"Don’t ask questions, just sign the papers.” Another High Court case dealing with "undue influence" in respect of Personal Guarantees

Friel Stafford > Blog > Business > “Don’t ask questions, just sign the papers.” Another High Court case dealing with “undue influence” in respect of Personal Guarantees

“Don’t ask questions, just sign the papers.” Another High Court case dealing with “undue influence” in respect of Personal Guarantees

  • Posted by: Jim Stafford
  • Category: Business

High Court precedent in dealing with defences of “undue influence” is essentially that a mere assertion by a guarantor of undue influence will not suffice as a Defence, and that the court will consider all of the surrounding circumstances.

I set out below a link to a recent case, Allied Irish Banks Plc -v- Grove Oil (Roscrea) Limited & ors, which is a useful summary of the factors to be considered when assessing undue influence as a defence. In the case the Defendant achieved the threshold of demonstrating that she had an arguable defence and was therefore successful in defending the application for a Summary Judgment. The case should now proceed to plenary hearing (if it is not settled in the meantime.)

http://courts.ie/Judgments.nsf/09859e7a3f34669680256ef3004a27de/8e743f5cb47a0f978025838a002e6a91?OpenDocument

(I would mention that sometimes the above link does not display on mobile phones. If that is the case you may need to view this posting from a lap top or a PC.)

Reading the judgment highlights for me the importance of properly interviewing clients and obtaining the full background circumstances to when and how personal guarantees were given. Lay people might not realise that a single comment by a banker at a meeting or over the telephone could have a dramatic impact on the merits of a defending a claim on a PG.

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Author: Jim Stafford
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