Wives were not privy to men’s credit union loans

A credit union cannot sell the jointly-owned family homes of two Cork men to recover judgments against them because their wives had nothing to do with the loan transactions and never signed any document providing their homes as security, the Court of Appeal ruled.

Judge Gerard Hogan found the homes could not be sold because the wives of the two borrowers were not parties to the relevant loans which gave rise to the judgment mortgages and never formally consented to them.

The ruling yesterday was made following the courts’ first consideration of principles governing the possible partition and sale of a family home under the Land Law and Conveyancing Act 2009.

It concerned an appeal by Muintir Skibberreen Credit Union against the High Court’s refusal to make orders for sale of the family homes of Cornelius Crowley and Brendan Hamilton.

Mr Crowley, a father of three, owns his home jointly with his wife Breda Crowley, Baltimore Road, Skibbereen, Co Cork, while Mr Hamilton, also a father of three, jointly owns his home with his wife Breda Hamilton, Caheragh, Drimoleague, Co Cork, Judge Hogan noted.

He said both men had engaged in “relatively small scale” property development in the West Cork region and got loans from the credit union. After the 2008 collapse, they were unable to repay those loans.

In October 2011, the credit union obtained judgment for €562,500 against Mr Crowley, which was later registered in the Land Registry. It also obtained judgment for the same sum against Mr Hamilton.

The Crowleys married in 1993 and Mrs Crowley never signed any documents providing the family home as security for the commercial loan at issue, the judge said. Nor was she involved in any way in her husband’s loan application.

The Hamiltons married in 1978 and have three adult children, he said. Mrs Hamilton never signed any documents providing the family home as security and was not involved in her husband’s loan application.

All other properties which the two men previously owned have been sold, he noted. Both families have serious debts.

Having analysed the relevant law, Judge Hogan said that

while the credit union was entitled to previous orders charging its judgment against both family homes, the High Court was correct to refuse it orders permitting the sale of either home.