Judgments for huge sums two-a-penny at Commercial Court

 

The judge told the court that 91 cases had built up for his next day of hearings on Monday, writes UNA McCAFFREYat the Commercial Court

IT DOESN’T take long to lose a few million euro in the Commercial Court these days, a lesson definitively learned yesterday by Matt Brennan of Williamstown, Co Galway.

Within 30 minutes of the court being put in session by Mr Justice Peter Kelly, a judgment for €2,023,883.18 had been registered against Mr Brennan for the benefit of Bank of Scotland (Ireland).

It was the kind of judgment that’s two-a-penny in Mr Justice Kelly’s court at the moment, but which will presumably cause serious upset to Mr Brennan, who is aged 33 and is no longer involved with the business which gave rise to the liability.

He set up Brennan Brothers Plant and Machinery Sales in Ballinasloe in 2004 and sold it last year for €500,000 to a Joseph Bowes.

The essence of Mr Brennan’s argument before the court was that when the business was sold, his legal obligation to honour guarantees relating to leasing agreements with the bank also passed on.

He had not understood “the onerous obligation” of the guarantees, his counsel said.

It was ruled that Mr Brennan had never been released from his guarantees and was therefore still liable to pay. Judgment was entered and Mr Brennan became another name in the records of the Commercial Court.

Mr Justice Kelly then moved on to AIB, which was seeking a judgment of €3.58 million against Simon Kelly and his developer father Paddy, who are by now veterans of the Commercial Court.

Technical argument moved back and forth between barristers on both sides, as a sense of resignation began building on the face of a judge who had earlier repeatedly told the court that no fewer than 91 cases had built up for his consideration on his next day in court on Monday.

Yesterday, the question was one of liability for an overdraft relating to the now-failed Thomas Read pub group. Counsel for the Kellys tiptoed around whether or not a proper contract existed over their guarantees for the overdraft. If a contract didn’t exist, then the guarantees would be open to challenge. It was “first-year law”, the judge later remarked, after observing that the nature of the arguments was akin to “angels on the head of a pin”.

He pointed out that the bank’s money had been used to run the Thomas Read group and “arguably the bank was too generous”.

He also made no secret of his dislike of the technical defence being put forward by the Kellys, describing it as “about as unattractive a form of defence as I’ve seen for a long time”.

Still, he said, an unattractive defence could win the day if it also had merit. Alas for the Kellys in this instance, merit was judged to be absent, and AIB won the day.

Next up was Peter Haydon, a businessman from Killiney in Dublin who is being sued by investors for more than €7.6 million. He had been in court some weeks previously, but his company, Haydon Private Clients, had since gone into provisional liquidation, leaving him to face the matter alone.

The meat of the case, a property purchase in Ukraine, did not feature yesterday, perhaps luckily for Mr Haydon, who was representing himself against a phalanx of barristers. He informed the court that he may be able to draw on some legal services “as a favour”, but for now he could not afford to do anything but stand up in the Commercial Court on his own.

“If I had the money I would’ve had legal representation,” he said.

At issue was discovery, and Mr Justice Kelly took some trouble to explain to Mr Haydon what would be required of him if he agreed to give discovery to the various parties suing him.

Failure to comply with discovery orders would lead to contempt of court, Mr Haydon was told.

The businessman said he had “no idea” how long discovery would take, prompting Mr Justice Kelly to impose a deadline of the end of September.

“You should if you can at all get yourself some advice on this,” he said, later suggesting to the businessman and the various parties on the other side that they should consider holding “sensible discussions”.

“This is a miserable business for everyone,” said Mr Justice Kelly, telling Mr Haydon he was “swimming in very choppy waters alone”. The judge said he could not act as a mediator, and nor could he provide legal advice for Mr Haydon.

“It’s a mess, isn’t it?” he remarked, before formalising the orders for discovery and moving on to the next matter before him.