AIB secures judgment for €43m against developer

AIB HAS secured summary judgment for more than €43 million against developer Dermot O’Rourke over unpaid loans and guarantees mostly related to the acquisition of properties here and in Britain.

A four-week stay on the orders was agreed to by the bank which, the court heard, is in negotiations with Mr O’Rourke.

The bank’s application for summary judgment for about €517,000 against the developer’s wife, Perle O’Rourke, over a loan to the couple to finance an investment in the European Hotel Group was refused by Ms Justice Mary Finlay Geoghegan yesterday after she ruled Mrs O’Rouke had made out an arguable defence to that claim, entitling her to a full hearing.

The judge said Mrs O’Rourke had raised arguable issues as to whether a loan facility of March 2009 – which Mrs O’Rourke said had not read before signing – accurately recorded the arrangements entered into between the bank and Mr O’Rourke.

Jennifer O’Connell, for Mrs O’Rourke, said her client was a director of several of her husband’s companies and frequently was asked to sign documents related to matters in which she was not involved.

AIB earlier this year brought proceedings against Mr O’Rourke and his wife; Reldon Ltd, a company of which he is a director; and the Keredern partnership, of which he was a general partner before he resigned in May 2010. All have addresses at Keredern House Stud, Naas.

The bank’s claim against Mr O’Rourke, Reldon and the partnership relate to various loans and guarantees, mostly advanced to buy properties here and in Britain.

Mr O’Rourke was neither consenting to nor opposing the application for summary judgment, his counsel Ronan Murphy SC told the court yesterday.

Mr O’Rourke was troubled by the “enthusiasm with which judgment” was sought by the bank, counsel added. There were talks underway with the bank, and his client wanted a stay on the judgment order.

Denis McDonald SC, for the bank, said it would agree to a four week stay with liberty to apply if there was any material adverse change in circumstances.

In those circumstances, judgment for some £22.7 million sterling (€26.2 million) and for €17.3 million was entered against Mr O’Rourke.

She also granted judgment for some £19.6 million and €10.6 million against Reldon and the Keredern partnership.

A stay on those orders applies for four weeks.

Bank of Scotland Ireland, now Bank of Scotland plc, previously secured €16.5 million judgment against Mr O’Rourke and initiated bankruptcy proceedings against him last summer.

Mr O’Rourke had, in 2006, along with developer Gerry Conlan, sold 400 acres associated with the Millennium Park business park in Naas, Co Kildare for €320 million.

Mr O’Rourke had argued, in court documents, that he was prepared to approach his indebtedness in a realistic fashion.

He owed monies to Bank of Scotland, AIB and Ulster Bank “arising out of business dealings in which difficulties commenced in late 2008 due to the economic downturn”.

Mr O’Rourke said he has significant assets which he is realising to meet his obligations and his advisers had told AIB last May it was in the best position of his creditors as its exposure was secured on “top-quality” assets producing some €5.45 million in income annually.

Mr O’Rourke said he had sought to sell property assets in the UK, including the “Barclays portfolio” of High Street properties bought for £27.6 million, but AIB had appointed a receiver over those.

The bank was not marketing the properties but was instead taking the rent while Savills UK had valued that portfolio at £21.6 million.

Some UK properties had been sold and net proceeds of £4.1 million were on deposit with AIB, he added.