Fears developer is transferring properties to wife

BANK of Ireland has said it has “significant concerns” that a Cork property developer it is pursuing for €8.9 million over unpaid loans has transferred some 13 properties to his wife.

James Doherty, for the bank, raised its concern over the transfers when seeking yesterday to admit to the Commercial Court proceedings against Patrick Murphy, Falcon Hill, Lovers Walk, Cork, in which the bank is seeking summary judgment orders for some €8.89m.

Counsel for Mr Murphy said he needed time to take full instructions, but his side believed there was a bona fide defence to the claim arising from the nature of the loan transaction.

Mr Justice Peter Kelly said he would deal with the summary judgment application next week when the basis for the defence would have to be outlined.

Mr Doherty said summary judgment was being sought in relation to loan facilities advanced in July 2008 to refinance and restructure borrowings of Mr Murphy with Bank of Scotland Ireland and with BOI itself. The loan was to be repaid within 60 months of drawdown, but could also be called in if there was default.

Counsel said the defendant made interest payments up to April 2009. Efforts to contact him between February and June 2009 met with no response, but a manager with BoI met Mr Murphy on the street in June 2009 who said he had been ill and asked that all communications be directed to a mortgage broker said to be acting on his behalf.

After various communications, the bank notified Mr Murphy in February 2010 an event of default had occurred and demanded repayment of the outstanding monies within 10 days. No repayment was made.

In March 2010, Mr Murphy informed a bank manager he had transferred some of his properties to his wife while he was ill and intended to deal with the BoI outstanding loan liability on a pro rata basis with his other outstanding liabilities.

Mr Doherty said the transfer of some 13 properties to Ms Gillian Murphy – on dates between February and June 2009 – was of significant concern to the bank given the debt owed to it.

In an affidavit, Janet Seacy of BOI Business Banking, said it appeared from a statement of affairs Mr Murphy was solvent as of January 2008. The bank was concerned the transfer of properties between February and June 2009 was being done for the purpose of defeating claims by creditors.

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