A fund appointed receiver is entitled to an injunction for possession of an apartment in Co Limerick where a couple have been living, mostly rent-free, for some five years, a High Court judge has ruled.
Thomas and Catherine Reidy claimed they had an oral agreement with the registered owners of the apartment - whose debts of some €2.3 million have been acquired by Everyday Finance - to buy it for €100,000.
Ms Justice Siobhán Stack ruled this week receiver Stephen Tennant was entitled to an injunction for possession of the apartment at Fisherman’s Wharf, Manor Court, Co Limerick. She said there was no unfairness to the Reidys, who had refused a 2019 offer from the receiver for them to purchase the apartment for €120,000.
A stay will be applied on the order to allow the couple time to make arrangements to move.
No dispute over receiver appointment
AIB registered a charge in 2008 over the apartment and in 2016 appointed Mr Tennant as receiver over it and other assets of its registered owners, the borrowers, arising from the latter’s debts of some €2.3 million. In August 2018, AIB assigned its interest in the borrowers assets to Everyday.
The judge noted it was not disputed Everyday was entitled to appoint Mr Tennant as receiver and that it is the registered owner of the charge over the apartment.
The Reidys’ essential case is that they have an oral agreement to buy the apartment from the borrowers and partly performed that by entering into possession of and renovating the property, she said. They paid a €5,000 booking deposit with an estate agent and moved into the apartment on October 1st, 2016 under a lease for one year at €100 a month.
For the purpose of the injunction proceedings, the judge accepted the borrowers and the defendants, without recourse to legal advice, concluded an oral agreement in mid-September 2016 concerning purchase of the apartment.
The latest date when the defendants became aware the property was mortgaged to AIB was October 9th 2016, just a week after they went into occupation of it, she said.
Neither AIB nor Everyday ever provided any written consent for the sale of the property to the defendants, she said. Any sale without such written consent cannot bind AIB or its successor in title and any agreement with the borrowers is “meaningless” without the release of the charge over the property, which could not be done without Everyday’s agreement.
Mr Reidy relied heavily on a phone call between himself and an employee of the receiver on October 16th 2016 in which he says he was clearly told the sale would proceed.
He said he was asked the same day by an estate agent to provide proof of funds and had done so and, as a result of those two factors, the defendants understood the purchase of the apartment would proceed and said they had spent €30,000 on renovations.
Release the charge
The problem with that argument is the defendants do not assert any agreement with AIB or Everyday that the apartment would be released from the charge, the judge said.
It appeared Everyday would have agreed to release the charge if the defendants had agreed to the receiver’s offer of September 2019 to buy the property for €120,000 but they refused.
The judge concluded Mr Tennant had made out a strong case for the possession order likely to succeed at hearing and, based on that and other findings, was entitled to the injunction sought.