Supreme Court to rule next year in Fleming Group case

The Supreme Court will rule early next year on whether to approval a survival plan for three companies in the Fleming group.

The survival scheme was approved by Mr Justice Brian McGovern in the High Court in November.

However, Dutch-owned ACC, who opposed the scheme appealed the decision on the grounds it prejudices the bank's capability to recover the money its is owed by the Fleming Group.

The Cork-based group which has interests in construction has debts of some €1bn, including €269m to Anglo Irish Bank and €21.5m to ACC.

It also has liabilities to AIB, Bank of Ireland Scotland and hundred of unsecured creditors. With the exception of ACC, all are in favour of the scheme.

Counsel for ACC Paul Sreenan SC said the scheme is somewhat "artificial" and is effectively a receivership. Counsel said that the scheme was only brought into being because ACC would "not play ball with the other banks".

Lawyers of for the three firms, the companies examiner George Maloney and Anglo have rejected ACC's claims.

The parties further reject ACC's claims that the proposed ten year survival plan for the Fleming construction group contains no commitment of continuing financial support from its bank creditors and amounts to a "personalised Nama".

The appeal concluded today before the five-judge Supreme Court, comprised of the Chief Justice Mr John Murray, Ms Justice Susan Denham, Mr Justice Adrian Hardiman, Mr Justice Hugh Geoghegan and Mr Justice Nial Fennelly.

The Chief Justice said that the court would give judgment as expeditiously as possible, but given the issues raised it would not be possible to do so before the next legal term commences on January 11.

In his judgment Mr Justice McGovern said he believed the rescue proposals would turn around the fortunes of the three affected companies - John J Fleming Construction, JJ Fleming Holdings and Tivway - and preserve jobs. He also rejected ACC's argument the scheme would prejudice it.

It provides for a sale of the group's contracting arm and other assets to a new company, Donban, for €3.6m.

It also leaves secured bank creditors with effective control of Fleming's property development business, which has a number of connected sites in Sandyford, Co Dublin. The banks will have 10 years to realise their security. The plan also proposes paying unsecured creditors 25% of what they are owed.

The scheme was due to become effective last month but, because of the appeal, has is on hold until the Supreme Court's ruling is given.

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