NIB seeks ruling on €37m in loans for Dublin project

NATIONAL IRISH Bank has asked the High Court to rule that Durkan New Homes, two of its directors and another company are all liable for loans of some €37 million provided by the bank in relation to a development at Cabinteely, Co Dublin.

Mr Justice Peter Charleton has reserved to June 26th his judgment on NIB’s proceedings against Durkan New Homes, its directors Don and Marian Casey and Tullycross Developments Ltd.

The bank claims the effect of cross-guarantees means all four defendants each have a liability for the €37 million sum, but this claim is disputed. The defendants contend the bank’s claim is limited to securities on certain properties specified in loan agreements.

NIB claims payment was sought on foot of the cross-guarantees on February 24th last, and should have been made within a month of that date.

The bank alleges that some €37.1 million is due under two separate but related loan agreements of March 2006.

It claims one loan agreement related to DNH, with offices at Ranelagh, Dublin, and to Don and Marian Casey, of Woodbrook, Beech Park, Cabinteely (the DNH agreement), while the second agreement related to Tullycross, with a registered office care of O’Donnell Sweeney Solicitors, Earlsfort Terrace, Dublin.

NIB claims the loan facilities were provided to refinance and further finance a development at Beech Park, Cabinteely. It also claims DNH and Don and Marian Casey executed a guarantee and indemnity relating to obligations of Tullycross to the bank, while Tullycross executed a similar guarantee relating to the obligations of the other parties.

Under the DNH agreement, it was claimed Don and Marian Casey executed two mortgages providing for co-ownership between the bank, on one side, and DNH and the Caseys on the other, of various properties at Beech Park/Bray Road, Cabinteely. NIB claims Tullycross also executed two similar co-ownership mortgages.

The bank claims the loan agreements provided, during the term of the loans, that the defendants’ debts to the bank would not exceed 70 per cent of the combined value of identified properties, in which circumstances the bank’s recourse against the defendants would be limited to the respective interests in the properties specified.

It is claimed the repayment date under each of the loan agreements was September 30th last when, it is alleged, the defendants paid only the interest due and not the “bullet payment” of capital due.

The bank also alleges the defendants’ debts to the bank under the loan agreements had, by late September, exceeded 70 per cent of the combined value of the properties specified in the agreements.