High Court allows for Renewal of Execution Order for Possession despite the Statute of Limitations

In a recent High Court decision of Start Mortgages DAC -v- Piggott [[1]], handed down on 15 June 2020, Justice Mary Rose Gearty made an order granting the Plaintiff leave to renew an execution order for possession for a further year, even though the order for possession (“OFP”) itself would become over 12 years old within the lifetime of the renewed execution order.

Facts

The High Court made an OFP in respect of the Defendant’s property on the 30 June 2008. Subsequent to the OFP being made, the parties made various attempts to find a resolution and a number of payment plans were put in place. Unfortunately, each arrangement failed and by 2016, the Defendant had stopped making payments.

In November 2018, the Plaintiff successfully made an application seeking leave to issue execution of the OFP (as is required when an order is more than 6 years old). The renewed execution order was taken up in July 2019. On foot of same, the Plaintiff had one year (until the 24 July 2020) to execute the OFP.

This case involved a further application by the Plaintiff to renew the execution order as it was reluctant to execute the OFP before the expiry of 24 July 2020 and risk rendering the Defendant homeless during the Covid19 pandemic.

The Law

Section 11(6)(a) of the Statute of Limitations Act 1957 provides that “An action shall not be brought upon a judgement after the expiration of twelve years from the date on which the judgement became enforceable”. The Court considered whether this section applies in the circumstances of this case.

The Court found that the most pertinent authority for the purposes of this case was the decision in Ulster Investment Bank Ltd v Rockrohan Estate Ltd [[2]]. Irvine J. in that case considered the rationale of and the policy behind the Statute of Limitations and also considered the relevant Rules of the Superior Courts (“RSC”) namely Order 42, Rules 23 and 24, and accepted the argument that the enforcement action (in this case an order for leave to execute a well charging order) was not a fresh action/action upon a judgement and for that reason was not barred by section 11(6)(a).

Decision

Being persuaded by Justice Irvine’s decision in Rockrohan and noting that her reasoning had the endorsement of a Supreme Court judgement, the court in this current case accepted that an order renewing the execution order calls for no further consideration by the Court and is an application to enforce an order previously made and hence is not affected by Section 11(6)(a).

In the current case, the Plaintiff chose not to enforce the OFP in the hope that the matter would resolve and also because the property was the Defendant’s family home. The court commented that this forbearance should be encouraged in these types of cases, rather than punished and granted the Plaintiff leave to renew the execution order for a further year, pursuant to Order 42 Rule 20 of the RSC.

Conflict between this decision and the Circuit Court Rules

While the RSC are silent as to whether or not an order can be renewed beyond the period of 12 years from the date of judgement, Order 36, rule 9 of the Circuit Court Rules (“CCR”), provides that one only has 12 years to execute a decree or judgement.

Given the conflict between the decision in Piggott and the CCR, it remains to be seen whether a similar decision would be made by the Circuit Court if such an application was made. As most possession orders are now made by the Circuit Court and in many cases the Plaintiff has no option but to bring possession proceedings in the Circuit Court, there would be real prejudice to Plaintiffs should the Circuit Court decide not to apply Piggott and rely instead on Order 36 Rule 9 CCR

Court’s discretion to renew an Execution Order

It should be noted that while one is entitled to apply to the court for leave to execute after 6 years has passed on a judgement, there is a Supreme Court decision, Smyth v Tunney [[3]] which is authority for the Court’s discretion in granting such leave. Sufficient reasoning must be given as to why a Plaintiff has not yet executed the judgement.

Conclusion

This is a positive decision for loan owners who wish to continue to engage with borrowers. It sets a precedent, in particular in relation to High Court orders, that an execution order can be renewed continuously if engagement is ongoing and a Plaintiff wishes to avoid executing an OFP.

It remains to be seen how the Circuit Court will deal with a similar application but one would hope that it would want to encourage a similar practice of only executing OFPs as a last resort and that a practical approach would be taken and the Piggott decision followed.

It also remains to be determined how either the High Court or Circuit Court would deal with a similar application where the OFP was over 12 years old before any execution order was applied for. However, if the rationale in Piggott is to be followed, it is arguable that one could make such an application at any time and the policy considerations would support it.