“Significant progress” has been made by the parties embroiled in a legal row over a €500,000 loan to Altada Technology Solutions, the High Court heard on Thursday, despite a “material conflict” over the facts of the matter.
The once-hotly tipped artificial intelligence company, which collapsed into receivership and then liquidation in late 2022, was sold to an investment vehicle controlled by Dublin tech entrepreneur Eoin Goulding by Altada’s receiver earlier this year.
However, Revenue, which is owed more than €2 million by the Cork-based tech business, has made an application to the High Court to set aside the loan security on foot of which the receiver, Nicholas O’Dwyer of Grant Thornton, was appointed.
The €500,000 loan was granted to the company by four creditors – Grattan Boylan, Lynn Bruce, Alan Bruce and Noreen Gallagher – who shortly thereafter, had Mr O’Dwyer appointed as receiver after Altada failed to meets obligations.
The loan had a repayment period of eight months at an effective interest rate of 100 per cent, an arrangement described by Mr Justice Brian Cregan as “most unusual” in court in January. The tax authority has queried the lawfulness of the loan, arguing that the company was, in fact, heavily insolvent at the time it was granted and that the consent of the shareholders was not secured.
Barrister Arthur Cunningham, for Revenue, told the court on Thursday that Altada’s liquidator, John Healy of Kirby Healy Chartered Accountants, had now filed “two very substantial affidavits”, setting out the findings of his preliminary investigations into the company.
In a replying affidavit filed in the High Court last month, the lenders denied any impropriety on their part.
However, the liquidator’s latest affidavit, which was received by the notice parties on Tuesday, sets out a number of serious allegations about the conduct of parties connected the company. Mr Cunningham said that there now appears to be “a material conflict” around the facts set out in the various affidavits.
He told the court that he and barrister Declan Murphy, representing the receiver and the four lenders, had agreed to seek adjournment of the matter to allow Mr Murphy to reply to the liquidator’s latest affidavit. Mr Justice Cregan agreed to adjourn the matter until April 27th, by which time counsel for the Revenue and the liquidator may also file affidavits in the case.
The Irish Times reported earlier this week that, among other things, the liquidator alleged in his most recent affidavit that the directors of the company, including co-founders Allan Beechinor and Niamh Parker, were told to seek independent legal advice over the loan to which “exorbitant and punishing” terms were attached.
Mr Beechinor and Ms Parker are not notice parties to Revenue’s motion due to the fact that the company’s assets have been sold by the receiver to a company controlled by Mr Goulding.
Asked for comment, Ms Parker told The Irish Times that neither she nor Mr Beechinor had seen the affidavit, which was presented to the notice parties earlier this week, and therefore would not be commenting.