Ex-Smart boss fights €8m repossession

FORMER Smart Telecom chief executive Oisin Fanning is opposing a bid by a bank to take possession of his home because of an alleged failure to keep up payments on an €8 million loan, the High Court heard yesterday.

Anglo Irish Bank has brought proceedings against Mr Fanning seeking that he and his partner Pearl Roche deliver up possession of Forenaghts House which stands on 24 acres near Naas, Kildare.

Ms Justice Elizabeth Dunne will give her decision on the bank’s application on Thursday.

The bank claims that Mr Fanning and Ms Roche have defaulted on a loan given to them in 2006 to enable him to buy €5m worth of shares in Smart Telecom and to allow the couple re-finance an existing €2.9m mortgage on Forenaughts.

The amount outstanding is now more than €8.6m.

Mr Fanning claims he is not responsible for the repayments and that he was pressurised to take out the loan by businessman Brendan Murtagh, who took over Smart Telecom in 2006. Mr Murtagh told him that as chief executive of the company he would have to be seen to be investing in it as part of a €44m fundraising drive, Mr Fanning claims.

Mr Fanning argues this was really a loan to Mr Murtagh as he got Anglo to provide the loan despite the fact that two years earlier the same bank had told Mr Fanning that it would not be interested in funding him or his company.

The loan was not advanced on the security of Forenaghts, Mr Fanning says, but on the basis of assurances from Mr Murtagh, who had a longstanding business relationship with Anglo, that it would be repaid.

Mr Fanning says he did not have the financial capacity to repay such a loan and that Mr Murtagh, who knew this, agreed to make the repayments from Smart Telecom.

Interest repayments were made by Smart between June 2006 and January 2007, Mr Fanning claims.

Mr Fanning and Mr Murtagh are currently involved in separate pending legal proceedings arising from the October 2006 buyout of Smart by Smart YuRoE Broadband, controlled by Mr Murtagh.

In its action, Anglo claims the loan to Mr Fanning and Ms Roche was secured on the basis of the bank having first legal claim over the Smart shares and over Forenaghts House.

The bank is now seeking to exercise power of sale of Forenaghts.

In an affidavit, Anglo associate director Paul Corry says without vacant possession of the house it would be “virtually unsaleable”.

The bank also claims the house is not covered by the Family Home Protection Act.

Mr Fanning argues the house is protected under family home legislation, as it was bought at the time he was married to Susan Fanning in 1995.