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Proceedings to enforce equitable mortgage are statute-barred

By: Cian McGoldrick BL

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High Court determines that proceedings seeking to enforce an equitable mortgage are statute-barred, on the grounds that: (a) any proceedings should have been instituted within two years of the date of death of the mortgagor on 25 August 2011; and (b) the mortgagee's cause of action had accrued once the prescribed repayment date had passed without the overdraft facility being cleared in full.

High Court - banking law - proceedings to enforce an equitable mortgage in respect of unregistered land - well charging order sought and order for the sale of the land - section 8 of the Civil Liability Act 1961 - Statute of Limitations Act 1957 - loan agreement entered into by borrowers in 2008 - security for the loan agreement was an equitable deposit held over title deeds to commercial property - sum was not repaid - first borrower died intestate in August 2011 - defendant was the personal representative of the first borrower and took out letters of administration in November 2019 - demand for repayment was sent in April 2020 - second borrower died in December 2016 - proceedings were instituted in June 2020 - whether the mortgagee's cause of action was subsisting as of the date of death of the mortgagor - if so, proceedings should have been instituted within two years of the date of death - proceedings were not commenced until almost nine years had elapsed since the date of death - no mortgage deed - cause of action had accrued once the prescribed repayment date had passed without the overdraft facility being cleared in full - any proceedings seeking to enforce the equitable mortgage should have been instituted within two years of the date of death of the mortgagor in August 2011 - claim was statute-barred

Note: This is intended to be a fair and accurate report of a decision made public by a court of law. Any errors should be notified to the editor and will be dealt with accordingly.

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