Mother of three loses appeal over order for sale of family home

A mother of three young children has lost her appeal over an order for the sale of her family home arising from the bankruptcy of her husband, from whom she says she has separated.

The house, valued at some €275,000, was registered in the sole name of the man in 2002, before his marriage in 2009. He was also registered as sole owner of farmlands surrounding the house, valued at some €1m in 2017, which he is still working.

When adjudicated bankrupt in July 2016 on the petition of Danske Bank arising from a judgment for some €1.3m against him in 2013, the property was still registered in his sole name.

A receiver has been appointed over the lands but the man has said he will not co-operate with the receiver’s bid to sell any assets of his bankruptcy estate. As a result of his bankruptcy, his assets were vested in bankruptcy trustee Chris Lehane who in 2018 secured an order from the High Court permitting him sell the family home.

In a recently published judgment, with the woman’s name redacted because of private matrimonial matters addressed, the three-judge Court of Appeal dismissed her appeal against that order.

Giving the judgment, Ms Justice Marie Baker noted the woman is herself not a bankrupt and not a creditor of Danske Bank or any other entity. She herself had never created any security over the house and there was no other security over it apart from the mortgage in favour of Danske Bank.

The woman had said she and her husband have separated since the High Court hearing, she is a homemaker and does not have gainful employment outside the home in which she claimed a beneficial interest.

While the woman had initiated separate proceedings in 2015 against the man asserting a 50 per cent interest in the property, those had not progressed beyond the issuing of a plenary summons, the judge noted. The woman represented herself in the High Court hearing of Mr Lehane’s application for orders permitting a valuation of the premises and its sale. The man took no part in that hearing. The woman had argued, among various claims, she was an “innocent party” and the sale of the house would be disproportionate and render her family homeless.

In the Court of Appeal judgment, Ms Justice Baker said the sale of a family home in the realisation of a bankrupt’s assets requires High Court sanction and the balancing of various factors. The factors which influenced the High Court included that significant value would be added to the estate of the bankrupt and there would be a “real prospect of recovery” for his creditors.

The High Court also considered the woman is in a position to earn a living, having worked outside the home in the past, and, “more importantly”, had made no offer to purchase the bankruptcy trustee’s interest in the family home.

A further factor was the bankruptcy trustee’s view that realisation of the bankrupt’s assets was likely to be difficult due to his lack of co-operation. Ms Justice Baker said the woman had not produced evidence to support her claims of “exceptional” and “changed” circumstances such as warranted not making an order for sale. The judge also rejected her claim she had a beneficial interest in the property for reasons including she had contributed to renovations.

The woman had produced no evidence to support that and no evidence of her assets, the judge said. The woman alleged changed circumstances in that she had had a baby since the High Court case and since she had initiated separation proceedings but refused to say whether that child was a child of her marriage or to produce the matrimonial civil bill, the judge noted. She offered no explanation for her refusal to explain the circumstances of her separation, other than her desire for privacy in her family life, the judge said. Even when orders were made prohibiting her identification, she had still refused to answer questions from the court in that regard. It was uncontested the woman has made no offer to purchase the bankruptcy trustee’s interest in the property, the judge added. The bankruptcy trustee had suggested he might be receptive to such an offer and the Court of Appeal had indicated it would defer judgment until after the end of January last to allow for that opportunity.

When no progress was made by mid-February, the court decided to proceed to judgment. For those and other reasons, the court dismissed the appeal.