IL&P shareholder abandons legal challenge to bailout

A shareholder in Irish Life and Permanent has "abandoned" his legal challenge against the Government’s plans to recapitalise the bank.

Today the court was informed that shareholder Mr Gerald Nigel Bunting of Shelly, Suffolk, Ipswich, England had settled his action aimed aimed at overturning or varying the orders obtained by the Minister for Finance on July 26 last allowing the State to inject €2.7bn into IL&P, giving the State a 99% stake in the bank and wiping out the shareholders investment.

Mr Bunting had claimed the Minister's actions were unreasonable and unlawful and that their shareholding in IL&P have been overwhelmingly diluted and their rights "have been abrogated without any consultation".

Lawyers for the Minister told Mr Justice Roderick Murphy Mr Bunting's action against the Minister was settled. As part of that settlement it was agreed Mr Bunting would "abandon" his challenge against the Minister's decision to recapitalise the bank.

The Judge agreed to strike out the action against the Minister with no orders for costs. No further details of the settlement were revealed in open court.

The court had previously heard that Mr Bunting and his family held a total of 3,030,000 shares in IL&P in a number of different accounts.

Last week Mr Bunting and another shareholder in the IL&P Horizon Growth Fund NV served motions aimed at overturning or varying the orders obtained by the Minister.

Horizon, which has a registered address at Berg Arrarat on the Caribbean Island of Curacao holds more than 6,000,000 shares in IL&P, which it acquired between February and July 2011.

Earlier this week two other shareholders Scotchstone Capital Fund Ltd and its managing director Mr Piotr Skoczylas obtained permission from the Court to be joined to the challenge.

The shareholder's actions were brought against the Minister arising out of the decision to go ahead with the recpaitalisation of IL&P after shareholders had earlier rejected that proposal.

Those remaining actions stand adjourned to a sitting of the High Court in September, for mention only. It is hoped the full hearing of the challenges will be heard sometime in October when the new legal term commences.

In their challenge the Shareholders claim the Minister's decision to obtain the recapitalisation order was in clear disregard of the majority of the company's members. The Minister's actions, have been unreasonable and carried out without any adequate consultation, discussion or adequate investigation of alternative measures.

It is also alleged the Minister's action was unlawful on grounds that the Minister acted without adequate consultation, proper observation of fair procedures and without the appointment of an independent valuer to assess the value of the shareholder's interest.