Wednesday 21 February 2018

Land grab by NAMA, Revenue stymied by new ruling

Tim Healy and Emmet Oliver

THE Revenue Commissioners, NAMA and the banks will find it more difficult to seize and sell the land of borrowers following a far-reaching decision of the Supreme Court, which was announced yesterday.

NAMA and the Revenue Commissioners won't be able to sell land owned by a developer if a portion of it is co-owned by another individual, such as a spouse.

While both agencies will still be able to place a charge over the land, they will not be able to sell it while the co-owner remains in place, experts said.

However, the judgment only impacts on registered land, leaving most properties in Ireland out of the net.

The Supreme Court yesterday ruled the Revenue Commissioners are not entitled to order the sale of lands belonging to a man and his estranged wife in order for debts to be repaid.

The unanimous ruling of the three-judge court has major implications for creditors seeking to sell co-owned property in order to get their money back.

The Revenue had sought orders entitling it to sell 19 hectares in Co Cork owned by Thomas and Carmel Deasy to satisfy three judgments obtained by it against Mr Deasy.

In 2004, the Revenue secured charging orders over Mr Deasy's interest in the lands but in 2006, the High Court ruled it was not entitled to an order for sale of the lands and the Supreme Court has upheld that order.

The Revenue is involved in at least 20 similar cases, while other cases were deferred pending yesterday's decision.

Last night it said it was studying the judgment, with NAMA saying the same.

While Mr Deasy had since reached a settlement with the Revenue, it asked the Supreme Court to determine the issues due to their relevance to other cases.

The Revenue's action was against Mr Deasy but Carmel Deasy was later joined to the case by order of the High Court as she was a co-owner of the lands.

Mrs Deasy raised an issue whether the High Court had jurisdiction to give a judgment creditor a remedy for enforcement of their judgment mortgage when that remedy affected not just the debtor but the co-owner of the property.


In the High Court in 2006, Ms Justice Mary Laffoy found that where a judgment mortgage is registered against the interest of one of the owners of co-owned registered land, the only effective remedy for enforcement of this judgment would be to order either partition of the land between the co-owners or a sale in lieu of partition, after which the proceeds would be divided between the owners.

She ruled that both those options would interfere with the property rights of the co-owner and, in the absence of specific jurisdiction, it would be inappropriate for the High Court to make such an order.

Giving the Supreme Court judgment yesterday, Mr Justice Joseph Finnegan stressed the sole issue for determination in the case was whether the court could order a sale in lieu of partition of the Deasy lands.

The Revenue had not sought an order for partition of the lands or for sale of Mr Deasy's interest in them, he noted.

Irish Independent

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