Judge to rule later on receiver’s bid for possession of apartments

Mary Carolan

A judge will rule later on an application by a receiver for injunctions restraining interference with his bid to take possession of 57 apartments in Dublin’s Docklands.

Hugh McGinley and his company McGinley Construction are opposing the application by Stephen Tennant, appointed receiver by Promontoria Eagle Ltd (PEL), a fund that bought their loans from Nama last year.

Mr McGinley, who also has assets in Northern Ireland, claims PEL’s directors include executives of Cerberus, the fund which last year acquired the Nama loans held by Northern Ireland debtors.

Mr Justice David Keane, having heard closing arguments from both sides, reserved his decision on the injunctions application.

Mr McGinley claims the April 2014 sale by Nama to PEL of the Bank of Ireland loans of himself and his company breaches a four-year agreement he had with Nama, including an arrangement whereby he would sell the 57 apartments at Alexandra Place, East Road, this year. He has initiated separate proceedings against Nama over the loan sale.

At the High Court on Friday, Noel J Travers SC, for the McGinley side, said the injunctions should be refused because his side had made out a case to be tried and PEL had failed to show it would suffer any irreparable harm if the injunctions were not granted. The appointment of the receiver would add substantially to the costs of managing the property which was only there because of the work the McGinley’s had put into it over years, counsel argued.

Kelley Smith BL, for Mr Tennant, argued no grounds had been advanced which disentitled the receiver to the injunctions. PEL had acquired contractual rights to the apartments and payments being made by the McGinley side towards the loans did not meet the interest obligations, she said.

It was “startling” the McGinley plan was to go ahead and sell the property in 2015, she said. The receiver was concerned about “threats and intimidation”, undertakings being offered by the McGinley side were “flawed” and the court should not condone a situation where a party was in occupation of premises in breach of her client’s legal entitlements.

In afffidavits, Mr McGinley, of Lifford, Co Donegal, said, after agreements for sale of most of the Alexandra Place units fell through at the height of the financial crisis in 2008, he spent considerable time funds fitting out and renting the apartments, with all rental proceeds going towards repaying interest on bank loans, maintaining them and resolving a major car park issue.

With the agreement of Nama, the plan was to sell the 57 apartments this year which could have realised up to €14 million for Nama and the State, he said.  Without giving him any opportunity to be heard, Nama sold some €30 million loans, €3 million personal and some €26 million of McGinley Construction, to PEL in breach of a management/workout agreement concerning his loans which he had since 2011 with the State agency, he claims.

PEL claims there was no binding agreement between Nama and the McGinley side concerning how their loans would be dealt with and, even if there was, that has expired.