Nama given €74m order against developer

THE NATIONAL Assets Management Agency (Nama) has secured summary judgment for more than €74 million against hotelier Jim Mansfield arising from his personal guarantee of loans to two companies.

Mr Mansfield, who is suffering from a serious neurological illness, will next month face a separate application by Bank of Scotland for summary judgment for more than €206 million arising from other debts of his companies.

The claims are believed to amount to the biggest summary judgment applications brought to date against an individual in the Commercial Court.

Yesterday, Mr Justice Peter Kelly granted judgment for €74,014,965 to Neil Steen, for Nama, after rejecting arguments by Patrick Leonard, for Mr Mansfield, that his client had an arguable defence to the claim.

The judge refused to grant a stay on execution and registration of the judgment pending any possible sale of some assets of the Mansfield group companies – including Weston Aerodrome – and/or pending a possible appeal to the Supreme Court.

A stay would deprive Nama of the fruits of the judgment and, given the falling property market, could sterilise the agency’s claim for years, he said.

There was no indication if and when there would be a sale and failure to grant summary judgment could prejudice Nama in circumstances where another creditor was seeking summary judgment for a sum almost three times that sought here.

Mr Leonard had raised a number of issues, including whether Kieran Wallace, the receiver appointed last April over assets of the Mansfield group, acted reasonably and fairly in rejecting offers of about €11.9 million for Palmerston House and estate and concerning any sale of Weston Aerodrome and West Park apartments.

Mr Leonard argued that his team had been told that Nama would not accept offers from parties connected with the Mansfield group which was also unfair and in breach of the agency’s own code of practice. He also complained that Nama had failed to allow a proper opportunity to the Mansfield interests to advance a business plan.

In his ruling, Mr Justice Kelly said it was not denied the monies were borrowed by two companies, Fallowvale Ltd and Bridford Ltd, or that Mr Mansfield executed guarantees over those borrowings.

Many of the complaints raised by Mr Mansfield related to the actions of the receiver appointed over the secured assets but there had been no application to remove that receiver.

Receiver or no receiver, the two companies owed the monies sought and Mr Mansfield had guaranteed those liabilities, Mr Justice Kelly added.

In all the circumstances, there could be no defence made concerning the conduct of the receiver or concerning any business plan obligations.

The receiver was not hidebound by any views of Nama concerning purchase offers made by Mansfield interests or by persons introduced to the receiver by those interests, the judge said. There was no evidence the receiver would do Nama’s bidding.

As no property had been sold by the receiver, the court could not address the claims that the judgment sum sought should be reduced if lesser offers were later accepted for the assets involved, the judge added.

Nama brought its proceedings arising from personal guarantees provided by Mr Mansfield, Tasaggart House, Saggart, Co Dublin, over loans by the Irish Nationwide Building Society to Fallowvale and Bridford between 2003 and 2009.

Those loans had been transferred to Nama which, last April, demanded repayment of some €45.4 million from Fallowvale and some €27.5 million from Bridford.

When no repayment was made, the agency demanded payment from Mr Mansfield under his guarantees and appointed Mr Wallace as receiver over the companies on April 20th last.

The court had previously heard medical reports which had stated that Mr Mansfield suffered from a number of medical conditions, the most serious being multiple system atrophy, described as incurable.