Legal Updates

This article considers the decision of Ms Justice Gearty in the recent case of Start Mortgages v Barry Piggott¹. The Court found that the twelve year limitation period barring actions brought in respect of judgments did not apply to the renewal of an order for possession in High Court proceedings. A finding that will be of relevance in the context of possession cases during the Covid-19 pandemic and into the future.

The facts

Start Mortgages (Start), as Plaintiff, obtained an order for possession in respect of Mr Piggott’s residential property on 30 June 2008 (the Order). Over the course of the following years payment plans were put in place in respect of his loans secured on the property. Each eventually failed, with Mr Piggott stopping all payments in 2016.

The Plaintiff obtained leave to issue execution of the Order in November 2018, which is a requirement when more than six years have passed since the date of the original Order. This execution order was then renewed in July 2019, giving the Plaintiff until 24 July 2020 within which to effect execution, some weeks after the twelve years would have passed. The Plaintiff subsequently sought to renew the execution order for a second time.

The law

The Court was required to assess whether such an extension could be granted in light of section 11(6)(a) of the Statute of Limitations Act 1957, which provides that:

“An action shall not be brought upon a judgment after the expiration of twelve years from the date on which the judgment became enforceable”.

The primary issue in this case was whether the enforcement action of renewing the execution order was to be considered an “action…upon a judgment” for the purposes of section 11(6)(a) of the Statute of Limitations.

All parties involved acknowledged that this would be an undesirable outcome. The Plaintiff did not wish to enforce the Order before the expiration of the twelve year period, seeking to avoid a situation where Mr Piggott would be dispossessed of his family home during the current pandemic. The Plaintiff had also acknowledged the relatively recent efforts of Mr Piggott to reduce the debt owed. Furthermore, Mr Piggott consented to the renewal sought, as if the renewal was not granted the Plaintiff would have little choice but to enforce their security to avoid being statute barred. The Court acknowledged the alignment of interests between the parties.

Decision

The Court relied heavily of the judgments of the High Court and Supreme Court respectively in the matter of Ulster Investment Bank Limited v Rockrohan².

In the High Court Irvine J., drew a clear distinction between ‘actions’ within the meaning of section 11(6)(a) of the Statute of Limitations and cases which relate to the procedure by which an order is executed. Irvine J found in Rockrohan case that an enforcement action is not a fresh action and as such, is not statute barred by section 11(6)(a) of the Act. Charleton J. in the Supreme Court again endorsed this view, advising that any order for possession is “entirely supplementary” to the conclusion of the primary action.

In the Piggott case, the Court also referenced the High Court’s consideration of the English decision of Ezekiel v. Orakpo³. This case concerned the enforcement of a charging order, with Millet L.J. drawing a clear distinction between; fresh actions on a judgment on one hand and proceedings to enforce a pre-existing judgment on the other. In that case the English Court held that the latter involves no further “consideration or investigation” by the Court, and as such should not be barred by the Statute of Limitations.

In this case the Court agreed with those positions, holding that an order renewing the execution of an order for possession calls for no further consideration by the Court and as such, should be viewed as an application to enforce an order previously made.

The Court in Rockrohan also considered policy issues and noted that it will not always be possible for a plaintiff to enforce an order for possession within twelve years of judgment for numerous reasons, not least of all the possible legal challenges and appeals that can be brought by a defendant. These factors will often be outside of a plaintiff’s control and, as such, it was unlikely the legislature intended for enforcement scenarios to be bound by the relevant time limits. This reasoning was also approved by Charleton J. of the Supreme Court.

In the Piggott case, Gearty J. was again in agreement with this rationale, especially in the context of modern mortgages which can extend beyond thirty years and the time consuming nature of modern litigation. The Court affirmed that “in such actions it seems absurd to suggest that the limitation period must apply not only to the first steps in the execution of a judgment but that the whole process of execution must be complete within twelve years.”

Gearty J also noted the discretion available to the Court in allowing leave for execution and cited the Supreme Court case of Smyth v Tunney⁴ which found that the plaintiff must show sufficient reason as to why it has not executed the judgment.

Conclusion

The Court followed the respective decisions of Irvine J. and Charleton J. in Rockrohan and granted the Plaintiff leave to renew the Order once more in line with Order 42 Rule 20 of the Rules of the Superior Courts. This was a pragmatic decision as it facilitated the intentions of both parties, such that the Plaintiff was not forced into a position whereby it had to execute the Order. Gearty J. acknowledged the Plaintiff’s reluctance to enforce the Order during the pandemic and emphasised that “forbearance” of this kind should be encouraged, rather than punished.

This sets a positive precedent before the High Court, with many loan owners likely to be cautious about enforcing orders for possession previously obtained during the current pandemic or in the backdrop of legitimate negotiations. This decision conveys that loan owners can renew an order continuously, subject to the court’s discretion, without fear of being statute barred after twelve years.

1 Start Mortgages DAC v Barry Piggott [2020] IEHC 293
2 Ulster Investment Bank Limited v Rockrohan Estate Limited [2015] IESC 17 [2015], 4 I.R. 37 and [2009] IEHC 4.
3 Ezekiel v. Orakpo [1997] 1 WLR 340
4 Smyth v Tunney [2004] IESC 24