The High Court has ruled that a bank is entitled to judgment of €1.6m against the wife of former government minister Ivan Yates
Deirdre Yates had asked the court not to order summary judgment and allow the case to go to a full hearing.
She claimed she did not realise a guarantee she signed in relation to loans for the family bookie company would give AIB the right to pursue her for her family home at Blackstoops, Enniscorthy.
Mr Justice Seamus Noonan ruled she had not raised an arguable defence to AIB's case and granted judgment for €1,648,147.
The case arose out of a guarantee she gave on April 13, 2010, towards €6.7m in loans for the expansion of the Celtic Bookmakers chain, which was run by her husband. In January 2011, the bank appointed a receiver over Celtic which went into liquidation.
Bankruptcy proceedings were launched in May 2012 by AIB against both Mr Yates and his wife seeking €3.6m.
The case against Mr Yates was dismissed in August 2012 and the summons against Ms Yates were not proceeded with.
Mr Yates was declared bankrupt in the UK in August 2012, having lived for 16 months in Wales to qualify under their more relaxed bankruptcy laws.
In June 2014, AIB demanded repayment of €1.6m from Ms Yates, a primary school teacher, in relation to the guarantee she provided on the loans.
Mr Justice Noonan said she had, in opposing the bank's application for judgment, claimed her clear understanding was that she signed documents relating to the guarantee 'for administrative purposes only'.
She believed the bank would not be entitled to have recourse to any assets other than those of Celtic and certain lands owned by her husband over which the bank had been granted a fixed charge.
She did not believe it exposed her to personal liability or gave the bank 'an entitlement to pursue our family home and I would not have signed those documents if I thought this to be the case'.
She also said she did not receive any legal advice before signing, nor did the bank suggest she do so despite the fact it (bank) knew she had no realisable assets and no substantive financial experience.
Mr Justice Noonan said the documentation clearly stated she was 'advised to obtain independent legal advice before signing the guarantee'.
Her claim in that regard was 'patently incorrect', he said.
There was also the uncontroverted evidence that Ms Yates was secretary of Celtic, regularly attended meetings with the bank and was appraised of financial affairs and dealings with the bank, he said. She held 990 of the company's 1,000 shares.
The judge rejected claims on behalf of Ms Yates that the bank should first execute other security available to it in relation to the debt before it obtains judgment against her. She had no arguable defence on this ground.
In relation to a claim that there was a radical or fundamental difference between the documents she signed and what she thought she was signing (the defence of non est factum), the judge rejected this.
The only possible evidence that could arise on this ground was where she said she was signing 'for administrative purposes only', though without explaining what that meant, he said.
At no stage did she identify what she thought she was signing if it was not a guarantee, the judge said. She merely understood AIB would only be entitled to have recourse to the assets of the company and her husband.
'The defendant is clearly an educated woman and does not purport to suggest she had any particular difficulty in understanding the document'.
Even accepting her claims at face value, without any consideration of assessment of their credibility, it was clear she could not sustain this defence.
She also had no arguable defence in relation to her claim that the bank had failed to adequately explain the calculation for the €1.6m.
The court heard the figure did not include interest or costs of the receiver.
Mr Justice Noonan said the bank explained the figure on multiple occasions and she had not engaged with this explanation in any way or sought to say why it was wrong.
Rather, she asserted that because a different amount was sought during bankruptcy proceedings in Ireland, which were aborted, that this gave rise to a defence.
The judge could not see any relevance to the bankruptcy proceedings to the bank's current claim.
The bank will only be able to recover what it is due and there was no question of 'double recovery'.
Even though it may have recourse to multiple defendants to recover a debt, it cannot recover more than it is due, he said.
To the judge's mind, she had not established that she has 'a fair or reasonable probability of having a real or bona fide defence.
'It is in my view clear she has no defence.'