High Court strikes out one claim but refuses injunctive relief and vacating lis pendens for retail business dispute.

THE HIGH COURT

[2025] IEHC 622

[Record No. HP 2025/4092 P]

BETWEEN

KAY MULCAIRE, ISOBEL FASHION LIMITED, CLOBEL FASHION LIMITED AND CHLOE FASHION BOUTIQUE LIMITED PLAINTIFFS AND CAPITAL FLOW GROUP DESIGNATED ACTIVITY COMPANY AND COLIN GAYNOR DEFENDANTS JUDGMENT of Ms. Justice Marguerite Bolger delivered on the 12th of November 2025.

1. The following three applications were before the court on 26 September 2025:

(1) The Defendants’ application to strike out the proceedings pursuant to Order 19, Rule

28 as bound to fail and/or having no reasonable chance of success.

(2) The Defendants’ application for an order pursuant to section 123 of the Land and Conveyancing Law Reform Act 2009 vacating the lis pendens registered by the Plaintiffs over the property, the subject matter of the proceedings (hereinafter referred to as “the property”) which had been run by the First and/or Second Named Plaintiff as a boutique.

(3) The Plaintiffs’ application for injunctive relief restraining the Defendants from selling the property, terminating the appointment of the Second Named Defendant as receiver and returning the property and stock therein to the First Named Plaintiff.

2. For the reasons set out below, I will allow the application to strike out the proceedings in respect of one aspect of the Plaintiffs’ claim, I refuse to strike out the remaining claims, I refuse the application to vacate the Lis pendens and I refuse the application for injunctive relief.

3. Background

There are a number of parties to these proceedings and the identity of each is relevant. The statement of claim sets out the following description of each of the Plaintiffs and Defendants as follows: "(1) The First Named Plaintiff, Kay Mulcaire, is a businesswoman and resides at Kilcoole Stables, Rathkeale, County Limerick.

(2) The First Named Plaintiff is the 100% owner of Countess Investment Holdings Limited, which is the parent company of the Third and Fourth Named Plaintiffs and the 99% owner of the Second Named Plaintiff.

(3) The Second Named Plaintiff, Isobel Fashion Limited is a private company limited by shares and the registered office of the company is Kilcoole Stables, Rathkeale, County Limerick, and this company carries on the business, “Isobel”, www.isobel.ie, which has traded for in or about 30 years from the property known as Isobel, Main Street, Adare Village, County Limerick, V94 ED29 (“the Property”) and from Adare Village generally, catering to both an Irish and international clientele for wedding attire and high-end ladies clothing.

(4) The said business has been carried on by the Second Named Plaintiff since 1 January 2023, having previously been carried on in the name of the First Named Plaintiff.

(5) The Third Named Plaintiff, Clobel Fashion Limited, is a private company limited by shares and the registered office of the company is Kilcoole Stables, Rathkeale, County Limerick, and the original loan facilities by letter dated 11 March 2022, the subject matter of the within proceedings, were provided to this company.

(6) The Fourth Named Plaintiff, Chloe Fashion Boutique Limited, is a private company limited by shares and the registered office of the company is Kilcoole Stables, Rathkeale, County Limerick and this company holds the Property, the subject matter of the within proceedings.

(7) The First Named Defendant is a private equity company with an address at Second Floor, Block A, The Crescent Building, Northwood Business Park, Santry, Dublin 9, D09 X8W3.

(8) The Second Named Defendant is a receiver, with an address at Suite 35, 3 Marine Road, Dún Laoghaire, Dublin, A96 HW25.”

4. The other party relevant to the background to these proceedings is Capital Flow (Commercial Real Estate) DAC (hereinafter referred to as “CRE”). That company entered a loan facility with the Third Plaintiff on 1 March 2022, following which the First Plaintiff executed a limited recourse guarantee and indemnity in respect of the Third Plaintiff's obligations under the loan facility. By mortgage, charge and assignment dated 25 April 2022, the First Plaintiff secured the loan facility over, inter alia, the property.

5. The Defendants say that CRE was merged by absorption with the First Defendant on 15 August 2022, as a result of which the First Named Defendant was entitled to move on the mortgage. The Plaintiffs’ challenge to the First Named Defendant’s asserted entitlement to appoint the Second Named Defendant as receiver, which they purported to do by deed of appointment dated 28 May 2025, is the central part of their challenge to the receiver's appointment and to his current possession of the property.

6. The letter of demand from the Defendants’ solicitors sent on 22 May 2025, ten days before the appointment of the Second Named Defendant as receiver, does not refer to the First Named Defendant but does identify CRE as their client. At that point in time, CRE had ceased to exist for almost three years. Two further letters from the Defendants’ solicitors were sent to the Plaintiffs’ solicitors dated 12 June 2025 and 26 June 2025, both of which also refer to CRE and make no reference to the First Named Defendant. The First Named Defendant is, for the first time, mentioned in their solicitor’s letter of 8 July 2025 which asserts that the First Named Defendant advanced money to the Plaintiff in 2022. That could not have been correct as it was CRE that advanced that money.

7. The First Named Defendant purported to appoint the Second Named Defendant as receiver over the property by deed of appointment dated 28 May 2025, in reliance on which the Second Named Defendant wrote to the Plaintiff and ultimately on 26 June 2025, the Second Named Defendant took possession of the property and its contents. The Plaintiff challenges the legality of his appointment and his current possession of the property and attempts to sell it.

The proceedings

8. The within proceedings were issued on 23 July 2025. At the same time, the Plaintiffs registered a lis pendens against the property pursuant to section 121 of the Land and Conveyancing Law Reform Act 2009. The Plaintiffs made an ex parte application for injunctive relief on 31 July 2025 but were only granted short service. The Defendants issued their motion to strike out the proceedings and to vacate the lis pendens on 13 August 2025. The Plaintiffs delivered their statement of claim on 25 September 2025 which sought different reliefs to what had been sought in the plenary summons, including a declaration that the mortgage deed and limited recourse guarantee are void as CRE was dissolved on 15 August 2022. The Defendants criticise the Plaintiffs for not having properly sought to amend the pleadings in accordance with the Rules of the Superior Courts. That may or may not be an issue for the trial judge, but I am not going to rely on that pleading point in an application for interlocutory relief and a corresponding interlocutory application to strike out the proceedings and vacate the lis pendens, all of which were issued over a short space of time.

9. The Plaintiffs make the following claims in their proceedings:

(1) The mortgage deed is between the First Plaintiff and CRE and as that company was dissolved in August 2022, the Plaintiffs challenge the entitlement of the First Named Defendant to appoint a receiver pursuant to that mortgage. The Defendants assert that CRE merged with the First Named Defendant by absorption in accordance with the Companies Act 2014. The Companies Act 2014 requires certain steps to be taken and the Plaintiffs say there is no evidence of those statutory requirements having been complied with. The Plaintiffs contend that the mortgage is therefore void.

(2) The First Named Plaintiff says she has no interest in the property which she says is held by the Third Named Plaintiff and that the Defendants have no recourse to its interest in the property.

(3) The Plaintiffs claim that another property also included in the mortgage, the Wild Geese property, was sold by the Second Named Defendant at an undervalue and that the Second Named Defendant breached his statutory obligations by refusing to engage with a prospective alternative purchaser who had offered a higher purchase price.

(4) The Plaintiffs say that the Second Named Defendant has, without lawful authority, closed its retail business and caused catastrophic disruption and destruction of its brand and business operation.

10. The Plaintiffs had originally claimed that the property was not included in the mortgage but chose not to pursue that claim in the within application.

Application to strike out the proceedings

11. The court’s jurisdiction to strike out proceedings pursuant to Order19, Rule 28 is well established as a jurisdiction to be exercised sparingly. The new rule, amended in 2023, did not dilute the previous jurisdiction including the principle that an application to dismiss had been bound to fail “is not a means for inviting the court to resolve issues on a summary basis… that the jurisdiction is to be sparingly exercised… rather than where the Plaintiffs’ case is very weak or where it is sought to have an early determination at some point of fact or law” (Keohane v Hynes [2014] IESC 66 at para. 6.5 and 6.6). The court must accept the facts as asserted in the Plaintiffs’ claim. If those facts would, if proven, give rise to a cause of action, then “the proceedings do disclose a potentially valid claim” (at para. 3.12 in Salthill Properties Ltd v. Royal Bank of Scotland [2009] IEHC 207). In considering whether the within claim is bound to fail and/or has no reasonable prospects of success, the court must take the Plaintiffs’ case at its highest.

12. I will consider each of the Plaintiffs’ claims below.

(i) Challenge to the First Named Defendant’s status and its entitlement to appoint the Second Named Defendant as receiver

13. The Plaintiffs challenge the legality of the Second Named Defendant’s authority to act as receiver over the property as they dispute the entitlement of the First Named Defendant to take over CRE’s entitlements pursuant to the mortgage. The Plaintiffs do not dispute that substantial monies are owed on the mortgage but, in effect, they dispute the legal entitlement of the First Named Defendant to assert that the monies are owed to it or to take any steps in relation to the property arising from the Plaintiffs’ failure to discharge the liabilities thereunder. They rely on the absence of evidence of compliance with the statutory requirements for CRE’s apparent merger by absorption with the First Named Defendant. The Second Named Defendant has sworn an affidavit in which he asserts that CRE approved the proposed merger and its directors were authorised to complete it. He exhibits a special resolution of CRE dated 15 August 2022, to that effect. The Second Named Defendant who swore the affidavit refers to never having had any role in the First Named Defendant and does not say he is acting as its servant or agent. He says he swore the affidavit on his own behalf and on behalf of the First Named Defendant but there is nothing in his means of knowledge clause to explain the source of his knowledge that the merger was effected, other than exhibiting the special resolution of CRE which approves the “proposed” merger. There is no direct evidence of the merger having been completed albeit the directors of CRE were authorised to do so.

14. In the course of oral argument, counsel for the Defendants asserted that most of the documentation evidencing the merger was filed in the Company Registration Office, apart from one document that is required by the Act (the draft terms of merger). Counsel for the Plaintiff challenge that contention about the documentation being publicly available.

15. There is no evidence, to date, before the court confirming the merger by absorption that the Second Named Defendant averred took place between CRE and the Second Named Defendant. Therefore, for the moment and taking the Plaintiffs’ case at its highest, I cannot say that the Plaintiffs’ claims in this regard are bound to fail and/or have no reasonable prospect of success. Those claims include a declaration that the mortgage is void, which may be a claim within section 121(2)(b) of the Land and Conveyancing Law Reform Act 2009.

16. Counsel for the Defendants cited the decision of Costello J in Hinde v Pentire Property Finance DAC & Anor [2018] IEHC 520 where Costello J held that the Plaintiff in that case was not making a claim to a right or interest in land as her interest in the land was not in dispute. However, Costello J also said at para. 46 “If the Plaintiff had sought a declaration that the mortgage should be declared void, this would come within the scope of s. 121". That seems to be what this Plaintiff asserts, a claim that I have found is not so fragile as to be bound to fail or have no reasonable prospect of success.

17. For those reasons, I refuse to strike out that aspect of the Plaintiffs’ claim or to vacate the lis pendens.

(ii) The First Named Plaintiff’s claim that she has no interest in the property

18. The First Named Plaintiff avers that she has no interest in the property which she says is held by the Third Named Plaintiff. At para. 20 of her Second affidavit dated 7 September 2005, she avers: "I say that I have no interest in the said property, Isobel’s Boutique, in circumstances where the said property is held by Chloe Fashion Boutique Ltd, having been transferred from Clobel Fashion Ltd to Chloe Fashion Boutique Ltd in the year ended 30 June 2003." To support her averment, she refers to the financial statements of the Third Named Plaintiff in the year ended 30 June 2024. Those financial statements confirm:

- The First Named Plaintiff is a director of the company.

- The First Named Plaintiff holds 100 shares in the Third Named Plaintiff's parent company, Countess Investment Holdings Ltd.

- The accounts are not signed by the Plaintiff or her co-director or by the accountant who apparently prepared the financial statement.

- The Third Named Plaintiff is stated to have a net book value in the amount of €1,507,009. The statement also states “Although the asset [being the property] is included in the financial accounts for the company as at the year ended 30 June 2024, it does not have a marketable title to the property which has not been formally registered in the name of the company. Stamp duty in respect of the transfer remains unpaid".

19. There are no documents exhibited by the Plaintiffs in relation to any transfer of the property to the Fourth Named Plaintiff. When the First Named Plaintiff entered the mortgage with CRE on 25 April 2022, she confirmed that she was the legal and beneficial owner of the property (at clause 8.1(i)). In the negative pledge at clause 5.2, she undertook that she would not transfer the property during the securing period without the prior written consent of the lender. There is no evidence, including any averment from the First Named Plaintiff, to suggest that the First Named Plaintiff or anyone else ever sought consent for the purported transfer of the property to the Third Named Plaintiff.

20. Counsel for the Plaintiffs submitted in oral argument for the First time that the First Named Plaintiff has a “limited legal interest” in the property. He disputed any breach of the negative pledge set out at clause 5.2 of the mortgage deed and said that no “proper conveyance” had been affected with the Third Named Plaintiff and that there “may” have been a transfer of the First Named Plaintiff’s beneficial interest, but not of her legal interest. It is difficult to see how that lines up with the sworn averments of the First Named Plaintiff, as set out above. The Plaintiffs’ counsel claims the Plaintiff was wrong in saying that she had no interest. However, at no time was any attempt made to swear a rectifying affidavit or to clarify what seems to be now presented as an inaccurate version of events set out by the Plaintiff in her sworn testimony to this court.

21. If the interest in the property was transferred to the Third Named Plaintiff, that would have constituted a breach of the negative pledge and in accordance with the decision of Dunne J in Fennell & Anor v N17 Electrics Ltd [2012] IR 634, would not be binding against the mortgagee. If the Plaintiff did not affect a valid transfer and/or retain an interest in the property, her claim that she has no interest in the property is bound to fail and/or has no reasonable prospect of success. Either way, I am satisfied that this aspect of the Plaintiffs’ claim is bound to fail and/or has no reasonable prospect of success and I therefore strike it out pursuant to Order19, Rule 28.

(iii) Sale of the Wild Geese property at an undervalue

22. The Plaintiff avers that there was a prospective alternative purchaser for the Wild Geese property who offered a higher price than the price that was accepted by the Second Named Defendant. The Second Named Defendant’s response on affidavit was to say that this was disingenuous as the First Named Plaintiff had herself made a previous lower offer for the property. Counsel for the Plaintiff said that that was in the context of a proposed buy and lease back arrangement. Either way, the Second Named Defendant does not contradict the assertion that an identified Third party made a higher offer for the property. Therefore, there is no explanation for what the First Named Plaintiff says was the Second Named Defendant's failure to secure the best price. The Defendants assert that this is a claim of professional negligence against the Second Named Defendant and therefore, cannot be made without an expert report. That point does satisfy me that the Plaintiffs’ claim is bound to fail and/or has no reasonable prospect of success. I refuse to strike out that part of the claim.

(ii) The Plaintiff's application for injunctive relief

23. The Plaintiffs contend that they have established an arguable case on the grounds already set out, that they will secure the reliefs they seek in the statement of claim. I have found that some of their case should not be struck out. That may or may not equate to having established a fair question to be tried but whether or not they have, I am satisfied that all of their claims can be adequately compensated by the award of damages. The Plaintiff seeks to rely on the nature of her longestablished retail business in the village of Adare. I have no doubt that the Plaintiffs have invested, both financially and personally, in that business. However, ultimately it was a retail business established for the purpose of generating a profit. Any losses sustained by the Plaintiffs as a result of the Second Defendant’s closure of that business, are capable of being quantified in damages similar to any commercial venture.

24. The adequacy of damages is, as per O’Donnell J in Merck Sharp and Dohme v. Clonmel Healthcare Ltd [2019] IESC 65, part of the balance of convenience, indeed the most important element in the balance in most cases. In the within case, no evidence, including expert evidence, was put before the court to claim that the damage the Plaintiffs will sustain cannot be quantified other than the Plaintiff’s claim that damages could not be quantified. The Plaintiffs relied on the

decision of Dignam J in Nihill v. Everyday Finance DAC & Ors [2022] IEHC 484 where he said that the property in question, a farm, “is not a purely commercial enterprise”. That can certainly be the case with a farm but not with a retail premises, no matter how long established or niche a boutique it might be or regardless of the loss of the pending Christmas market or even pending Ryder Cup business. Whatever time of year a business might be closed, there will likely be consequential loss. That loss must be capable of being quantified in damages, which must in turn persuade this court that the balance of convenience and balance of justice lie against the grant of the injunctive relief sought.

Decision

25.

(i) I strike out the Plaintiffs’ claim that she has no interest in the property. I will hear counsel as to how that can be affected in terms of the statement of claim.

(ii) I refuse to strike out the remainder of the Plaintiffs’ claims.

(iii) I refuse to lift the lis pendens.

(iv) I refuse injunctive relief.

Indicative view on costs

26. Given that there has been some win and some loss on both sides, and more significantly, given the matters at issue in this application will have to be determined by the trial judge, my indicative view on costs is that all costs should be reserved to the trial of the action where a trial judge will have the benefit of whatever discovery and examination or cross-examination either party may require.

27. I will put the matter in for mention at 10am on 18 November 2025 for the making of final orders. This case should be progressed without delay and I will consider case management on that date also.

Counsel for the Plaintiffs: Roddy McConnell BL, Alan K. Cormack SC Counsel for the Defendants: Stephen Walsh BL, Brian Conroy SC