Friday 24 November 2017

Couple lose €1m claim for 'reckless mortgage lending'

THE PRESIDENT of the High Court has thrown out a case where a Donegal couple claimed their lender “recklessly” lent them the money for a mortgage
THE PRESIDENT of the High Court has thrown out a case where a Donegal couple claimed their lender “recklessly” lent them the money for a mortgage
Charlie Weston

Charlie Weston

The president of the High Court has thrown out a case where a Donegal couple claimed their lender "recklessly" lent them the money for a mortgage.

They had claimed damages of €1m off the lender, claiming they were lured into a contact to take out the mortgage.

The decision comes after a number of people were advised to take on their banks and claim reckless lending.

It is understood that around 1,000 similar cases claiming reckless lending and seeking compensation were lodged with the courts with the help of variety of groups, some of whom were charging to take the cases.

Now it has emerged that High Court President Mr Justice Nicholas Kearns, in a case taken by Patrick Harrold of Drumrooske, Donegal Town, dismissed the reckless lending claim saying it was frivolous and vexatious.

He said there was no tort of reckless lending in this country, and he was not prepared to entertain fanciful arguments by borrowers seeking to repudiate their loans, in a written judgment delivered last month.

The court had heard that Mr Harrold borrowed €256,500 over 40 years in June 2007 for the property at Drumrooske. He subsequently defaulted on the loan, and receivers were appointed to secure the property.

Mr Harrold took a case to the High Court claiming reckless lending practices by the lender, Nua Mortgages. This was a subprime lender founded by former Irish Permanent boss Billy Kane, in a joint venture with South African bank Investec.

Disneyland

Mr Harrold claimed he was coerced into signing the mortgage agreement, said he was insolvent at the time of the loan, and sought €1m in damages, Mr Justice Kearns outlined.

The borrower claimed the mortgage company "created the alleged money out of thin air on a computer keyboard". However, Nua Mortgages applied to have the case struck out.

The judge said the claim was frivolous and vexatious, and dismissed it. He said there was no civil wrong of reckless lending in this jurisdiction. He said Mr Harrold failed to provide credible evidence that he was lured into the mortgage, and struck out the proceedings.

Meanwhile, David Hall of the Irish Mortgage Holders' Organisation has highlighted what he called "Disneyland advice" being given to borrowers in financial distress.

He warned that debtors are being given false hope that baseless arguments could succeed in court. "Some of these Disneyland characters charged for this help," he said.

Irish Independent

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