TWO DIRECTORS of a Limerick construction company are being sued over alleged failure to honour an agreement to provide securities related to a £10 million (€11.25 million) loan given for redevelopment of the Odeon Cinema site in London’s Leicester Square.
The proceedings against Patrick Whelan and Patrick Chesser, both directors of Callerview Properties, Steamboat Quay, Dock Road, Limerick, have been taken by Frank Woods, with an address at Onchan, Isle of Man.
Mr Justice Peter Kelly admitted the action to the Commercial Court this week on the application of Jim Breslin, for Mr Woods.
A retired businessman, Mr Woods claims that, under a loan agreement of September 26th, 2007, he advanced a £10 million loan to Callerview for the Odeon site redevelopment.
Under a further agreement of September 29th, referred to as the Priorities Agreement, Mr Woods claims that he agreed with Callerview and Anglo Irish Bank Corporation that the £10 million loan would be subordinated to existing banking facilities provided by Anglo to Callerview based on a facility letter of February 21st, 2007.
That agreement is no longer in effect, it is argued.
As security for the loan, it is alleged that Callerview executed a fixed charge over its assets at Ennis Road Retail Park, Limerick, that charge being second to one in Anglo’s favour. Callerview also allegedly agreed to arrange for the defendants to provide an equitable charge over their shares in Callerview.
It is further claimed that both defendants provided personal guarantees as security for the loan.
Mr Woods claims that his £10 million loan, plus £2 million in interest, was repayable on September 30th, 2008, but Callerview failed to repay it.
He claims the defendants subsequently agreed on November 12th to provide him with a charge over their shares in two Luxembourg companies if he did not call an “event of default” under the loan agreement or make a demand under the personal guarantees.
Despite several calls on them, Mr Woods claimed that the defendants have failed to complete the equitable charge under the November 2008 agreement.
He had initiated the proceedings to enforce the securities for his loan to the defendants.
