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England and Wales High Court (Commercial Court) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Dory Acquisitions Designated Activity Company v Frangos (Rev 1) [2020] EWHC 240 (Comm) (31 January 2020) URL: http://www.bailii.org/ew/cases/EWHC/Comm/2020/240.html Cite as: [2020] EWHC 240 (Comm) |
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BUSINESS AND PROPERTY COURTS
OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
Rolls Building London, EC4 1NL |
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B e f o r e :
____________________
| DORY ACQUISITIONS DESIGNATED ACTIVITY COMPANY |
Claimant |
|
| - and - |
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| IOANNIS (JOHN) FRANGOS |
Defendant |
____________________
The Defendant was unrepresented and did not appear.
Hearing date: 31 January 2020
____________________
Crown Copyright ©
A. Introduction.
A.1. The Applications.
(1) An order that proceedings have been validly served on the guarantor pursuant to CPR rules 1.2, 3.1(m) and 3.10, in circumstances where the claim form served on the Guarantor's English solicitors on 14 November 2019 did not have a court seal or a claim number on its face.
(2) Permission for Dory Acquisitions to apply for summary judgment against the Guarantor pursuant to CPR rules 24.4, such permission being required as the Application for summary judgment is made at a time when the Guarantor has neither acknowledged service or filed a defence.
(3) Summary judgment in respect of Dory Acquisitions' claim for amounts said to be due and unpaid pursuant to a personal guarantee and indemnity ("the Guarantee") given by the Guarantor to Piraeus Bank SA ("the Bank") in connection with a loan agreement in circumstances where the Bank's rights and obligations under the Loan Agreement and the Guarantee were transferred to Dory Acquisitions on 29 July 2019.
A.2. The Background Facts
The Loan
(1) Tranche A (pursuant to Clause 6.01) was to be repaid by the Borrowers:(a) in 32 quarterly instalments:(i) the first 12 instalments were in the amount of US$300,000 each. The subsequent 20 were in the amount of US$875,000.(ii) the first instalment became due and payable on a Banking Day falling three months after the Drawdown Date.(iii) all subsequent instalments became due at consecutive three-monthly intervals thereafter.The final instalment was payable on the Final Maturity Date.(b) Further, a balloon payment of 28,900,000 also became due and payable on the final maturity date (the Tranche A Balloon Payment).(2) Tranche B (pursuant to the Clause 6.01) was to be repaid by three balloon payments:
(a) US$3 million became due and payable on a Banking Day falling three years from the Drawdown Date.(b) US$5 million became due and payable on the sixth anniversary of the Drawdown Date.And (c) US$118,709,126.53 became due and payable on the Final Maturity Date.(3) The buyers were permitted to defer (with the consent of the Bank) paying instalments of Tranche A as long as they fell within the third anniversary of the Loan Agreement (a "Deferred Instalment"). These instalments were to be added into the Tranche A Balloon Payment. This was pursuant to Clause 6.02.
(4) Clause 7 set out provisions on payment of interest:
(a) by Clause 7.01 interest on the loan was payable in respect of each Interest Period at the applicable interest rate, such interest being payable in arrears on each Interest Payment Date (being the last day of an interest period) and on the Final Maturity Date.(b) by Clause 7.02 the Borrowers (subject to the Bank's approval and consent) could select the length of the next Interest Period (1, 3 or 6 months) and relevant LIBOR.(c) by Clause 7.03 the Interest Rate applicable to each Interest Period would be the aggregate of the Margin and LIBOR for each Interest Period.Interest on the loan was payable on arrears on each interest payment date (the last day of an interest period) at the applicable interest rate and also payable on the final maturity date.(5) An "Event of Default" was defined as follows:
"any principal or interest on the Loan or any part thereof or any other amount due from the Borrowers [...] under this Agreement or any amount due from the Borrowers [...] is not paid on the due date for payment thereof."This is pursuant to Clause 10.01(a).
(6) If an Event of Default occurred, then the Bank could, by notice to the Borrowers:
(a) terminate the Bank's obligation to make and continue to make the facility available and reduce that facility to zero.(b) accelerate the Loan and declare that the Loan and all interest accrued and all other sums payable under the Loan Agreement and security documents have become due and payable.This is pursuant to Clauses 10.01(a) and 10.02.(7) Each borrower indemnified the Bank on demand in respect of charges and expenses including legal fees incurred by the Bank in the exercise of enforcement of its rights under the security agreement. Further, the Borrowers also indemnified the Bank against any loss or expense which it may sustain as a consequence of inter alia any default in the repayment of the loan. That is pursuant to Clauses 15.02 and 15.03.
(8) The loan was governed by English law with English courts having exclusive jurisdiction to determine any disputes arising. This is pursuant to Clauses 20.01 and 22.02.
(1) In relation to Tranche A, three payments of the principal became due on 17 September 2018, 17 December 2018, 18 March 2019 and 17 June 2019 respectively. Principal payments were each for US$300,000, totalling US$1.2 million. A total of US$2,160,684.09 in interest payments also became due in respect of this period. The Borrowers did not pay these sums.
(2) In relation to Tranche B, the first balloon payment became due on 18 June 2019 in the sum of US$3 million. Interest payments were due under Tranche B on 17 December 2018, 18 March 2019 and 17 June 2019, in the sum of US$2,830,705.10. The Borrowers did not pay these sums.
The Guarantee
The transfer of rights and obligations
The notice of acceleration and demand under the Guarantee.
(1) US$153,138,088.53 as unpaid principal and interest as of 16 October 2019.
(2) Further interest accruing (currently at the rate of 8.10213 per cent per annum) from 16 October 2019 up to and including the date of payment.
And (3) US$40,274.88 as unpaid expenses.
The issue of legal proceedings and subsequent events.
"1. We act on behalf of Dory Acquisitions Designated Activity Company.
"2. We enclose the following documents by way of service in relation to the proceedings:
"(a) Claim Form.
"(b) Particulars of Claim.
"(c) Response Pack, comprising forms N9, N9(CC), N9A and N9B.
"And (d) Initial Disclosure List of Documents at Schedule 1."
"We refer to your letter dated 14 November 2019 and the various documents attached."
"We understand from the court that your client has failed to file an Acknowledgement of Service or a defence although the deadline for doing so expired on 29 November 2019."
"All our client's rights and remedies are reserved, including to apply for default judgment."
"We thank you for your letter dated 2 December 2019. We are currently seeking instructions from Mr Frangos."
"unless your client holds a banking licence it would be unlawful for your client to attempt to enforce the loan agreement or the security documents."
"We look forward to hearing from you."
"We invite your client to withdraw its claim on terms that it will pay our client's reasonable costs to be assessed if not agreed."
"Given your client's continued failure to pay a bona fide debt and the hopelessness [as it was put] of the only argument that had been raised in respect of that debt, our client must now take further steps to seek to recover the amount due."
"Accordingly, we enclose by way of service our client's application pursuant to CPR 24 for summary judgment (the Summary Judgment Application) as filed at court today, comprising (a) an application notice and draft order, (b) the First Witness Statement of Gregory Feldman dated 11 December 2019, (c) Exhibit GF1, and (d) a covering letter to the court, in relation to listing."
"If you would like your counsel's availability to be considered please arrange for their clerk to attend the Listing Office at that time."
"We had notified you your client's evidence in answer to the application was due by 27 December 2019. We had also invited you to attend the listing appointment to jointly list a hearing of the Application. However, your client did not file any evidence in answer and you did not attend the listing appointment. In this regard, please note the application has now been listed to be heard on Friday, 31 January 2020 with a time estimate of half a day.
"Given your client's non-participation we infer that your client does not intend to respond to the application or appear at the hearing. If that is not the case, please let us know as soon as possible so that we can keep costs and the parties' use of valuable court time to a minimum."
"We should make clear at the outset that Mr Frangos [that is the Guarantor] disputes the jurisdiction of the English court, and our comments below are made subject to that general reservation. So, to inform you and the English court of Mr Frangos' position without any intention of making any submission to the jurisdiction of the English court."
"With respect, that assertion is plainly wrong. On 14 November 2019 someone from your firm made a 'by hand' delivery of papers to our office just after 16.30 pm. The papers then delivered to our office had not been issued by the Court. The claim form did not bear any court seal and did not bear any court action number. For the purpose of service 'claim form' means the form issued by the Court and bearing the Court seal and action number. We refer you to the notes at CPR 6.2.3 and CPR 6.2.2 of the White Book and the case mentioned therein of Hills Contractors & Construction Limited v Struth [2013] EWHC 1693 (TCC). These defects…in service were not minor technicalities.
Similarly, the Particulars of Claim did not bear any action number (see CPR Practice Direction 7A at 7APD.4). In fact, you have never sent us a Claim form bearing a court seal or action number, and we became aware of the above-mentioned action number by chance as you included it in the headings of your letter dated 2 December and subsequent documents."
"Once it is appreciated that the steps taken on 14 November and subsequently were not good service, it is apparent that the time for filing an Acknowledgement of Service has not yet started to run and the time for a challenge to jurisdiction has not expired. It follows that it is not appropriate for the Court to give permission for a summary judgment application. The application should be dismissed. The rationale behind CPR 24.4 is that a defendant should not be required to respond on the merits to a summary judgment application until any challenge to jurisdiction has been determined, or the time for bringing a challenge to jurisdiction has passed without any challenge having been brought (see, for example, Trafigura Beheer BV v Renbrandt [2017] EWHC 3100 (Comm) and the other cases mentioned in that judgment)."
"The documents that you have delivered to our office [refer to] a variety of other matters. We do not propose to address them at this time. You should anticipate that if proceedings are served, Mr Frangos will challenge jurisdiction and will then set out the grounds upon which jurisdiction is challenged."
"... a naked attempt to obfuscate the straightforward debt claim that our client has against your client and/or delay matters. Indeed, if you had any real belief in the point the appropriate course of action would have been to serve notice under CPR 7.7 requiring service of the claim form or to ask us or the court for a copy. However, you did not do so."
"Mr Frangos [that is the Guarantor] disputes the jurisdiction of the English court, and our comments below are made subject to that general reservation, solely to inform you and the English court of Mr Frangos' position and without any intention of making any submissions as to the jurisdiction of the English court. Subject to that general reservation, we take the liberty of copying this letter to the court."
"In view of the content of your letter dated 21 January, we wish to draw attention to the fact that under the court's CE filing system it is not possible to file an Acknowledgement of Service without stating the applicable action number. The rules are clear and straightforward, there is no good reason why you should not comply with them. To date you have not complied with those rules."
"However, and without any admission, please find enclosed by way of service our client's application of today's date seeking an Order that the Court, pursuant to its powers under CPR 3.10, remedy any error of procedure in the service of the proceedings."
B. Defective service.
"3.10:
"Where there has been an error of procedure such as a failure to comply with a rule or practice direction -
(a) the error does not invalidate any step taken in the proceedings unless the court so orders; and
(b) the court may make an order to remedy the error."
(1) The guidance in Phillips v Nussberger is authoritative obiter dicta.
(2) CPR rule 3.10 is a beneficial provision to be given a very wide effect. It can be used beneficially where a defect has no prejudicial effect to the other party and to prevent the triumph of style over substance. (See Bank of Baroda at [17].) CPR rule 3.10 can apply even where the defect constitutes a failure to serve sufficient claim forms on defendants or a failure to deliver the correct claim form to the correct defendants or even where a defendant received no claim form at all, only an acknowledgement of service form in the context of service of claim forms on multiple defendants (see the Goldean Mariner [1990] 2 Lloyd's Reports 215 discussed in Phillips v Nussberger, Integral Petroleum and the Bank of Baroda). This interpretation of CPR rule 3.10 applies to originating processes as much as it does to other procedural steps (see Bank of Baroda at [19]).
(3) In view of this broad guidance, the most important question in determining whether CPR rule 3.10 applies is whether there has been an error of procedure which might otherwise invalidate a procedural step. This would be more difficult where there has been, for example, a complete failure of service (Bank of Baroda at [17]).
(4) Another important factor to consider is whether the defendant has suffered any prejudice as a result of the procedural error. The court has in the past used its powers under CPR rule 3.10 to remedy service of an unsealed claim form without a claim number where the service of that claim did not deprive the defendant of any knowledge of the fact that the proceedings had been or were about to be started or the nature of the claim against it (see Heron Bros Limited v Central Bedfordshire Council [2015] EWHC 604 (TCC), at [16] and below).
(5) Whether the defect was the fault of the applicant is considered, but it is a subsidiary factor.
(1) Status of the guidance in Phillips v Nussberger.
(2) Broad application of rule 3.10 including to originating process.
"28. Fifthly, Lord Brown approved two aspects of the decision of the Court of Appeal in The Goldean Mariner [1990] 2 Lloyd's Rep 215:
(a) He approved the unanimous view of the Court of Appeal in that case that RSC order 2 Rule 1 was a beneficial provision to be given wide effect, and further observed that in this respect it was not materially different from CPR 3.10. It is clear from [32] that CPR 3.10 is to be given wide effect so as to be used beneficially to cure defects.(b) He approved the majority decision in The Goldean Mariner that the rule was engaged even where all that had been served was an acknowledgement of service and there had been no service of the writ. This suggests a very wide ambit to the rule, which is capable of curing a defect which consists of non-service of the very document by which originating process is initiated.
29. Sixthly, Lord Brown's observations at [31] that CPR 3.10 was engaged were addressed to the position not only of Mrs Nussberger, on whom there had been service by a permitted method of a package of documents which included the German translation of the claim form and particulars of claim in both languages, but also to the position of Nefer, the third defendant, on whom there had been no service at all. In this he went further than the majority in The Goldean Mariner, where there had at least been some service, of the acknowledgment of service form if not the writ. I have some difficulty in treating an "error of procedure" in CPR 3.10 as encompassing circumstances where there is no purported service of any document of any kind, particularly where CPR 3.10(a) automatically validates subsequent steps in the proceedings if CPR 3.10 is engaged. I would be inclined for my part to treat the remedy in such case as lying, if at all, with the discretionary power to dispense with service under CPR 6.9. Nevertheless, the reference by Lord Brown in [31] to CPR 3.10(b) applying to the third defendant, Nefer, is indicative of the view of the Judicial Committee that CPR 3.10 is a beneficial provision to be given very wide effect indeed."
"15. This leaves only CPR 3.10 [...] In support of the Claimants' submissions I was referred to the judgment of His Honour Judge Graham Wood QC in United Utilities Group PLC v Hart (Liverpool County Court, unreported, 24 September 2015). That case concerned a question of whether purported defective service of a copy of the sealed version of the claim form can be cured by the court exercising discretion under any part of the CPR and where the defective service was held capable of being cured under CPR 3.10.
16. [...] [it] includes a very useful summary of the principles and recent authorities in the area, highlighting in particular Lord Brown's obiter dictum in Phillips v Symes (No 3) [2008] 1 WLR 180 at [31] ..."
"17. Judge Graham Wood QC also highlighted the careful analysis of the significance of that dictum by Popplewell J in Integral Petroleum SA v SCU Finanz AG [2014] EWHC 702 (Comm). Together these cases indicate the following:
i) Lord Brown's dictum can be taken as an indication of the view of the Judicial Committee that CPR 3.10 is a beneficial provision to be given very wide effect;
ii) This enables it to be used beneficially where a defect has had no prejudicial effect on the other party and prevents the triumph of form over substance;"
iii)..."
(3) Has there been an error of procedure?
"iii) the key in considering whether a defect can be cured under this provision is to analyse whether there is "an error of procedure" which might otherwise invalidate a step taken in the proceedings. Thus, the benefit of CPR 3.10 will be less easy to obtain where there has been no attempt at a procedural step (e.g. a complete failure of service) or the step taken is not permitted by or within the rules at all."
"19. Further, while the error relates to originating process (which Popplewell J at [37] indicated should attract a more cautious approach) this is a case where a procedural step was taken defectively rather than omitted or performed directly contrary to a rule. So although on one analysis one might say that service on some of the Defendants was omitted in the absence of sufficient Claim Forms, the covering letter makes clear that service was being attempted to be effected against all the Defendants. Effectively some of the procedural boxes were ticked, but others were not. This therefore seems to me to be a case where the power under CPR rule 3.10 can and should be exercised. Given the fact that no limitation point arises, and the effect of the order will be to validate the steps taken before the Claim Form expired, I do not consider that the expiry of the Claim Form stands in the way of this order being made."
"I also note that this result is consistent with the law as it existed before the CPR: in The Goldean Mariner [1990] 2 Lloyd's Rep. 215 (cited in passing by Popplewell J and also discussed by Lord Brown) four defendants received the wrong writs, while the fifth received no writ, only an acknowledgment of service form. These errors were all treated as capable of cure under RSC rule 2(1). It would be odd if the CPR, with its greater emphasis on substance, should produce a less favourable result to an erring Claimant than would have been obtained under the RSC."
(4) A question of whether the error had a "prejudicial effect".
"18. Is this therefore a case where CPR 3.10 can operate? There is no suggestion that the defect in service has had a prejudicial effect. The Defendants were effectively informed by the defective attempt at service that proceedings had been commenced against them. Nor was it argued that there was any limitation issue. If I were to accede to the Defendants' application, even though the validity of the Claim Form has now expired there would be nothing preventing the Claimants from issuing another Claim Form and serving it properly. This would, therefore, be a triumph of form over substance."
"29. […] (iii) the second and third defendants accordingly suffered no prejudice from the omission of the English language claim form from the package of documents served but rather used the omission as the opportunity to seek to achieve first seisin in Switzerland."
(5) Fault of the applicant.
(6) Application of the applicable principles to the facts of this case.
(1) The Guarantor received a letter before action from Dory Acquisitions on 29 October 2019 setting out Dory Acquisitions' intention to issue proceedings.
(2) The Guarantor was aware that the claim form had been issued by the court:
(a) the Guarantor, through Waterson Hicks, received a copy of the electronic filing submission confirmation from the courts CE filing system delivered by hand in its offices on 14 November 2019. The reason that the claim form was not sealed was that it had been electronically filed at court and the court had not yet provided a sealed version to Dory Acquisitions.
(b) further, Dory Acquisitions' letter of 2 December 2019 to Waterson Hicks set out the claim number, which demonstrated clearly if the Guarantor and Waterson Hicks were not already aware of the fact, that the claim had been issued by the court. As I have already noted, the means were readily at hand at any point for Waterson Hicks to check that the claim form had indeed been issued and issued in identical terms, and to have ascertained the claim reference number.
(3) Waterson Hicks engaged in correspondence with the solicitors of Dory Acquisitions regarding the proceedings, including discussion of the disclosure of documents.
(4) On 10 December 2019 Waterson Hicks sent a letter to Dory Acquisitions which asked Dory Acquisitions to "withdraw its claims on terms that it will pay [the Guarantor's] reasonable costs" (emphasis added). This comment is predicated on the basis that there was an extant claim - i.e. on the basis that the claim form had been validly served.
(1) The letter before action dated 29 October 2019 set out details of the claims that Dory Acquisitions intended to bring against the Guarantor. Those claims were also repeated in correspondence.
(2) Waterson Hicks was delivered a copy of the unsealed claim form and Particulars of Claim, a Response Pack and an initial disclosure list of documents to its offices on 14 November 2019.
(1) For the reasons set out above, the Guarantor (through his solicitors) was aware of the fact that Dory Acquisitions had issued proceedings and the nature of the allegations and causes of action against it.
(2) The only prejudice that the Guarantor appears to allege is that they would be unable to acknowledge service within 14 days of receiving the claim form, i.e. by 28 November 2019, on the basis that a claim number is required to file an acknowledgement of service (and Dory Acquisitions first provided this claim number after the deadline for acknowledgement of service had passed). However, this is a bad point in my view. The Guarantor had been served with the Response Pack. Waterson Hicks would have been well aware of the need to acknowledge service and would have been able to obtain the reference from the court CE filing system, within if not a matter of seconds certainly within a matter of minutes, by searching for either of the parties' names or they could of course have simply requested the claim number from Dory Acquisitions' solicitors. They did not take either action, instead allowing time for the acknowledgement of service to elapse. This cannot, in my view, have been other than a conscious decision.
(3) The manner in which the Guarantor has conducted its response to the Application also shows that it has not suffered any prejudice as a result of the defective service:
(a) the Guarantor initially took no point on service and indeed corresponded as if the claim had been validly served, and only took the point two months later and only about a week before Dory Acquisitions' application was due to be heard.
(b) whilst the Guarantor subsequently stated in correspondence that service had not been validly effected, he took no step to acknowledge service. Once he knew the claim reference number, he did not contest the jurisdiction and he did not put in any evidence either in furtherance of a jurisdictional challenge nor in opposition to the Application for summary judgment.
(c) yet further, even when put on notice of the application to be made under CPR rule 3.10 the Guarantor neither put in evidence in opposition nor any skeleton argument nor attended today.
(4) In such circumstances I am satisfied that the Guarantor suffered no prejudice as a result of the claim form with which he was served not being sealed nor in not being provided with the claim reference number.
C. Permission to apply for summary judgment
D Application for summary judgment
"The court may give summary judgment against a claimant or a defendant on the whole of a claim or on a particular issue if -
"(a) it considers that"(i) the claimant has no real prospect of succeeding on the claim or issue ... and"(b) there is no other compelling reason why the case or issue should be disposed of at a trial."
"(1) The Court must consider whether the defendant has a 'realistic' as opposed to a 'fanciful' prospect of success, see Swain v Hillman [2001] 2 All ER 91 , 92. A claim is 'fanciful' if it is entirely without substance, see Lord Hope in Three Rivers District Council v Bank of England [2001] UKHL 16 at [95].
(2) A 'realistic' prospect of success is one that carries some degree of conviction and not one that is merely arguable, see ED & F Man Liquid Products v. Patel [2003] EWCA Civ 472.
(3) The court must avoid conducting a 'mini-trial' without disclosure and oral evidence: Swain v Hillman (above) at p.95. As Lord Hope observed in the Three Rivers case, the object of the rule is to deal with cases that are not fit for trial at all.
(4) This does not mean that the Court must take everything that a party says in his witness statement at face value and without analysis. In some cases it may be clear that there is no real substance in factual assertions which are made, particularly if they are contradicted by contemporaneous documents, see ED & F Man Liquid Products v. Patel (above) at [10]. Contemporary activity or lack of activity may similarly cast doubt on the substance of factual assertions.
(5) However, the Court should avoid being drawn into an attempt to resolve those conflicts of fact which are normally resolved by a trial process, see Doncaster Pharmaceuticals Group Ltd v. Bolton Pharmaceutical Co 100 Ltd [2006] EWCA Civ 661, Mummery LJ at [17].
(6) In reaching its conclusion, the court must take into account not only the evidence actually placed before it on the application for summary judgment, but the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No. 5) [2001] EWCA Civ 550, [19] ....
(8) Some disputes on the law or the construction of a document are suitable for summary determination, since (if it is bad in law) the sooner it is determined the better, see the Easyair case. On the other hand the Court should heed the warning of Lord Collins in AK Investment CJSC v Kyrgyz Mobil Tel Ltd [2012] 1 WLR 1804 at [84] that it may not be appropriate to decide difficult questions of law on an interlocutory application where the facts may determine how those legal issues will present themselves for determination and/or the legal issues are in an area that requires detailed argument and mature consideration, see also at [116].
(9) The overall burden of proof remains on the claimant,
…to establish, if it can, the negative proposition that the defendant has no real prospect of success (in the sense mentioned above) and that there is no other reason for a trial, see Henderson J in Apovodedo v Collins [2008] EWHC 775 (Ch), at [32].
(10) So far as Part 24,2(b) is concerned, there will be a compelling reason for trial where 'there are circumstances that ought to be investigated', see Miles v Bull [1969] 1 QB 258 at 266A…."
(1) The Borrowers owed US$154,095,471.50 as unpaid principal and interest as at 13 November 2019.
(a) I am satisfied that the Borrowers failed to pay principal and interest due under the Loan Agreement from September 2018 onwards.
(i) In this regard the Borrowers failed to make principal and interest payments due under Tranche A on 17 September 2018, 17 December 2018, 18 March 2019 and 17 June 2019. The payments which were then due amounted to $1.2 million in principal and US$2,160,684.09 in interest. This was, I am satisfied, clearly in breach of Clauses 6.01 and 7 of the Loan Agreement.(ii) I am satisfied that the Borrowers failed to make the first Balloon Payment of Tranche B which was due on 18 June 2019 in the amount of US$3 million and failed to make interest payments due under Tranche B on 17 December 2018, 18 March 2019 and 17 June 2019 in the sum of US$2,830,705.10. This was clearly in breach of Clauses 6.01 and 7 of the Loan Agreement.
(b) I am satisfied that the Borrowers' breaches set out above each constituted an "Event in Default" under Clause 10.01(a) of the Loan Agreement. The Bank was therefore entitled to accelerate the loan with all amounts due under the Loan Agreement becoming immediately due and payable by the Borrowers.
(c) The Bank did exercise, I am satisfied, its rights under Clause 10.01(a) to accelerate the loan by sending a demand and notice of acceleration to the Borrowers on 6 September 2019.
(2) The Claimant claims that it is owed US$48,274 in expenses incurred to date pursuant to Clause 15.02 and 15.03 of the Loan Agreement. In relation to that, and whilst there is a right under Clauses 15.02 and 15.03 to claim expenses, I put to Mr Bloch that the material before this court did not descend to particularity as to what those expenses were, nor indeed did Mr Feldman depose that those expenses were approved and were due and owing. In those circumstances I am not satisfied for the purpose of the Application today that a claim for summary judgment in respect of those expenses have been made out. However, given the possibility that it may be possible for the Claimant to prove those expenses and to prove why they are due under Clause 15.02 and 15.03 of the Loan Agreement, rather than dismissing that aspect of the summary judgment application I will simply adjourn it at this point.
(3) I am satisfied in relation to the principal sums claimed that pursuant to Clause 2.01 of the Guarantee the sums due from the Borrowers under the Loan Agreement as earlier set out became due and payable by the Guarantor as primary obligor and debtor.
(4) Furthermore I note, which I regard as significant, that the Guarantor has not disputed any of the matters I have identified above in the course of the correspondence in relation to the Application, and of course has not attended today to dispute any of those points which are advanced on behalf of the Claimant and which I am satisfied have been demonstrated by the Claimant to the requisite standard on the Application before me today.
(1) As a matter of Irish law I am satisfied that the narrow circumstances in which the Irish Banking Act requires a person to obtain a banking licence do not apply to Dory Acquisitions for the reasons which are set out in the witness statement of Gregory Feldman:
(a) I am satisfied the Irish Banking Act only requires a person to obtain a banking licence where they are:
(i) carry on "banking business" this includes -- receiving money on their own account from members of the public or granting credits on their own account. Dory Acquisitions on the evidence before me does not carry out either of those functions.(ii) holding out or representing themselves as a banker or as carrying on banking business. Pursuant to section 7.2 of the Irish Banking Act a corporate body is deemed to hold itself out as a banker if its name includes the word "bank" or variance thereof or if it holds itself out or represents itself as conducting or being willing to conduct banking business. I am satisfied that Dory Acquisitions meets neither criterion.(iii) accepting deposits or other repayable funds from the public. Again, on the evidence before me Dory Acquisitions does not accept such monies.
(2) The argument is, I am satisfied, one which was vague and unparticularised. It was also made in correspondence rather than being carried through by way of any evidence or any skeleton argument or any submission at the hearing today. Certainly, it is not supported by any witness evidence such as might have been served in opposition to this Application.
