Larkin brothers fail to halt transfer of €89m loans to third party

Companies controlled by brothers Michael and Richard Larkin have failed to get an injunction preventing Ulster Bank Ireland transferring some €89m of their companies loans to any third party.

Mr Justice David Keane also discharged an interim order granted last October restraining the loans transfer to any third party pending legal proceedings by the companies over alleged mis-selling of financial instruments.

Vieria Ltd, European Property Fund plc and Laurelmore Ltd sought to prevent the transfer pending a full hearing of their action over losses of some €30m allegedly suffered due to alleged mis-selling and misrepresentation of derivative instruments.

As a result of the bank’s alleged actions, it was claimed the companies were forced into selling two valuable properties at Belgrave Road and the Old Jewry in London.

Richard Larkin had alleged he was a 24-year-old college graudate with no experience in derivatives when Laurelmore entered into a 2008 derivative instrument concerning the Old Jewry and Vieria entered into a positive carry swap instrument.

In his judgment, Ms Justice Keane said it was not clear how Mr Larkin’s claims could assist either Vieria or Laurelmore in light of terms and conditions agreed by other directors on behalf of those companies. The underlying provisions of the relevant contract documents were that selection of any derivative instruments were the responsibility of the companies, he said.

He found the companies had failed to raise a bona fide or serious question to be tried concerning their allegations of deceit or fraud. They had also not made out a serious issue based on their claim of a right of set-off against any demand for repayment by the bank or another party on the basis of the allegations of mis-selling, he ruled.

The companies, he ruled, had failed to raise a serious question to be tried to the effect the bank had mis-sold the derivative instruments.