Loophole change may affect Sheahan case
on 15/03/2013 00:00:00
Ms Justice Mary Laffoy was yesterday due to hear an action by a Bank of Ireland-appointed receiver over properties owned by Mr Sheahan restraining him from interfering with the receiver collecting rents from the tenants of those buildings.
Mr Sheahan and his brother Joey got loans, guaranteed by their father Frank Sr, from the bank for properties in Cork and Co Wicklow. As a result of alleged default in repayments, the bank is separately seeking a judgment of €2.9m against the father.
Bank of Ireland Mortgage Bank is also challenging the interpretation of a 2009 law designed to streamline repossessions.
Two years ago, repossessions ground to a halt after the High Court's Ms Justice Elizabeth Dunne identified a loophole in the 2009 Land and Conveyancing Reform Act.
The bank claims if Ms Justice Dunne's interpretation of that law is upheld, the property rights of secured lenders are being interfered with in an "arbitrary and capricious" manner that is unconstitutional.
Arising out of this, the Attorney General was brought into the action against Frankie Sheahan by receiver Michael McAteer and Bank of Ireland Mortgage Bank.
The move on Wednesday was intended to address the Government's concerns that the existing laws prevented lenders from repossessing properties.
Yesterday, when the Sheahan receiver case was about to open, Ms Justice Laffoy asked what effect Wednesday's announcement would have on this case.
Counsel for the AG said while the Cabinet said it intended to bring in legislation to address the gap, or perceived gap, in the relevant law, he was not in a position to say how specific the legislation would be. Counsel did not object to an adjournment until after the legislation is published.
Michael McDowell SC, for the receiver and the bank, said he had read that the Government proposed publishing the legislation before the end of the month and his clients were agreeable to an adjournment providing they could come back to court and seek an early date for the hearing, should it be required.
The judge adjourned the matter for mention in a month.