is suitable for that borrower’s intended use. This will happen if evidence establishes that some person dealing with the matter on behalf of a bank acted towards the borrower in a way which shows that the bank assumed this responsibility: see Customs and Excise Commissioners v. Barclays Bank Plc ([2006] UKHL 28) [2007] 1 A.C. 181 at pp. 189-191 [4] and [5], per Lord Bingham.

58. For example, particular types of lenders may be obliged by statute to concern themselves with value of security for loans when making advances. However, these obligations do not, of themselves, impose a duty of care on lenders to borrowers to ensure that they do not offer more than market value when agreeing price.

59. Facility letters invariably contain special conditions which make the right to drawdown loan funds conditional on demonstration of proofs to the satisfaction of the lender. These terms often require that land which the borrower intends to buy, or which is to be provided as security, must be valued by an independent valuer who must report on market value. This report is to the lender.

60. A special condition of this sort may require that a valuation shows that the property intended to be bought is assessed to have a specified minimum market value which may or may not correspond with the price which the borrower intends to pay. It may expressly specify that the bank must be satisfied with the valuation. Where not expressed, this will be implied.

61. A facility letter may provide that the bank will select the valuer and arrange a valuation. It may specify that the proposed borrower will pay for valuations. Where special conditions are silent on who is to arrange a valuation, the bank will usually insist on selecting and engaging the valuer. Banks often try to pass-on the cost of obtaining these valuations to borrowers.

62. A borrower may not know whether proofs required by this type of special condition have been considered as satisfied until the bank advises that it will permit drawdown. A careful borrower will attempt to postpone making any binding commitment to buy until a bank has indicated that it will permit draw-down of any loan needed to fund a purchase.

63. What happens if a bank agrees to lend to a property developer to buy property, conditional on that property being valued by an estate agent at a minimum amount, and that bank, without getting a valuation, or without advising that no valuation has been obtained, allows draw-down of a loan to complete the purchase? What happens if a valuation, if examined by a hypothetical objective banker, would not be accepted as satisfactory? What happens if a valuation is treated by the lender as a formality and put on file without being considered?

64. Does that bank, by permitting draw-down, or by indicating to the intending borrower that it has received the valuation make a contractual promise, or a representation relating to value which that borrower can rely on in deciding whether to go ahead with a purchase? That bank may not know whether its customer has entered into a contractual commitment at that time.

65. Does the existence of this type of condition in a facility letter create a relationship of proximity between bank and proposed borrower in circumstances where the borrower has not read or even asked for sight of the valuation and the bank is unaware that the borrower is placing any reliance on it in negotiating price?

66. Does a term in a facility letter which is structured in this way contain any contractual promise by the bank not to release the loan to the borrower without getting a valuation showing the minimum market value stipulated in the relevant special condition?

67. What happens if the bank misrepresents that it has obtained a valuation and the borrower on the strength of that borrows the money and commits to buying the property?

68. In my view, analysis of how the law deals with these issues by reference to whether contractual promises by a bank and a borrower terminate where a condition precedent to a bank’s further performance of its obligation to make a loan has not been satisfied may not be helpful.

69. A contract may be treated by a party who is not in breach as terminated where that breach which is sufficiently serious to justify refusal of further performance. Where a contract has been substantially performed this is not possible and the remedy of the party not in breach is confined to damages.

70. If a bank in making a loan on foot of a facility letter breaks a contractual commitment to its borrower, and that borrower suffers loss as a result, the remedy for that breach of contract is an action for damages.

71. If a borrower takes a step or makes a commitment as a result of deceit practiced by a bank on that borrower, the remedy is either rescission, where it is possible to revert to the status quo ante, or damages for loss sustained as a result: see Northern Bank Finance Corporation Limited v. Charlton & Others [1979] I.R. 149.

72. The tort of deceit consists of the act of making a wilfully false statement with intent that a person shall act in reliance on it, and with the result that he or she does so act and suffers harm in consequence: see “Salmond & Heuston on the Law of Torts”

21 ed. (1996) at p. 369, citing Bradford Building Society v. Borders [1941] 2 All E.R.

205, 211. The “statement” may take the form of words or conduct and the deceit may lie in failing to correct a statement known to have become false.

73. If a borrower is in a relationship of proximity with a bank which is such as to impose a duty of care in relation to a particular matter and suffers loss as a result of that bank’s want of care, that borrower’s remedy is an action for damages for negligence.

74. Rescission is available as a remedy where a fraudulent (deceitful) representation has led to performance of a contract which has ceased to be executory, provided that the prior position of the parties can be restored by each divesting benefits received in favour of the other: see Northern Bank Finance Corporation v. Charlton & Others per Henchy J. at page 199.

75. Rescission is not available where an innocent (non-deceitful) misrepresentation leads to performance of a contract for the supply of a service which was made prior to that misrepresentation. Assuming that a contract to make a once-off loan as embodied in an accepted facility letter is a “contract for the supply of a service” within s.43 of the Sale of Goods and Supply of Services Act 1980, s.45 of that Act only applies to cases “[w]here a person has entered into a contract after a misrepresentation has been made to him”.

76. This statutory provision does not apply to changes of position as a result of nondeceitful misrepresentations which post-date a contract embodied in an accepted bank facility letter. Furthermore, even this statutory right to rescind may be lost where it is not possible to restore the position of the parties to that which existed prior to the contract.

77. It appears from the decision of the Supreme Court in Northern Bank Finance Corporation v. Charlton & Others that proof that a loan was advanced as a result of a fraudulent misrepresentation by a lender will absolve a debtor from any obligation to make repayment based on a claim that “seeks to give direct effect to the contract of loan.”: see Henchy J. at p. 201. This is “on the basis that the contract must be held to stand rescinded”: see Henchy J. at p. 201. A claim by the plaintiff in that action against the defendants for recovery of a loan advanced to them in connection with a share acquisition which was found to have been procured as a result of a deceit was dismissed on these grounds.

78. The factual situation here was somewhat different to that which rendered it impossible to revert to the status quo ante in the context of share transfers taken by the defendants in Northern Bank Finance Corporation v. Charlton & Others.

79. Were Thomas Doran to succeed in proving deceit by AIB Bank, the law would not permit him both to treat all obligations to repay money received from AIB Bank as cancelled and to hold onto land which he bought with the bank’s money. Perhaps an adjustment recognising this point, while not giving “direct effect to the contract of loan” might be sufficient restitution of the prior status quo. Equity does not require that parties be restored precisely to the state they were in before a contract: see Erlanger v. New Sombrero Phosphate Co (1878) 3 App. Cas. 1218 per Lord Blackburn at 1278-1279.

80. Thomas Doran sought rescission of his loan contracts in his defence and counterclaim. At the trial he advanced his counterclaim as a claim for damages only, and accepted in his written legal submissions that “rescission is not a realisable option.” Instead, he made the case that AIB Bank was in breach of terms of contracts which resulted in his loans.

81. Thomas Doran failed to prove that he bought these lands at Irishtown or borrowed to buy them as a result of any deceit or misrepresentation by AIB Bank.

82. I am satisfied on the evidence that Thomas Doran was indifferent to either fact or content of whatever valuations were put on the bank’s file, except in the context of whether the bank was prepared to allow him to draw-down his loans.

83. I do not accept Thomas Doran’s evidence that he told Sharon Scanlon that he was worried that he was paying too much for either of these two blocks of land. I do not accept that she dissuaded him from getting his own valuations or promised to get valuations for both himself and AIB Bank or in any way left him under the impression that she would organise valuations which would satisfy him on this issue. I accept Sharon Scanlon’s evidence that Thomas Doran never raised any issue of getting valuations with her when he applied for these loans.

84. Nor do I accept that Thomas Doran relied on information from Sharon Scanlon that she had got valuations of these lands or that she was authorising draw-downs of his loans as showing him that he was paying the correct price. It is significant that he never asked to see these valuations.

85. I do not accept Thomas Doran’s evidence of what transpired at a meeting on 26 April 2007. This meeting related to the second block of land at Irishtown. He got the vendors to sign a contract to sell this land to him for €3,000,000 and paid a deposit of €100,000.

86. Thomas Doran’s evidence that he agreed with these vendors for an option which allowed him to get out of his deal if he was unable to get finance, was inconsistent with the content of the document which he got them to sign. I concluded that he wanted to get these vendors to sign a contract for sale for a price which he could hold them to. I do not accept that he told Sharon Scanlon at his meeting with her on the following morning that this agreement was an option and that his deal depended on her obtaining a valuation showing that the second block of land was worth €3,000,000.

87. Apart from this claim, there was no evidence that Thomas Doran kept Sharon Scanlon au fait with the state of his contractual arrangements with the vendors. He never sought copies of the valuations.

88. There was nothing in the proved circumstances of the relationship between Thomas Doran and Sharon Scanlon which gave rise to a duty of care by AIB Bank to Thomas Doran to lend to him only on the strength of valuations which an objective person would consider adequate to demonstrate that the prices which he proposed to pay for these lands equated with market value.

89. Thomas Doran gave evidence that he was introduced to the prospect of buying the twenty-two and a half acres at Irishtown by Thomas Scanlon in October 2005. They met James Murtagh, the estate agent for the vendors, in “The Foxes Covert” public house, which is located west of Mullingar. They then visited this land and walked it.

90. Thomas Doran owned a house in Rathfarnham. He got this from a brother who had run into difficulty with paying his mortgage. Thomas Doran took ownership of his house and paid-off his brother’s lender.

91. As a result of the Scanlon connection, he had a current account in AIB Bank, Upper Baggot Street where Sharon Scanlon worked as a bank official. She was then promoted to officer grade and she moved to AIB Bank, Mullingar. In 2007 she was promoted to assistant manager grade and she moved to AIB Bank, Ashbourne.

92. In 2004 Thomas Doran borrowed from AIB Bank on the security of his Rathfarnham house to buy land at Clonard in County Meath. Sharon Scanlon arranged this loan for him. This was an “equity release” borrowing on the security of his Rathfarnham property home-loan mortgage rates. This land at Clonard had a ruin on it and was part of a former stud. He told me that he bought it with a view to erecting a house on it and stables for an equine facility. He was interested in horses and had in mind to retire to Ireland eventually and breed mares.

93. He told me that his wife was not keen on the location of his land at Clonard. He told me that as a result of this he was interested in buying the twenty-two and a half acres with a view to carrying forward his project to build a house and stables on that land instead.

94. He told me that James Murtagh quoted an asking price of €850,000 for this land, and that he told him that this was expensive and that he would think about it. This price worked out at roughly €40,000 an acre. He also gave evidence that “the brochure” for this land advertised it as having development potential.

95. A witness from AIB Bank who assessed the security value of land for loans in 2007 gave evidence that he worked at that time on the basis that the value of purely agricultural land with no development potential was in the order of €22,000 per acre.

96. A copy of an advertisement issued the vendor’s estate agent on the Thomas Doran’s AIB Bank file described this land as having “obvious development potential.” It is obvious that the price quoted to Thomas Doran for this holding in 2005 reflected a prospect that it might be rezoned.

97. Thomas Doran told me that he had enough resources to buy this land without getting a loan. He visited Mullingar Branch of AIB Bank with Thomas Scanlon after they had walked the land as the latter was calling there to do some business. When he was in the branch he met Sharon Scanlon who he understood to be an assistant manager.

98. He told me that Sharon Scanlon offered him a loan for the full cost of this land, even though he had enough money available from his own resources. He said that he told Sharon Scanlon during this conversation that he could use his own money to buy this land and that he had not decided to go ahead yet.

99. He told me he was hopeful that he would get planning permission for a house and stables and that there was an existing house at the corner of this land. This house had been built on a site adjacent to the minor road which looked to have been sold off from the larger holding. He said that when he applied for planning at Clonard he sold his project to the planners on the basis that his stable yard would provide local employment.

100. His idea was to sell Clonard with the benefit of planning permission for between €1.2 million and €1.5 million and borrow the money for Irishtown for a year or two in the meantime. This would give him a free site.

101. He said that he had business back in Ireland in connection with his application to Westmeath County Council and showed his wife the land which was near Lough Owel. He corrected this evidence to refer to Meath County Council.

102. Thomas Doran said that he had a further meeting with Sharon Scanlon towards the end of November 2005 at which he indicated he was willing to take up her offer and that she took down details of his assets and liabilities. He gave evidence that he attended this meeting with Sharon Scanlon with his wife.

103. Thomas Doran told me that in the course of his meeting with Sharon Scanlon she mentioned “at prime rate.” “I just said to her is prime rate ECB rate and she said it was. I said I think this land is a bit expensive. I need to get it valued. She said no, the Bank will have to get its own valuation; there’s no point in you getting a valuation.” He said that he asked her about the rate because he was familiar with the Bank of England base rate because he did his business in London.

104. Sharon Scanlon agreed that when she met Thomas Doran in November 2005 there was a question as to what “Prime” rate was. She gave evidence that she told Thomas Doran that this was “the bank’s base rate.”

105. Thomas Doran gave evidence of his understanding that if he went to a bank, the bank would insist on getting a valuation from their own panel of valuers which he would be charged for and which would be “for myself and the bank.” He said this was from his experience of doing business in England. He did not give evidence that he told Sharon Scanlon about this understanding, or of when or how he had communicated to the vendor’s agents his agreement to pay €850,000 for the twenty-two and a half acres. He did not give evidence that he postponed making his offer for that land pending receipt of a valuation.

106. Thomas Doran also told me that he did not mention during this meeting anything about being interested in buying other land at Irishtown with a view to development.

107. Thomas Doran denied that he told Sharon Scanlon during that meeting that after two years he might sell the site on or further develop it or that he told her that an offer had been made through James Murtagh to purchase an adjoining circa forty to fifty acres and that this auctioneer was confident that this land would be zoned in the near future.

108. At some point which Thomas Doran could not confirm in evidence he communicated to the vendors that he was prepared to pay €850,000 asking price for this first block of land at Irishtown. A standard draft contract was issued by their solicitors with a closing date of 16 January 2006. This draft contract reflected a price already agreed.

Thomas Doran was not waiting to receive a valuation from AIB Bank in order to negotiate or confirm agreement on price.

109. Thomas Doran did not ask for copy of the Bank’s valuation of this land. He told me that he assumed that the bank’s valuation showed that the land was worth what he was prepared to pay for it because the bank allowed him to draw-down his loan and that he signed the contract for the purchase and sent it back to his solicitors, with instructions not to release it until the bank made this money available. He also signed an authority to give an undertaking and a deed of charge in favour of AIB Bank and returned them to his solicitors.

110. He did not give evidence of any discussion with Sharon Scanlon with a view to ensuring that he did not commit himself to buying this block of land until a valuation became available to AIB Bank.

111. When asked to explain why he did not get a copy of the AIB valuation of this block of lands, Thomas Doran claimed that this was being held for him by Sharon Scanlon at the branch. He also offered this as a reason why he did not take up his claim that he was being overcharged interest until 2008. He said that his statements were being held in the branch.

112. His explanation for this was that a letter had gone from AIB Bank to his house in Rathfarnham where his brother was living and had upset his brother. This related to his loan for Clonard which was secured on his house in Rathfarnham. He had instructed AIB Bank not to communicate to his address in Rathfarnham. However, there was no reason why this would prevent him from receiving facility letters, bank statements and other correspondence at his London address.

113. I do not accept Thomas Doran’s explanation that he did not get sight of the valuation for the first block of lands at Irishtown because he thought Sharon Scanlon was holding this document for him at the branch. He never asked her to send on this document. If he wanted to see it, he could have asked for it.

114. I do not accept this explanation in relation to bank statements either. Bank Statements are issued by an automated system. Nothing was produced by Thomas Doran to me which showed that his bank statements relating to his loans for the lands in Irishtown were issued “poste restante,” to be retained for personal collection by him from Mullingar or Ashbourne branches of AIB Bank. He gave no instructions of that sort in relation to his loans for Irishtown and there was no reason why he would have thought that his bank statements or correspondence relating to those loans were being held in branch of his collection, as opposed to being sent to London. It was clear that these communications were not going to be addressed to him in Rathfarnham.

115. This draft contract provided for payment of a deposit of €85,000. Somebody datestamped the copy which was signed by Thomas Doran “17 January 2006”. The originals of the bank’s files relating to Thomas Doran’s loans have been lost. Copies of valuations of the land at Clonard and of the twenty-two and a half acres outside Mullingar were dated 23 February 2006.

116. I accept the evidence of Sharon Scanlon that she received these valuations before money was released to Thomas Doran’s solicitor to enable him to complete the purchase. On 23 February 2006 Thomas Doran’s solicitor sent a letter to Sharon Scanlon setting out his understanding that she was “now in a position to release loan funds” and asking for a cheque to enable the transaction to be completed “as soon as possible.”

117. He gave evidence to me that he would not have bought the land and the bank would not have lent him the money if it had not met its target of a valuation of €850,000.

He claimed that if the bank did not get the valuation for the €850,000 he would not have got this loan and would not have bought this property.

118. He told me that booklets containing the bank’s general terms and conditions were not enclosed with the 2006 facility letters or with the two facility letters relating to his 2007 loan. He gave evidence that he did not believe that he was provided with these terms and conditions because he did not have them on his file. These facility letters drew his attention to the general conditions and advised him to read them “very carefully.”

119. He said that he knew that the special conditions set out in the facility letters took precedence over any “General Terms and Conditions.” He did not request a copy of these general terms prior to signing his facility letters. There is no doubt that these documents were readily available in AIB Bank branches and that he could have asked for them if he needed to see them. He was bound by these terms.

120. These “General Terms and Conditions” show that AIB Bank “Prime” rate of interest could not be the same as the ECB lending rate. “Prime” was one of a number of interest rates mentioned in these terms and conditions which were described in the facility letters as “Governing Business Lending.”

121. Thomas Doran’s evidence relating to his familiarity with the Bank of England base rate from his dealings in England was inconsistent with an understanding that the AIB Bank “Prime” rate could equate with ECB rate. The Bank of England’s base rate is the rate at which the Bank of England makes money available to banks. This is not a rate at which bankers lend to bankers or a rate at which bankers lend to commercial customers.

122. The evidence established that interest rates were set by reference to margins above rates based on the ECB rate. In that sense “Prime” rate could be explained as being “based” on the ECB rate.

123. I doubt very much that Thomas Doran seriously thought that he was being offered commercial loans for this speculative land adventure at a rate of interest which was 1.5% and 1.00% per annum over the Euro-Zone equivalent of the Bank of England base rate; “the ECB Base rate,” as was suggested by his counsel to Sharon Scanlon.

124. Thomas Doran denied that he brought an auctioneer’s advertisement from Mr Murtagh which related this block of land to the meeting with Sharon Scanlon or that any of the manuscript writing on a copy of that document retrieved from the AIB Bank file was his writing. This copy was produced in evidence. Sharon Scanlon gave evidence that Thomas Doran produced this document to her when he came in to her in November 2005.

125. He did not write the words “existing holding” on that document. He did not put the other marks on the original. A number of bits of faint writing appear on the copy of the aerial photograph of land which includes the twenty-two and a half acres.

126. Sharon Scanlon identified some of the handwriting on this document as hers. While she suggested initially in evidence that Thomas Doran put some of the manuscript writing on the original of this document, I was not satisfied that this was correct. I think it likely that the words “existing holding” and some of the other manuscript notations on this document were put on it in 2007, when Thomas Doran was buying the second block of land at Irishtown.

127. However, I think it likely that Sharon Scanlon had the original of this advertisement in front of her when she was preparing a proposal for her superiors in relation to Thomas Doran’s borrowing to buy the first block of land at Irishtown in 2006. I think it more likely than not that Thomas Doran gave her this document.

128. The photograph on this document was taken from the north with the camera facing south-east towards Mullingar. The Old Longford Road and St Finian’s College can be seen in the background. The lands have some road frontage to a minor road which must link up with the Old Longford Road outside the ken of the photograph. The word “proposed” appears on land above and to the right of the holding being sold and there is another arrow pointing from that holding in the direction of the College.

129. It is clear from this document that the twenty-two and a half acres was marketed by James L. Murtagh and Associates as having “obvious future development potential.”

The manuscript put on that document by Sharon Scanlon showed that the proposed borrowing was to cover €850,000 cost of purchase, plus €76,500 stamp duty calculated at 9%.

130. Sharon Scanlon gave evidence that she recalled only one meeting between herself and Thomas Doran relating to this land. This was the meeting in November 2005.

This meeting was attended by Thomas Doran and her father. Her evidence was that there was no mention by Thomas Doran at this meeting of buying this land to build a house and stables on it. Her evidence was that Thomas Doran was buying it to sellon or develop. He discussed with her the prospect that further lands would become available. She denied a suggestion that she forged part of a typed memo which referred to the prospect of more land becoming available at some later stage.

131. She denied that she represented to Thomas Doran that “Prime” rate was ECB rate.

She agreed that Thomas Doran asked about the rate of interest. Her evidence was that she said to him that it was the AIB base rate. She gave evidence that at the time she understood “Prime” rate was for commercial and ECB rate was used for mortgages.

132. I accept Sharon Scanlon’s evidence of what happened at this meeting. While it may well be that Thomas Doran at some stage had it in his head that he would get planning permission for the Clonard lands, flip them and use the proceeds of the sale to pay off his loan for Irishtown, I accept that he did not mention to her that he was buying with a view to building a house and stables for himself and his wife on them.

133. I accept Sharon Scanlon’s evidence that she did not forge the text at the end of her typed memorandum of her meeting with Thomas Doran. This text referred to the fact that Thomas Doran might sell-on the site or develop it further after two years and that an offer had been made through the auctioneer to purchase an adjoining forty to fifty acres and that the auctioneer was “confident that this land will be zoned in the near future.”

134. I am satisfied that Thomas Doran bought this land with a view to either developing or selling it after two years and that he was also interested in the possibility that forty or fifty acres more would become available to for him to buy. This purchase had nothing to do with a plan to build a house and stables and breed mares on this land during his retirement.

135. I consider improbable that Thomas Doran would want to build a house for his retirement and stables with a view to breeding horses in proximity to a housing estate in the knowledge that land adjacent to it might well be rezoned. I would have thought that anybody who had a genuine wish to build a 6,000 sq. ft. house and stables to retire to and breed horses would attempt to ensure that any nearby lands would not be rezoned for housing. I was not persuaded by his answers when I asked him questions about this.

136. It is significant that Thomas Doran made a submission to Westmeath County Council shortly after he bought this land with a view to getting it rezoned for development.

He also engaged with Meath County Council with a view to getting planning permission for his house and stables at Clonard with a view to adding value to that land by getting a permission for a house and stables. He did not apply for planning permission with a view to erecting a house and stables at Irishtown.

137. While I accept Thomas Doran’s evidence that his solicitors did not exchange contracts for the purchase of the twenty-two and a half acres with the solicitors for vendors until they were in funds to complete the purchase, I do not accept that this was because he wanted to ensure that the bank would, by agreeing to release the funds, provide him with an assurance that it had got a valuation which showed that he was getting value for money.

138. In my view the reason for this was that Thomas Doran and his solicitors wanted to be sure that he would have the money to pay for this land before he exchanged contracts with vendors. This is a common feature of many conveyancing transactions nowadays. The exchange of contracts and the transfer of the land often take place at the same time. The contract here was signed by Thomas Doran and sent to his solicitor who did not release it and arrange to close the sale until he was put in funds to complete the transaction.

139. I concluded that Thomas Doran did not exchange formal contracts for either block of lands until he was allowed to draw-down his loans for this reason and not because he was waiting on confirmation by AIB Bank that it was prepared to release funds as an assurance that he was getting value for money, based on receipt of by Sharon Scanlon of valuations.

140. I do not accept that Thomas Doran ever said to Sharon Scanlon that he was worried that he was paying too much for this land or wanted a valuation for that purpose. I accept Sharon Scanlon’s evidence that he never discussed with her the question of getting a valuation for this land.

141. The fact that Thomas Doran may have thought from the way he did business with banks in England that he could rely on a bank to refuse him a loan if its valuation did not support what he intended to pay for property was not enough to impose a duty on AIB Bank to get him a valuation which showed that he was getting value for money.

142. The special conditions in the facility letter dated 3 January 2006 did not impose any pre-condition to draw-down which required that the land at Clonard or the land being bought at Mullingar be shown by a valuation as having any minimum market value.

This did not provide any basis on which Thomas Doran could assume that AIB Bank required a valuation showing that the first block of Mullingar lands was worth €850,000.

143. I do not accept Thomas Doran’s evidence of the circumstances in which he came to agree to pay €3,000,000 for the second block of land at Irishtown, which he bought in 2007. His evidence on this topic showed a devious frame of mind which was of a piece with his evidence relating to his 2006 loan.

144. Thomas Doran’s evidence that he relied on representations from Sharon Scanlon that she would get a valuation for this block of land to confirm that the €3,000,000 which he proposed to pay represented market value was implausible.

145. He gave evidence to me that he came to Ireland to attend the Easter Monday race meeting at Fairyhouse in 2007. He and Thomas Scanlon had a horse running at that meeting. Thomas Scanlon told him on the phone while he was in London that the vendors of the first block of land had more land for sale. This second block of land comprised thirty acres. Thomas Scanlon arranged with him to meet them at their home on the following morning, Tuesday 10 April 2007.

146. Thomas Scanlon and Thomas Doran went to the vendors’ house. They were told that this land was accessed via an estate road through “College Hill” which was nearly finished.

147. Thomas Doran gave evidence that they gained access to this land by this route and walked it. While walking it, Thomas Doran discovered that it adjoined the block of land he had bought in 2006. This would give an opportunity for this land to be rezoned in maybe ten years’ time. The thirty acres might be rezoned in five or ten years’ time. He could put a scheme together for houses on the thirty acres and give the twenty-two and a half acres as recreation grounds for football pitches.

148. He gave evidence that after they walked this land they went back to the vendors.

After discussing the matter between themselves, the vendors quoted an asking price of €3,000,000. Thomas Scanlon suggested to him that Sharon Scanlon would provide the finance. Thomas Scanlon then drove him to AIB Bank in Mullingar, where he met Sharon Scanlon. She offered him 100% finance. He said that he would put €700,000 of his own money in. She said that she would “do it at 1% over prime.” “I said: ‘Prime now is ECB rate?’ and she said ‘yes.’”

149. He queried why land in Mullingar was so expensive and said that he needed to get this land valued. Sharon Scanlon responded by telling him that because of the size of the loan the bank would have to value it. She said: “Don’t get your own valuation, the bank will have to get the valuation.” He claimed to me that this would be standard practice “recognised in the industry” for any loan he had.

150. This land was, to Thomas Doran’s knowledge, zoned as agricultural land, with a potential to be re-zoned. He stated that this meeting with Sharon Scanlon lasted an hour and that she took notes of his assets and everything to substantiate a loan application.

151. Sharon Scanlon gave evidence that she did not meet with Thomas Doran on 10 April 2007. She gave evidence that her only meeting with Thomas Doran relating to the second block of lands at Irishtown was on 25 April 2007. On that date he arrived at Mullingar branch of AIB Bank and gave her an agreement signed by the vendors and himself on the previous evening.

152. It is common case that Thomas Doran drafted this document in London after he got back from a holiday in Portugal. Thomas Doran gave evidence that while in Portugal he got worried that he might be gazumped. He drafted this document to protect himself from being gazumped.

153. When he prepared it he had a map which he annexed to it. The second block of land at Irishtown was marked on this map. He was unable to tell me who gave him this map. This land referred to in the document as “Coloured brown on the County Development Plan 2002 Mullingar.”

154. This document was entitled in bold print: “Agreement for the sale of Land at Irishtown, Mullingar Co, Westmeath, Ireland (Approx 30 Acres).” It named the vendors as the “sellers” and Thomas Doran as the “buyer.” It specified the price as “3m (Three Million Euro).” This amount was typed out. It described the property by reference to the map. It then specified: “Part deposit paid: 100,000,00 Euro, exchange contracts a.s.a.p, Completion two months after exchange.” It was then signed and dated by each of the vendors, by Thomas Doran as purchaser and by Thomas Scanlon as witness.

155. The name of each of the vendors was typed out under the place for signature, as was the name of Thomas Doran as “buyer” and the name of Thomas Scanlon as “witness.” The area shown in the map referred to in this agreement, was initialled by the vendors and by Thomas Doran.

156. This document was signed at the home of the vendors on a wet Tuesday evening.

Thomas Scanlon collected Thomas Doran at Dublin airport and drove him to Mullingar to meet the vendors. He gave vague evidence of how this meeting came to be arranged.

157. He claimed that he agreed with the vendors that this agreement gave him an option to buy. He claimed that he told them that his agreement to pay €3,000,000 was subject to him getting bank finance. He might have mentioned to the vendors that he had been gazumped previously in Mayo. He probably told the vendors that this was an option to buy. He “would have said option, yes. As I said: ‘Exchange contracts as soon as possible. Completion two months afterwards’”, which he quoted from the agreement. He gave evidence to me that he told the vendors that he was buying this land to give access to his other land and he was buying it because of the access it would give him.

158. His evidence to me of what he meant by the expression “gazumped” was ambiguous.

Normally “gazumped” means that a person’s offer to buy land at a given price has been accepted subject to contract, but the seller does not honour this bargain and sells to somebody else at a higher price. Thomas Doran did not agree that his worry was he would be outbid; merely that somebody would intercept the vendors and secure a contract ahead of him.

159. Thomas Doran agreed that he gave the vendors the €100,000 deposit. He gave each of them a cheque for €50,000. He confirmed to me in evidence that this payment went towards the purchase price. This deposit was not treated as a separate option fee.

160. He was cross-examined on the circumstances in which this agreement came to be executed. The gist of his evidence on this is that he viewed the words which he quoted from the agreement as giving him an “out” if things went wrong. He did not consider that he was taking advantage of the vendors by landing in on them on a wet evening and getting them to sign this agreement without a solicitor. The three million “was just in the agreement … provided I get finance and it values the lands.”

He agreed this in principle but he said it was subject to getting valuations and a bank loan.

161. He claimed that he read over this agreement to his solicitor while being driven from Dublin Airport to Mullingar to get it signed and that his solicitor stated that it “the document is fine.” That was all the conversation they had. He said that they had no discussions about options or anything like that. He also gave evidence that his solicitor told him that he was not bound by it; that his solicitor said: “that’s not a contract.” He agreed that he gave evidence on a previous occasion that his solicitor told him that this document was not a contract. He claimed that he was on medication which affected his evidence on that occasion. His evidence to me was that he did not think that he was bound by this document, but that if he was bound, he would try and renegotiate it.

162. I did not believe Thomas Doran’s evidence that he told the vendors that this agreement was an option which depended on him getting loan finance. I consider it most unlikely that he would have been advised by his solicitor that he was not bound or that he genuinely believed that he could get out of this agreement on the basis of having included in it the words “Exchange contracts as soon as possible. Completion two months afterwards.”

163. I do not accept that he genuinely believed, as he claims, that there was no risk that he had made a binding contract to buy this land. This was completely inconsistent with the fact that he was the author of an agreement which specified the price which the vendors asked for some days previously. There was no suggestion in his evidence to me that he made the slightest effort to negotiate on this price, though he conceded that on cross examination that he might have given evidence on a previous occasion that the vendors asked for €4,000,000 for this land. That might have happened. He could not remember.

164. Thomas Doran’s view on this agreement, as he confirmed in his evidence, was that if the vendors sought to rely on it he would have contested it, and if a court found that he was bound he would have paid up. In the meantime, the vendors’ case would drag through the courts.

165. I have no doubt that if the vendors tried to renege on their commitment, Thomas Doran would rely on this agreement. The object of his visit to the vendors was to get in first and exclude a sale by them to any potential competitor who might offer more money. This was inconsistent with his claimed anxiety that the vendors were looking for too much money.

166. Thomas Doran gave evidence that on 25 April 2007 Thomas Scanlon took him to AIB Bank in Mullingar and he went in and met Sharon Scanlon. He had a meeting with her and handed her the document that was signed the previous evening. He told her that “I’ve got this option to buy agreement. I put down a deposit. I didn’t want to be gazumped and here’s the document.” He handed her the document. He claimed in evidence that this was never intended to be a contract. He construed it at the time as an option to buy.

167. The purpose of Thomas Doran’s meeting with Sharon Scanlon was to seek funding.

They discussed funding and the land would have to be valued because of the size of the loan and there was no point in him getting his valuation. He felt that this was only an option to buy agreement and that the bank would not lend him the money if it did not have a valuation so they agreed that the bank would get the valuation. He gave evidence that he was trying to buy the land and that he wanted the land valued before he would commit to drawing down any facilities. He gave evidence that Sharon Scanlon said that the bank would have to appoint the valuers. He told her that the access was from “College Hill” and that this would open up the first tranche of land for development purposes. He told her that he would put a deposit of €700,000 and borrow €2,600,000 and she took down a lot of information about his assets and what he was doing in the UK.

168. Thomas Doran gave evidence that they discussed the interest rate on this loan and that Sharon Scanlon told him at that time that it would be 1% over “Prime.” “I said:

‘Prime again is ECB rate?’ ‘Yes.’” “Sharon, that’s ECB rate, isn’t it?” He borrowed the money for a year and planned to repay it from money which would come in from a development in London. He gave evidence that if the valuation did not come up to scratch he would have gone back and renegotiated the price. He would use the valuation for this purpose. He claimed if he was “aware at the time that these were fraudulent valuations” he would not have drawn down the money.

169. He gave evidence that he was at Royal Ascot on 23 or 24 June 2007. This was before he received the first sanction letter which was addressed to himself and his wife.

Sharon Scanlon rang him and said that AIB Bank could not do 1% over “Prime” for the facility and they wanted 1.8%. He identified a letter of 15 June 2007 which offered a rate of 2%. He could not remember getting that. He recalled a later letter dated 27 June 2007 which offered a rate of 1.8%. He said that he first noticed that the rates of interest he was being charged were not based on ECB rates in January 2008 and that he rang Sharon Scanlon and said: “This is not the rates that was represented to me” and that she said: “I’ll try to sort it out.” He told her that it was “a higher rate” and not “based on ECB rates.” He looked up ECB rates and started calculating himself. He got a call from Sharon Scanlon in April and was told that he could “lick it and like it” or find a new lender.

170. Sharon Scanlon gave evidence that only one meeting took place between Thomas Doran and her in relation to the second block of land at Irishtown. This was the meeting at Mullingar Branch of AIB Bank on 25 April 2007. He came in by himself unannounced on that occasion. He gave her the agreement which had been executed the night before. She subsequently sent a FAX of it to his solicitor. She disputed that any conversation took place between Thomas Doran and herself about her getting valuations in respect of either the first or the second block of land at Irishtown. She gave evidence that when Thomas Doran came in to her looking for money on both occasions “the deals were none before he came in to me.” He did not talk about getting valuations in the context of being worried that he was paying too much for the lands.

171. I do not accept Thomas Doran’s account of his meeting with Sharon Scanlon on 25 April 2007. His evidence what he said that meeting in relation to the agreement which he signed the previous evening flatly contradicts the content of that agreement. I do not accept his evidence that he told Sharon Scanlon that he had signed an option or that he was relying on her to get him a valuation to show that this block of land was worth what he agreed to pay for it.

172. On cross examination he claimed that all he said about his agreement with the vendors when he produced it to Sharon Scanlon was that he was “seeking to purchase” this land and nothing else and that the vendors “were agreeing to sell it.”

This evidence from Thomas Doran was unreliable. It was clear that he gave this evidence because it fitted in with wording which he saw in an internal bank document which described for what he was seeking a loan.

173. Thomas Doran accepts that he did not see any valuations before the sale of the second block of land at Irishtown was closed. He never asked for them. He gave evidence to me that he did not ask to see valuations because he was relying on the bank to do them. I have concluded that the reason why he did not seek to see the bank’s valuations was because he had no interest in seeing them. I do not accept his evidence on this point. I accept Sharon Scanlon’s evidence that there were only two meetings between Thomas Doran and herself relating to these loans. I also accept her evidence that he never said that he wanted to get valuations on these lands at these meetings or worries that he was paying too much for this land.

174. On the subsidiary issue, I do not accept Thomas Doran’s evidence that Sharon Scanlon told him when he applied for each of these two loans that the AIB Bank “Prime” rate of interest was the same as the ECB rate of interest. His evidence that he asked her twice to confirm that the AIB Bank “Prime” rate was the same as “ECB”

rate and that she did so on both occasions struck me as most improbable. I accept Sharon Scanlon’s evidence that she told him that “Prime” rate was based on ECB rate.

175. Any conversations between Thomas Doran and Sharon Scanlon on this topic took place prior to issue of facility letters which he accepted. These facility letters contained standard terms relating to rates of interest which did not equate “Prime”

or any other rate of interest with the ECB rate. Evidence of background does not lead me to construe “Prime” rate in these facility letters as having any contractual relationship with ECB rate.

176. The general rule is that extrinsic evidence may not be received to add to, vary or contradict the terms set out in a written agreement. This applies to these loan contracts. None of the exceptions to that general rule apply. If Sharon Scanlon said what Thomas Doran claimed that she said, these assurances were clearly in error.

The facility letters offered Thomas Doran contract terms relating to interest rates which bound him upon his acceptance of those terms and superseded anything which she said about interest rates.

177. I now turn to the evidence about the valuations and the case made by Thomas Doran that he should be relieved of liability to repay his loans because he was deceived into thinking that AIB Bank held authentic valuations for the two blocks of land at Irishtown.

178. The valuations received by Sharon Scanlon and placed on Thomas Doran’s loan files were brief and uninformative. They baldly stated that the blocks of land at Mullingar had market value equivalent to their asking price. These valuations did not provide any analysis based on comparators, town planning information or availability of public infrastructure to support possible rezoning and development.

179. Thomas Doran appeared from his evidence to me to have an insouciant attitude to the basis on which he could gain access to develop from “College Hill.” He told me that he expected that this estate would eventually be “taken in charge” by the local authority. No evidence was given on the nature of whatever easements he was given to exit from either of his two blocks of land through “College Hill” or for drainage of sewerage and surface water. He could hardly expect the developer of “College Hill” to allow him access to his infrastructure free of charge.

180. He gave evidence to me that he did not know anything about rezoning or development plans. This was inconsistent with his contact with Westmeath County Council with a view to securing rezoning.

181. On cross examination he said that his thinking was that when he bought the second block of land he thought that the roads were virtually finished at “College Hill” and that sewerage would be there and that if this land got zoned in five or ten years it would have potential for development.

182. In my view the AIB Bank valuations relating to the land at Irishtown were worthless.

They lacked any valuation comparisons. More fundamentally, they were not based on any planning assessment of suitability of these blocks of land for development, availability or access to services, or their prospect of their being included in the forthcoming Westmeath Development Plan or the amount of extra land in Mullingar which was likely to be rezoned in that plan. If Thomas Doran was really interested in receiving a proper valuation, he should have arranged to get expert advice from a solicitor relating to access and easements, a planning consultant and sought a valuation based on that information. He could not rely on AIB Bank to keep him right on these matters.

183. Two one-page, one-paragraph valuations dated 23 February 2006 put the current market value of the first block of land at Irishtown at €850,000 and the land at Clonard at €650,000.

184. Three one-page one-paragraph valuations dated 11 July 2007 stated that the second block of lands had a value of €3,000,000; that the first block of lands had a value of €1,250,000 and that the land at Clonard, which at that stage had planning permission for a 6,000 sq. ft. house and outbuildings, had value of €1,000,000. This valuation of Clonard contained more detail than the previous one.

185. The 2006 valuation of the first block of land inaccurately stated that it comprised

25.5 acres. The 2007 valuation of the second block of land inaccurately stated that it had extensive road frontage onto a public road. It referred to a proposal to Westmeath County Council that these lands be rezoned. The 2007 valuation of the first block of lands incorrectly stated that this holding was adjacent to residentially zoned lands in the Westmeath County Development Plan 2002. In fact this land was separated from residentially zoned lands by the second block of land.

186. These documents were treated as proof of compliance with the special conditions in the facility letters. There was no evidence that Sharon Scanlon or any other official of AIB Bank gave any consideration to their content. They were put on file and Thomas Doran was allowed to draw-down his loans.

187. While the standard of proof of this is always the balance of probabilities, “cogent evidence is generally required to satisfy a civil tribunal that a person has been fraudulent or behaved in some other reprehensible manner.” see Secretary of State for the Home Department v. Rehman ([2001] UKHL 47) [2003] 1 A.C. 153 at para.

[55], per Lord Hoffman.

188. Thomas Doran alleged in his amended counterclaim that the valuations of these two blocks of land on the bank’s files were forgeries which were created and put on file after the money was advanced.

189. Thomas Doran also claimed through his counsel in closing submissions that Sharon Scanlon was aware that these valuations were bogus when she received them.

190. One of the principals in the firm of valuers which issued these valuations gave evidence. He was provided with copies of these valuations back in 2012. The originals were part of a file sent to AIB Bank’s legal department which has been lost or mislaid.

191. His evidence was that this type of brief valuation was the norm in 2006 and 2007.

He said that record-keeping of valuations issued by his office in 2006 and 2007 was incomplete. He could not locate any originals of these documents in such records as he was able to access when he searched in 2012. The letter-heads and footers on the copies appeared to be genuine and were of the sort being used by his firm in 2006 and 2007, as was a date-stamp (“11 JUL 2007”) on a valuation of Thomas Doran’s house in Rathfarnham in Dublin. The format of the valuation of this house was on an AIB Bank standard form for residential property mortgages. It was the same as that used previously by these valuers when the house in Rathfarnham was provided as security for Thomas Doran’s loan from AIB to buy his land at Clonard.

192. This witness pointed out inaccuracies in the valuations. He gave evidence that he did not author them. He would have expected the two other valuers in the firm who might have carried them out to sign them with their names and not with the name of the firm. He indicated that in his view these valuations did not conform with the style of writing of his two colleagues.

193. It emerged during Sharon Scanlon’s evidence that she had previously indicated on affidavit that she had contacted one of these two valuers in connection with the 2006 valuations and that she had been in contact with the other of them in connection with the 2007 valuations. Neither of these valuers gave evidence at the trial. Her evidence at the trial that she contacted these valuers in relation to arranging these valuations was not contradicted.

194. She gave evidence that Thomas Doran was not charged for these valuations. She was requested to pay for the 2007 valuations with €2,000 in cash, which she did.

These valuations were hand-delivered by her brother to her in AIB Bank in Ashbourne on either 11 July 2007 or 13 July 2007. The €2,000 cash was paid over to him and debited to an AIB sundry account with a reference “Thomas Doran” on 13 July 2007.

195. Sharon Scanlon gave evidence that the 2007 valuations were obtained as a matter of urgency in order to facilitate completion of Thomas Doran’s purchase of the second block of land and that she told Thomas Doran that these had been got and that AIB Bank would bear the cost in response to a complaint by him about the rate of interest being offered.

196. Sharon Scanlon gave no specific evidence on how it came about that Thomas Doran was not charged for the 2006 valuations. She was not cross-examined on this aspect or on the identity of the person in the Mullingar estate agents requested her to pay in cash in 2007.

197. She was not cross-examined on the inaccuracies in these valuations. It was not demonstrated that she had any motive to deceive Thomas Doran.

198. Nobody appears to have noticed that the 2007 valuation of the first block of lands came in at less than the amount specified in the special condition in the 2007 facility letter.

199. While I have reservations about the reliability of these valuations and about who prepared them, the evidence did not establish that Sharon Scanlon put bogus valuations on file after these loans were drawn down. The evidence did not prove to me that she was aware at that time that these valuations were not authentic. He failed to prove that Sharon Scanlon deceived him for the purpose of misleading him into buying the lands and borrowing the money.

200. It struck me that Thomas Doran’s real claim is that he should be allowed to walk away from his liabilities because he can embarrass the bank by showing that the daughter of his former friend and business associate put dubious valuations on the bank’s file so that he could draw-down his loans.

201. Even if I concluded that Sharon Scanlon knew or suspected that these valuations were not genuine, none of that would avail Thomas Doran. This is because I do not accept his evidence that he relied on AIB Bank having valuations for these lands when he drew down his loans and completed his purchases.

202. If there was any element of irregularity relating to these valuations, he could only have been the intended beneficiary; not the victim. He was not cheated, deceived or misled into buying these lands or into borrowing from AIB Bank.

203. The next element of Thomas Doran’s claim was advanced on the premise that the 2006 and 2007 valuations of the two blocks of land at Irishtown were not genuine.

His case is that AIB Bank promised in the facility letters not to loan him money unless it got valuations and that it was also necessary that these valuations were genuine and of a standard which an independent objective decision-maker would regard as satisfactory.

204. I have rejected Thomas Doran’s evidence that he impressed upon Sharon Scanlon that he was relying on the AIB Bank valuations to inform his decision-making. It follows that there is no basis on which that evidence could become material to how the language of the special conditions relating to valuations in the facility letters would have been understood by a reasonable person.

205. Where a party to a contract is entrusted by that contract with a subjective power to make a choice to accept something, such as a valuation, it is difficult to see how the courts can have a role of second-guessing exercise of that choice. This extends to cases where that party makes a subjective choice to accept or disregard something without reference to contractual criteria which have been inserted to protect that party’s interest.

206. While I doubt that these valuations were carried out by any of the three valuers in the estate agents, I am not persuaded that arguments based on an extract from the judgment of Charleton J. in I.R.B.C. v. Cambourne Investments Incorporated and Others [2014] 4 I.R. 54 ([2012] IEHC 262) which both AIB Bank and Thomas Doran rely on assists either of their cases on this issue.

207. Thomas Doran’s reliance on passages in the judgment of Charleton J. in Cambourne Investments at pp. 77-79, paras. [46] to [50] as somehow supporting treatment of his obligation to repay as void or terminated and as establishing that AIB Bank was in breach of contract in advancing the two loans is misconceived for a number of reasons. AIB Bank’s reliance on these passages is equally misconceived.

208. In Cambourne Investments a debtor and guarantor attempted to avoid liability for repayment of a loan on the ground of non-fulfilment of a valuation condition precedent to the draw-down of an advance to purchase further units in a shopping centre in which that borrower was already involved. A valuation obtained by Anglo Irish Bank for the purpose of deciding whether to waive conditions precedent to draw-down specifying minimum value of the units and minimum value to loan ratio was found by the Charleton J. to be worthless. He considered that the bank’s credit committee approved a waiver of a condition precedent to draw-down of the loan on an unrealistic and false premise as to the value of the property: see ibid para. [31] at page 71.

209. The borrower and guarantors were not made aware of this. The main guarantor who was also the controlling director of the borrower claimed that the purchase would not have gone ahead if the true valuation had been known and that he should have been told of and assented to the change in valuation.

210. The High Court concluded that on correct construction of the terms of the facility letter within the context of the pre-existing commercial relationship of the parties, this condition precedent to draw-down of the loan was for the benefit of both parties and therefore not one which could be unilaterally waived. The loan contract therefore terminated because the condition precedent to performance was not fulfilled.

However, this did not mean that the borrower was not obliged to pay the money advanced.

211. The relevant part of the judgment of Charleton J. is to be found on pp. 77 to 79 at paras. [46] to [51] and reads as follows:

“[46] The test to be applied for determining whether a contract term is for the exclusive benefit of one party was considered by Blackburne J. in Irwin v. Wilson [2011] EWHC 326 (Ch), [2011] 2 E.G.L.R. 61 where, at para. 23, he quoted with approval the decision of Brightman J. in Heron Garage Ltd. v. Moss [1974] 1 W.L.R.

148 at p. 153:

‘Without seeking to define the precise limits within which a contracting party seeking specific performance may waive a stipulation on the ground that it is intended only for his benefit, it seems to me that in general the proposition only applies where the stipulation is in terms for the exclusive benefit of the plaintiff because it is a power or right vested by the contract in him alone ... or where the stipulation is by inevitable implication for the benefit of him alone ... If it is not obvious on the face of the contract that the stipulation is for the exclusive benefit of the party seeking to eliminate it then in my opinion it cannot be struck out unilaterally. I do not think that the court should conduct an inquiry outside the terms of the contract to ascertain where in all the circumstances the benefit lies if the parties have not concluded the matter on the face of the agreement they have signed.’

[47] Blackburne J. also cited with approval, at para. 24, the following passage from the New Zealand Court of Appeal in Hawker v. Vickers[1991] 1 N.Z.L.R. 399, at pp.

402 and 403:-

‘A party may waive a condition or provision in a contract which is solely for that party’s own benefit and is severable. In such a case the other party is denied the right to treat the condition as unsatisfied and is obliged to complete notwithstanding the loss of that advantage. The question is one of construction of the contract. It turns on whether the stipulation is in terms or by necessary implication for the exclusive benefit of the party, and the answer is derived from consideration of the contract as a whole in the light of the surrounding circumstances...’

[48] I agree with these propositions. The test as to whether a contract term is for the sole benefit of one party is therefore twofold: the condition must of its nature be exclusively for the benefit of one party and, in addition, it must be severable from the contract. If the condition is so bound up with the proper performance of the contract that the unilateral waiver of it by the party in whose favour it is said to be alters the entitlements of the other party to the contract so that a different bargain may then be said to be present, then exclusive benefit cannot characterise the clause.

[49] The valuation precondition to the operation of a contract in the facility letters is claimed by Anglo to be for the benefit of Anglo in that it provided comfort as to the level of security being provided by the borrower against the facilities through the units. However, the borrower also offered to procure a guarantee as a further element to the security proffered for the facilities. As such, it may be claimed that it is difficult to see how the borrower took any benefit from the precondition except insofar as satisfaction of same was a precursor to the release of the funds. However, from the point of view of the ordinary borrower seeking funds on the basis of a valuation conducted by a bank, such a condition offers comfort as to the security of the bargain. It is not unreasonable on entering the matrix of fact within which such loans take place for the potential borrower also to rely on a valuation conducted independently of the aspiration of the borrower. Reliance on such a valuation cannot be excluded from the terms of a clause drafted in the manner in issue here. When clauses allowing waiver of any condition by a bank occur in a contract of loan, ordinarily, as in the decision of Birmingham J. in Zurich Bank v. McConnon [2011] IEHC 75, (Unreported, High Court, Birmingham J., 4th March, 2011), effect may be given to same. Any other remark by Birmingham J. is not essential to his decision and was therefore obiter dicta. My view is that the conditions precedent as to loan to value ratio and value of the property were for the benefit of both sides. The nature of the contract is also such that these conditions cannot be severed.

[50] The effect of a condition precedent for the benefit of both parties not being met is that the contract of loan on the two facility letters, which includes the guarantee on the facility letters made by Peter Curistan and Century City, does not come into operation. The action of parties upon the failure of a written agreement can evidence what their bargain was. The issue as to profit share, a specific term in the facility letter, establishing a partnership and also fiduciary duty between Anglo and Peter Curistan therefore falls away. Fundamentally, in place of these terms for which there is no evidence apart from the facility letters, a contract of loan remains. In general, unless the behaviour of the parties shows that they intended a different bargain, monies lent on overdraft are repayable on demand; Williams and Glyn’s Bank Ltd. v. Barnes [1981] Com L.R. 205. This was a loan for a project. The project was to proceed on terms of diligence by Cambourne, as separately guaranteed by a document apart from the facility letters by Peter Curistan. There is nothing in this case which establishes a contrary intention to repayment on demand. Insofar as it might be argued that the expectation of the parties might have been that the borrowings should have been allowed to continue until the market improved, such a contention is so vague as to lack commercial reality. Even were that capable of proof, this situation was one of large drawdowns of funds under the loan and of a fundamental failure by the borrower to remit rental income or service interest payments. That situation, under any commercial view of the transaction, could not be allowed to continue indefinitely. No aspect of any contract construed in place of the failed facility letter contracts could possibly allow for that.

[51] The decision of the bank to lend money was foolhardy, and the decision to borrow was as bad. Once lent, money is repayable. The decision of the bank to lend money was foolhardy, and the decision to borrow it was as bad. Once lent, money is repayable. It is this principle which establishes, unless excluded, the preservation of mutuality of obligations in contracts of loan. Cambourne is therefore liable to repay the monies”.

212. The first point which arises is that in Cambourne Investments Charleton J. proceeded on the premise that a contract on foot of which money was advanced by Anglo Irish Bank automatically came to an end because a condition precedent to draw-down was not satisfied. The correctness of this premise was not questioned by either side in that case or in this case.

213. Non-satisfaction of a proof which the bank was contractually entitled to insist on as a pre-condition to permitting draw-down of Thomas Doran’s loans did not necessarily result in automatic termination of the contracts embodied in the facility letters: see O’Connor v. Coady ([2004] IESC 54) [2004] 3 I.R. 271 per Geoghegan J. at p. 278 para. [11].

214. In para. [7] of his judgment in O’Connor v. Coady at p.276 Geoghegan J. stated as follows with reference to conditional contracts for the sale of land:

“In every case, as to what is to happen in the event of a condition not being fulfilled is first and foremost a matter for agreement between the parties. The courts will uphold any lawful agreement in this connection. Such agreement may be expressed or implied. If, however, there are no express provisions and if there are no concrete outside circumstances which would raise particular implications, there are principles which a court can lay down as applicable in interpreting the implied agreement of the parties.”

215. This general statement of the law is valid for all conditional contracts. In any particular case there may well be “concrete outside circumstances which would raise particular implications” from which it follows that a party may not treat its obligation to render or accept further performance as at an end.

216. An accepted bank facility letter is a contract to make a loan available to a potential borrower on terms specified by the bank. In absence of express agreement, acceptance of an offer contained in a facility letter does not oblige an intending borrower to avail of the loan offered.

217. Parties to a contract may treat their obligations to render and accept performance as continuing. This is common in sales of land where parties sometimes elect to ignore non-fulfilment of conditions which would entitle one or other of them to treat a contract as at an end. In my view this is not confined to cases where parties are aware that pre-conditions to further performance have not been fulfilled and make an election or waiver.

218. The special conditions in the facility letters governing Thomas Doran’s two loans regulated the circumstances in which a provisional commitment by AIB Bank to advance money to him ceased to be provisional and the bank came to be obliged to make an advance to him. It does not follow that contractual relations between bank and intending borrower come to an end automatically where a proof specified in this type of condition has not been obtained or provided.

219. If a bank signifies that it will permit draw-down or that some pre-condition has been satisfied the borrower can rely on this. This is an example of a situation where an estoppel arises. That borrower can safely enter into commitments in reliance on that bank’s promise to advance the money on the footing that any preconditions have been satisfied.

220. That state of affairs is assumed by those parties to exist and, excepting circumstances where it is possible to rescind for fraudulent misrepresentation, the law will not permit either party to contradict that convention by treating the contract as at an end.

221. Neither bank nor borrower can then claim that these terms of the loan contract do not apply to the advance because the right to draw-down the loan was conditioned on some proof which was waived, ignored, represented as having been satisfied, or forgotten about. The bank will not be permitted to rely on the fact that it does not in fact hold a proof required by a special condition as a ground for refusing to advance the loan.

222. If the money is advanced, that borrower will not be permitted to say that he is not bound to repay it in accordance with the terms of the facility letter or to say that he is not bound by other terms, such as those which require that security be provided for repayment.

223. Once the loan is advanced the obligations under the contract embodied in the facility letters cease to be executory. The remedy for breach of any contractual promise by the bank along the way to that result is damages for breach of contract. The bank is entitled to repayment of the loan in accordance with the terms on which it was advanced, as set out in the facility letter.

224. Furthermore, it does not always follow that a term in a facility letter which makes draw-down of a loan conditional on the bank receiving an independent valuation of property as having a minimum amount or a specific market value is an agreed provision for the benefit of both parties. That cannot be so unless there is some basis for implication of a contractual term to that effect.

225. A bank may choose to get a valuation for the purpose of considering whether to lend. The bank, by getting a valuation, is not assuming a duty to the proposed borrower relating to the value, quality or fitness of the land, or for any purpose.

Business people who borrow for commercial purposes are expected to engage their own experts to assist them on these matters.

226. Whether a borrower is contractually entitled to rely on a representation of compliance with a valuation condition as a basis for non-payment of a loan which has been advanced depends on the terms of the contract between bank and borrower. Was there a contractual promise by the bank not to advance money to the borrower without a valuation of the sort specified in the special condition or to ensure that any valuation which it acted on was the sort of valuation which an objective person could have confidence in?

227. The only contractual issue which could arise in this case is whether Thomas Doran has a cause of action for breach of contract which entitles him to compensation for any loss which he could prove that he sustained as a result of the bank not obtaining valuations which showed that these two blocks of land had market values which were lower than the price which he paid for them.

228. The issue of whether a clause making draw-down conditional on a valuation report, showing that the property has some particular market value confers some other benefit on a party depends on the intention of the parties as set out in the terms expressly agreed in the facility letter, as supplemented by any implied terms which they are taken to have agreed.

229. The underlying relationship which led to the facility letter may be relevant. For instance, a prior commitment by a bank to a borrower to obtain or share a valuation to enable that borrower to make a commercial decision may show that the bank and proposed borrower are in a relationship of proximity which may impose a duty of care. It may also show that the terms of the facility letter should be interpreted as including an implied term that a proper valuation for the benefit of the proposed borrower will be obtained and disclosed prior to draw-down.

230. Absent that type of relationship, there is no reason to suppose that a bank and proposed commercial borrower are not in the normal position of contracting parties dealing with each other at arm’s length. What, if anything, did the Bank agree to provide the borrower with?

231. In this context “benefit” as used in the authorities relating to waiver by one party of contractual rights means contractual benefit in the sense of an agreed right, obligation or entitlement which a party to a contract can enforce. The issue in this case is whether the parties by the terms of the contract agreed that AIB bank would provide for the Thomas Doran valuations which he could rely on in deciding whether or not to proceed with his projects.

232. It is necessary to identify what “benefit,” if any, this type of special condition in a facility intends to confer on the proposed borrower. The contract may not confer on the borrower a right to see any valuation which a bank has obtained or impose any express duty on the bank to draw attention of the proposed borrower to something in a valuation which may be adverse.

233. Absent some agreement which imposes a contractual duty on a lender not to loan money without getting the valuation stipulated for as a condition of permitting drawdown, it is difficult to conclude that an agreed purpose of a valuation pre-condition in a facility letter is to provide “the ordinary borrower seeking funds on the basis of a valuation conducted by a bank” with something “also” to “rely” on “independently of the aspiration of the borrower.”

234. It is possible to envisage other contractual relationships between commercial entities where the obligation of one party to render further performance is dependent on similar pre-conditions. They each assume responsibility for the wisdom of their proposed involvement in the commercial venture. Each of these parties is entitled to look to their own interests and obliged to make its own investigations into any matter which may carry a business risk.

235. There is no acceptable evidence in this case that Thomas Doran was “the ordinary borrower seeking funds on the basis of a valuation conducted by a bank.” This was not the factual background to either of the transactions or the context in which valuation special conditions were included in either of these facility letters. The contractual purpose of valuation clauses in these facility letters was to satisfy AIB Bank that property has some quantified value or minimum value which it set. This flowed from the bank’s decision to take on the lending.

236. Thomas Doran was seeking funds because he intended to buy un-zoned land which he perceived as having development potential at prices which he had already negotiated and agreed. His purchases were speculative, as he must have known at that time. He would be bunched if these lands were not rezoned by Westmeath County Council or if demand for private housing in Mullingar collapsed or if the Irish economy crashed.

237. It is not the business of the courts to foist obligations on a party to a contract which that party would never have expressly agreed to. There is nothing in the facility letters relating to these loans which would lead me to infer by implication that AIB Bank assumed a contractual responsibility to Thomas Doran to get valuations which would meet some objective standard or showed that the lands were worth what he had agreed to pay the vendors.

238. Any assumption by AIB Bank of a contractual obligation to provide any such assurance to Thomas Doran was not necessary to give business-efficacy to these loan contracts. If an officious bystander was to have enquired of the parties whether AIB Bank was agreeing to assume this responsibility, that bank would have said “most certainly not. Thomas Doran can go off and get his own experts if he wants to get advice or reassurance on that.”

239. This being the position, it was unnecessary to include in these facility letters any express disavowal by AIB Bank of contractual responsibility to Thomas Doran to ensure the quality or reliability of valuations obtained by it or not to lend to him, except on foot of valuations which would be acceptable to a hypothetical reasonable banker.

240. This facility letter relating to the first loan imposed no pre-condition to draw-down that AIB Bank be satisfied with a valuer’s opinion that the twenty-two acres was worth what Thomas Doran had agreed to pay. The price which he proposed to pay for these lands was not mentioned in the special conditions; merely that valuations of this and the other land offered as security were to be acceptable to the bank.

241. There is no basis on which I could conclude from the terms of this facility letter that the obligations of AIB Bank included an implied obligation to ensure for Thomas Doran’s benefit that any valuation which it got of the first tranche of lands would be objectively adequate to demonstrate that it was worth €850,000.

242. I do not accept that the facility letter relating to the second loan imposed any contractual duty on AIB Bank to get a valuation which an objective person would consider adequate to demonstrate that either of these two tranches of lands or of any of the other lands being sought as security for the proposed loans showing that those lands had market values in line with that specified in the special conditions.

243. Omission by AIB Bank to obtain a valuation proof specified as a pre-condition to the obligation of that bank to permit draw-down of funds did not give Thomas Doran a right to recover additional expense incurred if the value of the land was less than that specified in the special condition.

244. Thomas Doran did not prove to me that the market values of these two blocks of land at the times when he bought them were less than what he paid for them.

Without evidence, he cannot show that this land was worth less than he paid for it.

Absence of adequate proof of loss poses an insuperable obstacle to recovery of compensatory damages.

245. Thomas Doran’s counsel suggested that he suffered loss because he incurred a liability to pay interest on the loan which he borrowed to buy the first block of land at a time when he could have used his own resources to pay for it. No evidence was supplied for the amount of interest which he paid on this loan in the period up to the time when it fell due for repayment or to show how his loss by reference to a comparison of the effect of use of his capital for this purpose should be computed. It was also suggested that he lost an opportunity to deploy €700,000 used to purchase of the second block of land in some other investment or business which would have given a greater return. No proof was advanced in support of this claim.

246. No effort was made to prove to me that Thomas Doran suffered loss as a result of the alleged deceit, negligence or breach of contract. Thomas Doran stated in evidence that he paid €400,000 in interest on these loans. The exact amount was not quantified, nor was the period over which that interest was paid.

247. I am dismissing Thomas Doran’s counterclaim. Thomas Doran has no defence to the claim for recovery of what is due by him on his loans relating to the lands at Irishtown.

248. I am permitting amendment of the statement of claim as per the draft dated 14 February 2015 in the book of pleadings.

249. Prior to 1877 choses in action could not be assigned at law in Ireland. They were assignable in equity and in such circumstances the assignor’s legal interest was recognised by equity as held for the assignee. The effect of the s.28(6) of the 1877 Act was to establish a new form of statutory assignment under which legal title to a chose in action passes. “If the assignor observes the statutory procedure, the assignee gets the legal title and the assignor disappears into thin air”: see Keeton & Sheridan “Equity” 2nd ed (1976) at p. 214.

250. It has been proved that the debts on foot of the two loans were assigned by AIB Bank to Everyday. This was an absolute assignment. Notice in writing of this assignment was given to Thomas Doran. Thus, the requirements of s.28(6) of the Supreme Court of Judicature (Ireland) Act 1877 have been satisfied. From the date of that notice Everyday has been entitled to these debts and to recover them in this action without the concurrence of AIB Bank.

251. Title-based objections which Thomas Doran attempted to mount during the course of the trial of this action were misconceived because both AIB Bank and Everyday are both plaintiffs in this action. The law limits the extent to which a defendant to an action can raise a ius tertii as a defence to a claim based on ownership or possession of any type of property.

252. In this case Thomas Doran’s only legitimate concern relates to the identity of the creditor who can give him a good discharge if he pays his debt. If he were faced with rival claims he could interplead and pay this money into court.

253. Even if absolute assignment and notice had not been proved to my satisfaction, I would have granted judgment in this case because proceedings for recovery of these debts were pursued by Everyday as plaintiff with the concurrence of AIB Bank as plaintiff. Everyday is entitled to judgment for the amounts owed.

254. Absent proof of an absolute assignment and notice in writing, Everyday is entitled in these proceedings to enforce its right by using the name of AIB Bank in like manner to any equitable assignee of a chose in action.

255. AIB Bank and Everyday have not sought to compute Thomas Doran’s liability by exercising their contractual right to add unpaid interest to principal. They stopped compounding unpaid interest after the rest day prior to the date when AIB Bank formally demanded repayment of these loans.

256. The lenders elected to apply the proceeds of sale of a security in reduction of outstanding principal rather than towards accrued interest, which was also to Thomas Doran’s advantage.

257. Everyday applied rates of interest to these loan accounts which were considerably lower than those which would normally apply to commercial loans.

258. I am satisfied on the evidence that there remains due and owing for principal on foot of the 2006 loan €946,941.62, together with interest on that principal of €263,989.13, calculated on a simple interest basis at the rates from time to time applicable to that loan facility to 11 February 2015. This makes a total of €1,210,930.75 due by Thomas Doran for principal and interest on the 2006 loan as of that date.

259. I am also satisfied on the evidence that there remains due and owing for balance of principal on foot of the 2007 loan €2,758,056.85, together with interest on the principal sums from time to time due and owing in the sum of €884,074.32 calculated on a simple interest basis at the rates from time to time applicable to that loan facility to the 11 February 2025. This makes a total of €3,642,131.17 due and owing for principal and interest on the 2007 loan as of that date.

260. I am granting judgment for €4,853,061.92 against Thomas Doran in favour of Everyday in relation to these two debts.

261. This judgment is being delivered electronically. My provisional view on granting any stay on the debt judgment pending appeal is that this should not be granted.

262. My provisional view on costs is that costs of the dismiss of the counterclaim and of the claim should be awarded against Thomas Doran, including any reserved costs and costs of discovery and that no stay should be granted on this.

263. If Thomas Doran communicates any objections to these courses, this action will be listed on the first day of next term for determination of these points.