Introduction

This High Court decision addresses whether borrowers can, after settling prior litigation and expressly acknowledging a lender’s title and enforcement rights, obtain an interlocutory injunction to restrain a mortgagee’s sale by arguing that the lender is the legal but not the equitable owner of the security. Kennedy J declined to resolve the beneficial ownership issue at the interlocutory stage because the defendants’ preliminary objections—based on the settlement terms, estoppel, delay, acquiescence, and laches—were dispositive.

The plaintiffs were a father and daughter, Oliver and Nicola Donlon. Mr Donlon is the registered owner and mortgagor of approximately 8.27 acres of farmland at Clare Hill, Co. Westmeath. Following a loan sale by Ulster Bank, Promontoria (Aran) Ltd became the mortgagee. Insolvency practitioners Damien Harper, Aengus Burns, and Michael McAteer and their firm, Grant Thornton, were also defendants (collectively “the Receivers”). After a series of disputes and earlier void receiver appointments, the parties entered a settlement (March 2024), then a revised settlement (August 2024), which included a borrower warranty that the security was “valid and enforceable,” a recital acknowledging Promontoria’s acquisition of all rights, title, and interest, an obligation to discontinue proceedings, and a not‑to‑sue covenant.

When the revised settlement fell into default, Promontoria proceeded to sell the Moate lands and Clare Hill. The plaintiffs sought, months after receiving notice of sale, to restrain the Clare Hill sale by arguing that Promontoria lacked the equitable interest and therefore the power of sale. The Court assumed, without deciding, that there was a fair issue concerning beneficial ownership, but held that the settlement and associated equitable bars prevented the plaintiffs from advancing the challenge or obtaining interlocutory relief.

• Parties: Oliver and Nicola Donlon (plaintiffs) v Promontoria (Aran) Ltd, receivers (Harper, Burns, McAteer) and Grant Thornton (defendants).
• Relief sought: Interlocutory injunction to restrain mortgagee’s sale of Clare Hill.
• Core issues: Effect of a revised settlement agreement on later challenges to lender’s title; delay and acquiescence; undertaking as to damages; balance of justice; standing.
• Procedural posture: Interlocutory application; Court assumed fair issue on beneficial/equitable ownership but determined the application on preliminary objections.

Summary of the Judgment

• Ms Nicola Donlon’s application was dismissed at the outset for want of a pleaded or evidentially supported cause of action and lack of standing. Executing the revised settlement as attorney for her father did not give her a personal cause of action.
• As to Mr Oliver Donlon, the revised settlement “eclipsed” his earlier objections to Promontoria’s title. By the recital and by a warranty that the security was valid and enforceable, together with a not‑to‑sue clause and an agreement to discontinue proceedings, he was contractually estopped from disputing Promontoria’s power of sale. Absent fraud (none was alleged), he could not resile from the settlement or relitigate settled points.
• Independently, the application failed for equitable reasons: delay, acquiescence (including not objecting to the sale of other lands and not objecting after notice of sale), and laches, especially given the intervening third‑party contract for sale.
• The plaintiffs could not offer a meaningful undertaking as to damages, which counted strongly against relief on an interlocutory application that was not “highly warranted.”
• On the balance of justice, the Court held the case to be “essentially financial” despite the land’s status as a family farm, and the factors weighed decisively against an injunction.
• Application dismissed; defendants presumptively entitled to costs, with liberty to file short written submissions on costs.

Analysis

1. Precedents cited and how they informed the decision

• Springwell Navigation Corp v JP Morgan Chase Bank & Ors [2010] EWCA Civ 1221; Peekay Intermark Ltd v ANZ [2006] EWCA Civ 386; Credit Suisse International v Stichting Vestia Groep [2014] EWHC 3103 (Comm): used for the proposition that parties may contractually agree a statement of affairs and be precluded from later contending the contrary—often described as “contractual estoppel.” Kennedy J applied this to the settlement recital and warranty acknowledging Promontoria’s title and enforceability.
• McCaughey v Anglo Irish Bank Corporation Ltd [2012] 4 IR 417; Kennedy v AIB plc [1998] 2 IR 48: Irish authority supporting the legal effect of settlement provisions precluding re‑assertion of claims (absent fraud). These decisions underpinned the holding that the borrower could not reopen settled issues.
• Skymist Holdings Ltd v Groundlane Developments Ltd [2018] EWHC 3504: referenced on approbation and reprobation—although Kennedy J found it unnecessary to decide that point given his conclusions on settlement and acquiescence.
• Archbold v Scully (1861) 9 HL C 360; Watson v Croft Promosport Ltd [2008] 3 All ER 1185: acquiescence—used to emphasize that silence or inaction in the face of known rights and impending sale can bar equitable relief.
• Dowling v Minister for Finance [2013] 4 IR 576: illustrates how significant delay in seeking to restrain a sale can be fatal; Kennedy J analogised the months‑long delay here and the prejudice to a third‑party purchaser.
• Damiens [2018] IEHC 627 and Cahill v Irish Motor Traders Association [1966] IR 430: equitable defence of laches; confirms the fact‑sensitivity of delay/acquiescence assessments.
• Helsingor Ltd v Walsh; The Barge Inn Ltd v Quinn Hospitality Ireland Operations 3 Ltd [2013] IEHC 387; NALM v McMahon [2015] 2 IR 385; Bank of Scotland plc v Kennedy [2013] IEHC 420; Furey v Lurgan‑Villa Construction [2012] 4 IR 655: cited across estoppel doctrines supporting the preclusive effect of settlement terms and conduct.
• Minister for Justice v Devine [2012] 1 IR 326: undertaking as to damages—Fennelly J’s “highly warranted” formulation informed the court’s refusal where the applicants could not give a meaningful undertaking.
• McKenna v Pepper Finance Corporation (Ireland) DAC [2024] IECA 285: a comparator on delay and balance of justice; distinguished because there the injunction ran only briefly to an imminent trial and no prejudice to the lender was found, whereas here the defendants faced real prejudice and the history showed repeated enforcement difficulties and default.
• Charleton and Cotter v Scriven [2019] IESC 28; Ryan v Dengrove [2021] IECA 36: on the “greatest risk of injustice” lens and the approach to family homes/farms versus purely commercial disputes. Kennedy J concluded that, in context, the dispute was essentially financial.
• Kirwan, Injunctions: Law and Practice (3rd ed., 2020) and Priyanka Shipping Ltd v Glory Bulk Carriers Pte Ltd [2019] EWHC 2804 (Comm): relied on to characterise a not‑to‑sue clause as a “negative promise” potentially enforceable by injunction. Kennedy J did not grant anti‑suit relief here, but flagged it as a live possibility on a proper application.

2. The Court’s legal reasoning

a) Settlement recitals, warranties, and the not‑to‑sue clause create a contractual estoppel

The revised settlement:

• Recital B: acknowledged that Promontoria “acquired all the rights, title and interest to the Facilities, the Security and the Guarantee.”
• Clause 6.2: the borrower represented and warranted that the security is “valid and enforceable.”
• Obligation to discontinue proceedings and a not‑to‑sue covenant (Clause 26).

Kennedy J held that, absent fraud (none alleged), these provisions foreclosed the borrower’s attempt to challenge Promontoria’s title or power of sale. The agreement “eclipsed” earlier objections; having entered the bargain with legal advice and for consideration, the borrower could not later claim the recital was a misrepresentation so as to void the agreement. This reflects the Springwell/Peekay line: parties may bind themselves to an agreed state of affairs and be estopped from contending otherwise, ensuring transactional certainty.

The Court also rejected the suggestion that any deficiency in legal advice could assist the borrower against the lender; any such issue would be between the borrower and his advisors. A memorable line encapsulates the point: “Having entered the agreement with his eyes open… That war is over.”

b) Standing and cause of action

The Court struck out Ms Nicola Donlon’s interlocutory application outright: she is not the registered (or pleaded beneficial) owner, she was not a contracting party in her own right, and the pleadings did not articulate any facts grounding a personal cause of action. Acting as attorney for her father did not confer standing. The absence of affidavit evidence from the principal (Mr Donlon) drew judicial misgivings, though the point was not determinative because it was not argued.

c) Delay, acquiescence, and laches

The delay was multifold:

• Post‑settlement default occurred by 11 October 2024; notice of sale issued on 1 November 2024.
• No objection was raised then; the Moate lands were sold; an offer for Clare Hill accepted on 28 January 2025.
• Only on 17 February 2025 did the plaintiffs raise the power‑of‑sale objection.

That sequence constituted acquiescence (e.g., not objecting to Moate sales; not objecting after express notice) and laches, especially in light of the intervening third‑party contract for sale. The Court found the explanation (that the beneficial‑ownership issue was allegedly discovered late 2024) unsatisfactory and incomplete. On the authorities, delay of this nature weighs heavily against equitable relief.

d) Undertaking as to damages

The plaintiffs could not give a meaningful undertaking as to damages, which is normally a condition of interlocutory relief. While the requirement is not mechanical, Devine teaches that in the absence of a credible undertaking—and where the relief sought is not “highly warranted”—injunctive relief should be refused. That applied here.

e) Balance of justice

Even if the preliminary bars were set aside, the balance of justice weighed strongly against an injunction:

• Promontoria had been attempting to enforce for a prolonged period; repeated defaults and settlement breaches occurred.
• The proceedings themselves breached the not‑to‑sue clause (the Court noted this weighs against discretionary relief and could ground anti‑suit relief on another application).
• Real prejudice to the lender and the purchaser would flow from further delay in a sale that had already proven difficult to complete.
• Family attachment to the farm did not change the essentially financial nature of the dispute in this procedural posture (Scriven; Ryan v Dengrove).

f) “Undervalue” complaint

The assertion that Clare Hill was being sold at an undervalue was not vigorously pressed and was inconsistent with the sale history. It did not raise a fair question sufficient to justify injunctive relief.

3. Likely impact and significance

• Settlement finality and contractual estoppel: The decision is a strong reaffirmation that settlement recitals, warranties, discontinuance obligations, and not‑to‑sue covenants will generally be enforced according to their terms. Absent fraud, a borrower cannot later argue the lender’s lack of equitable title or power of sale if the settlement has contractually posited the contrary. This will be influential in mortgage enforcement disputes following loan portfolio transfers and securitisations.
• Recitals matter: The Court treats the recital as part of the agreed factual matrix with binding effect in the form of contractual estoppel, especially when coupled with an operative warranty (valid and enforceable security).
• Procedural discipline in injunctions: The judgment underscores the centrality of prompt action after notice of sale. Delay and acquiescence—particularly when third‑party contracts have been formed—are potent bars to interim relief.
• Not‑to‑sue clauses as “negative promises”: By referencing Priyanka Shipping and Kirwan, the Court signals receptivity to anti‑suit relief to uphold a settlement’s negative covenant. Lenders may, in appropriate cases, seek injunctions restraining the prosecution of claims brought in breach of not‑to‑sue clauses.
• Family farms: While attachment to a family farm can be a powerful equitable consideration, the Court indicates that where there is a long history of default and settled enforcement, the dispute remains “essentially financial,” and the greatest‑risk‑of‑injustice test will usually not tip toward restraint of a sale.
• Standing and pleading discipline: Co‑plaintiffs without a pleaded legal or beneficial interest, or without a contract nexus, should expect early dismissal at the interlocutory stage.

Complex concepts simplified

• Contractual estoppel: When parties agree in a contract (including in recitals and express warranties) that certain facts are to be taken as true between them, neither can later contradict those facts in litigation between them. It gives transactional certainty by locking in the parties’ agreed factual premises. It does not require the other party to have relied on a misstatement; it operates because both promised to treat the stated position as true.
• Recitals versus operative clauses: Recitals describe background and intentions; operative clauses impose obligations. But recitals can have binding effect, especially where they are integrated with operative warranties or are expressly adopted as agreed statements of fact.
• Not‑to‑sue clause (negative covenant): A contractual promise not to bring proceedings concerning specified subject matter. Courts may enforce it by restraining proceedings (anti‑suit relief) where appropriate.
• Acquiescence: Knowing of one’s rights (or having sufficient notice) and standing by while another acts to their detriment. In mortgage cases, failing to object after notice of an impending sale, or after related sales proceed, can amount to acquiescence.
• Laches: An equitable defence that bars relief where a claimant delays unreasonably and the defendant suffers prejudice because of the delay.
• Approbatation and reprobation: A party cannot take the benefit of a contract (or a position) and later reject its burdens or inconsistent aspects. The Court flagged this but did not need to decide it given its findings.
• Undertaking as to damages: An applicant for an injunction ordinarily promises to compensate the respondent for any loss caused by the injunction if it later proves unjustified. An inability to provide a meaningful undertaking often defeats interim relief unless extraordinary circumstances exist.
• Balance of justice / greatest risk of injustice test: After confirming a fair issue to be tried, the court asks which course (grant or refuse an injunction) risks the greater injustice. In commercial disputes, courts often prefer to leave parties to damages unless special factors justify restricting contractual enforcement.
• Legal vs equitable ownership: In modern finance, legal title (registration) and equitable interests (beneficial ownership) may diverge. Some borrowers contend that a legal owner lacks a power of sale if not the equitable owner. Here the Court assumed arguendo that there was a fair issue on this point but decided the case on preliminary bars.
• Standing/cause of action: To seek relief, a plaintiff must show a concrete legal basis—ownership, contractual rights, or other recognised interest. Merely working the land, or acting as attorney, does not itself confer standing.

Practical implications and guidance

For lenders and receivers

• Draft settlements to include: explicit recitals of title, operative warranties as to enforceability, discontinuance obligations, and broad not‑to‑sue clauses. This judgment shows such terms are powerful shields at the interlocutory stage.
• If faced with post‑settlement litigation in breach of a not‑to‑sue clause, consider an anti‑suit injunction. The Court signalled openness to such relief on a proper application.
• Document notice of intended sales and evidence of borrower inaction; this will support acquiescence and laches arguments if an injunction is sought late.
• For property being sold “with notice of proceedings,” ensure risk allocation is explicit; but note the Court viewed such a clause as non‑determinative on the balance of justice.

For borrowers

• Be cautious before signing settlements that include admissions/recitals about lender title or warranties of enforceability; they may preclude later legal challenges absent fraud.
• If an injunction is contemplated, act immediately after notice of sale and be prepared to give a credible undertaking as to damages.
• If alleging a beneficial interest or trust, plead and prove it with particulars; otherwise, standing will likely fail at the threshold.
• Do not assume family attachment to land will outweigh a history of default and prior settlements at the interlocutory stage.

For litigators

• Ensure the principal party (e.g., the registered owner/borrower) swears the key affidavits on an interlocutory application.
• Anticipate and address contractual estoppel directly; distinguish recitals that are mere background from those adopted as binding statements of fact, and scrutinise any fraud pleading if rescission is to be pursued.
• Track and justify timelines precisely; unexplained gaps after notice of sale are fatal in equity.
• If alleging misrepresentation about a settlement recital, consider the high bar: absent fraud, the Court will hold parties to their bargain.
• Note the Court’s likely typographical reference to “Clause 2.6” when earlier identifying “Clause 26” as the not‑to‑sue provision; be meticulous with clause numbering in applications.

Conclusion

Donlon v Promontoria is a clear and practically important reaffirmation of settlement finality in mortgage enforcement. Where a borrower has, in a post‑dispute settlement, acknowledged the lender’s title, warranted the enforceability of the security, agreed to discontinue litigation, and covenanted not to sue, the borrower will be contractually estopped from later asserting that the lender lacks power of sale—absent fraud. Even if a fair issue on beneficial ownership could be shown, equitable bars such as delay, acquiescence, and laches—amplified by prejudice to third‑party purchasers—will typically defeat interlocutory restraint. The inability to offer a meaningful undertaking as to damages is an additional and often decisive obstacle.

The judgment also sends a firm message on standing and pleading discipline and locates “family farm” considerations within a principled “greatest risk of injustice” analysis that, in protracted commercial enforcement contexts, will rarely justify halting a sale. The case will likely be cited for the potency of contractual estoppel arising from settlement recitals and warranties, the enforceability of not‑to‑sue covenants, and the stringent application of equitable defences to late‑stage injunction applications in property enforcement.

Case data

• Court: High Court of Ireland
• Citation: Donlon & Anor v Promontoria (Aran) Ltd & Ors [2025] IEHC 568
• Record No.: 2025/878P
• Judge: Kennedy J
• Date: 30 October 2025
• Outcome: Interlocutory injunction refused; Ms Donlon’s application dismissed for lack of standing; costs presumptively to defendants with directions for short written submissions.
• Appearances: Brendan Donelon BL (instructed by John Feahney & Co) for the plaintiffs; Eamon Marray SC (instructed by Keoghs Ireland LLP) for the defendants.