Anglo tries to recoup €26m in loans from insolvent businessman

ANGLO Irish Bank is seeking judgment orders for €26 million arising from personal loans made to insolvent well-known businessman Brendan Murtagh, whose total liabilities are estimated at €353m.

A solicitor for Mr Murtagh told Mr Justice Peter Kelly yesterday it would make more sense for all, including the taxpayer, if state-owned Anglo waited until December to make its claim as the sum due was likely to be increased then by an additional €6m arising from a potential Capital Gains Tax liability.

It was a “first” for a defendant to argue a bank was understating its claim, the judge remarked.

Mr Murtagh’s solicitors said the court was “painfully aware” of Mr Murtagh’s position in relation to his resources and the bank would not be prejudiced if the matter was adjourned so as to avoid two separate applications being brought.

Counsel for Anglo said it was true there was a potential €6m CGT liability but the bank’s concern was to protect its position.

In its claim, Anglo is seeking repayment of €23.4m and stg£2.1m personal loans made to Mr Murtagh between 1999 and 2009 for commercial dealings in shares and properties.

The bank said it had given Mr Murtagh time to restructure his interests in the hope he might be able to deal fully with the liability but no repayments had been made since March last when the bank also began receiving correspondence about other proceedings by private investors against Mr Murtagh.

It became apparent the prospect of his being able to deal with Anglo’s loans had receded in the context of his other financial difficulties.

Mr Justice Kelly noted he had, in the recent separate proceedings where investors are pursuing Mr Murtagh, Dunheeda, Kingscourt, Cavan, for €28m made orders for the sale of shares held by Mr Murtagh in Kingspan and other companies to part satisfy the investors’ claim.

Those proceedings were brought by Loparco SA arising from unpaid loans linked to Polish property deals.

The company in January secured judgment for €28.1m against Mr Murtagh, Greg Coughlan, Fastnet, Ardbrack, Kinsale, and Brian Madden, Well Road, Douglas, Cork.

Loparco is a Luxembourg registered firm through which investors provided €20m for the Polish deals, to be managed by Howard Holdings property group.

The judge had later given Mr Murtagh an opportunity to renew a previous application by him for living expenses before making the order for the sale of his shares. When Mr Murtagh did not bring a fresh application, the court made the sale order. That appeared to be “the end of the road” as far as Mr Murtagh’s assets were concerned, the judge remarked.

In those circumstances, Anglo would not be prejudiced by giving Mr Murtagh a two-week adjournment to put matters on affidavit relating to the liability in this case, he said.

Last April, Mr Justice Kelly rejected Mr Murtagh’s application to retain shares and a pension fund valued at up to €1.2m towards “living expenses”.

He noted Mr Murtagh, 64, purchaser of Smart Telecom, once had an estimated net worth of €271m but now had liabilities of €353m, including “colossal” sums owed to Anglo.

He found it hard to see how Mr Murtagh would need to keep assets valued at between €700,000 and €1.2m for “reasonable” living expenses in the way that term is understood by ordinary people, the judge said. He also noted the €28m Loparco debt was only part of Mr Murtagh’s “sorry tale” as total judgment orders of more than €60m had been obtained against him.