Judge refuses to strike out bank’s claim for €20m against husband and late wife

A High Court judge has refused to strike out, on grounds of delay, a bank’s claim for €10.87 million against a husband and €10.15 million against his late wife.

Mr Justice Brian Cregan believed there has been “no delay whatsoever” in the proceedings brought by AIB Mortgage Bank and Allied Irish Banks PLC against Gerard, his late wife Teresa and their daughter Caroline Burke.

Gerard and Teresa Burke, of Old Doughiska Road, Co Galway, borrowed significant sums from the banks over years. The bank parties obtained judgment, on consent, in 2015 for €9.5 million against the couple and €8.9 million against Mrs Burke, who died in November 2020.

In 2018, the judge said, the bank became aware that Mr Burke had allegedly transferred certain lands to their daughter Caroline, also of Old Doughiska Road, apparently in May 2018.

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The bank later discovered a second conveyance made in April 2019, in which Gerard and Teresa allegedly transferred other property to their daughter, the judge said. In March 2020, the bank says, they learned of a third property transfer by Gerard to Caroline.

The bank issued proceedings in May 2020 against all three of the Burkes claiming the property transfers were done at an undervalue and with an intention of defrauding them as creditors of Gerard and Teresa.

They want the court to set aside the alleged transfers and declare they were made with the intention of defrauding creditors.

The Burkes deny the bank’s claims against them.

They then brought an application seeking to dismiss the bank’s action on grounds of inordinate or inexcusable delay. They claimed they were prejudiced by the alleged delay due to Teresa Burke’s death and the dimmed recollection of the parties, among other factors.

Mr Justice Cregan dismissed that application, being satisfied the Burkes have not suffered prejudice due to any action on the part of the bank.

He also refused the Burkes’ request for the bank’s pleadings of fraud and/or conspiracy to be struck out.

He was satisfied the pleas of fraud and conspiracy are “fully and properly pleaded” in the bank’s documents to the court and are “entirely necessary” in the context of the case. Whether these claims succeed is a matter for the full trial of the action, he said.

The judge said it is “clear” that neither Gerard nor Teresa Burke made “any attempt” to satisfy the judgments against them. The amounts outstanding when the bank parties issued their statement of claim in this case were €10.87 million from Gerard and €10.15 from Teresa, he said.

The debt against them has “simply increased with interest added over a period of years”, he added.