Jim Mansfield pursued for €280m


Hotelier Jim Mansfield, who is suffering from what was described at the Commercial Court today as an incurable neurological illness, is being pursued by Bank of Scotland and Nama for summary judgment orders totalling €280 million.

In what Mr Justice Peter Kelly noted as probably the biggest ever summary judgment application brought here arising from a personal guarantee, the bank is seeking orders for €206 million against James Mansfield Sr arising from debts of his companies.

Nama in a separate case is seeking €74 million summary judgment orders also arising from Mr Mansfield’s guarantees over loans to made by Irish Nationwide Building Society to two companies.

Efforts by Mr Mansfield, Tasaggart House, Saggart, Co Dublin, and others to persuade a Saudi Arabian prince and a US business to invest in the Citywest enterprise had proven unsuccessful, the court also heard.

The Mansfield group had failed to deliver any of the items set out in a strategic plan provided by them to Bank of Scotland, it was claimed.

Mr Justice Peter Kelly yesterday transferred both sets of proceedings to the court, which fast-tracks commercial disputes, and listed the bank's summary judgment application for November 10th. Given Mr Mansfield is suffering from a neurological condition said to be incurable, it was in his interest the Bank of Scotland case be heard speedily, the judge said.

The judge allowed time to Mr Mansfield’s side to outline on affidavit what was described as a partial defence in the Nama proceedings and adjourned that matter for two weeks.

Earlier, Patrick Leonard, for Mr Mansfield, had opposed the Bank of Scotland case being fast-tracked on grounds of alleged delay by the bank in bring the proceedings and because of his client’s health problems. The judge rejected those arguments and found no culpable delay on the bank’s part.

The judge also noted the medical reports stated Mr Mansfield suffers from a number of medical conditions, the most serious being multiple system atrophy which, he noted, a neurologist had said was incurable. An estimated life span had been provided and, because this condition was deteriorating, the case should be got on as soon as possible, he said.

After the judge transferred the case, Mr Leonard said Mr Mansfield was currently able to give instructions but not on a daily basis as “some days are better than others”.

The case relates to loans provided by Bank of Scotland to HSS, Jeffel and Park Associates Ltd - the Mansfield group - of which Mr Mansfield is a director. The loans were advanced for purchase of lands and for development of a conference office, a golf course, residential units and a hotel.

Mr Leonard said business was conducted between Mr Mansfield and the bank via verbal agreements on funding, with the “paperwork” put in place later. He said a €28 million loan was sought for a convention centre built at the hotel but Bank of Scotland decided it was not prepared to finance that. Had that money been paid out, the business would “not have collapsed” as it had and Mr Mansfield would not be facing judgment.

After Bank of Scotland appointed Martin Ferris as receiver of HSS, Mr Mansfield was involved in negoatiations with a Saudi Arabian prince was concerning setting up the City West Institute, an English language school for up to a thousand middle eastern students and a meeting was held with representatives of the Royal Saudi Arabian Embassy in Christmas week 2010.

Paul Gallagher SC, for the bank, said when the loan facilities got into difficulties there were extensive negotiation with Mr Mansfield in an attempt to find a resolution. Several companies were involved in the Mansfield Group and there was significant business and employment at stake.

After it became apparent measures to seek potential investors and reduce debt were not going to be achieved a decision was taken to call in the debts and Mr Taite was appointed in July 2010 and tried to find a solution and maximise the assets.

Mr Mansfield controlled the companies, his cooperation was essential and up to July 2010 there was still discussion of a potential American investor, he added.

Mr Gallagher said various medical reports did not indicate Mr Mansfield’s condition was “likely to improve in the near future” and it might be better to deal with the matter when Mr Mansfield would be able to respond.

The court was told Mr Mansfield was “pivotal” to all the discussions while his sons PJ and James Mansfield, Sean Whelan chief executive of HSS, and financial controllers were also involved.

In the Nama proceedings, the agency is seeking judgment for more than €74.1 million arising from personal guarantees provided by Mr Mansfield over loans by NBBS to two companies, Fallowvale Ltd and Bridford, formerly Bridford Ltd, between 2003 and 2009.

Those loans had been transferred to Nama which last April demanded repayment of €45.4 million from Fallowvale and €27.5 million from Bridford.

When no repayment was made, the agency appointed Kieran Wallace as receiver over the companies on April 20th last. Nama claims Mr Mansfield is liable to it under his guarantees for €74,014,965.

Today, Mr Leonard, for Mr Mansfield, said he was not opposing transfer of the Nama case but wanted time to consider a partial defence to a small portion of the claim. Mr Mansfield was concerned whether Palmerstown Stud would be sold for less than an offer made earlier this year but not accepted by the receiver, counsel said.

Counsel also indicated he would seek a stay on any judgment order which might be granted in the Nama proceedings so as to allow certain assets be sold.