The High Court has been urged to continue court protection for the family-run Foley’s bar and restaurant and the adjoining O’Reilly’s bar on Dublin’s Merrion Row so as to finalise a survival scheme for the company. Together, the bar and restaurant employ about 20 people.
Bank of Scotland, the business's major creditor, which is owed some €5 million by the operating and holding companies, is strongly opposing examinership and its counsel Cian Ferriter SC made clear yesterday it would provide no further finance.
The court heard trading figures from 2012 indicate the business has potential to trade profitably into the future and its counsel Ross Maguire SC said both an independent accountant and its interim examiner believe it has a reasonable prospect of survival once certain conditions are met. The figures showed "clear signs of recovery", he said.
Mr Ferriter argued the €5 million debt could not be ignored but no proposals had been advanced to deal with that. The court also heard a receiver appointed by the bank in October 2012, but discharged by the High Court last month, had taken steps aimed at selling the business.
The Revenue Commissioners are also opposing examinership but Mr Maguire argued his client had honoured an agreement with the Revenue to make payments to it arising from a 2007 revenue audit.
Examinership is being sought for Belohn Ltd and Merrow Ltd, respectively the operating and holding companies for the business.
After the BOS receiver to Belohn was discharged by the High Court on the morning of Friday, March 22nd, the bank issued demands that afternoon to Belohn, whose directors are Seán Foley and his wife, for repayment of €4 million by Belohn and €1.06 million by Merrow.
When the Merrow debt was not paid by 5pm that same day, as demanded, the bank appointed a receiver to Merrow but its directors were not informed of that appointment until two days later. No receiver was appointed to Belohn.
In those circumstances, lawyers for the business secured examinership ex parte (one side only represented) at emergency High Court hearings on Saturday, March 23rd, for Belohn, and on the night of Sunday, March 24th, for Merrow.
Earlier this week, Mr Justice Gerard Hogan refused the bank's bid to discharge the Belohn examinership but overturned the examinership of Merrow on grounds he was incorrectly told, due to a genuine error, the receiver had indicated he would not hand over certain company documents when the opposite was the case.
The hearing continues today.