The Sufficiency of Legal Title for Summary Possession after Securitisation: Commentary on Pepper Finance Corporation (Ireland) DAC v Hayes [2025] IEHC 692

1. Introduction

This High Court judgment, delivered by O’Donnell J on 4 December 2025, sits at the junction of three increasingly common issues in Irish mortgage litigation:

• the effect of securitisation and complex portfolio transfers on the right to enforce a mortgage;
• the legal significance of company name changes and changes in shareholding; and
• the scope of the court’s “own motion” duty to examine consumer contracts for unfair terms.

The case concerns an appeal from a Circuit Court summary possession order made in favour of Pepper Finance Corporation (Ireland) DAC (“Pepper Finance”) over the family home of Suzanne and William Hayes in Co. Meath. The appellants, litigants in person, argued that:

• the loan and mortgage had been securitised and effectively “sold” to other entities;
• Pepper Finance was only a bare trustee or servicer, and not the true owner of the debt;
• the company that granted the loan (GE Capital Woodchester Home Loans Ltd) had changed its shareholding and name, allegedly in breach of contractual rights; and
• various terms of the mortgage were unfair under the Unfair Contract Terms Directive 93/13/EEC.

The judgment gains particular importance because it follows and distinguishes Pepper Finance v Moynihan [2024] IEHC 625, where Simons J had refused summary possession due to extensive redactions in securitisation documents. Here, after additional disclosure, O’Donnell J affirms that:

• legal title to the debt and registered title to the charge are sufficient to ground summary possession, even where the beneficial interest has been sold and the plaintiff is a bare trustee; and
• securitisation, changes of shareholding, and tax treatment of transactions are legally immaterial defences in a s.62(7) Registration of Title Act 1964 application, once legal title is clearly established.

The judgment also consolidates the Irish courts’ restrained approach to the Unfair Contract Terms Directive in mortgage possession cases, and it delivers an implicit message to lenders on the management of redactions in securitisation documentation.

2. Summary of the Judgment

The High Court dismissed the Hayes’ appeal and affirmed the Circuit Court’s summary order for possession. In doing so, O’Donnell J held:

1. Proofs under s.62(7) satisfied:
   • The plaintiff was the owner of the charge: GE Capital Woodchester Home Loans Ltd (the original lender) and Pepper Finance were one and the same legal entity; the Land Registry folio conclusively proved that this entity was the registered owner of the charge.
   • The right to seek possession had arisen and was exercisable: there was clear, significant and prolonged default on the loan; valid demands for repayment and possession had issued.
2. Change of name and shareholding did not alter legal personality: Changes in the company’s name and its ultimate shareholders did not create a new legal entity, did not require borrower consent, and did not affect the company’s rights to enforce the loan and security.
3. Securitisation did not undermine Pepper Finance’s standing:
   • The securitisation split legal and beneficial ownership of the debt and charge; Pepper retained legal title and the charge remained registered in its (former) name.
   • Even if Pepper acted as a bare trustee for the beneficial owner, the holder of legal title is the proper party to seek possession, and need not prove beneficial ownership.
4. Redactions acceptable once operative clauses are disclosed and explained: After additional affidavits and less-redacted documentation, the court was satisfied that all operative provisions relevant to legal title had been disclosed. The case was therefore distinguishable from Pepper v Moynihan, where redactions had prevented the court from ascertaining legal title.
5. Tax Appeal Commission (TAC) determination irrelevant: An anonymised TAC determination concerning the tax treatment of the GE portfolio transfers could not assist the borrowers; it addressed different legal questions and had no bearing on enforceability or ownership of the loans and securities.
6. Unfair terms arguments failed: The court conducted the required “own motion” assessment under Directive 93/13/EEC, but held that the clauses relied on by Pepper Finance were core terms — repayment, default and enforcement provisions — expressed in plain and intelligible language, and not unfair.
7. Costs: Pepper Finance was awarded costs, but only up to and including the first High Court hearing. Later costs were disallowed because the lender’s initial over‑redaction of securitisation documents had unnecessarily prolonged the case.

3. Factual and Procedural Background

3.1 The loan and security

In January 2008, GE Capital Woodchester Home Loans Ltd (“GE Home Loans”) offered the Hayes a 35‑year home loan of €392,000 on a variable interest rate. The borrowers:

• accepted the loan offer and its terms and conditions;
• executed a mortgage/charge over their property at Mountpoplar, Kildalkey, Co. Meath; and
• had that charge registered on Folio 51081F, County Meath in September 2008.

Both the loan offer and the charge contained express, detailed provisions:

• allowing the lender to freely transfer the loan and security, including as part of a securitisation scheme;
• providing that failure to make scheduled payments would be an “event of default” making the full amount due on demand and triggering a power to seek possession; and
• authorising the lender to assign legal or beneficial interests without borrower consent.

The borrowers fell into arrears; demands for repayment were issued in May 2014, and demands for vacant possession in June 2014.

3.2 Corporate changes and securitisation

The corporate context is critical:

• 11 October 2012: GE Home Loans changed its name to Pepper Finance Corporation (Ireland) Ltd.
• 29 October 2015: Pepper Finance converted to a designated activity company (DAC).

On 28 September 2012, in parallel with the name change:

• Pepper Netherlands Cooperative U.A. bought the entire share capital of the plaintiff; and
• the beneficial interest in the residential mortgage portfolio (including the Hayes’ loan and charge) was sold to Windmill Funding Ltd under a Mortgage Sale Agreement (MSA).

Under that MSA:

• GE Home Loans agreed to sell the “legal and beneficial interest” in the loans and related security;
• but pending “perfection”, GE Home Loans would hold the legal title as a bare trustee for Windmill;
• perfection would only occur if and when Windmill or the note trustee demanded it; and
• until then, monies recovered by GE Home Loans were held on trust for Windmill.

A later Mortgage Sale Deed (MSD) of 1 April 2021 transferred the beneficial interest from Windmill to Balbec Loan IE IV Ltd (later Lagado Assets IE IV Ltd). Pepper Finance, however, continued to hold the legal title and remained the regulated servicer.

3.3 Circuit Court proceedings

Pepper Finance commenced proceedings in the Circuit Court by Civil Bill dated 22 August 2014 seeking possession under s.62(7) of the Registration of Title Act 1964. Its evidence (through affidavits of Ms Loftus) established:

• the loan, the charge, and the registration of the charge;
• default, arrears and the service of demands; and
• the chain of corporate name changes and conversion to DAC.

Mr Hayes, acting in person, filed multiple affidavits challenging:

• Pepper Finance’s standing, on the basis that the loan portfolio had been “sold” to Windmill;
• the absence of Pepper as registered owner on the folio (which still showed GE Home Loans);
• the enforceability of the contract with Pepper; and
• the alleged unfairness of various contractual terms, relying on the Unfair Contract Terms Directive and a Tax Appeal Commission determination.

The Circuit Court (Quinn J) ultimately granted summary possession with a two‑year stay on 26 July 2021; the borrowers did not attend. They appealed to the High Court.

3.4 The High Court appeal and the two hearings

3.4.1 First hearing and the shadow of Pepper v Moynihan

The appeal was a de novo hearing, but in principle confined to the evidence before the Circuit Court unless the High Court permitted additional evidence. The borrowers sought an adjournment pending judgment in Pepper v Moynihan, claiming it was “on all fours” with their case. The adjournment was refused and the hearing proceeded.

Pepper Finance presented a straightforward Cody-compliant case:

• it was the same legal entity as GE Home Loans, and therefore the registered owner of the charge;
• the securitisation only affected the beneficial interest, not legal title; and
• default and service of demands were undisputed.

A week later, Simons J delivered judgment in Pepper Finance Corp (Ireland) DAC v Moynihan [2024] IEHC 625. There, because key operative parts of the mortgage sale documentation were heavily redacted, the High Court could not be satisfied that Pepper retained legal title to the debt, and the matter was remitted to plenary hearing.

In light of this, O’Donnell J reopened the Hayes appeal, allowed further argument, and permitted Pepper to file a new affidavit exhibiting less-redacted securitisation documents. The borrowers were allowed to respond.

3.4.2 Second hearing and additional evidence

Pepper’s new affidavit (by Mr Nevin, May 2025) exhibited fresher versions of the MSA and MSD, this time:

• with significantly fewer redactions; and
• with a clause-by-clause explanation of any remaining redactions, which were said to concern only:
  • commercially sensitive information;
  • irrelevant or non-operative clauses; and
  • information relating to other borrowers or third parties.

Crucially, Mr Nevin:

• explained that Pepper would hold the legal title to the loans and securities on trust for Windmill until “perfection” occurred; and
• averred unequivocally that the events giving rise to perfection had not occurred, so Pepper continued to hold legal title to the Hayes’ loan and charge.

Mr Hayes responded with further affidavits re‑emphasising issues about:

• alleged contractual rights to keep the loan within the GE group;
• the “true sale” nature of the transaction; and
• alleged defects in the execution of the securitisation documents.

The court refused to admit a late “expert” affidavit from a management consultant, Ms Anne Pounds, on the basis that:

• no prior permission for expert evidence had been sought;
• it was provided at a very late stage; and
• it addressed matters (banking practice, regulatory status) not material to the core legal issues in a s.62(7) application.

Having considered the fresh material and the parties’ submissions, the High Court delivered the judgment under comment, dismissing the appeal.

4. Analysis of the Court’s Reasoning

4.1 Proofs for summary possession under s.62(7) Registration of Title Act 1964

The starting point is the Supreme Court’s decision in Bank of Ireland v Cody [2021] IESC 26, which crystallises the two essential proofs for a s.62(7) possession order:

“The owner of a charge who seeks to obtain possession pursuant to s.62(7) has to prove two facts:
(a) That the plaintiff is the owner of the charge.
(b) That the right to seek possession has arisen and is properly exercisable on the facts.” (para. 49)

On proof (a), Cody emphasises that the Land Registry is conclusive as to ownership of the charge, citing the Court of Appeal in Tananger DAC v Kane [2018] IECA 352. A plaintiff can usually establish ownership by production of the folio, and the correctness of the register cannot be challenged in defence to a s.62(7) application.

On proof (b), the lender must show that:

• contractual conditions for enforcement (default, acceleration, service of demand) have been met; and
• any necessary notices have been given.

In Hayes:

• The folio showed GE Home Loans as the registered owner of the charge since 2008.
• Through company law certificates and statutory provisions (Companies Act 2014 ss.25, 30, 53), Pepper Finance proved it was the same legal person as GE Home Loans; the name changes and DAC conversion did not create a new entity.
• Default was immense and undisputed; repayment and possession demands were served.

O’Donnell J therefore concluded that both Cody proofs were satisfied: Pepper Finance was the owner of the charge, and the right to seek possession had arisen and was exercisable.

4.2 Corporate identity, name change and shareholding

A central plank of the borrowers’ argument was that:

• the sale of GE Home Loans’ share capital to Pepper Netherlands, combined with corporate rebranding, had somehow transformed the entity into a different legal person; and
• they allegedly had a contractual or implied right to insist that their loan remain within the “GE group”, so ownership or control changes required their consent.

The court firmly rejected both propositions.

4.2.1 Same company, different name

Drawing on the Court of Appeal’s decision in Pepper Finance v Moloney [2023] IECA 161, the court held that:

• company law recognises continuity of legal personality across name changes and DAC conversion;
• ss.30(6) and 63(12) of the Companies Act 2014 make explicit that a company’s identity is unaffected by a change of name; and
• therefore GE Home Loans and Pepper Finance are “one and the same entity.”

The key analytical point is the distinction between:

• the legal entity (the company); and
• the company’s shareholders or ultimate owners.

Changes in ownership of shares, or in group structure, do not in themselves alter the company’s corporate personality or ownership of its assets.

4.2.2 No contractual right to a particular shareholder

The court also dismissed the assertion that the borrowers had a contractual right to prevent GE Home Loans from being sold or leaving the GE group. O’Donnell J found:

• no such term — express or implied — in the loan offer or mortgage;
• no evidence that the parties agreed to restrict future changes in ownership of the lender’s shares; and
• no basis for reading such a term into a standard mortgage contract.

The case therefore underscores a clear principle: mortgage borrowers have no general right to insist that their lender’s shareholder base or group affiliation remain unchanged, absent specific contractual language to that effect.

4.3 Securitisation, legal vs beneficial ownership and the bare trustee

The appellants’ core submission was that:

• Pepper Finance had sold the loan and mortgage to Windmill (and eventually to Lagado/Balbec);
• Pepper therefore held legal title only as a bare trustee for the purchaser; and
• as a bare trustee or portfolio manager, Pepper lacked standing to commence possession proceedings.

The High Court rejected this, but not by denying the securitisation. Instead, it accepted that:

• the securitisation did transfer the beneficial interest in the Hayes’ loan and security to Windmill, and later to Lagado;
• Pepper retained the legal title and the charge remained registered in its (former) name; and
• Pepper was indeed holding the loan and security on trust for the beneficial owner.

The decisive point, following both High Court and Court of Appeal authority, was that:

• legal title is enough to seek possession under s.62(7);
• the plaintiff does not need to prove that it is the beneficial owner of the debt; and
• where legal and beneficial ownership are separated, the proper plaintiff is ordinarily the holder of the legal title (the trustee), not the beneficiary.

O’Donnell J relied on a well-developed line of authority, including:

• Pepper Finance v Hanlon (Ní Raifeartaigh J, 2018, ex tempore): explaining in detail that a securitisation can split legal and beneficial ownership and that the originating lender may retain legal title and enforcement powers;
• Freeman v Bank of Scotland [2014] IEHC 284 (McGovern J): securitisation under an equitable assignment does not affect the lender’s right to recover where legal title remains with the originating bank, which continues servicing the mortgage;
• Governor and Company of the Bank of Ireland v McMahon [2017] IEHC 600 (Noonan J): securitisation did not affect the lender’s right to recover the debt, especially where borrowers had consented in mortgage terms; and
• Pepper Finance v Moloney [2023] IECA 161; Permanent TSB v Donohoe [2025] IECA 222; Mars Capital Finance Ireland DAC v Phelan [2025] IECA 117: Court of Appeal holdings that the assignee holding legal title is the correct plaintiff, even if beneficial ownership lies with a third party.

In particular, Mars Capital v Phelan held that where a deed of transfer vests title in the plaintiff, the fact that purchase monies were provided by another entity is “immaterial”; at most, the plaintiff may hold on trust for that entity, but it remains the legal owner and the appropriate party to sue.

Thus, the Hayes judgment reinforces and applies a clear rule:

In summary possession proceedings under s.62(7), a plaintiff who holds legal title to the loan and is the registered owner of the charge may enforce the security, even if the beneficial interest has been securitised and is held by another entity.

4.4 Treatment of redacted securitisation documents after Pepper v Moynihan

A more subtle but important aspect of the judgment is its engagement with redacted securitisation documentation in the wake of Pepper v Moynihan.

In Moynihan, the High Court:

• accepted that GE Home Loans and Pepper Finance were the same entity and that Pepper was the registered owner of the charge; but
• refused summary possession because extensive redactions in the MSA made it impossible to determine whether Pepper had retained legal title to the underlying debt.

The court in Moynihan did not say that lenders must disclose every detail of securitisation arrangements; rather, the problem was that the redactions prevented the court from:

• understanding the operative effect of the deed; and
• confirming whether legal title and enforcement powers remained with Pepper.

In the present case, O’Donnell J effectively operationalises Moynihan by:

• requiring the lender to file less-redacted documents and a detailed affidavit explaining:
  • which clauses remained redacted;
  • why they were redacted (commercial sensitivity, irrelevance, third-party data); and
  • how the disclosed text established the plaintiff’s legal title;
• evaluating whether the operative clauses affecting title and enforcement were now visible; and
• explicitly concluding that any earlier doubt had been cured, making the case “fully distinguishable” from Moynihan.

This gives practical guidance for future litigation:

• some redaction remains acceptable; courts recognise legitimate confidentiality;
• however, redactions must not obscure clauses affecting legal title, trust arrangements, or enforcement rights; and
• if redactions are overbroad, courts may refuse summary relief or remit matters to plenary, and may penalise lenders in costs — as occurred here for the period after the first hearing.

4.5 Relevance (or irrelevance) of the TAC determination

The borrowers relied on an anonymised 2017 Tax Appeal Commission (TAC) determination concerning transactions involving GE Home Loans, Pepper Finance, and related entities. They argued this supported their contention that Pepper did not own their loan.

O’Donnell J agreed with the Court of Appeal’s treatment of this same TAC determination in Pepper v Moloney. The TAC’s focus was:

• the ability of the company to carry forward trading losses after a transfer; and
• whether there had been a cessation or major change in its trade for tax purposes.

Those issues are:

• entirely distinct from questions of legal and beneficial ownership of loans and securities; and
• not binding on the courts in possession proceedings.

Accordingly, the TAC determination was legally irrelevant to whether Pepper held legal title or could seek possession; it concerned taxation of corporate profits, not enforceability of mortgages.

4.6 Unfair Contract Terms Directive and the “own motion” assessment

The appellants contended that various provisions of the mortgage charge amounted to unfair terms under Directive 93/13/EEC and that the court was obliged to examine this “of its own motion”.

The High Court accepted that it had such a duty, referring to:

• AIB v Counihan [2016] IEHC 752 (Barrett J), which applied the CJEU’s decision in Aziz v Caixa d’Estalvis de Catalunya (Case C‑415/11); and
• the line of national cases setting out the scope of this review: Grant v County Registrar for Laois [2019] IEHC 185; Permanent TSB v Davis [2019] IEHC 184; Start Mortgages DAC v Clarke [2024] IEHC 310; Start Mortgages v Ryan [2021] IEHC 719; and Start Mortgages v Flanagan [2023] IEHC 667.

The key legal framework is Article 4(2) of the Directive, which excludes from unfairness assessment:

“the definition of the main subject matter of the contract [and] the adequacy of the price and remuneration, on the one hand, as against the services or goods supplied in exchange, on the other, in so far as these terms are in plain intelligible language.”

Applying this, the court:

• accepted that the borrowers were “consumers” within the Directive’s scope;
• accepted its duty to review terms even where the borrower had not precisely identified them; but
• held that the terms being relied upon by Pepper — repayment obligations, default clauses, the lender’s right to seek possession — were core terms of the mortgage.

Citing Phelan J in Start Mortgages v Flanagan, O’Donnell J agreed that:

“All borrowers understand that the fundamental essence of [a] mortgage agreement is that if scheduled loan repayments are missed the secured asset may be repossessed. This is such a fundamental principle that it is difficult to see how a contractual provision which gives effect to it could be said to fail the fairness test…”

He further noted that this was not a case of a marginal or technical default; there had been a prolonged and serious failure to repay, despite multiple opportunities afforded under the Central Bank’s Code of Conduct on Mortgage Arrears.

The court therefore concluded:

• the enforcement provisions were clear, transparent and central to the bargain;
• no terms of the type listed as unfair in the Annex to the Directive were engaged; and
• no unfairness could be identified, even on a proactive “own motion” assessment.

Thus, the judgment reinforces a now-settled line: in ordinary home loan cases, standard default and repossession clauses will rarely, if ever, be found unfair where they are clearly drafted and form the essence of the mortgage agreement.

4.7 Treatment of self‑represented borrowers and evidential flexibility

A noteworthy procedural aspect is the court’s approach to the appellants as litigants in person. Although the High Court appeal was formally confined to the evidence before the Circuit Court:

• O’Donnell J permitted the introduction of fresh evidence on several occasions, despite procedural irregularities, because:
  • the issues were largely matters of law and document interpretation;
  • the evidence could be dealt with on affidavit without oral testimony; and
  • it was preferable to resolve arguments at this stage rather than remit to plenary hearing, which would cause greater cost and delay.

However, the court also drew a line:

• late introduction of quasi‑expert material (Ms Pounds’ affidavit) was refused as unfair to the plaintiff and unnecessary to resolve the core legal issues.

The judgment thus balances:

• a pragmatic willingness to accommodate self-represented defendants by allowing some procedural latitude; with
• a firm insistence that evidence must be relevant and proportionate to the issues in a summary possession application.

4.8 Costs and conduct of litigation

On costs, the court adopted a nuanced stance:

• Pepper Finance had been “fully successful” on the merits, so the usual rule of costs following the event applied in principle.
• Nonetheless, O’Donnell J held that:
  • Pepper’s overly conservative redaction of securitisation documents had contributed significantly to delay and the need for a second hearing; and
  • this conduct justified limiting the lender’s recoverable costs to those incurred up to the first hearing.

This is an implicit warning to lenders: if they insist on excessive secrecy around securitisation arrangements, they may:

• jeopardise the possibility of summary relief (as in Moynihan); and/or
• face adverse or reduced costs orders (as here).

5. Precedents Cited and Their Influence

5.1 Bank of Ireland v Cody [2021] IESC 26

Cody is foundational. It:

• distils the two core proofs for s.62(7) possession; and
• endorses the conclusive nature of the Land Registry under s.31 of the 1964 Act.

The High Court in Hayes applies Cody directly: once Pepper proved it was the same entity as the registered owner (GE Home Loans) and showed default, it had established its prima facie case.

5.2 Tananger DAC v Kane [2018] IECA 352

As cited in Cody, Tananger holds that:

• the correctness of the register cannot be challenged by way of defence to a s.62(7) application;
• a court is entitled to grant possession to the registered owner once the right to possession has arisen.

Hayes follows this unquestioningly: attempts by the borrowers to contest the Land Registry entry (showing GE Home Loans as owner) were inadmissible in this procedural context.

5.3 Pepper Finance v Hanlon (HC, Ní Raifeartaigh J, 2018)

In Hanlon, Ní Raifeartaigh J:

• explained in accessible language how securitisation can split legal and beneficial ownership;
• emphasised that the originating lender can retain legal title and continue to enforce mortgages; and
• recognised that these arrangements are complex and counter‑intuitive to lay borrowers.

O’Donnell J adopts these observations (as did Heslin J in Conway), reinforcing their authority in cases concerning the GE/Pepper securitisation.

5.4 Freeman v Bank of Scotland [2014] IEHC 284

McGovern J described the typical securitisation structure:

• equitable assignment of mortgage receivables to a special purpose vehicle (SPV);
• retention of legal title by the originating bank;
• continuation of mortgage servicing by the bank; and
• no requirement to individually notify borrowers, where consent is embedded in standard terms.

Hayes uses Freeman to demonstrate that securitisation is a standard, legally recognised mechanism which — where legal title is retained — does not deprive the original lender of enforcement rights.

5.5 Governor and Company of the Bank of Ireland v McMahon [2017] IEHC 600

Noonan J held that:

• borrowers who consented to securitisation in their mortgage terms cannot validly complain later that the loan was securitised; and
• even absent such consent, securitisation per se does not undermine the lender’s right to recover.

In Hayes, this underpins the rejection of arguments that securitisation had somehow extinguished or displaced Pepper’s entitlement to sue.

5.6 Pepper Finance v Conway [2020] IEHC 35

Conway (Heslin J) offered a comprehensive review of securitisation case law, adopting Hanlon and Freeman. Hayes follows that analytic framework and applies it to the same underlying MSA.

5.7 Pepper Finance v Moloney [2023] IECA 161

In Moloney, the Court of Appeal (Allen J):

• confirmed that GE Home Loans and Pepper Finance are one entity under the Companies Act;
• accepted that Pepper was the registered owner of the charge;
• approved Ní Raifeartaigh J’s approach in Hanlon; and
• held that holding legal title alone suffices to sue, even where beneficial ownership has passed.

Hayes heavily relies on Moloney both for:

• corporate identity arguments; and
• the treatment of the TAC determination as irrelevant.

5.8 Permanent TSB v Donohoe [2025] IECA 222 & Mars Capital v Phelan [2025] IECA 117

These recent Court of Appeal decisions concern assignments of mortgage portfolios. They confirm that:

• the assignee named in the deed of transfer (holding legal title) is the appropriate plaintiff;
• the fact that a third party financed the purchase, or may be beneficial owner, is immaterial; and
• the trustee with legal title sues for possession, not the beneficial owner.

Hayes transposes this reasoning to securitisation contexts: Pepper, as holder of legal title, is the proper party even if the beneficial owner is Windmill or Lagado.

5.9 Unfair terms cases: Aziz, Grant, Davis, Ryan, Flanagan, Clarke

The judgment canvasses several key authorities on unfair terms:

• Aziz v Caixa d’Estalvis (CJEU) – imposes on national courts an obligation to assess, on their own initiative, whether consumer contract terms are unfair under the Directive.
• Grant & Davis (McDermott J) – apply Article 4(2) and clarify that core terms (main subject matter and price) in plain language are not subject to unfairness review.
• Ryan (Woulfe J) – summarises Davis and confirms that standard mortgage repayment terms are core and generally not unfair.
• Flanagan (Phelan J) – articulates the intuitive point that all borrowers understand that default can lead to repossession; such a provision can hardly be deemed unfair.
• Clarke (Heslin J) – reaffirms the limits of the “own motion” obligation and the protection for transparent core terms.

Hayes embeds itself squarely in this jurisprudential line, reiterating that while courts will scrutinise mortgage terms, they will not treat basic enforcement provisions as unfair where written clearly.

6. Complex Concepts Explained

6.1 Legal vs beneficial ownership

In many securitisation structures:

• Legal owner – the entity whose name appears on the Land Registry as the owner of the charge, and which has the formal, legal right to enforce the mortgage.
• Beneficial owner – the entity entitled in equity to the economic benefits of the loan (interest and principal received), often the SPV that bought the portfolio.

The legal owner may hold the asset “on trust” for the beneficial owner, meaning:

• the legal owner enforces the rights, but must account to the beneficiary for the proceeds;
• borrowers generally still deal only with the legal owner or its servicer.

6.2 Bare trust

A bare trustee:

• holds legal title for the sole benefit of the beneficiary;
• has no independent beneficial interest and limited discretion; and
• must act according to the beneficiary’s directions and the trust terms.

In securitisations like that in Hayes:

• Pepper holds legal title as bare trustee for Windmill/Lagado;
• but under Irish law, that does not prevent Pepper, as legal owner, from suing for possession on foot of the mortgage.

6.3 Securitisation

“Securitisation” is a financing technique where:

• a lender bundles a portfolio of loans (e.g. mortgages);
• transfers the economic benefits to a special purpose vehicle (SPV); and
• the SPV issues notes/bonds to investors, backed by the cash flows from those loans.

For borrowers, the practical impact is often minimal:

• they still make payments to the same servicer (here Pepper);
• the legal title to their mortgage often remains with the original lender; and
• their obligations under the loan contract do not change.

6.4 Summary vs plenary proceedings

• Summary possession (like s.62(7) applications) – decided on affidavit without oral evidence, suitable where there is no real dispute on key facts.
• Plenary proceedings – full trial with pleadings, discovery, witnesses and cross‑examination, used when factual disputes cannot fairly be decided on affidavit alone.

If defences raise genuinely arguable disputes of fact, courts may refuse summary orders and remit to plenary. In Hayes, once the redaction issue was cured, no such factual dispute remained.

6.5 De novo appeals from the Circuit Court

A de novo appeal means the High Court re-hears the matter afresh, generally on the same evidence as before the Circuit Court, unless the High Court grants leave to introduce new evidence. The High Court is not bound by the Circuit Court’s factual or legal conclusions.

6.6 Unfair Contract Terms Directive (93/13/EEC)

Directive 93/13/EEC protects consumers from unfair standard terms in contracts they did not individually negotiate. Important features:

• courts must consider, of their own motion, if such terms are unfair;
• an unfair term is not binding on the consumer; but the rest of the contract may survive;
• core terms (defining main subject matter and price) are excluded from fairness review if transparent.

In mortgage cases, repayment obligations and the possibility of losing the secured property on default are usually treated as core terms, not subject to an unfairness test if clearly drafted.

7. Impact and Implications

7.1 For lenders and servicers

The decision consolidates a creditor‑friendly but legally orthodox position:

• Holding legal title and being the registered owner of the charge is sufficient to ground a summary possession claim, even post‑securitisation.
• Lenders can structure securitisations so that they retain legal title (and thus enforcement standing) while transferring beneficial interests.
• They are not obliged to involve the beneficial owner or reveal every commercial detail of securitisation, provided operative title and enforcement clauses are disclosed.

However, the judgment also sends clear warnings:

• Over‑redaction of documents may lead to adjournments, refusal of summary relief (as in Moynihan), or adverse costs (as here).
• Lenders should be ready to:
  • prove continuity of corporate identity across name changes; and
  • demonstrate, with appropriately limited redactions, that legal title remains with the plaintiff.

7.2 For borrowers

For borrowers defending possession proceedings, Hayes narrows the range of plausible technical defences:

• Securitisation arguments — that the loan has been “sold” to an SPV, or that the plaintiff is only a “servicer” — are unlikely to succeed once the plaintiff proves legal title.
• Changes in the lender’s shareholder base, group affiliation or name, absent express contrary contractual terms, do not affect enforceability.
• Tax authority determinations about corporate profits or losses will almost never be relevant to mortgage enforcement.
• Unfair terms challenges will need to focus on specific, non‑core clauses; generic attacks on standard repayment and enforcement provisions will not avail.

This does not eliminate all consumer protection; but it emphasises that substantive defences must engage with:

• actual mis-selling, impropriety, procedural unfairness, or
• genuinely obscure or unusual clauses beyond the basic repayment and default regime.

7.3 For litigation strategy and evidence (especially redactions)

After Moynihan and now Hayes, there is a clearer template:

• Plaintiffs may legitimately redact:
  • commercially sensitive details (pricing, portfolio composition);
  • information about other borrowers; and
  • irrelevant boilerplate provisions.
• But they must disclose and, if necessary, explain:
  • clauses governing legal and beneficial title;
  • trust or agency arrangements;
  • any conditions or triggers for “perfection” or transfer of legal title; and
  • the plaintiff’s authority to enforce.

Failure to do this risks losing the procedural advantages of summary proceedings and incurring cost penalties.

7.4 For unfair terms litigation

Hayes contributes to a maturing body of Irish case law that:

• accepts the binding effect of CJEU case law on the court’s “own motion” duty; but
• limits that duty by robustly applying the Article 4(2) core terms carve‑out.

In practice, this means:

• courts will look for unfairness in ancillary or non‑core provisions (charges, unilateral variation clauses, obscure default interest regimes, etc.);
• they will not typically treat the right to repossess on serious default as an unfair term, provided it is clearly set out.

The upshot is that borrowers seeking relief under the Directive will need to identify more nuanced contractual issues than the mere existence of a power of sale or possession on non‑payment.

8. Conclusion

Pepper Finance v Hayes is not a radical departure from existing law, but an important consolidating judgment. It confirms and sharpens several key principles:

• In summary possession proceedings under s.62(7) of the Registration of Title Act 1964, legal title and registration of the charge are decisive — beneficial ownership after securitisation is largely irrelevant.
• Company name changes and shifts in shareholding or group structure do not affect corporate identity or the enforceability of loans, absent specific contractual constraints.
• Securitisation documents may be redacted, but not so extensively as to prevent the court from determining who holds legal title and who is entitled to enforce; lenders who over‑redact do so at their own procedural and costs risk.
• The Unfair Contract Terms Directive requires courts to scrutinise consumer contracts, but core mortgage terms — repayment, default, and enforcement — are generally shielded from unfairness scrutiny when transparently drafted.

For future cases, the judgment leaves a clear roadmap: where a plaintiff can demonstrate continuity of corporate identity from the original lender, produce the folio showing it as registered owner, and provide minimally redacted securitisation documents confirming retention of legal title, summary possession remains an appropriate and efficient remedy, notwithstanding complex financial engineering behind the scenes.