Third Stokes brothers' firm faces insolvency threat

A THIRD company owned by restaurateurs Simon and Christian Stokes is facing the threat of insolvency. A creditors’ meeting has been called for Auldcarn Limited, a company owned by the brothers. A liquidator is scheduled to be appointed at the meeting, which will be held on January 21st in Dublin’s Harcourt Hotel.

Brothers Simon and Christian Stokes and their father Jeffrey Stokes are listed as directors of the company.

Although records filed at the companies registration office state that Auldcarn owns the Clarendon Inn, separate filings show that Zarament, a company owned by property developer Bernard McNamara, has owned the property since 2005.

The Stokes brothers sold the property to Zarament in 2005 under a sale and lease-back deal. Zarament subsequently took legal action in the High Court against the Stokes brothers.

The Clarendon Inn is now operated by publican Niall Lawless, who is not connected with the Stokes brothers.

Accounts for Auldcarn for the year ended January 31st, 2008 – the most recent available – show that the company owed creditors €2.7 million on that date. The accounts, which were approved by the directors on February 18th, 2009, show the firm owed over €1 million in PRSI, PAYE, VAT and corporation tax at that time, as well as €670,226 to trade creditors and accruals, €170,554 in bank overdrafts and loans and €315,910 to directors’ accounts.

Auldcarn also owes its parent company, Mayfair Properties – the holding company for Bang Cafe – €436,755.

The financial statements state that Simon Stokes has guaranteed loans advanced by Friends First, while AIB holds letters of guarantee from the directors.

In a disclaimer and special report accompanying the financial statements, auditors FGS expressed concern that the company had failed to keep proper books of account.

FGS says it was unable to form an opinion as to whether the financial statements give a “true and fair view of the state of the company’s affairs” as the evidence available to the auditors in respect of cash sales and cash payments was “limited”.

FGS states that it wrote to the directors on January 19th, 2009, expressing its opinion that the company had failed to keep proper books of account, and that, on January 27th, 2009, the directors wrote to the auditors confirming that proper books of accounts had been kept.

In July and August last year, FGS resigned as auditors for all three of the Stokes brothers’ companies – Missford Limited, the holding company for Residence, Mayfair Properties and Auldcarn.

Twins Simon and Christian Stokes (34) are two of Dublin’s best-known restaurant owners. Last Tuesday their private members’ club, Residence, was granted temporary protection from the High Court, and their application for examinership is due to be heard in the commercial court tomorrow.