Nolan & Ors v Dildar Ltd & Ors

Factual and Procedural Background

This appeal arises from an order of the High Court refusing an application by two individuals (the Appellants) to be joined as defendants in ongoing proceedings brought by a group of plaintiffs (the Plaintiffs) concerning the beneficial ownership of certain lands (referred to as "the Nemo lands") registered in the name of a company ("Company A") incorporated in the Isle of Man. The Plaintiffs claim that their pension fund monies were used to purchase these lands through Company A and seek a declaration that Company A holds the lands on trust for them.

The Appellants claim to be the beneficial owners of Company A and sought to be joined as defendants to defend the Plaintiffs' claim and assert their own claim by way of counterclaim. The High Court refused this application on the basis that joining the Appellants would confer a procedural advantage, noting that the Appellants were free to commence their own proceedings against the Plaintiffs, which could be consolidated with the present case.

Subsequently, the Appellants issued their own proceedings against the Plaintiffs, leading to the question of whether the appeal was moot. The Court of Appeal considered the factual matrix and procedural history, including the financial arrangements and disputed ownership claims surrounding Company A and the Nemo lands.

Legal Issues Presented

1. Whether the Court should exercise its discretion under Order 15, rule 13 of the Rules of the Superior Courts to join the Appellants as defendants to the existing proceedings.
2. Whether exceptional circumstances exist to justify joining the Appellants as defendants despite the Plaintiffs’ opposition.
3. Whether the appeal is moot given that the Appellants have commenced separate proceedings.
4. The proper approach to the burden of proof concerning the beneficial ownership claims when a counterclaim is made by joined defendants.

Arguments of the Parties

Appellants' Arguments

• The Appellants claim to be the beneficial owners of Company A, having procured its incorporation and funded the purchase of the Nemo lands with family monies.
• They assert that the administrator of Company A has adopted a neutral position, leaving no party to oppose the Plaintiffs' claim, thus creating an "open goal" scenario.
• They contend that joining them as defendants is necessary to ensure that all relevant issues can be fairly and completely adjudicated in one proceeding.
• They argue that commencing separate proceedings and seeking consolidation is unnecessarily cumbersome, costly, and burdensome on court resources.
• The Appellants submit they have demonstrated a prima facie case, showing a rational basis beyond mere assertion, sufficient to justify joinder at this interlocutory stage.

Plaintiffs' Arguments

• The Plaintiffs deny that the Appellants are the beneficial owners of Company A and maintain that they bear the onus of proof to establish such ownership.
• They argue that the Appellants must address contradictions between their current ownership claims and prior statements made by Paul Kenny to the administrator of Company A.
• The Plaintiffs submit that until these contradictions are resolved, the Appellants should not be joined as defendants.
• They contend that the Appellants may pursue their claims in separate proceedings, as has occurred, and that the appeal is moot.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Fincoriz S.A.S. Di Bruno Tassin Din e C v. Ansbacher & Co. Ltd [1987] IEHC 19	Exceptional circumstances required to join a non-party defendant without plaintiff's consent; necessity of presence of parties to completely adjudicate all questions.	The Court applied the principle that the Appellants must show exceptional circumstances and that their presence is necessary to enable complete adjudication of issues.
Persona Digital Telephony Ltd and anor v. The Minister for Public Enterprise and ors [2014] IEHC 78	Joinder depends on what is just and necessary to enable the Court to completely settle all questions; absence of plaintiff's consent not determinative.	The Court emphasized the discretionary nature of joinder and that the absence of plaintiff consent does not preclude joinder if justice requires it.
Fitzpatrick v. FK [2007] 2 IR 406	Distinction between "precedential interest" and "direct interest" in litigation; only parties with direct interest in subject matter should be joined as defendants.	The Court found the Appellants have a direct interest in the ownership dispute, justifying their joinder as defendants rather than mere interveners.
O'Brien the Personal Injuries Assessment Board (No. 1) [2005] 3 I.R. 328	Clarification of circumstances allowing party intervention due to direct interest in subject matter.	Referenced to support the requirement that a party seeking joinder must demonstrate a direct interest in the litigation’s subject matter.

Court's Reasoning and Analysis

The Court began by acknowledging the discretionary power under Order 15, rule 13 RSC to join parties whose presence is necessary for a complete adjudication of the issues. It recognized the exceptional nature of joining a defendant against the plaintiff's wishes but found the Appellants’ direct interest in the beneficial ownership dispute warranted their joinder.

The Court rejected the High Court's view that joinder would confer an unfair procedural advantage by relieving the Appellants of any burden of proof, clarifying that any claim by the Appellants by way of counterclaim would require them to discharge the burden of proof on that claim.

It held that the Appellants had demonstrated a prima facie, arguable case with a rational basis beyond mere assertion, sufficient to justify joinder at this interlocutory stage without delving into the merits or contradictions of their evidence.

The Court also addressed the argument of mootness, concluding that the existence of separate proceedings by the Appellants did not render the appeal moot, as consolidation of those proceedings with the current case would be cumbersome and inefficient. Joinder would avoid duplication of effort and conserve court resources.

Holding and Implications

The Court ALLOWED THE APPEAL and ordered that the Appellants be joined as defendants to the existing proceedings. It directed that the Appellants deliver a defence and counterclaim within 21 days, with further directions to be made as necessary to avoid delay in the resolution of all issues.

The decision ensures that all parties with a direct interest in the ownership dispute are before the Court, facilitating a comprehensive and efficient adjudication of the matter. No new legal precedent was established beyond the application of established principles governing joinder of parties.