Bank secures €7.5m judgment against builder

Bank of Scotland has secured judgment of more than €7.5m against Jersey-based builder David Kennedy over personal guarantees of loans advanced to a number of building companies.

Mr Justice Brian McGovern yesterday ruled the bank was entitled to summary judgment of €7.5m and interest against the builder who, he said, had failed to present an arguable defence to the bank’s demand for judgment.

The companies for which he signed guarantees are Davitt Road Developments, Rimley Ltd, Eirmur Ltd and Florence Investment Properties Ltd.

The loans were advanced in 2006 and 2007 and after the companies failed to repay them, letters demanding he meet the guarantees had been issued in March of this year.

Mr Kennedy opposed the bank’s application for summary judgment.

He said that he had a defence to their claim, and that the dispute should be determined at a full hearing of the Commercial Court.

He claimed he reached an agreement with Bank of Scotland in 2012 that the bank would not seek to recover the monies guaranteed by the builder if he did his best to pay the unrelated borrowings of two other companies.

The bank said while discussions had taken place it argued no agreement was reached with Kennedy in respect of the release of the guarantees.

Mr Justice McGovern said there was no fair or reasonable probability of Mr Kennedy establishing a real or bona fide defence to the banks claim at a full trial.

The judge agreed to put a stay on the judgment until Sept 30 to allow both parties consider his ruling.

In July, Mr Kennedy consented to judgment of €8m against him in favour of the bank and a stay on that order was also placed until Sept 30.

That action arose from an alleged limited guarantee of €8m given by Mr Kennedy in respect of €260m loans advanced to Clancy Quay Properties Ltd, a company he was involved in.

Clancy Quay Properties Ltd paid €25m for the 13.5 acre site of the 19th-century Clancy Barracks site at Inchicore, Dublin, and borrowed the remainder to develop the site from Bank of Scotland (Ireland) and National Irish Bank.

A development of some 420 apartments on the site was completed