Bank obtains broker ruling

A bank has obtained a €3.7m judgment against a former partner in the liquidated Bloxham stockbroking firm.

Danske Bank secured the judgement against Patrick Finnegan, former partner and head of private clients in Bloxham arising from his personal guarantee of liabilities of his company, PTF Securities.

Those liabilities arose from a restructuring arrangement whereby the partners in Bloxham were each asked to set up individual companies to purchase an equity stake in the firm, John Donnelly, for the bank, outlined to the High Court.

Mr Finnegan’s company was PTF Securities and it secured a loan, personally guaranteed by Mr Finnegan, to acquire the equity in Bloxham, the High Court heard.

When Bloxham “went down”, the bank’s only recourse was to Mr Finnegan’s personal guarantee of the liabilities of his company, Mr Donnelly said.

In an affidavit opposing the bank’s application, Mr Finnegan said that if judgement was granted in the sum sought, it would affect his ability to earn a livelihood. Mr Justice Nicholas Kearns said the same could be said of every person against whom a judgment is granted.

Counsel for the bank said Mr Finnegan had made out no arguable case against the bank’s application for judgement and had merely raised “small, technical points” in opposing the application.

In submissions, counsel for Mr Finnegan denied the points raised were small or technical and said he had an arguable defence on grounds including the bank had not served notice of the demand on Mr Finnegan in accordance with the relevant notice terms.

In his ruling, Mr Justice Kearns said he was satisfied that no arguable defence was made out to the bank’s application.

There was no issue but that he executed that guarantee and had independent legal advice when he did so.

Judgement was now being sought on the basis the €3.7m, which was repayable on demand, was outstanding and demand had been made for payment of that sum, he said.

The only defence related to the form of the notice served on Mr Finnegan, the judge said. The court did not accept the slightest deviation from a specified formula of words in the notice terms, unless that deviation was of significance, afforded a defence which could preclude the bank relying on a guarantee.

The technical points raised had all “evaporated” and the court would grant judgment in the sum sought.