Further orders of €1.6m agreed

FIANNA FÁIL Senator Francis O’Brien and two Co Monaghan developers have consented before the Commercial Court to further judgment orders of €1.6 million each against them, increasing to €13.6 million the total judgments against them arising from unpaid loans for development lands.

The loans were for development lands at Swellan Upper and Lower, Co Cavan, now valued at about €3.7 million. Ulster Bank previously secured judgment in the same €13.6 million sum on consent against former Irish Nationwide Building Society chairman Michael Fingleton over the same loans.

The case arose from a €13.2 million loan advanced in 2006 to the four to purchase a 50-acre site at Swellan Upper and Lower, Farnham Road, Cavan.

Ulster Bank agreed in June 2008 to increase the loan facility to provide for an interest roll-up. Last June a demand for repayment of €13.5 million was served. The court heard negotiations between Mr Fingleton and the bank had continued for some time.

The bank said that while interest repayments were made, a number of events, including net worth statements received from the defendants last March, triggered its decision to demand repayment.

The bank said it was especially concerned about the position of Mr Fingleton.

A statement of affairs for Senator Francis O’Brien provided to the bank showed a €12.8 million deficit in liabilities over assets. His assets were given as €430,000 while his liabilities amounted to €13.3 million, the vast bulk of that sum being described as “development property borrowings”.

Mr O’Brien, Latton, Castleblayney, and the two developers, Noel Mulligan, Moyles, Castleshane, and Charles McGuinness, Tully House, Monaghan, had on November 2nd consented to summary judgment orders for €12 million against them but disputed the bank’s claim a further €1.6 million was owing.

When the issue of the €1.6 million came before Mr Justice Peter Kelly yesterday, he was told the three were now consenting to €1.6 million summary judgment and he made orders against each of them. He awarded costs to the bank.

The judge had described on November 2nd as “extraordinary” Mr Fingleton’s failure to include his €27 million pension in the list of assets and liabilities given by him to Ulster Bank in his hand-written statement of affairs. The pension “eclipsed” all Mr Fingleton’s other assets – which totalled more than €10 million.

Mr Fingleton’s counsel said it was a “genuine error” and there was no intention to mislead; the pension details were in the public domain.

Mr Fingleton did not oppose the €13.6 million summary judgment application but his lawyers raised issues about defects in the bank’s documents and the manner in which it granted the loan facility. The bank appeared to have relied on its perception of Mr Fingleton’s worth from media reports, it was stated.

Ulster Bank said it became concerned about the Swellan loans after receiving a statement of affairs from Mr Fingleton which contained no reference to his pension. The bank was also concerned at an assignment of Mr Fingleton’s interest in his family home (valued at €3 million) in Shankill, Co Dublin, to his wife.

Mr Fingleton was not a client when the money was loaned and the bank had not sought net worth statements from the four until some years after the loan was issued, the court has heard.