Injunction granted where fair issue is established in relation to alleged breach of the receiver’s duty

Plaintiffs’ application for an interlocutory injunction restraining the sale by the second or third-named Defendant of four parcels of land – Plaintiffs challenge the appointment of the third-named Defendant as Receiver to those lands and seek an order directing him and the Second-Named Defendant to yield possession of the lands - Plaintiffs borrowed monies from the First-Named Defendant bank on foot of three facility letters around 2007 - 2010 - a construction company borrowed monies from the same bank and this loan was secured by a mortgage over separate lands - these borrowings were guaranteed by the Plaintiffs in 2011 up to a maximum of €848,000 – these guarantees were to be supported by security - common case that the four parcels of land were at least part of that security for the guarantees – Letters of demand from the bank to the Plaintiffs around 2015 – sought payment of €129,660.20 – bank also demanded payment from each of the Plaintiffs on foot of their guarantees of the liabilities of the construction company – the bank issued summary proceedings against the Plaintiffs in 2016 in respect of their guarantee obligations, the sums due on foot of a facility letter from 2010 and a separate alleged facility - proceedings were not progressed by the bank –global deed of transfer in 2018 - the Plaintiffs’ loans, the bank’s security over the lands and the Plaintiffs’ obligations under the guarantees were transferred to a vulture fund – the vulture fund’s ownership of the charge over the relevant four folios was registered on the folios in 2018 – vulture fund issued a letter of demand in 2019 on foot of the facility of 2010 – no demand made on foot of guarantees – emails produced regarding the Plaintiff’s argument that the bank released and then wrongfully re-instated the guarantees and so claims that the vulture fund cannot rely on them – Court found that the emails are likely an administrative error - nevertheless the Court found that the Plaintiffs have established a fair question that the guarantees were released – low bar - Court not satisfied that the Plaintiffs have established a fair question that the Receiver was appointed on foot of the guarantees - no evidence to support such a conclusion - the case turns on whether the Plaintiffs have established that there is a fair, serious or bona fide question to be tried - Court noted that the threshold test in a prohibitory injunction is a low hurdle – the only claim made in the Statement of Claim is that the appointment of a Receiver was based on guarantees entered into by the Plaintiffs in respect of the liabilities of the construction company and that those guarantees are void – claimed that they were not supported by valid consideration - were obtained by economic duress - were released, deleted and no longer relied upon by the bank prior to it transferring its relevant interests to the vulture fund - also argued that the Respondents could not appoint a Receiver because the vulture fund had not been registered as owner of the relevant charges on the relevant folios - Respondents had failed to adduce any evidence that the vulture fund enjoyed a contractual power to appoint a Receiver – claimed that there was no entitlement to sell the lands in the manner in which they proposed to do because they do not enjoy vacant possession and are not acting reasonably in attempting to sell the lands with a tenant still in occupation – made further points at hearing inc. that a mortgagee with a power of sale must proceed reasonably and must market the property in such a way as to obtain the best price– Respondents objected to introduction of matters not pleaded – Court noted that some matters arose after the delivery of the Statement of Claim – considered points on merit - Court not satisfied that the Plaintiffs have not established a fair question that the Receiver was appointed on foot of the guarantees - no evidence to support such a conclusion – Court satisfied that the Plaintiffs have established a fair question that the vulture fund did not have the power to appoint a receiver to the lands in a Folio because they had not been registered as owner of the relevant charge - Court was not satisfied on other grounds that there was a fair question to be asked – Court would not accept the assertion that a sale with that tenant in occupation will lead to a depressed price - Plaintiffs established a fair question that the lands in the Folio can not be sold at least until the Register is rectified - Defendants said that they would provide an appropriate undertaking in respect of those lands pending an application in respect of the entries on that Folio - undertaking will have the same effect as an injunction – Court deferred determination as to whether the balance of justice favours the grant of an injunction in respect of the Folio.