Everyday Finance DAC v Cullinane

Factual and Procedural Background

Company A, the assignee of a loan originally made by Bank A, applied for an interlocutory injunction against the Defendant, the executrix of a deceased borrower’s estate. The application sought to require the Defendant to sell The Property and set aside the proceeds pending trial of the dispute. [1][2]

The original loans were made in 2011. Repayment was due in December 2011, the borrower died in September 2019, and proceedings were commenced in September 2025. Company A claimed approximately €340,000, subject to the value of another charged property. [3][4]

The will directed that The Property be sold and the proceeds used to clear the borrower’s indebtedness to Bank A and other monies owed. The Defendant refused to comply, asserting that the debt was statute-barred and that the estate was insolvent. [5][6]

Legal Issues Presented

1. Whether the Defendant could ignore the will’s direction because enforcement of the underlying debt might be statute-barred. [7][8][9]
2. Whether Company A had established a fair issue to be tried concerning the will’s direction and its claimed equitable mortgage. [10][9]
3. Whether the balance of justice and adequacy of damages justified granting an interlocutory injunction requiring the sale proceeds to be set aside. [11][12][13]

Arguments of the Parties

Company A’s Arguments

• A statute-barred debt continues to exist, although it may not be recoverable by an action on the debt; proceedings based on the will’s direction therefore constituted a separate and timely cause of action. [8][14]
• The will’s direction bound the Defendant and could not simply be ignored. [15]
• Company A had an equitable mortgage over The Property. [16][10]
• The estate’s insolvency was uncertain, and the available valuations indicated that it might be solvent. [17][18][19]
• Without an injunction, the estate might be distributed before trial, leaving no assets from which Company A could recover; if the injunction were granted and Company A lost, the proceeds could still be distributed to the beneficiaries. [20][21]

Defendant’s Arguments

• The underlying debt was statute-barred, so the Defendant did not intend to follow the direction in the will. [22][6]
• Company A had not properly established that the loan had been assigned to it, because the account numbers in the facility documentation differed from those in the transfer documents. [23]
• The estate was insolvent and, under section 46 of the Succession Act 1965, the estate had to be distributed under the statutory rules rather than the will’s direction. [24]
• The injunction might prevent The Property from being sold because another beneficiary would not release his charge unless paid. [25]

Table of Precedents Cited

Court's Reasoning and Analysis

The Court rejected the argument that the differing account numbers established that Company A lacked title to the loan. The transfer documents identified the borrower, the facility date and The Property, and there was sworn evidence that the loan had been transferred. The issue was therefore not a basis for refusing relief. [26][27]

The Court accepted that insolvency could cause the will’s direction to be ignored under section 46 of the Succession Act 1965. However, the evidence did not establish insolvency with sufficient certainty. An earlier revenue form indicated a surplus, while a later valuation indicated a deficit; the difference was substantially affected by the valuation of The Property and by whether Company A’s debt was recognised. [24][28][29][19]

The Court was particularly concerned that most of the alleged estate liabilities were owed to the Defendant’s close relatives. One relative had received a charge for a substantial and poorly particularised debt, while another relative’s debt was also vague, potentially statute-barred and greater than the amount claimed in related proceedings. [30][31][32]

Those arrangements could place Company A, an unrelated creditor with an equitable mortgage and the benefit of the will’s direction, at a significant disadvantage. They therefore raised doubts about the alleged insolvency and engaged the balance of justice. [33][34]

The Court found a fair issue to be tried: whether the Defendant could ignore the will’s direction, particularly since she intended to do so regardless of whether the estate was ultimately solvent or insolvent. [11][35]

Damages were inadequate for Company A because, without an injunction, the estate might be distributed before judgment, effectively ending Company A’s claim. Conversely, damages were adequate protection for the estate because Company A had given an undertaking in damages. The injunction would therefore cause the estate only a delay in payment, rather than a loss. [13][36]

The Court also rejected the argument that the injunction should be refused because a beneficiary might not facilitate the sale. That difficulty arose from the Defendant’s own actions, including the grant of the disputed charge, and could not be relied upon to defeat the injunction. [25][37]

Holding and Implications

INTERLOCUTORY INJUNCTION GRANTED. The Defendant was required to sell The Property and set aside the proceeds pending determination of whether she was bound to comply with the will’s direction. [37]

Costs were awarded to Company A because the Defendant contested, and lost, the injunction application. [38][39]

The direct effect was to preserve funds for Company A if it succeeds at trial while postponing distribution to the estate’s beneficiaries if Company A fails. No new precedent was set by the decision.