Lynch family sues AIB and solicitors over loan deal

WELL-KNOWN businessman Philip Lynch, his wife Eileen and their four children are suing AIB and two firms of solicitors in a bid to stop the bank pursuing them individually over unpaid loans of €25.3 million advanced to buy lands in Waterford for development.

A process leading to AIB’s deletion in its loan facility letter of a clause concerning the nature of the bank’s recourse for the €25.3m loan raised the “most profound questions” about the ethics of AIB’s behaviour, Michael McDowell, counsel for the family, said yesterday.

Mr McDowell also argued that, between two law firms, LK Shields Solicitors, then acting for the Lynchs, and Matheson Ormsby Prentice Solicitors, representing Gerard Conlan, the Lynchs were collectively led to believe on February 8, 2007, they were signing up to a borrowing regime which would involve AIB having recourse only to the Waterford lands.

He said AIB, without telling the Lynchs and “never signalling what it was up to,” decided to remove a clause from the loan facility letter just hours before it was signed on February 8, 2007, by Judith Whelan, daughter of Mr Lynch.

The bank deleted a clause confining recourse to Mr Lynch and Mr Conlan “with the intention of widening its recourse to everyone but without telling anyone,” he said. The family were induced into accepting revised loan facility documents which, although silent on the matter, did not exempt them from liability, he said.

As a result of that deletion, AIB was claiming it has recourse to all six members of the family for €25.3m.

Mr McDowell said the Lynch family always understood AIB’s recourse would be confined to the Waterford lands.

Mr McDowell was opening the action by the family against AIB, LK Shields and MOPS aimed at preventing AIB securing €25.3m judgment orders against them.

The case is before Mr Justice Michael Peart at the Commercial Court.

The plaintiffs are Philip and Eileen Lynch, Athgarvan Lodge, The Curragh, Co Kildare, their daughters Judith Whelan, Leinster Wood, Carton Demesne, Maynooth, Co Kildare; Therese Lynch, Ardoyne House, Pembroke Park, Dublin 4, Philippa Lynch, of Burlington Gardens, Burlington Road, Dublin 4, and their son, Paul Lynch, Oakley Road, Ranelagh, Dublin 6.

Separate but related proceedings by AIB seeking €25.3m judgment against Gerard Conlan, Bridalwood House, Naas, Co Kildare, will be heard later.