Developer consents to record €86m judgment

A DEVELOPER has consented to a record judgment of more than €86.5 million being entered against him over unpaid property loans of twice that amount made to his companies by Anglo Irish Bank.

The judgment order granted by Mr Justice Peter Kelly against Michael Daly yesterday is the largest ever entered against an individual at the Commercial Court.

In his defence, Mr Daly had claimed he was regarded by Anglo as a “favoured developer” in the mid-west region with “easy access” to senior figures in the bank, including Sean FitzPatrick and David Drumm. He claimed he was actively encouraged by Anglo in 2006 and 2007 to undertake massive property developments with the assurance hundreds of millions of euros would be made available.

His companies spent more than €300m on development projects here, plus more than €100m in projects in Germany, Mr Daly said. In 2006 and 2007, Anglo was anxious the group make additional investments in Germany and Mr Drumm made it clear funds of up to €500m were available, he alleged.

Mr Daly, of Dalmin, North Circular Road, Limerick, said he relied on oral assurances from Anglo executives that personal guarantees provided by him over loans were secondary to security taken by the bank and would never be relied upon. The bank however failed to take proper security and its handling of securities was “a shambles”, he said.

Anglo argued the claims about Mr Daly’s access to senior Anglo executives were not relevant and described as “incredible” his claims relating to Anglo’s approach to the guarantees.

Last year, the proceedings against Mr Daly were sent to a full plenary hearing after the court ruled he had made out an arguable defence.

The full hearing was listed for January 11 next but Anglo brought a preliminary motion seeking to strike out Mr Daly’s defence on grounds of failure to make discovery of documents.

That motion was due to be dealt with yesterday but Mr Justice Kelly was told by Brian Kennedy, for Anglo, that Mr Daly had emailed Anglo earlier indicating he was consenting to judgment in the sum sought.

Mr Daly confirmed he was consenting to judgment, plus costs and judgment in the sum of €86,543,769 was entered against him.

Anglo previously secured judgment orders against four solicitors arising from guarantees related to more than €165m in loans to companies and partnerships linked to the Fordmount property group.

Dermot O’Donovan, Michael Sherry and Aidan Frawley, all partners in the Limerick-based firm Dermot G O’Donovan & Partners, consented at the Commercial Court last month to judgment orders for €21.7m against each of them.

A fourth partner, Thomas Dalton, previously consented to summary judgment against him for €21.4m.