Bank secures €214m Mansfield order

Bank of Scotland has secured €214 million summary judgment orders against hotelier Jim Mansfield arising from his personal guarantees of debts of various companies of his.

Mr Justice Peter Kelly ruled today Mr Mansfield had made out no arguable defence to the bank's claim and entered summary judgment for €214,122,346 in favour of the bank.

Cian Ferriter SC, for the bank, opposed an application by Patrick Leonard, for Mr Mansfield, for a stay on the judgment order.

The National Assets Management Agency (Nama) had previously secured a judgment for €74 million against Mr Mansfield and the bank's demands for repayment dated back to July 2010, counsel said.

In the circumstances, Mr Justice Kelly said he would not grant a stay.

In his reserved judgment, the judge ruled Mr Mansfield had no arguable defence on grounds including the bank's failure to honour an alleged 2008 agreement by the bank to loan more money to complete the Citywest convention centre lead to the collapse of the Mansfield group.

The judge said the nature of the alleged agreement to loan sums of between €17m and €20m was so vague it could not give rise to any binding obligation. There was no specified sum of money involved, no terms were specified, the beneficiary was not identified and the issue of security was not addressed, he said.

It had been said by the defence side the identity of the alleged contracting party was HSS, a company of which Mr Mansfield is a director, which meant only HSS could bring a counter-claim to the bank's claim for judgment, the judge said.

However, correspondence showed HSS had written to the bank in 2009 seeking €5m funds for completion of the convention centre at Citywest and this was inconsistent with the alleged contractual obligation to loan €17m to €20 m.

On foot of those and other findings, Mr Mansfield had failed to make out a defence entitling him to a full plenary hearing, the judge ruled.

The claim arose from loans provided by BOS to HSS, Jeffel and Park Associates Ltd - companies of which Mr Mansfield is a director - for purchase of lands and development of a conference centre, offices, a golf course, residential units and a hotel. BOS appointed a receiver to HSS in July last year.

Among various claims, Mr Mansfield has alleged business was conducted between him and BOS via verbal agreements on funding with the "paperwork" put in place later.

During the hearing of the summary judgment application last month, Mr Justice Kelly said his experience of bank managers "of old" was they had looked for the "three C's" when considering whether to make loans - capital, collateral and character - to ensure a borrower had funds and could be trusted.

"If they stuck with that, this country might not be in the position it is now," he said.

The bank had rejected the claims by Mr Mansfield there was some form of legal contract with it for funding of the convention centre arising from an encounter with Mark Duffy, then head of Bank of Scotland Ireland in the bank's car park at St Stephen's Green, Dublin, in August 2008.

Mr Mansfield and his son James said in affidavits Mr Duffy had told them they could go ahead with building the convention centre as the bank would fund it but BOS argued it was always the case any funding proposal would have to secure approval through the bank's formal processes and this was not forthcoming.

Nama last month secured €74m summary judgment orders arising from Mr Mansfield's guarantees over loans made by Irish Nationwide Building Society to two companies

Mr Mansfield, Tasaggart House, Saggart, Co Dublin, was not in court today. Medical reports have stated he suffers from a number of medical conditions, the most serious being multiple system atrophy.