Friday, December 16, 2011

Patricia Quinn and Undue Influence

The Irish Times is reporting that the Commercial Court has just issued judgment rejecting Patricia Quinn's plea that she did not have to repay her loan eur.3 million loan to Anglo Irish Bank (now Irish Bank Resolution Corporation) because of undue influence. Justice Peter Kelly, correctly, ruled that "[t]he law since the middle of the 18th century allowed for no presumption of undue influence between a wife and husband, and there was also no actual evidence of undue influence by Mr Quinn over Mrs Quinn, such as bullying behaviour."

This is a relatively straightforward case and it is surprising that an undue influence argument was even advanced. The law has moved on considerably beyond patronising views about a married woman's contractual powers. It is necessary to show that the woman is under the dominion of her husband in order to succeed. In other words, a lot more than the mere fact of marriage is necessary for an undue influence presumption to arise. Further, even if dominion is shown, it is not the end of the inquiry. If the woman exercised independent judgement the transaction would stand. Quinn's claim seems to have been based on authority along the lines of Midland Bank v. Cornish, where there was clear evidence of the bank taking advantage of the wife. But there is no evidence of unfair advantage here and it beggars belief for a woman who serves as a director on a number of corporate boards, and who must be assumed to be reasonably sophisticated, to make such a claim.  

In sum, Justice Kelly got it absolutely right and it would be hard to see this judgment being overturned on appeal - at least on undue influence grounds.