Woman, 81, liable for €1m guarantee of son’s business

An 81-year-old woman who provided a €1m guarantee concerning a loan to her son’s fuel distribution business which later went into receivership is liable for judgement in that sum, the Court of Appeal has ruled.

The three-judge court upheld a commercial court finding that Maureen Curran, from Oldcastle, Co Meath, had made out no arguable defence to Bank of Ireland’s claim for summary judgement against her for the €1m. Ms Curran, a widow, is the mother of Michael Curran whose XL Fuels Group, Oldcastle, went into receivership when the firm defaulted on loans from Bank of Ireland.

The bank had brought proceedings seeking judgement against Mr Curran and his mother. Judgment for €2.2m was previously entered against Mr Curran who did not defend the application but Mrs Curran maintained she had an arguable defence.

Yesterday, the Court of Appeal agreed with the commercial court that she had made out no arguable defence, including on grounds the guarantee was executed under undue influence or was an unconscionable bargain such as entitled her to argue it was unenforceable.

Giving the court’s judgement, Ms Justice Mary Irvine noted Mrs Curran was a director of the company, its secretary and received what was described as a ‘stipend’ for her services.

Mrs Curran had signed an acceptance of facilities which the bank agreed in May 2008 to make available to the company, the judge said.

It was not disputed that she signed the guarantee in three places and in the presence of two bank officials during an encounter which took place, at her request, in her home.

Her third signature was under a statement written by her which advised she understood the nature of the liability she was undertaking and did not wish to get independent legal advice.

It was accepted the text of that statement was read to her by one of the officials. The judge said Mrs Curran’s claim of undue influence seemed to be made not against the bank but rather her son, who had an interest in procuring execution of the guarantee.

Evidence to support a claim of undue influence by her son or based on the conduct of the bank was “glaringly absent” from Mrs Curran’s affidavits, the judge ruled.


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