Injunction dismissed due to plaintiffs' failure to file affidavits and lack of substance in damages undertaking.

THE HIGH COURT

[2025] IEHC 564

[HP 2025/793]

BETWEEN

THOMAS CLARKE AND CATHERINE CLARKE

PLAINTIFFS

AND

PEPPER FINANCE CORPORATION (IRELAND) DAC AND JAMES ANDERSON

DEFENDANTS

Judgment of Mr. Justice Cregan given on 21st October, 2025

Introduction

1. This is an application by the plaintiffs for an injunction prohibiting the defendants from selling a property known as The Cottage, Moone, County Kildare comprised in Folio KE10478F.

Background

2. On 17th July, 2007, the plaintiffs purchased a bungalow known as The Cottage, Moone, County Kildare registered under Folio No. 10478F. This purchase was financed by way of a loan of €400,000 from Leeds Building Society which was secured on a mortgage over the said property.

3. Subsequently, the first defendant acquired the loan and the mortgage, and the first defendant was registered as the owner of the mortgage on the said property.

4. The plaintiffs defaulted on their obligations under the loan, and as of 3rd December, 2024, the plaintiffs’ loan account had an outstanding balance of €538,231 (which included arrears of €134,436).

5. On 3rd December, 2024, the first defendant called in the loan and appointed the second defendant as receiver over the said property.

6. On 17th February, 2025, the plaintiffs brought an injunction application to restrain the sale which was made returnable to 3rd March, 2025 (“the first application”). This application was grounded on the affidavit of Mr. Thomas Clarke, the first named plaintiff. That grounding affidavit was sparse and only consisted of three pages.

7. When this matter came before the court on 3rd March, 2025, the defendants gave undertakings not to market or sell the property pending the determination of the application for an interlocutory injunction. The court gave directions about filing of affidavits by the defendants and the plaintiffs. Subsequently, however. it emerged that the plaintiffs failed to abide by directions of the court on two separate occasions to file affidavits - in circumstances where they had the benefit of undertakings given by the defendant. In the circumstances, I released the defendants from their undertakings not to sell the said property.

8. Subsequently, the defendants offered the property for sale and, as a result, the plaintiffs brought this second application for an injunction.

9. On 4th July, 2025, counsel for the plaintiffs applied to court for an early hearing date for their second interlocutory application for relief. Having considered the submissions from both sides, I granted liberty to the plaintiffs to issue a second motion seeking interlocutory relief returnable for 10th July, 2025.

The hearing of the injunction

10. The hearing of the injunction took place before me on a number of days in late July 2025. I was not satisfied about the state of the evidence on whether the property was landlocked. I adjourned the matter until 7th October, 2025, and directed both parties to obtain experts’ reports and to prepare clear maps which showed whether the property was landlocked. I also granted an injunction restraining the defendant from selling the property until the return date on 7th October, 2025. I will come back to the issue of the experts reports later in this judgment.

The legal test for an injunction

11. The legal test for an interlocutory injunction was recently restated by O’Donnell J (as he then was) in Merck Sharp & Dohme Corporation v. Clonmel Healthcare Ltd [2019] IESC at paragraph 64: “Finally, at the risk of perhaps creating a further rule that will require subsequent qualification and correction, it may be useful to outline the steps which might be followed in a case such this:-

(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 upon ending 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 Cyanimid 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.”

Analysis of whether there is a serious issue to be tried

The first issue - the first defendant does not have the power to appoint a receiver

12. The first issue raised by the plaintiffs is that the first defendant does not have the power to appoint a receiver under the mortgage. However, it is clear that condition 14.5 of the mortgage conditions provides that the lender does indeed have the power to appoint a receiver to the property.

13. I am satisfied that the plaintiffs’ submissions on this issue are without substance. The second issue – that the receiver does not have a power of sale

14. The second issue raised by the plaintiffs is that the receiver does not have a power of sale. However, it is clear that condition 15.2 of the mortgage conditions provides that any receiver “shall have the power to exercise the rights referred to at condition 14.5”. Mortgage condition 14.5 includes a power of sale.

15. I am satisfied therefore that the plaintiffs’ submissions on this issue also are without substance.

The third issue – that the receiver is invalidly appointed

16. The third issue raised by the plaintiffs was that the receiver was invalidly appointed. However, it is clear from the affidavit of Patrick O’Dwyer of 11th March, 2025, for the defendants, that the plaintiffs were obliged to make monthly repayments on the loan and that the mortgage deed provides that failure to make monthly repayments would trigger acceleration repayment of the whole debt under paragraph 2(b) of the mortgage (and paragraph 3.1(b) of the mortgage conditions) and 14.4(a) of the mortgage conditions. These conditions state that the whole debt becomes immediately due and payable on default in paying two or more monthly payments. It is clear that the plaintiffs defaulted on their debt over a considerable period of time. On foot of their default, the first defendant issued demands to the plaintiffs on 3rd December, 2024, and as a result of the plaintiffs’ breach the whole debt became due and payable. As a result, the first defendant became entitled to appoint a receiver under paragraph 14.5 of the mortgage conditions.

17. I am satisfied therefore that the plaintiffs’ submissions on this issue also are without substance. The fourth issue – that Pepper holds no interest in the mortgage dated 2nd October, 2007

18. The next issue raised by the plaintiffs is that Pepper does not hold any interest in the mortgage dated 2nd October, 2007. However, it is clear that Leeds Building Society transferred this loan and mortgage to the first defendant on 16th November, 2018. The first defendant is now registered on the folio as the owner of the charge.

19. Section 31(1) of the Registration of Titles Act, 1964 provides that the register shall be conclusive evidence of the title of the owner to the land as appearing on the register. (See also Tanager DAC v. Kane [2019] 1 IR 385. See also Bank of Ireland v. Cody [2021] 2 IR 381).

20. I am satisfied that the plaintiffs’ submissions on this issue also do not raise a fair question to be tried. The fifth issue – the receiver was appointed over folio 10478 County Kildare not the property that is the subject matter of the mortgage

21. The plaintiffs’ fifth submission is that the receiver was not appointed over the correct property. The plaintiffs submit that the receiver was appointed over Folio 10478 County Kildare and not over Folio 10478F, the property which is the subject matter of the mortgage.

22. It is clear, however, that this submission is also without substance. The property which was the subject matter of the mortgage was stated to be “The Bungalow, Timolin, Moone, County Kildare” on “Land Registry Folio No. 10478F, County Kildare”.

23. The receiver was appointed over “The Bungalow, Timolin, Moone, County Kildare” comprising “all that and those being the property comprised in part of Folio 10478 of the Register of Freeholders, County Kildare”.

24. The plaintiffs sought to argue that the schedule to the mortgage had the property as being in Folio 10478F whereas the schedule to the deed of appointment of the receiver described the property as Folio 10478 (i.e. that the letter F was missing). The plaintiffs argued that the missing “F” in the schedule to the deed of appointment was fatal to the deed of appointment.

25. However, it is clear from McCarthy v. Langan [2019] IEHC 67651 and Casey v. Everyday Finance DAC [2021] IEHC 167, that an issue with the description of property is not fatal to the deed of appointment. In Casey, the court was of the view that even if the property was not described at all in the deed of appointment of the receiver, this was not fatal to the validity of the deed of appointment.

26. Moreover, as Allen J. stated at paragraph 74 in McCarthy: “The secured properties are not described in a schedule (or elsewhere) in the deeds of appointment but they are in the deeds of charge, and the appointments are expressly made over ‘the assets of the Chargor referred to and comprised in and charged by’ the deeds of charge. The appointments are not invalid by reason of the absence in them of a description of the properties.”

27. I am satisfied that the receiver was appointed over exactly the same property which was the subject matter of the mortgage.

28. I am also satisfied therefore that the absence of a missing letter “F” does not undermine the validity of the deed of appointment of the receiver. I am satisfied that the omission of the letter “F” in the schedule to the deed of appointment of the receiver is not, in any way, significant, based on the evidence before this court in this application, and I am certainly not satisfied that it is of such significance that it amounts to a serious issue to be tried in this application.

The sixth issue – that the receiver is a rent receiver only

29. The plaintiffs also submitted that the receiver was a rent receiver only. Again, however, I am satisfied that this submission is without substance. It is clear that the receiver has a power of sale. The seventh issue – that the first defendant failed to comply with s.28 (6) of the Supreme Court of Judicature (Ireland) Act, 1877

30. The next submission by the plaintiffs was that the first defendant failed to comply with the provisions of section 28(6) of the Supreme Court of Judicature (Ireland) Act, 1877.

31. However, as Simons J. stated in Promontoria Oyster DAC v. Lynn [2020] IEHC 1999, there is no difficulty with “giving of notice of the assignment as part and parcel of a comprehensive letter of demand [and] no logical reason that a single document may not serve the twofold objective of giving notice of the assignment of the debt and making demand for payment”.

32. The written demand in this case, set out in the affidavit of Patrick O’Dwyer for the defendants of 11th March, 2025, at exhibit POD5 provides that: “By way of an Irish law Deed of Transfer dated 16th November, 2018 and made between (1) Leeds Building Society (the seller) and (2) Pepper Finance Corporation (Ireland) DAC (“Pepper”), Pepper acquires the right, title and benefit (past, present and future) of the seller in and over the loan and the security”.

33. I am also satisfied therefore that the requirements of the express notice in writing of an assignment of a debt have been complied with.

34. I am also of the view that a serious issue to be tried has not been raised in respect of this matter.

The eight issue – alleged forged signature

35. The eighth issue raised was that the plaintiffs’ signature on an application form (for mortgage broker services generated by Morrin Mortgages, an independent mortgage broker based in Naas, County Kildare, executed on 3rd May, 2007) was forged.

36. However, it is clear from Mr. O’Dwyer’s affidavit of 9th July, 2025, that the defendants are complete strangers to Morrin Mortgages. It is difficult to know on what possible basis the plaintiffs make this argument - in circumstances where the money was in fact advanced to them, where they purchased the property with these funds, where they entered into a loan agreement with Leeds Building Society and where they entered into a mortgage over the said property as security for this loan. The issue of whether the signature was forged is completely irrelevant to this application and certainly does not amount to a serious issue to be tried.

The ninth issue – that the lands were landlocked

37. The plaintiffs submitted that the property – the subject matter of the mortgage and the subject matter of the receiver sale – was landlocked. When this matter was first raised by counsel for the plaintiff, my understanding of what they meant was that, on the facts of this case, there was a sliver of land between the land which was being offered for sale by the receiver and the road - so that a person buying the property would be buying property which was landlocked. In other words, I was concerned that the receiver might be offering for sale a landlocked property to an innocent bona fide purchaser for value without notice. In the circumstances, I directed both parties to file exact maps prepared by independent consulting engineers on this matter.

38. On 20th August, 2025, the plaintiff retained Mr. Owen Wynne of Wynne Civil Engineering Ltd to prepare a report and a map. The plaintiffs’ map was a survey of the relevant property. It sets out:

(a) the property, the subject matter of the dispute - highlighted in red.

(b) the property owned by a partnership which is adjacent to the property the subject matter of the dispute - outlined in green.

(c) the public road - outlined in grey.

39. The defendants also prepared a map of the same property. This shows:

(a) the property in dispute outlined in red.

(b) the property owned by the partnership outlined in green and

(c) the public road outlined in grey.

40. It is clear however from both maps that the land being sold by the receiver is not landlocked at all. There is no sliver of land between the property being sold and the main road. It is not landlocked in that sense.

41. However, it appears as if there is no actual entrance from the road onto the said property. Thus, for example, it does not appear as if there is a proper gate through which a car could drive from the road to access the said property. The defendant submitted that it was possible to gain “ambulatory access” by which I take it to mean that a person could actually walk onto the said property from the road. It is accepted, however, by the defendants that there is no gate or other obvious access to the property from the road.

42. I am satisfied based on the evidence before this court that the property is not landlocked and that there is access to the road in the sense that the property does abut the main road. The sliver of land which belongs to the partnership is not between the land being sold and the road; it is adjacent to the land being sold. The maps of both the plaintiffs and the defendants’ experts show that this is the case. However, it is also clear that there is no proper access to the said property from the road and that if a purchaser wished to create an entrance to the said property from the road, they would have to apply for planning permission from County Kildare. The current vehicular access to the property being sold appears to be on the partnership land.

43. In the circumstances, it is clear that the receiver will have to advertise the property as a property which requires planning permission for vehicular access. However, that is no different from a person selling, for example, a site of land without planning permission and stating that the sale is subject to the planning permission. Likewise, in the present case, the receiver will have to sell the land with a clear notice in writing to all interested parties that the land is being sold subject to a requirement for planning permission for a gate or other entrance to be obtained to gain access to the property from the road.

44. There were a number of arguments advanced at the hearing as to whether the receiver could sell the property with the benefit of an easement of necessity or with an implied right of way over the property. I am satisfied, however, that these arguments were speculative and academic. It is clear that the receiver can only sell the property, which is the subject of the mortgage, “warts and all”. It seems clear that there is no vehicular entrance from the public road onto the said property. That must be made clear to any potential purchaser (i.e. that the said property is being sold subject to planning permission for proper vehicular access). Whilst that might reduce the price obtained for the said property, it will also mean that the amount of the plaintiffs’ loan with the defendant will not be reduced as much as it should be. However, the resolution to that issue is a matter to be left to the parties to resolve.

45. I am satisfied that the issue raised on this does not amount to a fair question to be tried. The tenth issue – that the defendants trespassed on “lands adjacent to the property”

46. The first plaintiff also alleges that the defendants have gone on to lands adjacent to the property being sold and that these lands are owned by a partnership consisting of the first named plaintiff and one other party. The plaintiffs submit that the defendants have not only gone on to this land but that they have removed a mound of earth and interfered with the gate specifically in order to create an access to the property being sold from their land. This, they say, amounts to a trespass upon partnership land.

47. However, even taking the plaintiffs’ case at its height on this point, and assuming that the defendants have committed such acts of trespass, all that would do is entitle the partnership to apply for an injunction to restrain any future trespass, and damages for trespasses already committed. However, the partnership is a separate legal entity and that partnership is not a party to these proceedings. Moreover, that partnership has not brought any injunction proceedings to date to restrain such a trespass or to seek damages for past trespasses.

48. More importantly, for the issues involved in this case, the alleged trespasses have been committed on lands adjacent to the property being sold which lands are owned by a different party and could not amount to a serious issue to be tried in this case to entitle the plaintiffs in this case to obtain an injunction against the defendants to restrain them from selling the property in this case.

Conclusion on a fair issue to be tried

49. I am satisfied therefore that, based on a proper analysis of all of the above issues, the plaintiffs have not raised a fair question to be tried in the context of this application.

The balance of justice and/or convenience

50. The next issue I have to consider is whether the balance of justice is in favour of granting an injunction. The plaintiffs submit that it is.

51. However, the defendants have relied on the decision of Dignam J. in Ryan v. Promontoria [2025] IEHC 362. In this case Dignam J. refused the plaintiff’s application for an interlocutory injunction on a number of grounds, including that the balance of convenience favoured refusing the application. Dignam J. held that the balance of justice favoured the refusal of the injunction because of three particular reasons, i.e.

(1) that the property was an investment property and not a family home;

(2) that the plaintiffs were not able to provide a satisfactory undertaking as to damages and

(3) that the adequacy of damages was an important consideration in the assessment of this matter.

52. Likewise, in the present case, it is clear that the property in this case - a derelict bungalowwas an investment property and not a family home. On that ground alone, I would have considered that the balance of justice did not favour the granting of an injunction in this case.

The undertaking as to damages

53. The plaintiffs in their affidavit have given an undertaking as to damages. However, it is clear from the facts of this case that the plaintiffs obtained a loan of €400,000. The arrears on this loan now amount to €134,000 and the entire debt now amounts to €538,000. It is clear that the plaintiffs have not made any effort - or any bona fide effort - to make any repayments on this loan, or even to service the interest on this loan.

54. The defendants challenged the plaintiffs’ undertaking as to damages from the very start of the first application. Despite this, the plaintiffs have not put any affidavit evidence before the court to establish to the court’s satisfaction that the plaintiffs are people of means who would be in a position to satisfy their undertaking as to damages. Counsel for the plaintiffs has indicated on his feet that the first named plaintiff is not a man of straw and that the plaintiffs own a number of properties. That, however, is a mere submission. There is no evidence of that before the court.

55. There are numerous cases before the courts on a daily basis in respect of injunctions to restrain receivership sales of properties. Day after day, borrowers apply to this court for injunctions to restrain the sales of such properties. They provide undertakings as to damages, as they must, in order to obtain such injunctions. However, such undertakings must be carefully assessed as to whether they have any substance or are purely illusory – particularly in circumstances where they have defaulted on their investment loans and are not making any effort – or any bona fide effort - whatsoever to repay these loans or even to repay the interest on these loans. These applications never seem to take account of the fact that the borrowers borrowed the money to purchase the property and that such loans have to be repaid. In reality, many of these applications are simply tactical. If they can obtain an injunction, it can strengthen their hand in their negotiations with the lending institutions. Often however, they are completely unmeritorious. They could, in certain circumstances, amount to an injustice to the party seeking to rely on their security to obtain repayment of a loan made in good faith which has never been repaid. This is particularly relevant where the property is an investment property. Entirely different considerations apply if the property is a family home or a business premises in the family for generations. Everything depends on the context of the application. But where, as here, the property in question is a derelict cottage purchased in 2007 and which has remained derelict for the past eighteen years, and where little or no effort has been made to repay the loan or even the interest on the loan, I am satisfied that the plaintiffs’ undertaking as to damages is without substance.

The adequacy of damages

56. I am also satisfied that if the plaintiffs proceed to trial with this case and prove their case at trial, an award of damages would be an adequate remedy. It is also important to bear in mind that any damages award which might be awarded against the defendants in favour of the plaintiff will then have to be set off against the significant loan owing by the plaintiffs to the defendants.

Conclusion

57. In conclusion therefore I am of the view that:

1. the plaintiffs have not raised any fair question to be tried in this matter;

2. the balance of justice is in favour of refusing the application;

3. if the plaintiff were to be successful, damages would be an adequate remedy;

4. the plaintiffs’ undertaking as to damages is without substance;

58. I would also emphasise that the receiver will have to ensure that the property is marketed and sold as a property without proper vehicular access and/or normal pedestrian access to the property and that planning permission for a new entrance will be required.

59. The issue of alleged trespass to adjoining lands owned by a different party is not relevant to these proceedings.