McHugh v McHugh: damages award on counterclaim inappropriate without hearing

6244-2In this case ([2015] IESC 101) the Court held that (1), for the purposes of s 13 (2)(a) of the Statute of Limitations Act 1957 (here), transfer and registration of ownership of land will begin the 12 year period during which a right of action for the recovery of that land is limited (even where it was done without informing a potential claimant); failure by a family member to inform a potential claimant that he has become registered owner of disputed land is not fraud or concealment for the purposes of s 71 of the 1957 Act (here). And (2), the High Court judge acted inappropriately in giving judgment on the Defendants’ counterclaim, on hearing of a motion to dismiss proceedings as bound to fail, without directing a hearing on the counterclaim in the normal way.

Background

The plaintiff/appellant, Gerard McHugh, is a security guard and part-time farmer. In 1974, when his father became too ill to work the family farm, Gerard dropped out of agricultural college to manage the farm and support the family. His three younger siblings completed college afterwards and gained professional qualifications. On his father’s death in 1976, Gerard inherited the half of the farm that was registered in his father’s name. In 1987 his mother, Rita McHugh, made her will, making Gerard sole executor and bequeathing him all of her property. That included the half of the family farm that she inherited from her parents. However, in 1990 Rita transferred ownership of that land to Gerard’s brothers, Myles and Anthony. In 1991, Myles and Anthony registered their title to the land. But they did not inform Gerard of the transfer of ownership, and Gerard continued in possession of the land and to farm it until after his mother’s death in 1998.

In 2004, Gerard issued High Court proceedings by way of plenary summons seeking, among other things, to have the Deed of Transfer revoked and an order under s 117 of the Succession Act 1965 that Rita had failed in her moral duty to make proper provision for Gerard.

Myles and Anthony did not deliver their defence until 2007, and they delivered an amended defence in January 2011. In June 2011 they brought a motion seeking to have proceedings struck out.

High Court

In the High Court, Murphy J delivered judgment in February 2012, striking out proceedings on grounds that they were prohibited by statute, and awarded costs to the Defendants. The High Court refused to place a stay on its order and refused to allow an amended statement of claim, as that could not overcome the statutory bar. In addition, Murphy J gave judgment on the Defendants’ counterclaim and awarded special damages without directing a hearing on those issues.

Gerard McHugh made a Notice of Appeal to the Supreme Court against those orders and seeking to admit new evidence and add new grounds.

Supreme Court

McKechnie J outlined that the courts’ jurisdiction to dismiss proceedings without considering the merits of the case can cause an unforeseen injustice. Therefore the safeguards established in case law must be applied correctly “with a generous measure of skepticism to the fore”. But a respondent has an equal right to justice. And where a court has correctly identified that a plaintiff is pursuing an action that is bound to fail, the court has, not only jurisdiction but, a duty to dismiss proceedings.

As the Appellant’s purpose was to recover the lands for his sole and exclusive use, McKechnie determined that s 13 of the 1957 Act provided his strongest case. But an action under s 13 must be taken within twelve years from the date at which a right of action accrued. Ruth McHugh transferred the land to her sons in 1990 and they registered their ownership in February 1991. However, the Plaintiff did not issue his plenary summons until March 2004. Therefore the Plaintiff had not issued his summons within the statutory period allowed, and the Defendants’ failure to inform him of their registration of ownership did not represent fraud or concealment for the purposes of s 71 of the 1957 Act [54], which allows an extension of the statutory period.

McKechnie J also found that the High Court judge had acted inappropriately in giving judgment on the Defendants’ counterclaim, and in making an award of special damages, at a motion to dismiss hearing: he ought to have directed a hearing on that issue in the normal way [52]. The Court understood from submissions, though, that the Respondents would not be pursuing that issue.

MacMenamin J and Laffoy J concurred.

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