Irish High Court finds debtor has no independent right to appeal Personal Insolvency Arrangement

The High Court has ruled that the review of a rejected proposed personal insolvency arrangement can only be applied for by a Personal Insolvency Practitioner. The ruling impedes debtors from seeking an appeal independently and has implications for hundreds of cases which stand adjourned pending clarification on the issue.

The case concerned the appeal of a debtor who’s PIA was rejected by his primary creditor, Bank of Ireland, who hold a security over his family home and are owed €720,000. Relying on the Personal Insolvency Act the Circuit Court dismissed the man’s appeal as according to Section 115(1) of the legislation only a Personal Insolvency Practitioner (PIP) has legal standing to apply for a review. Ms. Justice Marie Baker upheld the Circuit Court decision ruling as a preliminary issue that the High Court can only hear and decide an appeal that complies with statutory procedural rules. The judge rejected the argument that the PIP’s role is “merely procedural” finding that a debtor cannot engage the process without an intermediary who acts not only on their instructions but who must at all times seek to achieve resolution of the debt and devise a remedy that is “satisfactory to all parties concerned”.

Justice Baker acknowledged the “practical problems” the judgment may result in given the reluctance of PIPs to take appeals for fear of losing and facing cost orders. In an effort to counter-balance the effect of the ruling and to dispel the qualms of PIPs it was asserted that costs would only be awarded against a PIP in “exceptional circumstances”.

Click here for a copy of the judgement. For further commentary however please click here.

Click here for previous PILA features on judgments by Justice Baker in the area of personal insolvency.




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