We recently acted for a married couple seeking interlocking PIAs under section 115A(9) of the Personal Insolvency Act 2012. They had combined mortgage debt of over €600,000 with Pepper Finance DAC secured on their family home, valued at €385,000.
The arrangements proposed:
- A 24-month PIA,
- Mortgage written down to the market value of the home (with circa €218,000 treated as unsecured debt and written off),
- Mortgage term extended to 20 years,
- Repayments fixed at 3% for the first 2 years, and 4% variable thereafter, equating to approximately €2,500 per month.
Pepper Finance objected, arguing that the couple’s full means were not being applied and that the write-down was unfairly prejudicial. Judge O’Malley Costello in the Circuit Court disagreed, holding that the proposal was reasonable and sustainable, and that the creditor’s counterproposal would leave the debtors exposed to default in later years.
The objection was dismissed, and the PIAs were approved. (Decision under appeal to the High Court.)
This decision highlights that Courts will approve significant mortgage restructurings where proposals are balanced, sustainable, and demonstrably in the best long-term interests of both debtors and creditors.
This case note is based on a published judgment. It is provided for information purposes only and does not constitute legal advice.
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Anthony Joyce
Anthony founded Anthony Joyce & Co. Solicitors in March 2004 in the oldest part of Dublin known as the Liberties. He is focused on building the practice in certain niche areas of law such as financial litigation and personal insolvency. Entrepreneurship is in his blood and he is on the board of a number of start-ups. If Anthony is not available he could be watching a SpaceX rocket launch, spending time with his two children or playing 5-a-side.
