Possession order granted but stay on execution ordered pending determination of defendant's separate claim.

THE HIGH COURT

[2026] IEHC 17

Record No. 2018/416SP

Between

START MORTGAGES DAC and MARS CAPITAL FINANCE IRELAND DAC

Plaintiffs

and

JOHN HEALY

Defendant

Judgment of Mr. Justice Conor Dignam delivered on the 16th day of January 2026

INTRODUCTION

1. These proceedings were originally issued by Permanent TSB. Start Mortgages DAC was substituted for Permanent TSB by Order of Murphy J of the 19 th October 2020. By Order of the 30th June 2025, Mars Capital Finance Ireland DAC was joined to the proceedings as second-named plaintiff. I will refer to these parties as “the plaintiff”.

2. The proceedings were commenced by Special Summons dated the 9 th August 2018. The plaintiff seeks an Order for Possession pursuant to section 62(7) of the Registration of Title Act 1964 in respect of four properties in Galway.

3. The defendant asserts that he has a defence to the claim and a separate claim of his own and that the proceedings should be adjourned to plenary hearing or at the very least a stay should be placed on any judgment pending determination of his own claim.

4. The proceedings have a somewhat convoluted history. They were, as I say, commenced on the 9th August 2018. There followed an extensive exchange of affidavits.

When the matter eventually came on for hearing, the defendant sought and obtained an adjournment. He was directed to file a compendium affidavit which brought together all the various matters from the previous affidavits sworn by him and to deliver written submissions. The plaintiff had previously done so but the defendant had not. Several defences were asserted across the defendant’s affidavits and, subsequently, these submissions. The matter subsequently came on for hearing but did not conclude on that date. On the resumed date, the defendant appeared in person, having dismissed his legal team. He sought time to file yet a further affidavit. The question of whether he should be permitted to do so was listed for hearing and on that date, the defendant sought and obtained an adjournment due to a family bereavement. The plaintiff then consented to the affidavit being admitted and the substantive matter was then listed for resumed hearing. The defendant attended that day and indicated that he had engaged a solicitor and sought time for that solicitor to come on record and to prepare for the hearing. I acceded to that application on a number of conditions and listed the balance of the hearing of the substantive matter. Ultimately, the substantive hearing resumed on the 18th October 2023, on which date the seventh affidavit of the defendant was opened and the plaintiff made submissions. It was then indicated on behalf of the defendant that he would not be relying on certain points which had previously been raised. In those circumstances, I directed the delivery of supplemental written submissions by both sides. In the submissions delivered on behalf of the defendant, he confirmed that a number of the issues upon which it had been previously claimed that he had a defence, and which had been dealt with at very great length in the exchange of affidavits, were not being maintained. He identified the points which were being maintained. I deal with these in the next two paragraphs. There was then a further hearing in January 2024 on these points. Subsequently, the defendant handed in to court a Statement of Claim in separate proceedings which had been issued on his behalf and on which he was relying.

5. As noted in the previous paragraph, the defendant originally raised a number of points on which he claimed to have a good defence. These were dealt with in the affidavits and at the original hearing. He has now, for the purpose of this application, limited the points on which he maintains a defence to the following:

(i) the defendant’s debt was discharged in full by him being adjudicated bankrupt in the United Kingdom and the plaintiff thereafter had no right or basis to seek or accept payments since the date of adjudication;

(ii) the defendant went back into possession of the properties and spent money on repair and management of the properties;

(iii) by accepting and retaining payments and the benefit of the repair and management of the properties by the defendant, the plaintiff is:

(a) estopped from taking possession;

(b) guilty of delay and laches and causing damage or loss to the defendant;

(c) unjustly enriched.

(iv) the plaintiff has instituted separate proceedings regarding his claim to the properties, his equitable interest therein and/or unjust enrichment.

6. The defendant also maintained a point about the validity of the transfer of ownership of the charge from Permanent TSB to Start Mortgages because the deed of transfer appeared not to bear the seal of Start Mortgages but he withdrew that point after the conclusion of the hearing when it transpired that the seal was in fact affixed to the deed.

7. The background is as follows.

8. Permanent TSB advanced the sum of €1,000,000 to the defendant on the 12 th March 2008 on foot of a ‘Letter of Approval – Particulars of Mortgage Loan’ of the 26th February 2008. By way of security, the defendant executed a deed of mortgage dated the 12th March 2008 in favour of Permanent TSB over the four properties. The mortgage was registered on the relevant Folios in the Land Registry.

9. The defendant is alleged to have defaulted in the repayment of the loan facility resulting in the total debt becoming immediately repayable. Permanent TSB’s solicitors demanded repayment and/or that the defendant deliver up vacant possession of the properties.

10. A rent receiver was appointed on the 15th September 2012.

11. On the 19th July 2013, the defendant was adjudicated a bankrupt in the United Kingdom. He was discharged from bankruptcy on the 19th July 2014.

12. It seems that little to no rent was obtained by the rent receiver in respect of the properties. The plaintiff claims that the properties were either advertised for rent or that works were required to have them suitable for renting. The rent receiver was discharged on the 14th October 2015 and it is claimed by the plaintiff that the plaintiff did not have control of the rent/management of the properties since that date.

13. The defendant claims that the rent receiver and, after his discharge, Permanent TSB and then Start Mortgages, allowed the properties to fall into disrepair. The defendant claims that he was not informed of the rent receiver’s discharge and only became aware of it in 2019.

14. A creditors’ meeting in respect of the bankruptcy estate was held by the Trustee in Bankruptcy on the 21st November 2019 following receipt of funds from the defendant’s Irish Life pension. There had been prolonged litigation in the courts of England & Wales in respect of the pension. The Trustee in Bankruptcy was discharged on the 1 st February 2020.

15. Permanent TSB stayed outside the defendant’s bankruptcy and did not prove its debt. As a secured creditor, Permanent TSB, or its successor, remains entitled to realise its security but will not be entitled to any shortfall out of the bankruptcy estate if one arises. Permanent TSB and Start Mortgages both confirmed during the exchange of affidavits that they would not be seeking any shortfall.

16. In the meantime, on the 25 th January 2018, Permanent TSB, through its solicitors, demanded that the defendant repay to it all sums then due and owing (which was stated to be €1,125,669.38). On the 9 th February 2018, Permanent TSB demanded vacant possession of the properties.

17. Permanent TSB issued these proceedings by Special Summons of the 9th August 2018 seeking possession of the properties. At that stage, no payments had been made by the defendant since the 15th May 2013. The properties were unoccupied. There followed an extensive exchange of affidavits.

18. On the 7th February 2020, Permanent TSB transferred its rights, title, interest, estate, benefit and entitlement in the defendant’s loan facility to Start Mortgages. On the 19th October 2020, the High Court substituted Start Mortgages as plaintiff in these proceedings.

19. The proceedings were adjourned generally with liberty to re-enter due to the Covid-

19 pandemic. They were re-entered on the 6th December 2021. Further affidavits were exchanged.

20. At some point (it seems about mid-September 2020) the defendant re-entered the properties. He claims that he spent approximately €30,000 in restoring and refurbishing the properties. He moved into one of the properties along with his wife and son after returning from the United Kingdom. He claims that he then rented out the other three properties and that from this rental income he resumed making payments to Start Mortgages. There is no dispute that he resumed making monthly repayments. They are in the amount of €1,200. They seem to have commenced in November 2021. The defendant describes this in the following way “I say that I wrote to Start on the 30 th of October 2021 to Start requesting agreement on a new monthly payment. I paid the sum of €1,200 per month in good faith subject to new agreement being reached.” Part of the defendant’s case is that he was originally on an interest-only mortgage and that it was wrongfully converted to a capital and interest mortgage. As I understand it, the figure of €1,200, on the defendant’s case, is the appropriate interest-only repayment amount.

21. The defendant has issued his own Plenary proceedings against Start Mortgages. The Statement of Claim was delivered after the hearing and a copy was handed in to Court. The defendant relies on the existence of these Plenary proceedings as a basis for contesting summary determination of the current proceedings. He does, however, place greater emphasis on the fact that the Plenary proceedings also raise a number of the points which are raised by him in the instant proceedings.

22. It is possible to identify the following key facts which, for the purpose of the arguments being maintained in this application, are not seriously in dispute:

(i) The defendant took a loan from Permanent TSB and gave a charge over the four properties as security;

(ii) The defendant at some point between then and September 2012 defaulted in his repayments;

(iii) Permanent TSB demanded payment of the full debt and, when that was not paid, they appointed a rent receiver;

(iv) The defendant was declared a bankrupt in the United Kingdom on the 19 th July 2013;

(v) He was discharged from bankruptcy on the 19th July 2014;

(vi) Permanent TSB did not participate in the bankruptcy and confirmed on affidavit that they were relying on their security only and would not be seeking to recover any shortfall in the debt following the sale of the properties;

(vii) The rent receiver was discharged on the 14th October 2015;

(viii) The properties were vacant for most of the period between the appointment of the receiver and September 2020 and they fell into disrepair;

(ix) Permanent TSB demanded payment of the full amount due and owing on the 25th January 2018;

(x) On the 9th February 2018, Permanent TSB demanded vacant possession of the properties;

(xi) Permanent TSB issued these Special Summons proceedings for possession of the properties on the 9th August 2018;

(xii) No payments towards the mortgage had been made since the 15 th May 2013;

(xiii) In 2020, the defendant and his wife and son returned to Ireland. They moved into one of the properties and the defendant carried out works on the other properties;

(xiv) The defendant then rented the three properties out and started making monthly payments of €1,200 to Start Mortgages (who, at this stage, had replaced Permanent TSB as the chargeholder and plaintiff);

(xv) Affidavits were being exchanged throughout the period 2018 – 2022 and, indeed, beyond.

APPLICABLE PRINCIPLES

Principles on Application for Possession in a Summary Manner

23. Order 38 Rule 9 of the Rules of the Superior Courts provides:

“On the hearing of any special summons, the Master, in a case within his jurisdiction, or the Court, as the case may be, may give judgment for the relief to which the plaintiff may appear to be entitled or may dismiss the action or matter or may adjourn the case for plenary hearing as if the proceedings had been originated by plenary summons with such directions as to pleadings or discovery or settlement of issues or otherwise as may be appropriate, and generally may make such order for determination of the questions in issue in the action or matter as may seem just.”

24. Both parties were agreed that the applicable principles were correctly stated by Baker J in Bank of Ireland v Cody [2021] IESC 26. Baker J said at paragraphs 49 and 50:

“49. The owner of a charge who seeks to obtain possession pursuant to s. 62(7)

has to prove two facts:

(a) That the plaintiff is the owner of the charge;

(b) That the right to seek possession has arisen and is exercisable on the facts.

50. The summary process is facilitated by the conclusiveness of the Register as proof that the plaintiff is the registered owner of the charge is a matter of the production of the folio, and, as the Register is by reason of s. 31 of the Act of 1964 conclusive of ownership, sufficient evidence is shown by that means: see the discussion in the Court of Appeal in Tanager DAC v. Kane [2018] IECA 352. The judgment of the Court of Appeal inter alia held that the correctness of the Register cannot be challenged by way of defence in summary possession proceedings, and that a court hearing an application for possession pursuant to s. 62(7) of the Act of 1964 is entitled to grant an order at the suit of the registered owner of the charge, or his or her personal representative, provided it is satisfied that the plaintiff is the registered owner of the charge and the right to possession has arisen and become exercisable.”

25. She went on to say:

“70. On one end of the range are cases where a plaintiff establishes its claim on the affidavit evidence, as the defendant is not able to persuade the judge either that the evidence is incomplete or that there is a basis on which a credible defence exists. That approach to both the law and the facts is established in the authorities and a court hearing a claim for summary judgment, whether that be for summary judgment for debt or for summary possession, must be satisfied that the plaintiff

has established its claim and that the defendant has not put forward a basis for a credible defence either on the facts or on the law.

…

74. At the other end of the range of possible results are cases where a defendant either positively establishes a defence either at law or on the merits, or persuades the judge that the plaintiff has not established its proofs. The claim will then fail. Most of the examples are cases where the defendant has advanced an unanswerable legal defence, as for example in the judgment of Dunne J. in Start Mortgages v. Gunn where the repeal of s. 62(7) of the Act of 1964 by s. 8 of the Land and Conveyancing Law Reform Act 2009 meant that there was no legal basis in some of the claims there under consideration on which the court could grant possession.

…

76. Many applications for summary judgment would fall between these two extremes and will involve the proffering of evidence or argument by a defendant by way of defence which is not sufficient to rebut the evidence of the plaintiff to enable the judge to make a positive finding against the plaintiff, but which offers enough doubt as to the truth or completeness of the plaintiff's evidence, or credibly presents reasonable arguments or evidence that a defendant has a basis of defence which merits further scrutiny, evidence or argument. In that instance the trial judge is constrained by the inability to decide between contested affidavit evidence of fact, or resolve complex questions of law, the action cannot therefore be disposed of summarily and will be adjourned to plenary hearing.”

26. In Ulster Bank v O’Brien [2015] 2 IR 656, to which I was referred by the defendant, MacMenamin J for the Supreme Court said:

“The fundamental question is whether there is a fair and reasonable probability of a defendant having a real or bona fide defence, either in law, or on the facts, or both? It is not necessary to show that the defence will succeed, or even will probably succeed. The questions, therefore, can be reduced to the following: First, is it very clear that a defendant has no case? Second, are the issues simple and easily determined? Third, has a defendant disclosed even an arguable defence? Fourth, where there is no notice to cross-examine, can a

court be confident, on the affidavit evidence alone, where the justice of the case lies?”

27. MacMenamin J went on to refer to earlier decisions and said “[a]s emphasised in each of these decisions, in exercising this jurisdiction, a court should proceed with care and caution.”

28. The defendant referred to a number of other judgments in the first set of written submissions delivered on his behalf. However, in circumstances where the parties are agreed that the applicable principles are contained in Bank of Ireland v Cody, it is not necessary to refer to those earlier authorities, save to note that caution must always be exercised when considering determining proceedings on a summary basis.

DISCUSSION

29. I am satisfied that the plaintiff is the owner of the charge and that the right to seek possession has arisen in circumstances where there is no real dispute about these points. The defendant’s defences are directed towards whether an Order should be made and whether the plaintiff is estopped from exercising its right to seek possession.

Effect of the Defendant’s Bankruptcy in the United Kingdom

30. The plaintiff contends that the defendant does not have an entitlement to defend these proceedings by virtue of his adjudication as bankrupt in the United Kingdom. This is based on a mix of the law of the United Kingdom (the UK Insolvency Act 1986, as amended) and European law (Council Regulation (EC) No. 1346/2000 (“Insolvency Regulation 2000”)) when read with this jurisdiction’s domestic insolvency law. The Insolvency Regulation 2000 was replaced on the 25 th June 2017 by Regulation (EU) 2015/848.

31. If the plaintiff is successful in establishing that the defendant has no entitlement to defend the proceedings or, more properly, that he has no credible basis for saying that he is entitled to defend them, then the plaintiff would have to succeed in the application for summary judgment. Some of the considerations relating to his entitlement to defend the proceedings also go to the substantive defences which he has raised.

32. Articles 4(1) and (2) of the Insolvency Regulation 2000 (now articles 7(1) and (2) of Regulation 2015/848) provide that:

“(1) Save as otherwise provided in this Regulation, the law applicable to insolvency proceedings and their effects shall be that of the Member State within the territory of which such proceedings are opened, hereafter referred to as the ‘State of the opening of proceedings’.

(2) The law of the State of the opening of proceedings shall determine the conditions for the opening of those proceedings, their conduct and their closure. It shall determine in particular:

(a) ...

(b) the assets which form part of the estate and the treatment of assets acquired by or devolving on the debtor after the opening of the insolvency proceedings;

...

(e) the effects of insolvency proceedings on current contracts to which the debtor is party;”

33. It is agreed by the parties that the applicable law in respect of the conduct of the bankruptcy and in respect of the assets which form part of the estate is the law of the United Kingdom. The plaintiff submits that as a matter of United Kingdom law (section 283, 436 and 306 of the Insolvency Act 1986) foreign property vests in the Trustee in Bankruptcy. It is submitted on the basis of articles 4(1) and (2) of the Insolvency Regulation 2000 that this Court is “required to determine in the proceedings herein that the mortgaged properties have vested in the Defendant’s trustee in bankruptcy arising from the effects of the UK bankruptcy legislation”. It is further submitted on foot of this that the defendant is therefore not entitled to defend proceedings relating to those properties. On this latter point, the plaintiff relies on Finlay Geoghegan J’s judgment in ACC v Fagan [2013] IEHC 346, in which she considered section 44 of the Bankruptcy Act 1988. Unlike the current case, ACC v Fagan concerned an Irish bankruptcy and Irish property. The defendants, a married couple, had been adjudicated bankrupt in Ireland. ACC issued possession proceedings pursuant to section 62(7) of the Registration of Title Act 1964 in respect of mortgaged property. The Official Assignee was not defending the proceedings and the Fagans sought to defend them. Finlay Geoghegan J held that they were not entitled to challenge the validity of the charge registered on the folio as ownership of the folio was vested in the Official Assignee. Finlay Geoghegan J said:

“Upon adjudication as bankrupts all property of Mr. and Mrs. Fagan including their interests in [the Folio] vested in the Official Assignee pursuant to s.44 of the

Bankruptcy Act 1988. Hence they have no standing to defend any claim in relation to property now vested in the Official Assignee. See inter alia Quinn v Irish Bank Resolution Corporation Limited and Ors [2012] IEHC 261. This precludes them having any entitlement to challenge the validity of the Charge.”

34. The plaintiff submits that where UK bankruptcy law provides for the equivalent vesting of property as is provided for in Irish law, the Court should adopt a similar approach in these proceedings and should hold that the defendant is not entitled to defend the proceedings.

35. The plaintiff’s claim that the properties vested in the Trustee in Bankruptcy is based on UK law. As a general principle, the interpretation and operation of foreign law must be proven by evidence. There is no evidence before me as to the interpretation or operation of the Insolvency Act 1986. If there was a dispute about whether or not the properties had vested in the Trustee in Bankruptcy or whether, if they were still vested in the Trustee, the defendant was not entitled to defend the proceedings, I would have to conclude, in the absence of such evidence, that I could not grant summary judgment.

36. However, in accordance with the responsible and focused manner in which counsel for the defendant approached the case, it is not disputed that the properties vested in the Trustee in Bankruptcy. Rather, it is submitted that this does not disentitle the defendant from defending the proceedings. He advances two bases for this in addition to submitting that ACC v Fagan is of no assistance: (i) since the defendant’s discharge from bankruptcy, certain property rights have re-vested in him; and (ii) some of the rights upon which he relies are equitable rights (these are discussed further below) which did not vest in the UK Trustee in Bankruptcy.

37. Before addressing these, I note that the defendant’s written submissions address the situation where there is a dispute on the affidavit evidence and make the point that where there is a bona fide dispute of fact it means that a matter must be adjourned to plenary hearing because it can not be resolved on affidavit. I was referred to IBRC v McCaughey [2014] 1 IR 749, RAS Medical v Royal College of Surgeons [2019] IESC 4, GE Capital Woodchester Ltd v Aktiv Kapital Asset Investment Ltd [2009] IEHC 512, Templecrone Co-Operative Agricultural Society Limited v McLoughlin [2015] IECA 14, National Irish Bank v Graham [1995] 2 IR 244, and Anglo Irish Bank Corporation plc v Fanning [2009] IEHC 141. Save for the issue of UK law, there is no material conflict of evidence in respect of the facts underlying the defences which the defendant is currently advancing and relying upon. I have set out the key facts at paragraph 22 above. Thus,

subject to the English law issue, there is no necessity for the matter to be remitted to plenary proceedings to resolve any factual conflicts.

38. The defendant claims that certain property rights have re-vested in him since his discharge from bankruptcy and that he has acquired an equitable interest in the properties which do not (and did not) vest in the Trustee in Bankruptcy. He does not really expand on these points in his written submissions and did not cite any authorities for the propositions. The basis for these claims was set out at the hearing and in the Statement of Claim which he delivered after the hearing. These points are interlinked and it is more convenient to deal with the second one first.

39. He claims that he has an equitable interest in the properties due to a confluence of factors: (i) the plaintiff’s delay in seeking this relief; (ii) the plaintiff allowed the properties to go into a state of disrepair; (iii) the defendant went back into possession; (iv) he spent monies on repairing and refurbishing the properties; (v) the properties are worth more as a result of his works and expenditure than they would otherwise have been worth; (v) the plaintiff accepted repayments even though they did not participate in the bankruptcy and could therefore not recover the debt save by relying on their security. On the defendant’s case, these factors must be taken together, though he places significant emphasis on the fact that he spent money and as a result the properties enjoyed an uplift in value.

40. The plaintiff rejects the contention that the defendant has an equitable interest on the basis that he does not have a proprietary interest in the properties. The plaintiff submits that the properties vested in the Trustee in Bankruptcy upon the defendant’s bankruptcy and he therefore has no proprietary right in the properties. In those circumstances, the expenditure of monies by the defendant and the commencement of repayments were done as a volunteer. It is submitted that any successful claim for equitable relief requires that the party claiming such relief must first establish a proprietary interest in the properties.

41. In O’Donnell v Bank of Ireland [2014] IESC 77, the parents of the appellants established a trust of which the appellants were beneficiaries. The trust owned a company called Vico Limited and the company owned a property called Gorse Hill. The parents and the children lived in the property. The parents had loans with Bank of Ireland and when they defaulted on those loans the bank sought possession of the property. The children sought a declaration that they were entitled to the beneficial interest in the property.

42. McGovern J rejected this on the basis that the children were the beneficial owners (through the trust) of the shares in Vico Limited but not of the property.

43. On appeal to the Supreme Court, Laffoy J said:

“135. The appellants’ contention that whether they have or have not a proprietary interest in Gorse Hill is immaterial to their claim that the Bank’s interest is subject to a constructive trust in their favour and to their entitlement to equitable declaratory relief that the security given by Vico Limited to the Bank is ineffective or, alternatively, to an order rescinding the security, in my view is utterly misconceived. Even if it were established that Gorse Hill was trust property and that the Bank had acquired an interest in it by taking security from Vico Limited in circumstances where it was aware that it was trust property and the interest was being given to it as security in breach of trust, the Bank’s obligation in equity to account for the interest it had acquired would be owed to the beneficial owner of Gorse Hill or a person (for example, a trustee not involved in the breach of trust)

entitled on behalf of, and accountable to, the beneficial owner. That is fundamental;

a person who cannot demonstrate a proprietary interest in the relevant property cannot pursue an equitable remedy against a constructive trustee to account to him or her for the interest in that property acquired in breach of trust by the constructive trustee.

136. Moreover, I am satisfied that all of the authorities relied on by the appellants in which the plaintiff was successful in getting equitable relief on the ground that the defendant held property as a constructive trustee for the plaintiff illustrate that the plaintiff must have a proprietary interest in the property in question.”

44. The defendant did not dispute the principle that a proprietary interest is a prerequisite for an equitable interest. Rather he claimed that he had a proprietary interest on the basis that the properties had re-vested in him.

45. The defendant relies on the provisions of section 283A of the UK Insolvency Act to claim that the properties have revested in him. It provides:

“(1) This section applies where property comprised in the bankrupt’s estate consists of an interest in a dwelling-house which at the date of the bankruptcy was the sole or principal residence of –

(a) the bankrupt,

(b) the bankrupt’s spouse or civil partner, or

(c) a former spouse or former civil partner of the bankrupt.

(2) At the end of the period of three years beginning with the date of the bankruptcy, the interest mentioned in subsection (1) shall –

(a) cease to be comprised in the bankrupt’s estate, and

(b) vest in the bankrupt (without conveyance, assignment or transfer).”

46. The Trustee in Bankruptcy did not realise any of the properties within three years of the bankruptcy.

47. As noted above, the defendant moved into one of the properties with his wife and son in September 2020. On that basis, he claims that it is his principal private residence and that the effect of section 283A of the UK Insolvency Act is to re-vest that property in him.

48. He also appears to claim that the effect of section 283A(2) is to re-vest the other three properties in him.

49. I have serious doubts that the defendant is correct in either respect. There is no basis for claiming that the property that he moved into was the defendant’s sole or principal residence “at the date of the bankruptcy”. Indeed, the admission to bankruptcy in the United Kingdom was based on him being resident in the United Kingdom. That is inconsistent with a property in Galway being his sole or principal place of residence at that time. There is no evidence that it was the sole or principal place of residence of his wife at that time. In relation to the other three properties, it seems likely that section 283A(2) does not apply to them because it expressly applies to “the interest mentioned in subsection (1)” and that interest is an “interest in a dwelling-house which at the date of the bankruptcy was the sole or principal residence” of the bankrupt or his spouse or partner. There is no evidence, or even a claim, that any of those three properties were his principal place of residence at any stage.

50. However, more fundamentally, the interpretation and operation of this provision is a matter of UK law. Therefore, evidence as to that law must be adduced. In circumstances where the burden of establishing that there is a credible defence is on the defendant, he must adduce that evidence. In order for the defendant to establish that he has a credible defence on this basis he must adduce some evidence. He has not done so. In the absence of any evidence at all as to the United Kingdom law, I can not conclude that he has established a credible basis for saying that the properties re-vested in him. Of course, he does not have to prove the position, but it is not enough to simply make an assertion as to the operation of foreign law. In circumstances where he has not established a credible basis for saying that the properties have re-vested in him, and he does not dispute the principle that in order to have an equitable interest he must have a proprietary interest, I must conclude that he has not established a credible basis for saying that he has an equitable interest in the properties.

Estoppel

51. The defendant also relies on estoppel by convention and promissory estoppel.

52. Charleton J considered the former in Ulster Investment Bank Limited v Rockrohan Estate Limited [2015] IESC 17. He said at paragraph 24:

“Estoppel can arise, however, through an assumption shared by those interacting.

This does not necessarily always have to be written or spoken once the state of affairs is clear, and therefore obvious, and the parties act upon it. For estoppel to arise, it is essential that there is conduct which establishes an objective state of affairs, whereby the party to be estopped, who would otherwise be bound by the legal relations, is placed in circumstances whereby it is clearly understood that a new state of affairs governs the rights and obligations as between the parties. This requires some demonstrable action, behaviour or representation by the party who is to be bound by the altered state of affairs. It is insufficient, to establish estoppel, merely for the party later pleading that defence to conclude that matters must be so. There must, instead, be a foundation in the behaviour of the party who is to be estopped from asserting a legal entitlement, either pursuant to contract or otherwise. The same applies where estoppel is used not as a shield but as a sword.

It would be an unwarranted and dangerous extension of the doctrine of estoppel to permit it to be one-sided; which it would be if based on bare assumption. It has always been central to the equitable principle of estoppel that it derives either from representations or from situations of behaviour that, reasonably construed, clearly withdraw or alter the strictures of legal obligations in such a way that circumstances may later arise whereby it would be unfair to enforce these.”

53. Charleton J went on to quote from Treitel, The Law of Contract, 13th Ed, at paragraph 3.094:

“Estoppel by convention may arise where both parties to a transaction “act on an assumed state of fact or law, the assumption being either shared by both or made by one and acquiesced in by the other”. The parties are then precluded from denying the truth of that assumption, if it would be unjust or “unconscionable” to allow them (or one of them) to go back on it. Such an estoppel differs from estoppel by representation and from promissory estoppel in that it does not depend on any “clear and unequivocal” representation or promise. It can arise where the assumption was based on a mistake spontaneously made by the party relying on it, and acquiesced in by the other party, though the common assumption of the parties, objectively assessed, must itself be “unambiguous and unequivocal””.

54. In Courtney v McCarthy [2008] 2 IR 376, Geoghegan J quoted with approval from Amalgamated Property Co v Texas Bank [1982] 1 QB 84. He said:

“The case related to a bank guarantee given by a company, the validity of which was being disputed by the liquidator of that company. A question arose as to whether even if the guarantee was not valid an estoppel had arisen by virtue of the conduct of the company which precluded denial of the guarantee. Brandon L.J., though forming the view that the guarantee was in fact effective went on to consider the estoppel question in the event that he was wrong. Two main arguments against the existence of the estoppel had been put forward in the High Court and the Court of Appeal. The first was that since the bank held its mistaken belief as a result of its own error alone and that the company had at most innocently acquiesced in that belief which it also held, there was no representation which could found an estoppel. The second argument was that the bank was seeking to use the estoppel not as a shield but as a sword and that that was not permitted by the law of estoppel. Brandon L.J. rejected both arguments. He expressed the view that the particular estoppel relied on was of the kind described in Spencer Bower and Turner, Estoppel by Representation, 3rd ed. (1977) at pp. 157-160 as “estoppel by convention”. He cited the relevant passage of that work as follows:

“This form of estoppel is founded not on a representation of fact made by a representor and believed by a representee, but on an agreed statement of facts the truth of which has been assumed, by the convention of the parties, as the basis of a transaction into which they are about to enter. When the parties have acted in their transaction upon the agreed assumption that a given state of facts is to be accepted between them as true, then as regards that transaction each will be estopped as against the other from questioning the truth of the statement of facts so assumed.””

55. In National Asset Loan Management Limited v McMahon, O’Brien & Downes [2014] IEHC 71, Charleton J said:

“When it comes to an assumed state of affairs, an assumption on its own is not sufficient unless there is proof that the assumption is shared by both sides or is made by one and acquiesced in by the other. In the context of estoppel by convention, for an estoppel to operate, acquiescence requires knowledge of the state of affairs and therefore effective consent to any representation based on conduct.”

56. It was submitted on behalf of the defendant that the fact that “he spent money repairing the properties, ...then maintained the properties, generated rental income, and repaid the plaintiff” establishes all the necessary ingredients of an estoppel by convention, namely, as the defendant put it, “a shared or common assumption of fact made by one party and acquiesced in by the other, such that the truth of that statement cannot be subsequently be denied.”

57. The defendant also relies on a defence of promissory estoppel. Snell (Equity, 32nd Ed.) defines promissory estoppel as:

“Where by his words or conduct one party to a transaction freely makes the other a clear and unequivocal promise or assurance which is intended to affect the legal relations between them (whether contractual or otherwise) or was reasonably understood by the other party to have that effect, and, before it is withdrawn, the other party acts upon it, altering his or her position so that it would be inequitable to permit the first party to withdraw the promise, the party making the promise or assurance will not be permitted to act inconsistently with it.”

58. The words or conduct which is alleged to give rise to the estoppel must be intended to affect the legal relations between the affected parties. The words or conduct must, therefore, have at least as much precision as would be needed for a variation of a contract between them (see Pearson LJ in Woodhouse AC Israel Cocoa Ltd SA v Nigerian Produce Marketing Co Ltd [1972] AC 741).

59. It is the defendant’s case that the test of whether the plaintiff intended to affect the legal relationship between the parties is an objective one and that if the Court has evidence on a plenary trial any objective observer would reasonably conclude that the intention of the plaintiff was to allow the defendant to retain the properties.

60. The different types of estoppel clearly have different features. However, for the purpose of this discussion they can be treated together.

61. I am not satisfied that there is any credible basis for a defence that the plaintiff is estopped from seeking possession either on the basis of estoppel by convention or promissory estoppel.

62. Essentially, the defendant’s case is that by allowing the defendant to spend monies on the properties and accepting his payments of €1,200 per month (in circumstances where they had not participated in the bankruptcy and where they indicated that they would not be seeking any shortfall following the sale of the properties) the plaintiff was estopped from seeking possession or had entered an agreement that the defendant could retain the properties. Paragraph 62 of the Statement of Claim in the plenary proceedings pleads:

“The Defendant is estopped from seeking possession. That the receipt of payments and/or benefit of the works to the Properties was on the basis that the Plaintiff would retain ownership and control of the Properties and would have a legal, equitable or beneficial interest in the Properties.”

63. That entirely disregards the surrounding context. The plaintiff demanded possession on the 9th February 2018. At that stage, the properties were vacant. The defendant did not give up possession. The plaintiff issued these proceedings on the 9 th August 2018. At that point it was crystal clear that the plaintiff was seeking possession. The defendant appears to have retaken possession of the properties in or around September 2020. There is no evidence that this was on notice to the plaintiff or that the defendant informed them that he was resuming possession. Thus, there can be no basis for saying that the plaintiff permitted or acquiesced in the defendant resuming possession. Nor is there any evidence whatsoever that the defendant informed the plaintiff that he was planning to spend monies on repairing or refurbishing the properties or any evidence that the plaintiff was even aware that the monies were being spent. There is, therefore, no basis for saying that the plaintiff acquiesced in these works or the associated expenditure and certainly no basis for saying that it was represented to the defendant that if he carried out the works and spent the money that he would be allowed to retain the properties.

64. The acceptance by the plaintiff of the monthly payments from November 2021 is slightly more difficult. Of key importance to the defendant’s case on this point is that the plaintiff had not participated in the bankruptcy and had expressly said on affidavit that it would not be seeking any shortfall after the sale of the properties. The effect of accepting these payments, it is submitted, was to accept monies towards any such shortfall and, therefore, it was a representation that the plaintiff would not be seeking to enforce its security. However, there are a number of factors which fatally undermine this argument.

First, these payments commenced in 2021. At that stage, the proceedings were already in being and there had been an extensive exchange of affidavits. It was clear that the plaintiff was seeking possession. Perhaps more importantly, the exchange of affidavits continued after the payments had commenced and the defendant could not have been in any doubt that the plaintiff was still seeking possession. This is fundamentally inconsistent with any representation by the plaintiff to the defendant that he was being permitted to retain possession of the properties or with acquiescence by the plaintiff. Furthermore, the defendant could have been in no doubt that the plaintiff did not accept that the repayments were in the amount due under the mortgage. For the purpose of promissory estoppel there must be a “clear and unequivocal promise or assurance which is intended to affect the legal relations between them...or was reasonably understood by the other party to have that effect, and, before it is withdrawn, the other party acts upon it, altering his or her position...” There was no “clear and unequivocal promise or assurance”. Furthermore, the conduct or words relied upon must precede the actions by which the defendant alters his position. That is not the case here. For estoppel by convention, the parties must act on a shared assumed state of facts or law or at least acquiescence by the party in the other party’s assumption. The assumption must be unambiguous and unequivocal. There is no evidence of an assumption on the part of the plaintiff. I am not satisfied that the acceptance of these payments establishes an estoppel by convention or a promissory estoppel.

65. Nor am I satisfied that there has been any delay or laches on the part of the plaintiff which might preclude it seeking possession or, indeed, which would give rise to an estoppel. As was fairly conceded by counsel for the defendant, the fact that the defendant was adjudicated bankrupt in the United Kingdom was a complicating factor and slowed matters down somewhat. There was a significant issue in the bankruptcy in relation to a private pension owned by the defendant. The plaintiff issued these proceedings in 2018. There was a delay due to Covid-19. There were then further delays, principally caused by the defendant seeking time to deal with the proceedings. It seems to me that there was no delay by the plaintiff which would deprive him of the right to seek and obtain an Order for Possession at this stage.

66. I am, therefore, satisfied that an Order for Possession in respect of the four properties should be made.

Stay on Judgment

67. It was submitted on behalf of the defendant in the alternative that if the Court grants the relief sought by the plaintiff, it should place a stay on the execution of the Order until the defendant’s separate proceedings are determined.

68. In Moohan v S & R Motors (Donegal) Ltd [2008] 3 IR 650, Clarke J said:

“4.2 Where the nature of the defence put forward amounts to a form of cross claim slightly different considerations may apply. In those circumstances the court has a wider discretion. Where the defendant does not establish a bona fide defence to the claim as such, but maintains that he has a cross claim against the plaintiff, then the first question which needs to be determined is as to whether that cross claim would give rise to a defence in equity to the proceedings. It is clear from Prendergast v.

Biddle (Unreported, Supreme Court, 21st July, 1957) that the test as to whether a cross-claim gives rise to a defence in equity depends on whether the cross-claim stems from the same set of facts (such as the same contract) as gives rise to the primary claim. If it does, then an equitable set off is available so that the debt arising on the claim will be disallowed to the extent that the cross-claim may be made out.

4.3 On the other hand if the cross claim arises from some independent set of circumstances then the claim (unless it can be defended on separate grounds) will have to be allowed, but the defendant may be able to establish a counter claim in due course, which may in whole or in part be set against the claim. What the position is to be in the intervening period creates a difficulty as explained by Kingsmill Moore J., in Prendergast v. Biddle (Unreported, Supreme Court, 31st July, 1957) in the following terms at p. 24:-

“On the one hand it may be asked why a plaintiff with a proved and perhaps uncontested claim should wait for judgment or execution of judgment on his claim because the defendant asserts a plausible but unproved and contested counterclaim. On the other hand it may equally be asked why a defendant should be required to pay the plaintiff’s demand when he asserts and may be able to prove that the plaintiff owes him a larger amount”.

4.4 The court’s discretion is to be exercised on the basis of the principles set out by Kingsmill Moore J. later in the course of the same judgment in the following terms at p. 25:-

“It seems to me that a judge in exercising his discretion may take into account the apparent strength of the counterclaim and the answer suggested to it, the conduct of the parties and the promptitude with which they have asserted their claims, the nature of their claims and also the financial position of the parties.

If, for instance, the defendant could show that the plaintiff was in embarrassed circumstances it might be considered a reason why the plaintiff should not be allowed to get judgment, or execute judgment on his claim, until after the counterclaim had been heard, for the plaintiff having received payment might use the money to pay his debts or otherwise dissipate it so that judgment on the counter claim would be fruitless. I mention only some of the factors which a judge before whom the application comes may have to take into consideration in the exercise of this discretion”.

4.5 It seems to me that it also follows that a court in determining whether a set off in equity may be available, so as to provide a defence to the claim itself, also has to have regard to the fact that the set off is equitable in nature and, it follows, a defendant seeking to assert such a set off must himself do equity.

4.6 On that basis the overall approach to a case such as this (involving, as it does, a cross-claim) seems to me to be the following:-

(a) it is firstly necessary to determine whether the defendant has established a defence as such to the plaintiff’s claim. In order for the asserted cross-claim to amount to a defence as such, it must arguably give rise to a set off in equity, and must, thus, stem from the same set of circumstances as give rise to the claim but also arise in circumstances where, on the basis of the defendant’s case, it would not be inequitable to allow the asserted set off;

(b) if and to the extent that, a prima facie case for such a set off arises the defendant will be taken to have established a defence to the proceedings and should be given liberty to defend the entire (or an appropriate proportion of) the claim (or have same, in a case such as that with which I am concerned, referred to arbitration);

(c) if the cross-claim amounts to an independent claim, then judgment should be entered on the claim but the question of whether execution of such judgment should be stayed must be determined in the discretion of the court by reference to the principles set out by Kingsmill Moore J. in Prendergast v. Biddle (Unreported, Supreme Court, 31st July, 1957).”

69. In Prendergast v Biddle (Unreported, Supreme Court, 31 st July 1957), Kingsmill Moore J had to consider whether to grant summary judgment to the plaintiff for monies owed or whether to adjourn the matter to plenary hearing in circumstances where the defendant had raised a cross-claim for damages in respect of a separate matter. He said:

“...Procedure by plenary summons is the normal procedure, but procedure by Summary Summons is allowed in limited classes of cases. It enables a Plaintiff in a suitable case to obtain a judgment rapidly and economically...But granting judgment under this rule is discretionary, and it must not be used to shut out a possible defence, or to exclude from consideration a triable issue. If there appears to be a defence, or a setoff, common law or equitable (which is regarded as a defence), the case must go to a plenary hearing when such defence can be fully investigated...If however, there is no defence suggested it seems to me that the Plaintiff is entitled to obtain his judgment. It may be important for him to obtain a judgment with priority of date as of the day when the application is heard...

It does not, however, follow that the Plaintiff should necessarily be able to issue execution at once...Where there is no defence to a claim such as would warrant the refusal of judgment the Defendant may yet be able to put forward a cross claim of a greater amount which he desires to litigate. In such a case it may be a hardship for the Defendant to be forced to pay the judgment when he has a valid counterclaim for a larger amount. Equally it may be a hardship on the Plaintiff to be kept out of his money because of a counterclaim which may not be successful. The Court in Sheppard v Wilkinson solved the difficulty by saying that the proper order was to stay execution until the hearing of the counterclaim. If this was intended as a universal direction in cases where there was a plausible counterclaim it appears to be to be too sweeping. In my opinion however, it should be within the discretion of the judge in a proper case to make such an order...”

70. It is important to note that in Prendergast v Biddle and Moohan the claims and counter-claims were money claims. Thus, the ultimate question was how much the defendant would owe the plaintiff, if anything, when the respective proceedings were determined. It is also important to note that in those cases, the counter-claims were not defences to the plaintiffs’ claims but rather separate claims.

71. In this case, of course, the plaintiff’s claim is not a money claim but a claim for an Order for Possession. Nor is the defendant’s own claim limited to a money claim, though it does include a claim for damages. Furthermore, a central part of the defendant’s claim in his separate proceedings is the same as the defence which he sought to raise in response to the plaintiff’s claim, i.e. that the defendant had acquired an equitable interest in the properties such as would preclude the plaintiff from obtaining an Order for Possession.

72. These differences do not mean that the approach in Prendergast v Biddle and Moohan does not apply but account must also be taken of these factors in determining how the court should exercise its discretion.

73. With some considerable reservation I am satisfied that a stay should be placed on the Order for Possession until the separate proceedings are determined. I am of this view for the following reasons.

74. Some factors lean heavily against a stay being granted. Firstly, I have already determined that the defendant has not discharged the burden of proving that he has a credible defence on the basis that the properties have re-vested in him and/or that he has an equitable interest in the properties. Where this is a central element of the defendant’s own claim, there is an incongruity in delaying the execution of the Order for Possession on the same basis. Furthermore, it follows from what I have already decided that I have serious doubts about the strength of this aspect of the defendant’s claim. Kingsmill Moore J identified the “apparent strength of the counter-claim” as one of the factors to be considered by the court. Secondly, there has been very significant delay by the defendant in raising and focusing on the claim that the properties have re-vested in him and/or that he has an equitable interest. As noted earlier in this judgment, there was a very extensive exchange of affidavits in which the defendant raised a large number of points but the points which he now raises and relies upon were not raised until very late in the day. Kingsmill Moore J made clear in Prendergast v Biddle that the court could have regard to the conduct of the parties and the “promptitude” with which they asserted their claims. Clarke J in Moohan noted that “It has often been said that delay defeats equity and that he who seeks equity must do equity” and that Kingsmill Moore J had made clear that “delay is a factor to be properly taken into account.”

75. As against those, the defendant’s claim raises two interesting issues. The first of these is whether the plaintiff, having obtained an Order for Possession, is entitled to retain the monies paid as mortgage repayments since November 2021 in circumstances where the plaintiff did not participate in the bankruptcy and stated on affidavit that it would not seek any shortfall following the realisation of its security. The second issue is whether the plaintiff is entitled to the benefit of the expenditure of monies by the defendant and to the uplift, if any, in the value of the properties that may be ascribed to the defendant’s works and expenditure of monies. For the reasons set out above, I am not satisfied that these give rise to a defence to the claim for an Order for Possession, but they may give rise to successful money claims against the plaintiff.

76. Neither of these would be sufficient in themselves to justify a stay. However, I am satisfied that no particular hardship would be caused to the plaintiff by the Order for Possession being made and a stay placed on execution (provided there is no unreasonable delay in the prosecution of the defendant’s proceedings) whereas there would be some hardship caused to the defendant if possession of the properties has to be given up immediately and they are then sold but he then had to wait to have the question of his entitlement to damages or credit for his payments, his works and the uplift in value to be determined.

77. On balance, therefore, it seems to me to be appropriate to place a stay on the Order for Possession pending determination of the defendant’s proceedings. However, that is strictly dependent on those proceedings being prosecuted with expedition. I have determined that the plaintiff is entitled to the Order for Possession but, with some reservation, that the defendant is entitled to a stay. That does not entitle the defendant to delay the possible execution of the Order for Possession by unreasonably delaying his own proceedings. The plaintiff will have liberty to apply to have the stay lifted in the event that there is any unreasonable delay the.

78. As this judgment is being delivered electronically, it may be helpful for me to indicate that my provisional view in respect of costs is that the plaintiff is entitled to its costs with a stay on execution pending determination of the other proceedings. The plaintiff has obtained the relief sought. The defendant had the benefit of a number of adjournments and opportunities to deliver further affidavits and submissions. Furthermore, the defendant’s position that the court should grant a stay was really only advanced at a late stage of the proceedings and after the hearing had commenced. In the event that either party is of the view that a different Order should be made then they should deliver written submissions of no more than 1500 words within two weeks of the delivery of this judgment.