Harry Crosbie took no salary for nearly three years from his last remaining business, the Vicar Street music venue in Dublin, but did draw €1.7m from it to pay for his living and trading expenses, the Commercial Court has heard.
During that period, 2013-16, he paid around €30,000 in income tax, the court heard.
Mr Crosbie said he had been advised, after most of his businesses were taken over by Nama, not to draw a salary or profits until a dispute with Ulster Bank over the amount of rent on Vicar Street was sorted out.
He was being cross-examined by Paul Sreenan, for Nama, in its efforts to execute a €77m judgment it obtained against him in 2014.
Mr Crosbie had supplied statements of affairs in advance of his appearance which showed he had made various loans, gifts, and transfers of cash to his wife Rita, to her Grand Canal dock Cafe H business, and to his daughter Alison.
Those transfers were done on the basis of financial advice to make the best use of cash within the family businesses.
He accepted he had paid the mortgage on his daughter’s €700,000 home in Booterstown from Vicar Street takings and that he had paid the local property tax for that house, as well as for a house owned by his wife in Wexford.
While that tax should not have been paid, he expected he would get back the money back from his daughter as it was a loan.
He said his son Simon’s home, also in Booterstown, had originally been put in his name to save on stamp duty but he now realised that had been an error of judgment as it had also been used as security for his indebtedness.
Mr Crosbie said, however, that as part of an agreement, Nama had agreed to release any claim over both his son’s home and over his home in Hanover Quay. He had transferred his 50% interest in the family home to his wife and did not know the value it, nor had he asked to know “because I was in Nama”.
He said efforts were being made to sell three apartments he part owned in Villefranche-sur-Mer, in France, but he believed the €850,000 price tag would have to drop to about €500,000 if they were to sell. He had transferred his share in another property on the Cote D’Azur to his wife.
Asked why Vicar Street, also excluded from the Nama claim, was valued at €6m in 2012 and minus €4.2m four years later, Mr Crosbie said this was partly due to issues over rent arrears to Ulster Bank, which the court heard had originally bought the property and rented it out to Mr Crosbie at between €700,000 and €850,000 per annum.
Mr Crosbie said both he and Ulster Bank benefited under a double rent allowance scheme from this arrangement but after the economic crash, the venue was not making enough money to pay that level of rent sought.
Aiken Promotions, which puts on shows at the venue, rents the premises from Mr Crosbie at €400,000 while Mr Crosbie runs the bars and provides maintenance. Mr Crosbie said there was no written contract with promoter Peter Aiken and they had always operated on the basis of a handshake.
The minus €4.2m valuation was due to problems in relation to title relating to the overall property which had been extended by renting adjoining buildings.
The valuation was also on the basis of a similar valuation approach used when Mr Crosbie’s share in the other major venue he founded, the Point Depot, now the 3Arena, was sold by Nama to meet his debts. The Point was sold for some €35m, about six times its profitability, he said.
Mr Crosbie believed the Point Village development is worth tens of millions and would be more than enough to pay off his debt. However, he was unable to find out what was going on with it because of Nama’s “secrecy”.
© Irish Examiner Ltd. All rights reserved