The future of the O’Briens Sandwich Bars outlets remains uncertain today following refusal of the High Court to allow the troubled company tear up the leasehold contracts it entered with landlords.
Mr Justice Sean Ryan had been told that Abrakebabra Investments Limited (AIL) was prepared to pump money into O'Briens in a proposed takeover of the company's business in the Republic.
But the Graeme Beere and Denis Desmond-backed AIL had stipulated the proposed investment deal would collapse by close of business today unless the company obtained High Court approval to breach its lease contracts.
O'Briens Sandwich Bars Ltd leased restaurant premises from landlords and then sub-let them to its franchisees, who own the individual business. It was these direct company commitments to landlords that AIL wished to have scrapped before investing in the company.
Martin Hayden SC, counsel for 53 of 61 franchisees, had told the court over a two-day hearing that the majority of outlets did not back the proposed AIL takeover. While some of the franchisees and landlords had consented to new leases which released the company from its middleman relationship, his clients were firmly against such deals.
Mr Hayden said his clients represented more than 450 employees and they believed they would be better off if O'Briens went into liquidation.
Mr Justice Ryan, in a reserved judgment in more than 40 company applications, refused to allow O'Briens repudiate its leases so that franchisees could be substituted in direct tenancies with landlords.
He said it was his view that Section 20 of the Companies Amendment Act 1990, which governed repudiation of leases, did not permit the wholesale repudiation of more than 40 leases.
Bill Shipsey, SC, counsel for O'Briens, had told the court that O'Briens had been granted protection of the court since July and Examiner Paul Mc Cann believed the repudiation of leases, as demanded by the investor he had secured, would allow him
save the company.