Bula contends claims are statute barred

BULA, and a number of other plaintiffs who are suing three banks and a receiver, contended in the High Court yesterday that the…

BULA, and a number of other plaintiffs who are suing three banks and a receiver, contended in the High Court yesterday that the right of the banks to claim sums against them was statute barred.

A preliminary issue in the case is being taken by Bula Ltd (in receivership), Bula Holdings, Mr Richard Wood and Mr Michael Wymes against Mr Laurence, G Crowley, receiver, the Northern Bank Finance Corporation Ltd, Ulster Investment Bank Ltd and the Allied Irish Investment Bank Ltd.

Mr Justice Barr yesterday adjourned the hearing until today so that he could read the judgment of Mr Justice Lynch in a previous case concerning Bula and Tara Mines.

At the beginning of February, Mr Justice Lynch delivered judgment after 277 days of hearing the case. He rejected claims that the Minister for Energy and Tara Mines were responsible for the failure to bring into production the neighbouring Bula lead and zinc mine at Nevinstown, Co Meath. He dismissed the action by Bula Ltd, Mr Wymes and Mr Wood. They had sued the Minister and Tara.

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The judge had said, when assessing costs, that he estimated the three banks were owed £40 million which included interest.

Yesterday, Mr John Trainor SC, for Bula and others, said that notice of appeal to the Supreme Court on the previous case had been lodged last month.

In the present preliminary issue, Bula states that a number of agreements were entered into by it and the banks. The repayments of the monies, with accrued interest, advanced by the banks were secured by Bula over its assets and under takings in favour of each of the banks by debenture, charge and/or mortgage. They were further secured by personal guarantees.

In 1982, the banks made demand on Bula for repayment of all sums owing. On October 8th, 1985, the banks purported to appoint the receiver, Mr Crowley, over the Bula property.

Bula claims that the right of the banks to sums currently claimed either by principal, or interest, and the title of the banks to lands and property of Bula is statute barred.

It is seeking an order requiring the banks to deliver up to Bula all original documents of title relating to the lands and property which are the subject matter of mortgages and debentures.

It also seeks a declaration that Mr Wood and Mr Wymes are entitled to stand discharged of all and any liability, to the banks, on foot of such judgments as have been obtained against them.

Other reliefs sought include an order directing the banks to release to Mr Wymes and Mr Wood, and to any company controlled by them, all securities held by them as collateral security for alleged obligations by the two men on foot of their guarantees.

They also seek an order directing the banks to make restitution to Mr Wymes and Mr Wood of all monies released by them in respect of such collateral securities as have been furnished by either of the men with interest.

If necessary, in lieu of the orders sought, they are seeking an inquiry into what portion of the rights of the banks to the repayment of either principal or interest were extinguished because of the Statute of Limitations.

The receiver, Mr Crowley, states that the banks' claims to repayment of the monies or their rights to realise their securities or interest in the secured property are not statute barred.

The banks, in their defence, state that their claims to repayment of monies by Bula and the other plaintiffs are not statute barred.

They deny that there are any grounds upon which Bula was entitled to deny and/or avoid repayment of the monies due.

They state that in the substantive claims in these proceedings, the plaintiffs are claiming reliefs which include a declaration that any outstanding obligations of Bula under loan agreements entered into between Bula and the defendants were discharged and unenforceable.

Bula was also seeking an order that all contracts whereby the plaintiffs granted or arranged any security in favour of the defendants be rescinded and were unenforceable and that any receiver appointed be removed.

The banks claim that there is no validity in Bula's claims that the rights of the banks to recover payments of the monies with interest and the title of the banks were extinguished or the defendants' claims as mortgagees are statute barred.