NIB sues Noel Smyth for €9.6m over guarantees

SOLICITOR AND businessman Noel Smyth is being sued for €9.6 million in the Commercial Court over his guarantees of loans made to two companies.

Mr Justice Peter Kelly agreed yesterday to fast-track the action by Danske Bank, trading as National Irish Bank, against two companies – Monway and Fitzwilliam Finance Corporation – both with registered offices at Arkle Road, Sandyford, Dublin – and Mr Smyth, Lisieux Hall, Murphystown Road, Sandyford.

Denis McDonald SC, for the bank, said the case arose from facilities provided to the two companies.

Declan Murphy, for the defendants, said they were neutral on the application to transfer the case to the Commercial Court but wanted two weeks to file a defence to the bank’s application.

Mr Murphy said the defence would include claims that a bond was missold to Fitzwilliam Finance and would also be making set-off claims.

There were also issues concerning the nature of the guarantees.

Mr McDonald said he did not know what the claim of misselling involved but there was no misselling.

Mr Justice Kelly said he would allow time for the defendants to outline their defence on affidavit and would hear the summary judgment application next month.

The bank is seeking €8.3 million in summary judgment against Monway.

This arises from a loan approved in November 2005 to purchase a development site at Dún Laoghaire, Co Dublin, and a loan in 2007 to buy a premises at Tyrconnell Road, Inchicore, Dublin.

The security for that loan included a personal guarantee of Mr Smyth of liabilities of Monway up to a maximum €8.9 million, the bank claims.

The bank demanded repayment from Monway of the sums due last September and, when no repayment was made, it demanded repayment from Mr Smyth under his guarantee.

In its claim against Fitzwilliam Finance, the bank claims some €1.3 million is due and owing under a facility of June 2007 under which €5 million was advanced to provide finance for an investment by Monway in a bond.

That loan was to be repaid from the proceeds of the bond with any shortfall to be funded by Fitzilliam Finance, the bank claims.

Mr Smyth, NIB claims, executed a guarantee related to the Fitzwilliam facility subject to a limit of €1.36 million.

The bank also demanded repayment under that guarantee last September.

In those circumstances, National Irish Bank claims some €8.3 million is due and owing by Monway, some €1.31 million is due and owing by Fitzwilliam Finance and some €9.6 million is owed by Mr Smyth under the repayment guarantees.