Court overturns €36m bank judgment against Morrissey

THE Commercial Court has agreed to overturn a €36 million summary judgment order granted to Irish Bank Resolution Corporation (IBRC) last month, against businessman John Morrissey.

The bank’s case against Mr Morrissey will now go to a full hearing.

The summary judgment order automatically came into effect last month as a result of delays in the filing of Mr Morrissey’s defence to the bank’s claim.

He argued those delays were not his fault but were attributable to his then lawyers and he sought to vacate the judgment.

Last week, Mr Justice Peter Kelly agreed to put a stay on the registration of the judgment order, on condition of another order being made, restraining Mr Morrissey from reducing his assets below €36m, or from entering bankruptcy or other arrangements with his creditors.

The judge allowed €2,500 for Mr Morrissey’s living expenses, plus funds for reasonable legal expenses, pending the matter coming back before him yesterday, when the bank urged the judge not to vacate the judgment and Mr Morrissey’s new legal team argued that he should have an opportunity to defend.

Having heard from the sides, the judge agreed to vacate the €36m judgment and to accept the defence and counter-claim on terms including that Mr Morrissey provide a full statement of his assets and liabilities.

Mr Morrissey may also not dispose of any assets worth more than €10,000, unless the bank agrees to such a disposal or enter bankruptcy or other arrangements with creditors.

IBRC had brought the proceedings over loans allegedly due for repayment in July 2009.

Earlier this year, the bank appointed a receiver over secured assets of Mr Morrissey and his wife, Carol Nolan, including about 18 properties in Dublin.

On November 21st last, IBRC secured the €36m judgment order against Mr Morrissey over his failure to comply with court orders requiring delivery of his defence and counter-claim.

The defence was to be delivered in September and, when it was not, the bank sought judgment.

Mr Justice Kelly allowed more time to file the defence but made an order stipulating that unless the defence was delivered by 2pm on November 21, judgment would automatically enter. When the defence was delivered shortly after that deadline, judgment was duly entered.

In his initial defence and counter-claim, delivered five weeks late, Mr Morrissey denied receiving €36m loans from the bank and pleaded he did not have to repay due to the bank’s conduct in collapsing the Irish property market and economy. He also claimed €140m damages from the bank on grounds including suffering a brain haemorrhage while under stress dealing with it.

Mr Justice Kelly described the denial of the loans as “nonsense” and warned Mr Morrissey he must provide a properly pleaded defence. The court was not engaged in a public inquiry into Anglo, the judge added.