Developer Sean Dunne failed to persuade the US bankruptcy judge to bar Ulster Bank Ireland Ltd from initiating a parallel bankruptcy in Ireland.
Saying he has resided in the US with his wife and children for more than three years, Dunne filed a Chapter 7 bankruptcy petition in Connecticut in March. The bankruptcy judge ruled in June that the bank could initiate a parallel bankruptcy against Dunne in Ireland. Dunne appealed.
While the appeal is pending, Dunne wanted the bankruptcy court to grant a stay pending appeal, so the bank would be precluded from beginning the Irish bankruptcy until the appeal is decided.
In a 14-page opinion on Jul 18, US Bankruptcy Judge Alan HW Shiff in Bridgeport, Connecticut, denied the stay. He said Dunne “will not be irreparably injured absent a stay.” Shiff is allowing the bank only to conduct initial proceedings in Ireland, first to determine whether Dunne should be bankrupt and then to select a trustee. Shiff isn’t permitting further proceedings at this time. Dunne has the right to request a stay from a federal district judge now that he was denied a stay by Shiff.
Dunne’s Chapter 7 trustee, Richard M Coan, agreed with the idea of having a parallel bankruptcy in Ireland. He said Dunne’s “Irish connections are paramount.” The court authorised Coan to “minimise costs” on matters “more properly resolved” in the Irish bankruptcy.
Ulster Bank began involuntary bankruptcy proceedings in Ireland six weeks before Dunne filed for Chapter 7 bankruptcy in the US. The US proceedings automatically stopped the bank from serving papers on Dunne commencing the Irish bankruptcy in earnest.
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