The High Court has granted an order restraining Millura Enterprises from impeding a receiver in carrying on the business of the Holiday Inn Hotel in Dublin's Pearse Street, pending the outcome of legal proceedings.
The interlocutory order also prevents Millura from itself carrying on the hotel's business.
Mr Kent Gross and Mr Charles Daly, directors of Cristeeg Catering Limited, with registered offices at Blainroe House, Blainroe, Co Wicklow, consented to a similar order being granted against them by Mr Justice McCracken.
No one appeared for Millura, which has registered offices at Northumberland Road, Ballsbridge, Dublin, at the hearing of yesterday's application by Ms Mary Irvine SC on behalf of the receiver, Mr Pearse Farrell.
The court made an order last March permitting Mr Farrell, receiver and manager of Cristeeg, to manage and operate the Holiday Inn, and he continues to do so. Mr Farrell has also taken legal proceedings against Millura and against Mr Gross and Mr Daly.
The Holiday Inn is owned by Tara Virgin Resorts and was operated by Cristeeg under licence from Bass Hotels and Resorts. The High Court has been told Cristeeg appeared to have disposed of its interest in operating the hotel to Millura, a company about which little was known, for a "valuable sum" of money.
Mr Farrell alleges that the attempted transfer of the business was "a sham" and "invalid".
Mr Farrell was appointed receiver to Cristeeg by Smurfit Finance Limited (a subsidiary of Equity Bank Limited) under a mortgage debenture.
Cristeeg was alleged to be in default to its landlord and to Smurfit for some considerable time and, as of March 9th last, was liable for more than £268,000 (€340,290) to Smurfit.
The court has heard that Mr Farrell, on arrival at the Holiday Inn last March, was told that Cristeeg was no longer the operator of the hotel, that it had been "thrown out" for failure to comply with its obligations and that its functions had been taken over by Millura. In an affidavit, Mr Farrell said he was "amazed" to hear this assertion from Mr Gross and Mr Daly.
He said both directors were well aware that Cristeeg had covenanted with Smurfit that it would not transfer, sell, license or otherwise dispose its business or assets, or part thereof.
He said the directors claimed Cristeeg had not voluntarily disposed of the business but had been removed instead.
"I did not understand the meaning of this remark," Mr Farrell said.
He said Cristeeg also could not validly assign the leasehold interest in the hotel without the consent of the landlord, being a consortium of eight investors from KPMG, and that consent had not been given.
Mr Farrell said an unsigned letter from Mayhaps Investments Limited was of considerable concern.
He said the letter appeared to have been written by Mr Kent Gross, who was a director of Mayhaps and Cristeeg.
He said Mr Charles Daly was director and secretary of Mayhaps until February 18th last and remains a director of Cristeeg.
He said the letter was alarming because it referred to a "duly executed management agreement" whereby Millura Enterprises assumed control from Cristeeg of the Holiday Inn.
This conflicted directly with the assertion made to him by Mr Gross and Mr Daly that Cristeeg had been removed from the hotel and had not voluntarily disposed of its interest in the hotel.
"This letter makes it abundantly clear that, if this occurred at all, it occurred as a result of an agreement."
Mr Farrell said he had never been shown any management agreement or documents indicating what, if any, consideration was paid as alleged.
It was his view that attempted transfer of the business of the hotel to Millura "is a sham and is invalid".
Also yesterday, Mr Justice McCracken adjourned an application by the receiver for an order directing AIB Stillorgan to pay to Mr Farrell all funds which might stand to the credit of Millura Enterprises Limited in any accounts held by the branch. An order freezing any such accounts was granted last March.
