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AB Wolfe & Co provides the highest quality debt recovery service and representation to Irish and overseas clients. We provide guidance and support at all stages from pre-legal, formal demand letter to culmination of the debt recovery process through enforcement in all courts and jurisdictions, both within and outside Ireland.

Corporate and Consumer Debt Recovery

We manage both high volume and individual high value judgment proceedings at District, Circuit and High Court levels as well as appeals to the Court of Appeal and Supreme Court.  We provide quality advice, guidance and support throughout the litigation and recovery process. This service includes:

  • Review of initial instructions and providing advices;
  • Asset investigations and tracing;
  • Issuing pre-legal demands;
  • Issuing and serving legal proceedings;
  • Timely application for judgment where the claim is undefended;
  • Pragmatic advice and timely case progression where the claim is defended;
  • Regular advice and updates to clients by email, letter or report format;
  • Prompt engagement with debtors where correspondence or proposals are received;
  • Providing practical advice and guidance on settlement offers; and
  • Timely remittance of money recovered.
Enforcement of Domestic and Foreign Judgments

We advise on the enforcement of judgments both domestic and foreign. Our advices incorporate a review of the judgment secured, a clear explanation of enforcement options, a pragmatic cost / benefit analysis on enforcement within the jurisdiction, tracing and asset searches as well as timely enforcement applications in the Irish Courts. Enforcement options include:

  • Instructing county sheriffs to seize and sell assets;
  • Registration of judgments in the Register of Judgments with consequent publicity;
  • Registration of judgment as judgment mortgage over relevant property;
  • Issuing and progressing instalment proceedings in the District Court;
  • Examining debtors and related persons such as company directors as to the whereabouts of assets to help with the execution of judgments;
  • Securing third party garnishee orders;
  • Issuing and progressing well charging proceedings in respect of property;
  • Bankruptcy;
  • Notices to wind up  pursuant to the Companies Acts;
  • Employing enquiry, searching and tracing agents to trace and verify data on debtors and their property; and
  • Advising on the enforcement of historic or acquired / assigned judgments and securing leave of the court where necessary.
Mortgage Enforcement

We advise numerous secured creditors, financial institutions, credit unions, receivers, liquidators, credit servicers and investment funds on the enforcement of security together with related regulatory and compliance requirements. In particular, we have in-depth experience in high volume Circuit and High Court mortgage enforcement proceedings.

We have advised domestic and international clients on litigation and enforcement in the context of acquisition of loan portfolios, as well as advising on the transfer of such litigation. This includes large scale substitution applications (including omnibus applications), along with applications to join purchasers to appeals and for leave to execute existing orders and judgments. We advise on workouts and the impact of personal insolvency arrangements and bankruptcy on recovery. 

Hire Purchase / Leasing / Personal Contract Plans

We provide cost effective and timely debt recovery services and advices to businesses concerning vehicle and equipment finance, including HP, leasing and / or PCPs.  We advise on the termination process, repossession of the asset, compliance with consumer legislation and debt recovery.

Particular consideration must be given where financing is provided to consumers as this is heavily  regulated in Ireland. The relevant legislation has strict requirements surrounding the termination process of any agreement.

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Summary judgment, concurrent wrongdoers and the Civil Liability Act: Ulster Bank v McDonagh

Sep 8, 2020, 15:41 PM
The recent judgment of Ulster Bank & Ors v McDonagh & Ors [2020] IEHC 185, is one in a series of judgments stemming from the purchase of a site at Kilpeddar in County Wicklow in 2008. In this instalment, the Court addresses some important questions around settlements, concurrent wrongdoers and summary judgment.
Title : Summary judgment, concurrent wrongdoers and the Civil Liability Act: Ulster Bank v McDonagh
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Insight Date : Jul 8, 2020, 12:10 PM
The recent judgment of Ulster Bank & Ors v McDonagh & Ors [2020] IEHC 185, is one in a series of judgments stemming from the purchase of a site at Kilpeddar in County Wicklow in 2008. In this instalment, the Court addresses some important questions around settlements, concurrent wrongdoers and summary judgment.

Although much of the judgment considers factual disputes and the substantive claim, the judgment also makes a number of interesting observations on the interpretation of s17(2) of the Civil Liability Act, 1961 insofar as it relates to summary debt claims.

The facts

In 2008 the Defendants, the McDonagh brothers, took out a €21.8 million loan from Ulster Bank (the “Bank”) to purchase an 80-acre site at Kilpeddar, County Wicklow. Planning permission was obtained to develop a data centre, however, for various reasons this did not proceed and ultimately the McDonaghs were unable to repay the loan which was secured on the 80-acre site. A compromise agreement was reached between the Bank and the McDonaghs but after an alleged breach of the agreement, the Bank sought summary judgment against the McDonaghs in the sum of €22,090,302.64.

Prior to the initiation of these proceedings, the Bank had sued CBRE for an alleged negligent valuation of the Kilpeddar site and these proceedings settled for €5 million. The Bank applied this sum against the McDonaghs’ loan in reduction of their overall debt.

The issue

A key defence raised by the McDonaghs was that (a) the McDonaghs and CBRE are concurrent wrongdoers and therefore, (b) pursuant to sections 17(2) and s35(1)(h) of the Civil Liability Act, no further monies are due and owing by the Defendants to the Bank.

In its defence, the Bank contended that (a) sections 17(2) and s35(1)(h) of the Act do not apply to summary debt claims; and (b) the McDonaghs and CBRE are not concurrent wrongdoers.

Applicability of the Act to summary debt cases

The Court first addressed whether the Act applied to summary debt claims. The Bank had relied on Histon v Shannon Foynes Port Company to argue that it did not. However, the trial judge, Twomey J, noted that in Histon it was held that the Act did not apply simply because counsel failed to produce an authority which provided otherwise. The judge in this case instead relied on ACC Bank v Malocco [2000] 3 IR 191 and AIB v O’Reilly & Anor [2019] IEHC 151. Both cases are authority for the application of the Act in summary debt claims.

The judge then analysed the key definitions of the Act. The term “Concurrent wrongdoers” is defined as “two or more persons … responsible to a third person … for the same damage”, with “damage” including loss of property, loss of life and personal injury. The judge noted that the definition of damage is not exhaustive and that, in his view, where a defendant fails to repay a loan, the plaintiff suffers a loss that constitutes damage. Furthermore, the non-payment of monies is a breach of contract and therefore constitutes a wrong as defined by the Act. Finally, the judge pointed out that if the legislature had intended to exclude one type of civil liability from the remit of the Act, this would have been easily achieved by suitable wording. In conclusion, the judge held that the Act does apply to summary debt claims.

Concurrent wrongdoers

The judge separately considered whether the McDonaghs and CBRE are concurrent wrongdoers for the purpose of the Act. In the present case, the judge found that in the Bank’s pleadings CBRE was described in a manner consistent with that of a concurrent wrongdoer. Furthermore, the settlement sum had been applied against the overall judgment sum. The Court found this indicated an implied understanding amongst the parties that the losses suffered in each case were related. Against that, the judge also found that a settlement agreement was not the same as a determination of liability by a court and on that basis there could be “no certainty” as to whether the parties were liable for the same damage.

The judge chose not to determine whether they were in fact concurrent wrongdoers, and instead took the approach that assumed they were so as to enable a further analysis of section 17 of the Act.

Application of section 17 of the Act

The judge considered the effect of the Bank’s settlement with CBRE on the McDonaghs liability to the Bank having regard to sections 17 and 35(1)(h) of the Act. Section 17(1) of the Act provides that when a settlement or accord is reached with one concurrent wrongdoer, it will discharge the other wrongdoer if such settlement or accord indicates an intention to do so. If no such intention is evident, then s17(2) applies. As there was no reference to the McDonaghs in the settlement agreement between the Bank and CBRE, the Court held that s17(1) of the Act did not apply and went on to consider s17(2) of the Act.

Section 17(2) of the Act provides that where a settlement is reached with one wrongdoer (“D1”), the other wrongdoer (“D2”) will not be discharged. Instead, the injured party (“P”) will be “identified” with D1 in any action against D2 and the claim against D2 will be reduced to take account of the amount paid by D1. The Court will reduce the overall figure payable by D2 by the larger of the following:

  1. the consideration paid for the release or accord, i.e., the amount paid by D1 to be released from liability;

  2. the amount by which the release or accord states that the total claim shall be reduced, i.e., if the settlement says D2’s liability shall be reduced by €10,000, this is the amount the claim against D2 will be reduced by;

  3. the extent to which D1 would have been liable to contribute to the plaintiff’s total claim if they had not settled.

In the present case, these limbs were considered as follows:

  1. the consideration paid for the release or accord – here the settlement between CBRE and the Bank was €5 million, this sum had already been applied by the Bank when taking their claim against the McDonaghs;
  2. the amount by which the release or accord states that the total claim shall be reduced – in the settlement agreement between the Bank and CBRE there was no reference to the overall claim of €27 million being reduced by any particular amount, therefore this limb equates to zero;
  3. the extent to which D1 would have been liable to contribute to the plaintiff’s total claim. This involves the plaintiff identifying with and being deemed to be responsible for the acts of the settling wrongdoer pursuant to section 35(1)(h) of the Act, so as to give rise to a claim for contributory negligence (with the corollary that the settling wrongdoer is protected from a claim for contribution from the remaining defendant). This involves the court attempting to determine the degrees of fault of the concurrent wrongdoers.

Parties rarely reach a stage where the division of the concurrent wrongdoers liability is addressed by the Court in advance of settlement with one of the parties. Therefore this limb requires the court to estimate what D1 would have been liable for.  So in this case, if the court were to decide that only 5% of the loss should be attributed to CBRE, that would mean that CBRE would only be liable for €1.35 million.  Applying the above formula, the Bank would be entitled to pursue the McDonaghs for the full value of the claim less the €5 million referred to in limb 1.

Judge Twomey helpfully used this analysis to demonstrate that, far from absolving the McDonaghs of liability, section 17(2) of the Act is simply intended to provide for the fair apportionment of liability between defendants.  Judge Twomey also said that the intention of both this section and the Act itself is to encourage settlement and, if he were to accept the McDonaghs interpretation of this section, this would go against this intention.

Given that the division of liability under the third limb required further consideration, and given the Court had merely presumed for the purpose of the analysis that CBRE and the McDonaghs were concurrent wrongdoers, the Court adjourned the matter to allow for further submissions on the point.

Key takeaway points

The important takeaway points from this judgment are first, that the Act and the concept of concurrent wrongdoers, both apply in summary debt claims.

Second, entering into a settlement agreement with one defendant will not automatically absolve the other defendants of their liability unless this is expressly stated in the settlement agreement.  In the absence of such an express intention, section 17(2) of the Act will apply.

Finally, pursuant to section 17(2) of the Act, a settlement with one defendant will reduce the overall liability of the other defendant in accordance with the greater of (a) the settlement amount, (b) the amount by which the settlement provides the overall claim should be reduced and (3) the amount the settling defendant would have been liable to contribute to the plaintiff’s claim had he not settled.

For further information, please contact Gráinne DeverMairéad Ní GhabháinJulie Murphy-O’ConnorNatalie CoenDylan Gannon or your usual Matheson contact.

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