Supreme Court will hear appeal over insolvency plan allowing man to keep €1.8m farm

The court will consider the meaning of a ‘readily realisable asset’ in the context of insolvency and debt restructuring applications

A debt fund has persuaded the Supreme Court to hear its appeal against approval for a personal insolvency arrangement (PIA) allowing a man to keep his €1.8 million farming assets.

Promontoria (Oyster) DAC’s appeal relates to the personal insolvency arrangement of Co Wexford-based Fergus O’Connor (47), who had debts totalling €1.1 million.

It is understood to have been the first time the High Court heard and approved a contested PIA application concerning a farm, which was described as a “core asset” supporting the tillage and sheep farmer’s livelihood.

In a determination granting leave to appeal, three Supreme Court judges said it will consider what constitutes a “readily realisable asset” in the context of insolvency and PIA applications.


In seeking leave, Promontoria argued the High Court’s decision will have a “significant impact” on the ability of creditors to recover debts from a debtor who holds agricultural land exceeding the value of the debt owed.

Following through on the High Court’s logic, the fund submitted, a debtor receiving income from any property could potentially exclude that property and benefit from being declared insolvent and getting a PIA.

Under the approved arrangement, Mr O’Connor, a separated father of three, will continue making repayments over 30 years to fully service the €874,000 debt to Promontoria. All unsecured creditors will be paid within three years.

He keeps his €1.8 million worth of farming assets, including land and sheep, as well as his €230,000 family home, which sits on seven acres of land in Kilmuckridge, Gorey.

He was balance-sheet solvent, with net assets of €594,000, but he did not have sufficient cash flow to meet debt repayments as they fell due, the High Court heard.

The fund argued it has extensive security over the debtor’s assets, including his agricultural assets, which it said are “readily realisable” through a sale.

The fund submitted in the High Court that the debtor is able to discharge his debts but has chosen not to and asked the court to condone this choice.

Despite the objecting creditor, the High Court’s Mr Justice Alexander Owens found Mr O’Connor was insolvent as defined in the Personal Insolvency Act 2012-2015 and he approved the arrangement.

Opposing the grant of leave to appeal to the Supreme Court, Mr O’Connor’s personal insolvency practitioner argued the High Court did not determine a matter of principle.

This view was bolstered, he submitted, when Mr Justice Owens clarified after his decision that he did not say agricultural land would never be considered a “readily realisable asset” in insolvency cases. He said his decision was limited to the facts of the specific case.

The practitioner also said the decision was based on Mr O’Connor’s debt level, the farm’s value, and the cost of realising the agricultural assets.

A three-judge Supreme Court panel, comprising Ms Justice Elizabeth Dunne, Mr Justice Séamus Woulfe and the now-retired Mr Justice John MacMenamin, was satisfied there were exceptional circumstances to allow a further appeal.

Mr O’Connor’s debts primarily arose from loans he and his now-estranged wife borrowed in 2006 from Ulster Bank to purchase 64 acres of land. He subsequently sold about €800,000 worth of assets to reduce his debts. The bank registered charges over lands he owns and later sold the debt to Promontoria.

Ellen O'Riordan

Ellen O'Riordan

Ellen O'Riordan is an Irish Times reporter