A bid by insolvent well-known businessman Brendan Murtagh to retain shares and a pension fund valued at up to €1.2 million towards “living expenses” was rejected by a High Court judge today in proceedings where investors are pursuing Mr Murtagh for €28 million.
Mr Justice Peter Kelly noted Mr Murtagh (64), purchaser of Smart Telecom, once had an estimated net worth of €271 million but now has liabilities of €353 million including “colossal” sums owed to Anglo Irish Bank.
Mr Murtagh would have to come to terms with the fact he was no longer very wealthy, may have to reduce his living standards accordingly and consider a number of matters, including whether he needed two houses, the judge added.
He found it hard to see how Mr Murtagh would need to keep assets valued between €700,000 and €1.2 million for “reasonable” living expenses in the way that term is understood by ordinary people. He could only imagine the sense of injustice the investors would have if Mr Murtagh was allowed that when they were left “high and dry” with €28 million debt.
Mr Murtagh was an example of some of those very wealthy persons who had come before the Commercial Court in the last six years who never seemed to be satisfied with what they had but seemed to require more and more. This was all very well if they had the means to do so but many sought to borrow “extraordinary sums” to feed their desire.
Such persons had apparently forgotten hubris is usually followed by nemesis and this case showed that, the judge said. This €28 million debt was only part of Mr Murtagh’s “sorry tale” as total judgment orders of more than €60 million had been obtained against him.
Earlier, Gary McCarthy, for Mr Murtagh, said his client was very wealthy some years ago but his only remaining assets are his pension fund and some shares. He would receive the State pension at age 66 of some €11,000 a year and would lose his €70,000 salary as non-executive director of Kingspan plc when he resigned that directorship next month. Counsel said he had no instructions about the circumstances of that stepping down but the court could probably make inferences.
This was “not a lifestyle issue” but to put food on the table and his client’s ability to look after himself at the age of 64, counsel said. Mr Murtagh had made great efforts to deal with the issues raised by the investors and the transfer of properties into his wife’s name occurred before these proceedings.
After hearing submissions, the judge agreed with Eileen Barrington, for the investors, Mr Murtagh had failed to produce adequate information to defeat the investor’s application for charging orders over various shareholdings and to appoint a receiver over his pension fund.
The total value of the shares and pension fund was said to be between €700,000 and €1.2 million and the real effect of Mr Murtagh’s application would be to prevent the investors getting the fruit of charging orders which were “a drop in the ocean” of their overall claim, he said.
The judge confirmed the charging orders, including orders over shares in Kingspan plc, and also appointed Mr George Maloney as receiver over the Brendan Murtagh Approved Retirement Fund, the latter with a value of up to €831,000.
The judge told Mr McCarthy he could make a fresh application to allow Mr Murtagh certain sums in living expenses if additional information was produced to the court to correct “glaring gaps” in that provided, including concerning the circumstances of Mr Murtagh’s ceasing his non-executive directorship of Kingspan plc and whether this was voluntary or forced by the board of Kingspan because Mr Murtagh was a judgment debtor.
He also required information about the value of two properties - Mr Murtagh’s family home at Dunheeda, Kingscourt, Co Cavan, and a mews at Raglan Lane, Dublin 4 - which had been transferred in to the name of Mr Murtagh’s wife Martha.
The judge was dealing with proceedings by Loparco SA which last January secured a €28.1 million judgment order - arising from unpaid loans linked to Polish property deals - against Mr Murtagh, Greg Coughlan, Fastnet, Ardbrack, Kinsale, and Brian Madden, Well Road, Douglas, Cork.
Loparco is a Luxemburg registered company through which investors provided some €20 million for the Polish deals, to be managed by the Howard Holdings property group.
