Two brothers, their father, and three companies have failed to get an injunction preventing a fund appointing a receiver over 56 commercial and residential investment properties.
Niall and Robert Howard, their father PJ Howard, and the companies, claim the appointment of a receiver by Everyday Finance DAC is in breach of terms of an amended settlement agreement made by them with AIB plc and AIB Mortgage Bank before their loans were sold to Everyday.
On Friday, Mr Justice Michael Quinn refused an injunction on the basis they had not established a fair bona fide question to be tried as to the existence of that amended agreement.
Last November, the Howards, all with an address at Ballybeg House, Kildysart Road, Ennis, Co Clare, and three companies – Downes and Howard Ltd, Waymill Ltd and Lapovoa Ltd, all with registered offices at Westgate Business Park, Ennis – had proceedings against Everyday entered into the Commercial Court.
They claimed they were meeting their obligations but Everyday was refusing to release the relevant security.
Between 2003 and 2013, they had borrowed from the AIB banks to part finance the purchase and construction of the 56 properties located in Cork, Limerick, Ennis, Kilkee, Nenagh, Tipperary and Tullamore.
Those loan facilities were amended and replaced from time to time. In February 2016, a deed of settlement between them and AIB was worked out whereby the banks agreed to accept in full and final settlement of all the loans then due the amount of €9.8 million, provided it was paid by June 30th 2016, Mr Justice Quinn said.
The judge noted there had been no evidence as to the total amount due at the time of the settlement but the court heard the balance at the time of the injunction application was €25 million.
Among the conditions of the settlement were that certain payments had to be made.
The June 30th, 2016 repayment date was extended. The plaintiffs claimed a June 2017 extension amending the settlement agreement was agreed to the effect the date would be extended indefinitely provided they continue making monthly payments. It was not contended this variation was made in writing, the judge said.
The Howards and their companies say they are now willing and able to implement the settlement and Everyday cannot rely on the letters of demand for repayment and appoint receivers.
They said they had secured alternative financing in August 2019.
Letters of demand
In June 2019, Everyday had acquired their loans and the following November letters of demand for the immediate repayment of €22.8 million, the amount outstanding at that time, were issued. The plaintiffs were also told Everyday did not accept it had to honour the amended settlement agreement providing for the repayment of just €9.8 million as it had expired.
The plaintiffs then brought the Commercial Court proceedings seeking, among other things, that Everyday honour the agreement with AIB.
In February 2020, Everyday appointed receiver Ken Fennell of Deloitte over the properties.
The Howards and their companies then sought an injunction restraining the receiver’s appointment.
Refusing the injunction, Mr Justice Quinn concluded the plaintiffs failed to establish there was a fair issue to be tried. He was also not persuaded Everyday can be compensated in damages for the loss it would suffer if it succeeds in the main action.
