Property firm told to repay INBS €78m

IRISH Nationwide Building Society has secured a €78 million summary judgment order against Aifca, a company controlled by property developer Liam Carroll, over unpaid loans.

The loans relate to the proposed development of The Square Shopping Centre in Tallaght.

Mr Justice Peter Kelly granted the judgment order against Aifca and adjourned to July 29 the society’s application for a €60m summary judgment order against Mr Carroll personally, arising from a September 2006 guarantee by him and others over the loans to Aifca.

Aifca was a company of developers Thomas McFeely and Larry O’Mahony which bought the Lowe Taverns licence required for any development of The Square in Tallaght. Mr Carroll later acquired a controlling interest in Aifca. The proposed development of The Square has not proceeded.

INBS’s proceedings against Mr Carroll and Aifca, Upper Mount Street, Dublin, were admitted to the Commercial Court last month.

On the basis of guarantees of September 28, 2006, by Mr Carroll, Mr McFeely and Mr O’Mahony, INBS claims it granted a term loan facility to Aifca for €66.5m and some €78.6m was owed by Aifca under that facility.

It claims the guarantee was for liabilities of a maximum €60m.

INBS claims the repayment of the loan facility was to be made on demand or within the two-year period of the loan. Mr Justice Kelly was told, while Mr O’Mahony and Mr McFeely also executed the guarantee over the borrowings of Aifca, INBS has not to date brought summary judgment proceedings against them but only against Mr Carroll and Aifca.

The judge ruled the society was entitled to summary judgment against Aifca on grounds no arguable defence had been made out to that claim.

Meanwhile, a number of companies associated with Mr Carroll have been given permission by the High Court to advertise they will be seeking court protection.

The application was made by Bill Shipsey SC on behalf of Vantive Holdings, which, along with Jersey-registered Morston Investments, is the parent company of around 50 firms colloquially known as Zoe Developments, the court heard.

Four companies within the group – Villeer Developments, Peytor Developments, Caragh Enterprises and Parlez International – are facing demands from ACC for the repayment of €130m in loans. Mr Shipsey told Mr Justice Frank Clarke they would be seeking to have an interim examiner appointed to those firms so a scheme of survival could be developed.

The court heard the Zoe group has substantial borrowings from banks in the order of €1.1 billion. AIB was the largest lender, accounting for 40%, followed by Bank of Scotland Ireland, 23.8%, ACC, 10.7%, Bank of Ireland 9.3%, Ulster Bank, 6.7%, Anglo Irish 3.1%, and a number of smaller institutions.

While other banks with links to the four companies involved in this matter had come to agreements over restructuring debts, ACC had issued letters of demand which expire tomorrow and which meant the bank could apply to appoint a receiver “within hours”, Mr Shipsey said.

This application was to prevent ACC taking such action until an examiner is appointed, counsel said.

Under the survival scheme, it was proposed that interest payments to secured creditors, including ACC, be deferred until a business plan is put in place to sell off developments.

Mr Justice Clarke ordered advertisements of the petition to appoint an interim examiner be placed in newspapers. He made the matter returnable to July 29.