A married father has had more than €5 million of his debts written off as part of a High Court approved plan to return him to solvency.
Judge Nessa Cahill on Monday sanctioned a debt settlement arrangement for contracts specialist Eoin McDermott (46) that involves him paying a total of €45,676 to his creditor, Everyday Finance DAC.
McDermott, who has a young child, owed €5.868 million to debt servicing firm Everyday Finance, which did not oppose the High Court application for approval of the plan.
The court was told McDermott had residual debt following the sale of properties.
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His debt proposal, formed by personal insolvency practitioner Eugene McDarby and presented to the court by barrister Keith Farry, enables him and his family to stay in his home in Kildinan, Glenville, Co Cork. The property is currently worth €400,000 and has an outstanding mortgage balance of €126,500 for which McDermott has been paying €1,718 a month.
The plan, if followed, will see him return to solvency after a year. He will be required to pay €5,685 in fees, including outlays, to his personal insolvency practitioner.
Everyday Finance will recover 0.78 per cent of what it is owed, which is less than the 1.68 per cent it would have recovered if McDermott was to be declared bankrupt. The insolvency practitioner said the creditor would likely have had to wait a longer period to recover a dividend in a bankruptcy scenario.
McDarby said he believed the debt settlement represented a “fair outcome” for the creditor.
The court was told McDermott earns about €7,300 per month as an employee of a Saudi Arabian energy consultancy company.
Under the plan he is allowed reasonable living expenses of €5,536 per month, including a €1,460 monthly mortgage, €425 working abroad costs and €680 in childcare fees.
