Bank of Scotland PLC v Beades

Factual and Procedural Background

The Plaintiff, a commercial bank (“Company A”), sued the Defendant (“Defendant”) for repayment of four loan facilities first advanced between 18 May 2005 and 11 February 2008. Following a cross-border merger in 2010, all liabilities of the original Irish lending entity were transferred to Company A.

A summary summons issued on 4 January 2012. After several extensions to allow a replying affidavit—which was ultimately sworn on 21 June 2012—Judge Kelly in the High Court granted summary judgment for €9,684,987.04 plus costs on 20 July 2012 ([2012] IEHC 328). The Defendant’s request for a stay was refused, and no appellate stay was sought. Although judgment has stood for seven years, no enforcement steps have been taken.

The Defendant appealed to the Supreme Court. The matter was transferred to, and later restored from, the Court of Appeal due to case-management re-allocation. The present judgment, delivered by Judge O’Donnell on 29 July 2019, determines that appeal.

Legal Issues Presented

1. Whether the High Court correctly concluded that the Defendant had raised no arguable or triable defence to Company A’s claim for the outstanding loan balance.
2. Whether the affidavits sworn by employees of Company A and Company B (its loan-servicing agent) constituted admissible and sufficient evidence under Order 37 rule 1 of the Rules of the Superior Courts and/or the Bankers’ Books Evidence Act 1879.
3. Whether alleged procedural irregularities (adjournments, short notice, and the conduct of hearings) deprived the Defendant of fair procedures.
4. Whether service of a demand letter was properly effected and, if not, whether such service was a prerequisite to judgment.
5. Whether an alleged defect in the swearing of an affidavit by Company A’s employee rendered the evidence invalid.

Arguments of the Parties

Appellant’s (Defendant’s) Arguments

• Company B’s employee could not rely on section 4 of the Bankers’ Books Evidence Act 1879; only a partner or officer of the bank could prove the debt.
• The confirmatory affidavit sworn by Company A’s employee was “fraudulent” and, in any event, did not state that she had perused the bank’s books.
• The High Court adopted unfair procedures in fixing dates and adjourning hearings, thereby denying effective participation.
• No valid demand letter was served because it was delivered to “30 Richmond Avenue,” an address the Defendant claims does not exist and was unilaterally substituted by Company B.
• Any indebtedness is offset by breaches of contract by Company A, including delays in drawdowns and alleged anticipatory breach; the Defendant asserted a potential counterclaim or claim for specific performance.
• The affidavit was sworn abroad before a solicitor alleged not to be authorised in that jurisdiction and purportedly connected to Company A’s legal advisers.

Respondent’s (Plaintiff’s) Arguments

• Affidavits from Company A’s employee (a senior credit-risk manager) and Company B’s employee (directly involved in the loan relationship) satisfied Order 37 rule 1; the Bankers’ Books Evidence Act was not invoked.
• The Defendant never denied executing the loan agreements or receiving the funds; his allegations amount at most to a counterclaim, which cannot defeat summary judgment.
• Procedural directions in the High Court were fair; the Defendant repeatedly missed deadlines for affidavits and chose not to attend certain hearings.
• The demand letter was delivered by DHL to the address the Defendant himself nominated on 29 June 2011.
• Any technical defect in the jurat of an affidavit is curable under Order 40 rule 15 RSC and, in any case, is immaterial given the independent evidence of Company B’s employee.

Table of Precedents Cited

Court's Reasoning and Analysis

1. Adequacy of the Defence. The Court observed that the Defendant never actually denied receiving the loan funds. His references to “losses,” “wrong facility,” and the possibility of finishing the development presupposed the receipt of money. Judge O’Donnell agreed with Judge Kelly that any alleged counterclaim could not bar summary judgment, particularly given an express contractual clause prohibiting set-off.

2. Evidential Sufficiency. Applying Ulster Bank v. O’Brien, the Court held that Order 37 rule 1 permits affidavits by “any other person who can swear positively to the facts.” Company B’s employee had direct involvement with the loan, had perused the bank’s records, and therefore met the rule. Section 4 of the Bankers’ Books Evidence Act 1879 was inapplicable because the Plaintiff did not seek to introduce copies of book entries; the Act is not a mandatory code governing all banking evidence.

3. Procedural Fairness. Examination of Digital Audio Recordings from the interim hearings revealed no discrepancy with Judge Kelly’s written account. The Defendant had missed multiple affidavit deadlines and opted not to appear on 25 June 2012; the adjournment to 6 July 2012 was proper.

4. Service of Demand Letter. Even if service were defective (which the Court doubted, given the Defendant’s own nomination of “30 Richmond Avenue”), it was not essential: the loans were term facilities repayable at the end of their term, not “on demand” loans.

5. Alleged Irregularity in Swearing an Affidavit. The Defendant ultimately accepted that the solicitor before whom the affidavit was sworn was duly practising. Any technical defect would, in any event, be cured by Order 40 rule 15 RSC. Moreover, Company B’s independent affidavit provided a separate evidential foundation.

Holding and Implications

APPEAL DISMISSED.

The Supreme Court affirmed the High Court’s summary judgment for €9.68 million plus costs. The decision reinforces that, under Order 37 rule 1, affidavits from servicing-agent personnel with first-hand knowledge can ground summary judgment without recourse to the Bankers’ Books Evidence Act 1879. No new legal principle was created, but the judgment consolidates existing authority and confirms that purely technical objections will not defeat an undefended debt claim.