About this case:

• Citation:
  [2023] IEHC 309
• Judgment:
  External link
• Court:
  High Court
• Judge:
  Mr Justice Garrett Simons

Delivering judgment in the case, Mr Justice Garrett Simons held that the proper jurisdiction for the determination of the existence of a valid tenancy agreement was the High Court. The question of whether a valid tenancy existed had to be determined prior to the RTB considering whether there had been compliance with the Residential Tenancies Act 2004 (see AIB plc v. Fitzgerald [2022] IECA 286).

Background

The plaintiffs sought to recover possession of land pursuant to a charge registered under section 62 of the Registration of Title Act 1964. The plaintiffs claimed an entitlement to possession on foot of a mortgage entered into with the first defendant.

The first and second defendants were brother and sister. It was alleged that the first defendant created a tenancy over the property in favour of his sister in December 2015. A tenancy agreement was exhibited in the proceedings and purported to grant tenancy rights for seven years. The tenancy was not registered with the RTB.

The second defendant stated that she did not pay rent for the first 14 months of the tenancy but thereafter paid rent directly to her brother for approximately four or five years. The second defendant also asserted that, from November 2021, she had been paying her rent to a company called “Newgrange”, although she did not provide detail on who directed her to do so.

The plaintiffs took the view that the tenancy was invalid having regard to the terms of the mortgage, which contained a covenant against the creation of leases without prior written consent. Moreover, the “Newgrange” account was held and maintained by the second plaintiff, Pepper Finance Corporation (Ireland) DAC. A statement was exhibited which showed that the monthly payments of €600 made by the sister were credited to the reduction of the debt.

The second defendant issued a motion seeking to adjourn the possession proceedings pending a resolution of a dispute made to the RTB in January 2023. It was claimed that no notice of termination had been served by Pepper Finance and accordingly, Pepper Finance was not entitled to possession of the property.

The RTB raised queries as to the identify of the landlord in the second defendant’s dispute and closed the case after 30 days when no information was forthcoming. However, the second defendant claimed that she had provided the additional information within 30 days and that the dispute should be reactivated.

The adjournment application was heard and judgment was reserved. The second defendant was given liberty to exhibit certain documentation including a copy of the application for adjudication to the RTB, correspondence with the RTB and any further communication received from the RTB.

However, in this affidavit, the second defendant exhibited incomplete email correspondence between her brother’s financial advisor and the receiver’s office in 2021. The correspondence related to loan redemption and made reference to “the tenant” and payment of “rent”.

High Court

Mr Justice Simons began by outlining that the affidavit filed following the hearing went “well beyond what was allowed by the court” and the material should have been exhibited in advance of the motion. No proper context was provided for the additional material, which was incomplete and unexplained. The court therefore determined that it would not rely on the material.

Turning to relevant law, the court outlined the decision in AIB plc v. Fitzgerald which held, inter alia, that the requirements of a notice of termination under the 2004 Act applied only where there was a tenancy in existence. As a matter of logic, it did not apply where there no tenancy existed. It was only where a tenancy existed that there should be a consideration of whether a notice of termination was validly served.

Applying the law to the facts, the court held that the present case required a determination of whether a valid tenancy existed between the parties. The court held that the RTB had the exclusive jurisdiction to determine disputes in relation to tenancies or terminated tenancies.

However, it was clear that this jurisdiction was limited to tenancies which actually existed between parties. The legislative provisions presupposed the existence of a valid tenancy, meaning that the RTB did not have jurisdiction to determine whether a valid tenancy ever existed, the court held.

There was nothing in the Act to suggest that the RTB had this jurisdiction, the court said. The existence of a tenancy was a condition precedent to consideration of a dispute by the RTB.

While the RTB may be prepared, for pragmatic reasons, to form a view of whether a valid tenancy existed when a dispute was referred to it, it should decline jurisdiction when it feels that no valid tenancy existed.

As such, the High Court’s full original jurisdiction was not ousted by the 2004 Act. The resolution of whether a tenancy existed was outside the remit of the RTB and was properly determined by the High Court.

Conclusion

The adjournment application was refused and the determination of the validity of the tenancy agreement would be determined by the High Court.

Anderson and Anor. Fitzgerald and Anor. [2023] IEHC 309