ACC seeks judgment orders for €30m

ACC BANK is seeking judgment orders for about €30 million against Friends First Managed Pension Funds Ltd and two businessmen, arising from a facility advanced in 2007 to buy property in Clare and to pay off another loan.

The proceedings were transferred to the Commercial Court yesterday by Mr Justice Peter Kelly, who noted that if earlier negotiations between ACC and Seán Lyne and Noel Connellan had led to an agreement, Friends First Managed Pension Funds Ltd would be “off the hook”. However, no agreement had been reached

The case arises from a facility of October 2007 under which the bank was to make available €25.2 million to discharge an AIB debt secured on 33 acres at Gaurus, Ennis, Co Clare, and to acquire an additional 61 acres at Gaurus.

The bank claimed the loan facility letter had limited the liability of the fund in relation to repayment of the principal sum to the amount realised from sale of the bank’s security (the lands) and to 46.6 per cent interest.

It claimed Mr Lyne and Mr Connellan, both of Ennis, were jointly and severally liable for repayment of €22 million and for 53.4 per cent of interest and costs.

The bank claimed the limitations on liability provided for in the 2007 facility letter would lapse if any provisions of a co-ownership agreement were materially varied without the prior written consent of the bank. Such a material variation occurred about October 2009, so all three were jointly and severally liable for €25.2 plus interest, which in July 2010 stood at €5.3 million, ACC claimed.

In April 2010, ACC demanded repayment of about €30 million and later issued proceedings.

Mr Justice Kelly said the fund should have been “kept in the picture” and he adjourned the matter to October.