Appointing receiver could lead to closure of electronics firm

A businessman has sued in an effort to prevent a financial fund appointing a receiver over a premises from which his business operates, employing 30 people.

Paul McKenny claims the fund's actions could lead to him having to close his electronics installation business, Electroplus Cable & Satellite Ltd, of Western Industrial Estate, Naas Road, Dublin.

His proceedings are against Promontoria (Aran) Limited and an insolvency practitioner, Ken Fennell, of Deloitte.

Mr McKenny seeks various orders, including one preventing Mr Fennell acting as receiver of the Naas Road premises, which is leased to Electroplus.

Hugh O’Flaherty, for Mr McKenny, argued that the receiver’s appointment was invalid because the parties entered an agreement last year in respect of a loan taken out by Mr McKenny with Ulster Bank. The loan, acquired by the fund in 2014, was to assist with the purchase of a commercial business in 2006 and fell into arrears.

Following discussions, Mr McKenny claims he agreed with Promontoria in May 2016 that he would make repayments totalling €175,000 and would appoint a sales agent to sell two commercial properties, including the one where Electroplus is located. His intention was either to buy out that premises or come to an arrangement with the ultimate purchaser, he says.

He said Promontoria claimed in August 2016 that he had breached the agreement by delaying the appointment of a sales agent. Mr McKenny denied that claim.

Promontoria then made a demand for €2.3 million that is allegedly owed and also proceeded to appoint as receiver Mr Fennell, who intends to sell the building, he claims.

Mr O’Flaherty said his client’s case is that Promontoria had no authority to appoint Mr Fennell.

Mr McKenny seeks a declaration that he has not breached the settlement agreement with Promontoria in May 2016.

Mr Justice Paul Gilligan granted counsel’s ex parte application (one side only represented) to serve short notice of the proceedings on both Promontoria and Mr Fennell. The matter will be returned to next week.