High Court refuses to set aside prior orders and denies interlocutory injunction against property sales.

THE HIGH COURT

[2025] IEHC 519

Record No. 2016/10145P

Between

SHANE MCCARTHY

Plaintiff

and

PEGGIE (OTHERWISE MARGARET) BYRNE AND JOHN BYRNE

Defendant

Judgment of Mr. Justice Conor Dignam delivered on the 2nd day of October 2025

INTRODUCTION

1. This judgment concerns the following three applications:

(i) The defendants’ application for an order prohibiting or suspending the plaintiff from selling or disposing of two properties, the subject of these proceedings (2nd December 2021);

(ii) The plaintiff’s application to dismiss the defendants’ Counterclaim (27th September 2022);

(iii) The defendants’ application to set aside Orders made by Gilligan J on the 17th November 2016 and the 24th November 2016 (7th February 2023).

2. The second-named defendant made submissions on behalf of both defendants. He clarified that while the applications were stated to be made by the first-named defendant, they were in fact brought on behalf of both defendants. I will simply refer to them as the

“defendants’ applications”. It follows that the Defence and Counterclaim, which is stated to be delivered by the first-named defendant, was delivered on behalf of both defendants.

3. The defendants urged me to determine the application to set aside the Orders of Gilligan J first and I, therefore, deal with the applications otherwise than in chronological order.

4. At the hearing, it emerged that the defendants had lodged a book of exhibits but the book had not made its way to court. They lodged another booklet and I have, of course, had regard to those exhibits along with all of the other papers.

5. The background to these applications is, in summary, as follows. It is important to note that the following do not constitute findings of fact on any of the matters set out. As will be discussed below, the defendants have delivered a Defence and Counterclaim. This is in very unusual form and terms and it is extremely difficult to ascertain with any certainty precisely what the defendants’ position is in respect of the matters pleaded in the plaintiff’s Statement of Claim. In order to be absolutely fair to the defendants (and at the risk of being unfair to the plaintiff) I am proceeding on the basis that all matters are in dispute.

6. The plaintiff claims that on the 16 th March 2006, ACC Loan Management DAC advanced a loan facility to the first-named defendant. Documents exhibited by the defendants indicate that this loan was drawn down on the 26 th May 2006. The purpose of the loan was to pay planning and architect fees in relation to the proposed development of a property at 88 South Main Street, Wexford. The plaintiff claims that the security for this loan was a charge over property at 90 South Main Street, Wexford, and a guarantee given by the second-named defendant. The charge was dated the 26th May 2006.

7. The plaintiff also claims that on the 27 th June 2006, the first-named defendant obtained a loan from ACC for the purpose of constructing a commercial property at 88 South Main Street and that this was accepted by the first-named defendant on the 4 th July 2006. The security for this loan was a charge over 88 South Main Street dated the 8 th November 2006. The first-named defendant appears to accept that she entered this mortgage (see paragraph 3 of her grounding affidavit for the application for an interlocutory injunction). It also seems that she does not really take issue with the claim that she gave a mortgage over 90 South Main Street (see paragraph 4 of the same affidavit), though points are made in relation to the validity or effectiveness of both mortgages. I touch on these later in this judgment.

8. Both loans were stated to be repayable on demand.

9. ACC called in both loans on the 9th March 2015. They were not repaid and, on the 23rd April 2015, ACC appointed the plaintiff as receiver over both properties pursuant to the charges. It seems that Pepper Finance took ACC’s former interest in the loans at some point prior to August 2019 and that the plaintiff’s appointment as receiver was novated on the 19th August 2019. The defendants do not appear to dispute the fact of the plaintiff’s appointment as receiver but they do challenge the validity of his appointment. They also challenge the validity of the subsequent purported novation of the appointment.

10. The plaintiff issued these proceedings on the 14 th November 2016 and brought an application for an interim injunction on the 15 th November, claiming that the defendants were interfering with the receivership. Gilligan J granted an interim injunction on the 15 th November 2016 restraining the defendants from accessing, occupying, breaking into and/or trespassing on the properties, which the Order describes as “a commercial premises”, or contacting any tenants or from collecting or attempting to collect any rents or licence fees. Gilligan J subsequently made an Order on the 17 th November 2016, declaring the service of that Order good and sufficient. On the 24 th November 2016, the defendants gave undertakings to the Court reflecting the reliefs sought and Gilligan J granted interlocutory injunctions and made directions as to the exchange of pleadings and the progress of the proceedings.

11. A Statement of Claim was delivered by the plaintiff on the 23 rd December 2016 in accordance with those directions. A Notice for Particulars was raised on behalf of the defendants on the 9th January 2017. The plaintiff claims that Replies to those particulars were delivered on behalf of the plaintiff on the 16 th February 2017. This is disputed by the defendants. A Defence and Counterclaim was not delivered on behalf of the defendants until May 2022. I return to this.

12. Following an online auction, both properties were sold on the 2 nd December 2021 on foot of a contract for sale of that date.

13. On the same day, the first-named defendant issued the motion referred to at paragraph 1(i) above seeking injunctions prohibiting the sale of the properties.

14. Following an exchange of affidavits, that application came before Egan J for hearing on the 8th April 2022. It was submitted on behalf of the plaintiff that the first-named defendant was not entitled to the interlocutory Orders sought because a Defence and Counterclaim had not been delivered and, therefore, she had failed to put anything in issue or raised anything that could ground an entitlement to an injunction. The first-named defendant sought an adjournment to deliver a Defence and Counterclaim. This was acceded to by Egan J and the first-named defendant subsequently delivered a Defence and Counterclaim. It is this Counterclaim which is the subject of the plaintiff’s application referred to at paragraph 1(ii) above.

15. Before dealing with the individual applications, it is necessary to make two general points.

16. Both parties allege that the other has been guilty of delay. The plaintiff claims that the defendants did not deliver a Defence and Counterclaim in accordance with the directions of Gilligan J and that this disentitled them to any of the relief claimed in these applications. The defendants, for their part, claim that the plaintiff is guilty of delay in progressing the proceedings after having secured an interlocutory injunction. These counter-allegations are based on a dispute about whether or not the plaintiff provided Replies to the defendants’ Notice for Particulars of the 10th January 2017.

17. The defendants contend that they were not obliged to deliver a Defence and Counterclaim because the plaintiff did not provide those Replies. They also contend that they were not obliged to do so because the plaintiff failed to comply with Gilligan J’s Order to provide information on any rental payments he had received as receiver.

18. There is no basis for this second point as Gilligan J did not make such an Order.

19. In relation to the first, the plaintiff claims that he did deliver Replies to Particulars. I do not accept that Replies to Particulars were not given. There are a number of factors which support the plaintiff’s claim that Replies to Particulars were sent. On the 30 th September 2021, solicitors acting for the first-named defendant, GN & Co Solicitors, wrote to the plaintiff’s solicitors claiming that a Statement of Claim had not yet been delivered. They stated, inter alia, “Our client through Solicitor Paul Kelly wrote to your client’s then solicitors seeking a Statement of Claim soon after the interlocutory order. No action whatsoever was taken to provide same.” This is manifestly wrong and is entirely inconsistent with the defendants’ own case that they raised particulars on the Statement of Claim in January 2017. Furthermore, the plaintiff’s solicitor replied on the 14 th October 2021 setting out the procedural steps that had been taken, including that a Statement of Claim was delivered on the 23rd December 2016, a Notice for Particulars was served on behalf of the defendants on the 9th January 2017, and that Replies to Particulars were sent on behalf of the plaintiff on the 17 th February 2017. There is no evidence of any reply on behalf of the defendants disputing what was stated by the plaintiff’s solicitors. Instead, in

March 2022, the second-named defendant deposed that the above statement by GN & Co Solicitors was a mistake and that it should have referred to Replies to Particulars rather than a Statement of Claim. However, the statement in GN & Co Solicitors’ letter is very clear and it is difficult to see how it could be interpreted this way. Furthermore, at paragraph 3 of the same affidavit, the second-named defendant says that the statement by the plaintiff’s solicitor at paragraph 10 of his affidavit of the 27 th January 2022, that as of that date no Defence or Counterclaim had been delivered, is untrue. It is difficult to understand how it could be asserted that this statement was untrue. That position is inconsistent with the defendants’ application for an injunction being adjourned when it came before Egan J on the 8th April 2022 because a Defence and Counterclaim had not been delivered. Finally, the second-named defendant submitted that there is an inconsistency on the plaintiff’s side. He submitted that the plaintiff swore at paragraph 10 of his replying affidavit to the defendants’ application for an injunction that “to this day he had heard nothing from the defendants following Gilligan J’s directions”, whereas Mr O’Sullivan, who swore an affidavit on behalf of the plaintiff, confirmed that a Notice for Particulars was delivered on behalf of the defendants. However, in fact the plaintiff does not say that he had heard nothing from the defendants. He specifically says that “as of the date of swearing hereof no defence or counterclaim has been delivered by or on behalf of the defendants”. I therefore do not see any inconsistency.

20. In all of those circumstances, I am satisfied that Replies to Particulars were delivered on behalf of the plaintiff.

21. The defendants have raised a large number of factual and legal issues in the Defence and Counterclaim and the various affidavits filed in these three applications. I have, of course, considered these in their entirety but for the reasons set out below, it is not necessary to set them out or address them in any great detail. I do refer to some of them in the course of the discussion below.

APPLICATION TO SET ASIDE ORDERS OF GILLIGAN J

22. As noted above, Gilligan J made an Order on the 17 th November 2016 declaring service of the interim Order made by him on the 15 th November good and sufficient, and made an Order on the 24th November 2016 granting interlocutory injunctions to the plaintiff on foot of undertakings given by the defendants. The defendants seek to have those Orders set aside on various grounds. I will deal with the Orders in turn.

23. The Order of the 15th November 2016 for an interim injunction provided that the plaintiff’s solicitor be at liberty to notify the making of the Order to the defendants forthwith by telephone and e-mail and that the plaintiff be at liberty to issue and serve short Notice of Motion for an interlocutory injunction seeking the reliefs set out in the ex parte docket/draft Notice of Motion with service as set out in the Rules of the Superior Courts in default of agreement on service in any other manner.

24. The plaintiff made an ex parte application to have service deemed good on the 17 th November 2016. As recited in Gilligan J’s Order of that date, it was grounded on an affidavit of Francis Craven and an affidavit of Patrick Fitzpatrick. It is not necessary to set out the details contained in these affidavits. In summary, they set out in some detail several efforts made to serve the defendants and ultimately, Mr. Craven, who is a summons server, set out that he left a copy of Gilligan J’s Order at the side entrance of 88 South Main Street, through which he had seen people entering the property, and also attached a copy to the front entrance, and that he attached a copy to the gate of the defendants’ residential property.

25. The sole basis for the defendants’ application to set aside this Order is that service was not effected as averred and that the affidavits as to service are “a work of fiction”. The first-named defendant goes on to say that “...service was never effected prior to hearings as set out in their affidavits.”

26. The defendants do not expand on the allegation that the affidavits of service are works of fiction in any of their affidavits. They simply make that assertion without explaining which parts are alleged to be untrue. The second-named defendant, in the course of his submissions, told the Court that a package with the Court papers was left on the front step of 90 South Main Street on the Saturday (which was the 19th November 2016). He sought to suggest that it was not left at an earlier date because it was not damp or wet and that in fact a member of An Garda Síochána drew his attention to it. He also said that the phone number referred to by Mr. Fitzpatrick in his affidavit was not his phone number. However, none of this was put on affidavit and is not in evidence. In my view, this in itself is a reason to refuse the application to set aside the Order of the 17 th November 2016.

27. Perhaps more importantly, it is clear that the defendants were aware of the fact that the matter was in Court the following week because they were present in court on the 24th November and, as reflected in Gilligan’s Order of that date, were represented by Counsel. There is no evidence that any issue was raised in relation to service or that an adjournment of the application for interlocutory relief was sought. Indeed, the defendants gave undertakings on that date. The first-named defendant now says in her grounding affidavit that they “were short served and unprepared” and were “blindsided and unprepared” (see paragraph 39 of the first-named defendant’s grounding affidavit). Indeed, the second-named defendant submitted at the hearing that the package was left on the Saturday as part of a plan to ensure that the defendants would not be prepared. However, there is no evidence of any such points being made to Gilligan J. In circumstances where the facts grounding an application to set aside were known to the defendants at the time and could, therefore, have been raised but were not, there is no basis for setting aside the Order.

28. Finally, to the extent that it is claimed that Gilligan J erred in making the declaration in relation to service, that could have been raised by way of appeal and was not.

29. In relation to the interlocutory injunction Order itself, the defendants contend that this should be set aside on a number of bases. These are set out in the Notice of Motion itself, the grounding affidavit of the first-named defendant, and in oral submissions at the hearing. These include: (i) that the plaintiff did not have the ability to seek the relief and misled Gilligan J into believing that he had a bona fide claim; (ii) that the claim must fail for want “of Subject Matter Jurisdiction...and for the Lack of Claim Equity in the Matter; for the lack of a valid Deed Grant; for dependence upon a photocopy of a Stranger Schedule added to a torn Counterpart Deed”; (iii) because the plaintiff can not produce an Original Deed of Mortgage and instead only relies on the Land Registry Counterparty; (iv) the alleged debts were unsecured; (v) the doctrine of Non Est Factum; (vi) the plaintiff misled Gilligan J by alleging that the two properties were cross-secured but there are internal ACC documents which show they were not cross-secured; (vii) the plaintiff has not proven the validity of his appointment; (viii) there are two versions of the plaintiff’s Deed of Appointment in existence; (ix) the plaintiff has not produced the originals of documents; (x) the mortgage covers present and future debts but not past debts; (xi) the mortgage of the 8th November 2006 did not contain a schedule identifying the property to which it applied and that someone subsequently inserted a page into the copy mortgage;

(xii) the plaintiff did not obtain proper rents and this meant that the defendants’ indebtedness was higher than it should have been. This is not an exhaustive list. Furthermore, the first-named defendant expands on these in the Notice of Motion, grounding affidavit and in submissions. She contends on those bases that the plaintiff had not established that there was a serious issue to be tried, that damages would be an adequate remedy or that the balance of convenience/justice favoured the grant of an interlocutory injunction. She also contends that the test which should have been applied was the Maha Lingham v Health Service Executive [2005] IESC 89 test, i.e., “a strong case that he was likely to succeed.”

30. The questions of which threshold test should be applied and whether the plaintiff had met that test are matters which go to the merits of the application for an interlocutory injunction and could and should have been raised before Gilligan J. There is no evidence that they were. Furthermore, in the event that the defendants were of the view that Gilligan J was incorrect, the appropriate course of action was to appeal his decision. The second-named defendant explained at the hearing that the reason they did not appeal was because they were waiting for the main trial to come on. That is not an adequate reason for setting aside an Order when an appeal would have been the appropriate avenue.

31. In any event, I am not satisfied that it would be a correct exercise of the Court’s discretion to set aside the Orders (even if there was a basis for doing so). The relevant motion was not issued until the 7th February 2023, over six years after the date of the Order. The defendants offer no explanation for this delay. The delay in making the application is particularly relevant in circumstances where a third party (the purchaser) has obtained rights in the meantime.

32. I therefore refuse to make an Order setting aside the Orders of the 15 th and 24th November 2016.

MOTION TO DISMISS THE COUNTERCLAIM

33. The plaintiff seeks to dismiss or strike out the Counterclaim pursuant to Order 19 Rules 27 and 28 of the Rules of the Superior Courts on the basis that it is frivolous and vexatious or fails to disclose a reasonable cause of action and/or pursuant to the Court’s inherent jurisdiction on the grounds that it fails to disclose any cause of action, has no reasonable prospect of success and is bound to fail or is frivolous and vexatious and thereby constitutes an abuse of process. The plaintiff did not really advance any case pursuant to Order 19 Rule 27. I have therefore considered the application under Order 19 Rule 28 and the Court’s inherent jurisdiction.

34. Specifically, it was submitted that (i) no counterclaim or claim for relief is properly pleaded and therefore no reasonable cause of action has been disclosed and the counterclaim is frivolous and vexatious and bound to fail; (ii) even if the Counterclaim discloses a cause of action, it is bound to fail and is, therefore, frivolous and vexatious and an abuse of process. The plaintiff initially also argued that as no Counterclaim had been delivered the defendants could not maintain an application for an injunction. However the

Counterclaim has now been delivered and the plaintiff accepts that argument has fallen away

35. In relation to the first of these, the plaintiff relies on Morony v Guest (1878) 1 LR Ir 564, Order 21 Rule 9 of the Rules of the Superior Courts and Delany & McGrath on Civil Procedure, 4th Ed (2018) (paragraph 5-58).

36. In Morony v Guest, the Vice Chancellor held:

“The Rules in this country...require a defendant to state specifically in his counter-claim the reliefs which he claims...and where he relies upon any facts as supporting his counterclaim, he must in his statement of defence state specifically that he does so by way of counter-claim.”

37. The Vice-Chancellor went on to say:

“...a counter-claim should contain within itself sufficient to support it, either by way of statements in detail, or by clear reference to portions of the defence, as which, if repeated, would properly, and without confusion or embarrassment, constitute a good pleading by way of counter-claim...In the present case the counter-claim refers to and incorporates the statements in the defence; and those statements if repeated in the counter-claim would be quite sufficient to support it...”

38. Order 21 Rule 9 of the Rules provides:

“Where any defendant seeks to rely upon any grounds as supporting a right of counterclaim, he shall in his defence, state specifically that he does so by way of counterclaim.”

39. Delany & McGrath state at paragraph 5-58 (repeated at paragraph 5-61 of the 5th edition):

“Order 21, rule 9 requires a defendant, who seeks to rely upon any grounds as supporting a right to counterclaim, to state specifically that he does so by way of counterclaim...it is not necessary to repeat in the counterclaim, facts that are set out in the defence provided that they are adopted for the purpose of the counterclaim.”

40. The parties argued the case on the basis of the version of Order 19 Rule 28 that was then in force (Order 19 Rule 28 was amended with effect from the 22 nd September 2023) and I have, therefore, determined the matter on that basis.

41. The principles governing the exercise of the Court’s jurisdiction to strike out a claim under the previous version of Order 19 Rule 28 or under the Court’s inherent jurisdiction are well-established (see, for example, Barry v Buckley [1981] IR 306, Salthill Properties Limited v Royal Bank of Scotland plc [2009] IEHC 207, Lopes v Minister for Justice, Equality and Law Reform [2014] IESC 21, Keohane v Hynes [2014] IESC 66, Clarington Developments Limited v HCC International Insurance Company plc [2019] IEHC 630, Kearney v Bank of Scotland [2020] IECA 92). The principles, particularly in relation to the exercise of the Court’s inherent jurisdiction, have recently been stated by the Court of Appeal in Scotchstone Capital Fund Ltd & anor v Ireland & anor [2022] IECA 23, and in McAndrew v Launceston Property Finance DAC & anor [2023] IECA 43.

42. In summary, the jurisdiction, whether under Order 19 Rule 28 or the Court’s inherent jurisdiction, is subject to a number of overarching principles: first, the default position is that proceedings should go to trial and that a person should only be deprived of a trial when it is clear that there is no real risk of injustice; second, it is a jurisdiction to be exercised sparingly, given that it relates to the constitutional right of access to the courts; third, the onus is on the moving party to establish that the pleadings do not disclose a reasonable cause of action or that the case is frivolous or vexatious or bound to fail or that it is an abuse of process, and the threshold to be met is a high one; fourth, the Court must take the plaintiff’s claim at its highwater mark; fifth, the Court must be satisfied not just that the plaintiff will not succeed but cannot succeed; and sixth, the Court must be satisfied that the plaintiff’s case would not be improved by an appropriate amendment to the pleadings or through the utilisation of pre-trial procedures such as discovery or by the evidence at trial. Butler J said at paragraph 4 of her judgment in Greally v Havbell DAC Limited & Ors [2021] IEHC 637 that:

“...in the circumstances, I will adopt the summary of the relevant principles set out in the defendants’ written submission as follows:

(a) The inherent jurisdiction should be exercised sparingly and only granted where there is no risk of injustice to the plaintiff (Barry v. Buckley [1981] IR 306);

(b) The court must be satisfied that it would be manifestly unfair on the defendant to allow the claim to proceed (Kelly v. Allied Irish Bank [2019] IESC 72);

(c) Where an amendment of proceedings would save the action, the plaintiff should be allowed to make such an amendment (Sun Fat Chan v. Osseus Ltd [1992] 1 IR 425);

(d) It is a primary precondition to the exercise of the jurisdiction that all essential facts upon which the claim is based are unequivocally identified (Jodifern v. Fitzgerald [2000] 3 IR 321);

(e) The court may engage in an assessment of the facts, in a limited way, to identify uncontroversial meanings from contracts, letters etc. that inform the evidential basis of the claim (Keohane v. Hynes [2014] IESC 66); and

(f) The court may also resolve disputes which concern issues of law or construction insofar as they can be easily resolved (Moylist Construction Ltd v. Doheny [2016] IESC 9)”

43. The principles were also stated by O’Moore J in Wang v Ladywell Homes Limited & Ors [2021] IEHC 468, to which I was referred on behalf of the plaintiff. O’Moore J said:

“...It is possible to cull the following general propositions (on the jurisdiction to strike out a claim as being bound to fail) from the judgment of Clarke J [in Moylist], building on his earlier judgment in Keohane v Hynes [2014] IESC 66, as well as the judgment of Murray J in Jodifern Ltd v Fitzgerald [2000] 3 IR 321:-

(i) The jurisdiction to dismiss a case as being bound to fail arises from the power of the court to prevent an abuse of process. It is an abuse of process to bring an action which cannot succeed, and the court can act to end such an abuse by dismissing such proceedings.

(ii) It follows from (i) that the court, in hearing such an application, is not engaging in some form of ‘surrogate summary disposal procedure’.

(iii) The power to dismiss a case as being bound to fail is one which must only be used when it is clear that such failure will occur. The fact that the case may appear to be a very weak one is not enough to justify its dismissal. Equally, the jurisdiction should not be used to secure an early determination of points of law or points of fact; there are potentially other avenues available to parties who wish to try to secure such early decisions on particular aspects of a claim.

(iv) The jurisdiction is one to be exercised sparingly, given its very limited function.

(v) In exercising this power, the court must be clear that there is no real risk of injustice in dismissing a case. The court must be mindful that the ‘default position’ in any proceedings is that they will go to trial.

(vi) The court should be alive to the possibility that, even where the only issue in the proceedings appears to be a legal one seemingly capable of determination without further evidence, it may well be that such an issue should only be decided ‘at a full trial and in circumstances where the facts can be fully explored’. This is particularly likely to arise where the legal issues are themselves complex, and require careful analysis.

(vii) Where there are disputes on the facts (which are material or, I think, even potentially material) then it will almost never be appropriate to dismiss a case as being bound to fail.

(viii) The type of case most suitable for exercise of this jurisdiction is one where there is no dispute on the facts, where the legal or documentary issues are clear and straightforward, and where these issues are ones which the court is confident it can safely decide.

(ix) By way of contrast to (viii), where the issues raised in an application such as this reach a certain level of complexity, the appropriate course of action is to let the action proceed to trial even if the judge hearing the application has formed his or her own views about the merit of the points raised.

(x) The court should nonetheless be careful to avoid falling into the trap of finding that a range of arguments, worthless in themselves, collectively give rise to sufficient complexity to refuse the application to dismiss; ‘seventeen noughts are still nothing’.

(xi) In the event that the court decides that the issues arising on a motion to dismiss are genuinely so complex that the motion should fail, it is preferable that the court would refrain from expressing any view on the issues involved; that is a matter for the trial judge, at least in first instance.”

44. These were reflected in the Court of Appeal judgments in Scotchstone Capital Fund Ltd & anor v Ireland & anor [2022] IECA 23, and in McAndrew v Launceston Property Finance DAC & anor [2023] IECA 43.

45. Irvine J dealt with the meaning of “frivolous and vexatious” in Fox v McDonald [2017] IECA 189. She said, inter alia:

“The word ‘frivolous’ when used in the context of O.19 r.28 is usually deployed to describe proceedings which the court feels compelled to terminate because their continued existence cannot be justified having regard to the relevant circumstance...Proceedings which are regularly struck out as “frivolous” or “vexatious” are proceedings clearly destined to cause irrevocable damage to a defendant, such as where a defendant is asked to defend the same claim for a second time or where a plaintiff seeks to avail of the scarce resources of the courts to hear a claim which has no prospect of success.”

46. It is well-established that there is a difference between the jurisdiction which arises under the previous Order 19 Rule 28, of the Rules and the inherent jurisdiction of the Court (the extent of the difference in light of the new terms of Order 19 Rule 28 remains to be considered in a case where submissions are made on the issue). In an application to dismiss proceedings under Order 19 Rule 28, the Court had to accept the facts as asserted in the plaintiff’s claim and, if the facts so asserted were such that they would, if true, give rise to a cause of action then the proceedings did disclose a potentially valid claim and should not be struck out. On an application under Order 19 Rule 28 there was to be no enquiry into, or assessment of, the facts as pleaded. They had to be taken as correct, and the enquiry had to be solely concerned with whether those facts gave rise to a cause of action. On an application under the Court’s inherent jurisdiction, on the other hand, there may be a limited analysis of the facts (see, for example, Lopes v Minister for Justice, Equality and Law Reform [2014] IESC 21, at paragraph 17).

47. As noted above, the first basis upon which the plaintiff seeks to have the Counterclaim dismissed is that it is not properly pleaded and therefore does not disclose a reasonable cause of action.

48. It seems to me that where it is claimed that a Counterclaim does not comply with Order 21 Rule 9, a plaintiff can apply to have the Counterclaim struck out on that basis. However, that does not preclude the dismissal of the Counterclaim on the basis of Order

19 Rule 28 or the Court’s inherent jurisdiction if, as a result of the non-compliance with Order 21 rule 9, the Counterclaim does not disclose a reasonable cause of action, is frivolous and vexatious, is bound to fail and/or is an abuse of process.

49. The Counterclaim in this case is fundamentally deficient. It does not contain a prayer for relief and therefore does not identify precisely what reliefs are sought. Nor does it plead the facts, either expressly or by adopting any relevant facts contained in the Defence, upon which a claim for any reliefs are based.

50. However, I am not satisfied that the plaintiff has established that no reasonable cause of action is disclosed and, therefore, given the high bar to be met, that the counterclaim should be dismissed on that basis. At paragraph 46 of the Defence and Counterclaim, it is pleaded that the plaintiff has engaged in unlawful acts of trespass and interference with the first-named defendant’s properties; and, at paragraph 47, it is pleaded that the plaintiff had no entitlement to let or dispose of the properties. It is possible to discern from paragraphs 50 and 51 that the Counterclaim is based to some extent at least on the claim that the plaintiff was not validly appointed and/or that his appointment was not validly novated. It is also possible to discern that the defendants seek damages for trespass. For those reasons, I do not believe that it can be said that the Counterclaim does not disclose a reasonable cause of action or is frivolous or vexatious. Nor can it be said, given the nature of the points raised by the defendants, that the Counterclaim is bound to fail. Therefore I am not satisfied that the Counterclaim may be dismissed pursuant to Order 19 Rule 28 or under the Court’s inherent jurisdiction.

51. However, it is equally clear that the Counterclaim can not proceed as it is currently pleaded. That would be entirely unfair to the plaintiff. The purpose of pleadings is to set out clearly what the claim is and the facts upon which that claim is made. While it is possible to discern a cause of action, the Counterclaim does not come close to reaching that minimum standard. I will, therefore, make an Order permitting the defendants to deliver an amended Counterclaim which is properly pleaded within fourteen days of perfection of the Order on foot of this judgment (which in reality is a period in excess of fourteen days). Failing such delivery, the Counterclaim will be dismissed. I will also give the plaintiff liberty to issue a motion in respect of such amended Counterclaim.

52. I have had regard to the fact that the plaintiff’s solicitor wrote to the defendants highlighting the deficiencies in the Counterclaim and inviting them to amend it, and that this invitation was rejected by the first-named defendant. The defendants have not sought any opportunity to deliver an amended Counterclaim since. In those circumstances, if I was satisfied that it did not disclose a cause of action, I would not provide an opportunity for the defendants to deliver an amended pleading in order to “save” the Counterclaim. However, the basis upon which I am providing them with that opportunity is that I can not dismiss the claim pursuant to Order 19 Rule 28 or the Courtr’s inherent jurisdiction but the plaintiff is entitled to have the case against him properly pleaded. If the defendants do not avail of this then the Counterclaim will be dismissed.

DEFENDANTS’ APPLICATION FOR AN INJUNCTION

53. The principles applying to an application for an interlocutory injunction are, of course, also well-established. The modern approach to interlocutory injunctions is set out in Merck Sharp and Dohme v Clonmel Healthcare [2019] IESC 65, in which O’Donnell J set out an eight-step approach:

“(1) First, the court should consider whether, if the plaintiff succeeded at the trial, a permanent injunction might be granted. If not, then it is extremely unlikely that an interlocutory injunction seeking the same relief pending the trial could be granted;

(2) The court should then consider if it has been established that there is a fair question to be tried, which may also involve a consideration of whether the case will probably go to trial. In many cases, the straightforward application of the American Cyanamid and Campus Oil approach will yield the correct outcome. However, the qualification of that approach should be kept in mind. Even then, if the claim is of a nature that could be tried, the court, in considering the balance of convenience or balance of justice, should do so with an awareness that cases may not go to trial, and that the presence or absence of an injunction may be a significant tactical benefit;

(3) If there is a fair issue to be tried (and it probably will be tried), the court should consider how best the matter should be arranged pending the trial, which involves a consideration of the balance of convenience and the balance of justice;

(4) The most important element in that balance is, in most cases, the question of adequacy of damages;

(5) In commercial cases where breach of contract is claimed, courts should be robustly sceptical of a claim that damages are not an adequate remedy;

(6) Nevertheless, difficulty in assessing damages may be a factor which can be taken account of and lead to the grant of an interlocutory injunction, particularly where the difficulty in calculation and assessment makes it more likely that any damages awarded will not be a precise and perfect remedy. In such cases, it may be just and convenient to grant an interlocutory injunction, even though damages are an available remedy at trial.

(7) While the adequacy of damages is the most important component of any assessment of the balance of convenience or balance of justice, a number of other factors may come into play and may properly be considered and weighed in the balance in considering how matters are to be held most fairly pending a trial, and recognising the possibility that there may be no trial;

(8) While a structured approach facilitates analysis and, if necessary, review, any application should be approached with a recognition of the essential flexibility of the remedy and the fundamental objective in seeking to minimise injustice, in circumstances where the legal rights of the parties have yet to be determined.”

54. While this is set out as an eight-step process, it is clear that any application for an injunction must be approached “with a recognition of the essential flexibility of the remedy and that fundamental objective in seeking to minimise injustice…” This was also touched on in Betty Martin Financial Services Ltd v EBS DAC [2019] IECA 327 in which Collins J warned against a “tick-the-box” approach to the grant or refusal of an interlocutory injunction and said (at paragraph 34):

“[A]llowing that establishing a serious issue to be tried is a necessary (but not sufficient)

condition to the grant of an injunction (at least where that issue, if established at trial, would provide a basis for a permanent injunction), the decision to grant or refuse thereafter becomes a matter of overall assessment of where the balance of justice lies, though with particular (and, in many cases, decisive) weight being given to the adequacy of damages within that overall assessment…there are likely to be multiple considerations to be weighed in the balance, pointing in different directions, none of which are likely to be decisive in itself.”

55. The parties were largely agreed as to the appropriate threshold test (O’Donnell J’s second step) in the circumstances of this case. The injunctions sought are prohibitory in nature and therefore the threshold test is that of a “fair question” or “serious question to be tried”, these terms being used interchangeably. Barniville J in O’Gara v Ulster Bank Ireland DAC [2019] IEHC 213 described that test in the following terms:

“It may be helpful to view the threshold in terms of requiring a plaintiff who seeks an interlocutory injunction to demonstrate that there is a question or issue which would withstand an application to dismiss…as disclosing no reasonable cause of action or as being frivolous or vexatious. The threshold is of that order and so unless the case is unstateable, it is generally not a difficult threshold to meet.”

56. This was approved of by Collins J in Betty Martin Financial Services Ltd v EBS DAC [2019] IECA 327.

57. In her grounding affidavit, the first-named defendant sets out three points upon which an injunction is sought, i.e. upon which she says there is a serious question to be tried: (i) the plaintiff has incorrectly acted as though the properties were cross-secured;

(ii) the plaintiff should not have been appointed as receiver over 90 South Main Street and therefore has no power to sell it; and (iii) the title documents published online for the purpose of the auction incorrectly refer to a lease held by the defendants’ son over part of

88 and 90 South Main Street for a term of ten years whereas the actual term is ninetynine years. The first-named defendant also refers to seeking a statement of account and payments made into her mortgage accounts and a redemption figure from Pepper Finance and these have not been provided. In his oral submissions (in fact in his replying submissions), the second-named defendant referred to and relied on many of the points listed at paragraph 27 above. He also relied upon the submissions that the plaintiff’s appointment as receiver could only be novated with the agreement of the borrower, and the fact that while in the Memorandum of Agreement for the sale of the properties the vendor is described as the first-named defendant in receivership “acting by Shane McCarthy”, the receiver is defined in the Definitions Section as a Mr. Colin Gaynor,

58. The plaintiff submits that as there is no proper Counterclaim and, most particularly, as the defendants do not assert any rights in the Counterclaim, there is nothing grounding the application for an injunction. It was also submitted that the points that are raised in the grounding and replying affidavits to support the application are not matched in the pleadings. On those bases, it was submitted the defendants are therefore not entitled to an injunction. This point has considerable merit. However, I do not need to resolve this point because I am not satisfied that the defendants would be entitled to an interlocutory injunction in the terms sought even if they established that there is a serious question to be tried. I will therefore proceed on the presumption (though not a finding) that there is a serious question to be tried on one or more of these points.

59. I am not satisfied that the defendants have established that the balance of convenience/balance of justice favours the grant of an interlocutory injunction. There are three reasons for this.

60. The defendants seek an injunction “prohibiting and/or suspending the Plaintiff from selling/disposing of my properties situated at 88 and 90 South Main Street, Wexford.” However, the uncontested facts are that the plaintiff has already sold the properties by public auction. The beneficial interest has therefore passed to the purchaser (see section

52 of the Land and Conveyancing Law Reform Act 2009). Although the sale has not been completed, the purchaser can enforce the contract. In those circumstances, it is not open to this Court to grant an injunction restraining or prohibiting that which has already been done. Even if the injunction sought could be granted, the Court would have to place considerable weight on the rights of the purchaser in weighing up the balance of convenience or balance of justice.

61. Related to this, but also a separate consideration in its own right, is the question of delay on the part of the defendants. There was significant delay in the overall progress of the proceedings on the part of the defendants. As discussed above, I am satisfied that the plaintiff did reply to the defendants’ Notice for Particulars. Following those replies, there was then a four year delay before the first-named defendant took any other step in the proceedings, i.e., the application for an interlocutory injunction (and a five year delay before the Defence and Counterclaim was delivered). One of the grounds upon which the defendants contend that there is a serious issue to be tried is the validity of the appointment of the plaintiff as receiver. That occurred in 2015. That overall delay in itself is a weighty consideration in the assessment of the balance of convenience/balance of justice and leans heavily against the grant of an interlocutory injunction.

62. There was also a specific delay by the defendants in seeking this interlocutory injunction. On the 30th September 2021, GN & Co Solicitors, wrote to the plaintiff’s solicitors stating, inter alia “Our client instructs us that your client has or is preparing the property for sale. In view of the above our client will be seeking appropriate reliefs as against your client in the event of any attempted disposition...” The plaintiffs replied on the 14th October 2021 clearly stating that the plaintiff was “in the process of selling the Property...” Notwithstanding this, no legal steps were taken to restrain the sale until the Notice of Motion was issued six weeks later, on the 2 nd December 2021. Even then an application for an interim injunction was not made. The motion for an interlocutory injunction was issued on the same day that the property was sold by auction. It was open to the defendants to seek an injunction prior to the 2 nd December 2021. The plaintiff, through his solicitors, had been perfectly clear on the 14th October 2021 that he was going to sell the properties but nonetheless the defendants did nothing to restrain it. The secondnamed defendant said in submissions that he spoke to the auctioneer two weeks prior to the sale but that he could not get into court any sooner but did not explain why.

63. This delay by the defendants meant that the property was sold and the beneficial interest disposed of by the time the motion was issued and certainly before the return date for that motion. Thus, the inability of the Court to grant the injunction sought, or the need to have regard to the interests of the purchaser, were brought about by the defendants’ inaction.

64. I am also not satisfied that damages would not be an adequate remedy for the defendants. Traditionally, the question of the adequacy of damages was considered separately from the assessment of the balance of convenience but it is clear from Clonmel Healthcare v Merck Sharp & Dohme that it is now to be considered as part of that balancing exercise. It will in most cases be the most important factor in that assessment.

65. It is absolutely clear that these properties are commercial properties and, indeed, that the defendants’ borrowings were for the purpose of the commercial development of the properties. The second-named defendant said in submissions that it was for the purpose of a pension for the defendants and, in particular, for the first-named defendant. I have considerable sympathy for a couple or individual who seek to make provision for their future during their retirement. However, such a project is a financial investment that can be compensated for in damages. There is no evidence that there is anything personal or special about these properties. For example, in some cases (e.g. Doran v Charleton & Anor [2022] IEHC 331 and Sammon & Anor v Tyrell & Everyday Finance DAC [2021] IEHC 6) the Court has granted an interlocutory injunction to restrain the sale of land on the basis that damages would not be an adequate remedy because there was a special connection with the lands, such as where the lands had been farmed by the same family for generations and therefore could not be replaced. However, there is no evidence of any such features here. They are commercial properties and if the defendants are ultimately successful they can be compensated in damages.

66. It is also relevant that the plaintiffs have not given an undertaking as to damages and that they have not explained why they have not done so.

67. In Nolan & Ors v Dildar Ltd & Ors [2020] IEHC 243, Barniville J set out a nonexhaustive list of the principles applicable to undertakings as to damages. He said at paragraph 228:

“…in most cases, a party seeking an interim or interlocutory injunction will be required to provide an undertaking as to damages. The purpose of requiring such an undertaking is to strike a fair balance between the respective rights of the party seeking the interim or interlocutory injunction and of the party against whom the orders are made…Such an undertaking has been described as the “price which the person asking for an interlocutory injunction has to pay for its grant”…Fennelly J in the Supreme Court in Minister for Justice, Equality and Law Reform v Devine [2012] IESC 2 referred to the “invariable practice” of requiring an undertaking as to damages, at least at the interim stage of proceedings, although the court did not exclude the possibility of there being exceptional cases, such as in the case of an impecunious applicant, where the court might dispense with the undertaking as to damages…In his judgment in that case, O’Donnell J discussed some of the circumstances in which a court could give an injunction, notwithstanding that the undertaking as to damages was of little or no worth (see paras. 23 and 24)

68. In Minister for Justice, Equality and Law Reform v Devine [2012] 1 IR 326, O’Donnell J said:

“23… it is well established that a court can give an injunction notwithstanding the fact that the undertaking as to damages is of little or no worth because of the lack of means of the Minister (Allen v Jambo Holdings Ltd. [1980] 1 W.L.R. 1252). It would clearly be wrong that the deserving plaintiff with a good claim would be denied an injunction simply because they were without assets. In such a case the court must take into account the unlikelihood of such a party being able to satisfy an undertaking as to damages as one of the factors in considering the grant of an interlocutory injunction but may, and on occasion does, proceed to grant an injunction in such circumstances without such an undertaking. Finally, it is generally the case that an undertaking as to damages will not extend to protect the interests of third parties.

24 The picture which emerges, therefore, is not of a mechanical rule, but rather of the exercise of the discretionary jurisdiction in which the presence or absence of an undertaking as to damages may be significant, and in many cases decisive…”

69. Thus, the requirement for an undertaking, while undoubtedly the normal rule, is not absolute and may be departed from in exceptional cases. However, in the absence of any explanation as to why an undertaking was not offered, it seems to me that I can not conclude that this is an exceptional case or that I should not give significant weight to the failure to give such an undertaking.

70. For all of those reasons, taken separately and together, even assuming there is a serious question to be tried, I am satisfied that the defendants would not be entitled to an interlocutory injunction.

CONCLUSION

71. I will therefore make the following Orders:

(i) I will refuse to set aside the Orders of Gilligan J of the 17 th November 2016 and the 24th November 2016;

(ii) I will make an Order granting the defendants’ liberty to deliver an Amended Counterclaim within fourteen days from the perfection of this Order and that unless the Amended Counterclaim is delivered within that period the Counterclaim will stand dismissed. I will also grant the plaintiff liberty to issue a motion in respect of such Amended Counterclaim within twenty-one days of receipt of same, if necessary.

(iii) I will refuse to grant the interlocutory injunctions sought by the defendant.