Mr Justice Paul Gilligan appointed insolvency practitioners Declan Taite and Anne O’Dwyer as joint provisional liquidators to Mount Carmel Medical Group (South Dublin Ltd), which runs the Mount Carmel Hospital in Churchtown, Dublin 14, after being informed the company was insolvent and unable to pay its debts.
The company sought to have itself wound up after what the court heard was “a disastrous 2013” whenNama decided it was no longer in a position to provide working capital to the company which allowed the hospital to trade.
The judge said he was satisfied to appoint the provisional liquidators after being informed a plan had been put in place to protect, care and attend to the needs of the hospital’s 230 patients, 60 of whom are in-patients.
Solicitor for the provisional liquidators Jane Marshall said the liquidators had devised a plan with management at the hospital in advance of their appointment to ensure the patients’ safety and wellbeing would be in no way compromised by the insolvency.
Mr Justice Gilligan gave the liquidators various powers, including the power to take possession of the company’s assets and retain and dismiss staff at the facility.
Andrew Fitzpatrick BL, for the company, said the hospital, which has been in existence since 1949 but was acquired by its current owners in 2006 from the Little Order of Mary religious order, has a net asset deficiency of more than €45.5m.
Its main creditors include Nama, which in 2010 acquired a loan advanced to the company by AIB. Counsel said the company’s director Gerald Conlan had loaned the company more than €18.1m. It also has a current account overdraft of €9.1m.
Nama is supporting the application to have liquidators appointed.
Mr Fitzpatrick said the company was able to trade since 2010 thanks to funding provided by Nama, on the basis it was to be sold. However, a buyer could not be found. Two bids were tendered but they were deemed to be unsuitable.
In recent days, Nama told the company it was no longer prepared to provide it with any more funds. The company did not have the funds to continue to trade beyond next week, counsel said.
The hospital was left with the option of either closing its doors immediately, which counsel said was “not an option”, or having liquidators appointed who would ensure an orderly winding up of the business.
In an affidavit to the court, Gerald Conlan said the company made financial losses after it acquired the hospital. Steps were taken to reduce costs. In 2013, the company anticipated making a profit of €185,000. However, it incurred a significant operating loss of €1.9m.