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The Court of Appeal has permanently prevented a fund from attempting to recover some € 1.6 million from a doctor as a result of a loan issued by Ulster Bank Ireland in 2007.
On Friday, the three-judge Court of Appeal granted Neil Healy’s appeal against a High Court decision that Promontoria (Aran) Ltd is entitled to recover that sum from him.
The Superior Court ruling was made in 2018 after a new hearing of the proceedings by Dr. Healy, based at Lough Sheever Corprate Park, Mullingar.
In 2015, the Supreme Court ordered the hearing after allowing Dr. Healy’s appeal of a High Court rejection in 2009 of his claim that Ulster Bank erroneously allocated some 667,000 euros in a deposit account to offset its liability in relative dispute. to a loan of 3.4 million euros.
Mr Healy had claimed that he had been released from his guarantee of the € 3.4 million loan during a meeting in August 2007 with an official from Ulster Bank. The Supreme Court held that the 2009 Superior Court decision was “unrelated” to his mother’s evidence, supporting her son’s version that the bank official had given him certain guarantees.
Dr. Healy had planned to develop a former hospital at Coole in Westmeath in 2005 with a medical colleague. They obtained a € 3.4 million loan from Ulster Bank Ireland and both provided guarantees for the loans.
In 2007 they agreed to terminate the agreement on the basis that Dr. Healy received 2.2 million euros and his former partner assumed the assets and liabilities of the association.
The bank stated that Dr. Healy’s liability for the original loan was still in effect and, in August 2008, it deducted € 667,210 from the € 2.2 million of the outstanding debt balance of the € 3.4 million.
Dr. Healy claimed that the bank had no right to do that and that he had only deposited the € 2.2 million after being assured in a meeting with Alan Leech, Relationship Manager at the Mullingar branch, on 1 August 2007, he was “in the clear” regarding his responsibility for the Coole project. Her mother, who had attended the meeting, gave evidence to support her account.
Following the new hearing, the High Court dismissed Mr. Healy’s proceeding in March 2018 and ordered Promontoria to recover 1.63 million euros, plus costs.
In the judgment of the Court of Appeal that allowed Mr. Healy’s appeal, Judge Mary Faherty noted that the bank had not filed an appeal against the Superior Court, considering that the guarantees given by Mr. Leech extended to all liabilities. related to the Coole project.
The outstanding consideration in this appeal was whether the bank does not have the capital to pursue Dr. Healy with respect to Coole’s liabilities, he said.
It found that the Superior Court made a mistake of fact and law by not owning the bank, that it could not offset the funds in Dr. Healy’s account, or pursue him for Coole’s debt.
Any reasonable person in Dr. Healy’s shoes who had just completed the series of transactions in question, in which the bank was centrally involved, would have treated Mr. Leech’s words as a clear representation of Dr. Healy regarding the Coole project. said.
Dr. Healy’s “totally reasonable” reliance on the bank’s guarantees also had the effect of depriving him of the opportunity to take steps to safeguard his position in relation to the agreements with his former business partner.
The judge said it was “inconceivable” for the bank, after August 1, 2007, to allow Dr. Healy to proceed for a year to use his money in the belief that he was free of Coole’s debt without disturbing him from that belief. It was inconceivable that he applied the compensation, in August 2008, given the guarantee that he had given him a year earlier.
Promontoria, as the assignee of the loans, is bound by the bank’s statements and, due to the bank’s conduct, cannot prosecute Dr. Healy, it further said.
Final orders arising from the judgment will be issued at a later date.
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