Ireland: Court Of Appeal: Financial Loss Claims Statute Barred

Cantrell & Ors v Allied Irish Banks Plc & Ors [2019] IECA 217 (18 July 2019)

The Court of Appeal has overturned a finding of the High Court in one of the so-called "pathway cases", setting the parameters for hundreds of investors seeking damages against AIB and a number of other defendants for losses made on their investments.

High Court

The appeals arose as a result of a decision of Mr. Justice Haughton in the High Court (delivered on 28 April 2017) on a preliminary issue as to when the time limitation periods started to run for claims arising from losses suffered by investors following their investment in certain "Belfry" property investment schemes (the "Belfry Funds").

A component of the investment included a loan whereby debt was acquired with a loan to value ("LTV") covenant which meant that if the property value fell below 80% of the purchase price of the assets, there would be an automatic default and crystallisation of the floating charge, entitling the lender to dispose of the assets. The investors, who claimed to have entered into the Belfry Funds on the basis of representations made in the investment prospectus and other marketing material, said that they received no notice of this covenant or its potential negative impact until they received a letter from the defendants in 2008 indicating that the property value had fallen below 80% of the purchase price and that an event of default had occurred. Ultimately, the investors lost all of their investments and commenced proceedings in 2014 seeking damages for breach of contract, negligence, breach of duty, negligent misstatement and misrepresentation.

The High Court held that the limitation period in relation to the breach of contract claims began on the date the investors entered into the contract which, as it was in excess of 6 years from the date of commencement of the proceedings, meant those claims were statute barred.

The remaining "claims in tort" were split into three categories by the Judge: (1) negligence simpliciter; (2) negligent misstatement/misrepresentation; and (3) negligence and breach of fiduciary duty/mis-management. In respect of (1) and (2) it was held that the 6 year limitation period only began to run when the actual damage occurred. That was found to be the date when the audited accounts demonstrating the actual loss in shareholder value were signed off by the directors. As that fell within the relevant limitation period, the claims were not statute barred.

Given the above findings, Mr. Justice Haughton found that it was unnecessary to determine whether the investors were entitled to rely on an allegation of fraud in relation to the alleged non-disclosure of the LTV covenants, which would have the effect of postponing any limitation periods.

Court of Appeal

The question to be determined by the Court of Appeal (Peart J., McGovern J. and Baker J.) was whether Mr. Justice Haughton erred in distinguishing between the different categories of investor claims (as they arose from the same set of facts) and in his overall finding that the investors were not statute barred in their claims of misrepresentation and negligent misstatement.

The Court found that the trial judge was incorrect in his conclusion that the damage was manifest only when the loss actually occurred and found instead that the LTV covenants, which gave rise to the ultimate loss of the investments, were present and capable of being discovered at the time of the original investment.

Furthermore, whilst Haughton J. was correct that the relevant question was when the damage was caused, the Court found that he was incorrect to conclude that this happened only when it showed in the accounts. Rather, "the cause of action accrues when the plaintiffs were in a worse position than they would otherwise have been", and this was sometime after the investments were initially made when the LTV covenants were entered into for the purposes of securing the borrowings. As this fell "well outside" of the relevant limitation period, the appealed claims were statute barred and it was not necessary for the Court to consider whether the trial judge was correct to distinguish between the different categories of claims.

As the trial judge had made no determination of fact regarding the allegation of fraud in relation to the claim of non-disclosure of the LTV covenants, which would have the effect of postponing any limitation periods, that matter has been returned for determination by the High Court.


This is a hugely significant case, not only because it sets the parameters for the other hundreds of claims arising from the Belfry Funds, but also because it highlights the circumstances and factors that a court should consider when determining if a claim for financial loss is statute barred. Of particular note is the reluctance expressed by the Court of Appeal to conclude that a time limitation should run before a plaintiff knew, or could have known, of the cause of action; and its reference to the fact that legislative provisions have been implemented to rectify this in the case of personal injury claims, but not for other types of damage including claims for financial loss.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions