A MAN claimed in the High Court yesterday that bad advice from the Bank of Ireland caused him to lose his 240-acre Co Kildare farm, valued at over £750,000 seven years ago.
Mr James Behan (51), who once farmed at Dollardstown House, At by, which he inherited from his parents in the late 1970s, claimed that by 1990 he had lost everything and was now on the dole. In 1981 he had assets over £800,000 and claimed he had been brought to his present state by the bank's actions.
Mr Behan, who is suing the Bank of Ireland for damages, has claimed that the advice he got from the bank to borrow money to expand his business, rather than sell some of his assets to clear his debts with it, contributed, if not wholly, then in great measure to the complete destruction of his farming business.
The bank has denied it advised Mr Behan to extend his business to deal with cash-flow problems. It has also denied his claims that it held itself up to be conversant with the needs of the local farming community or that it had expertise in advising farmers.
Mr Noel Clancy SC, for Mr Behan, said if his client had sold between 40 and 70 acres in 1981, he would have cleared his debts with everybody and had a viable farm.
Mr Behan claimed he first became a customer of the Carlow branch of the Bank of Ireland in 1977 and by May 1981 had borrowed about £150,000.
To offset cash-flow problems arising from inflation, static prices and the abolition of the Green Pound system, Mr Behan instructed his auctioneer to sell between 40 and 70 acres to clear his debts to the bank.
Mr Behan, who was involved in beef, wheat and pea production, claimed that when the bank became aware of his intention to sell land to clear his accounts, it assessed the situation and advised him that the sale of the lands was unnecessary and unwarranted.
He claimed the bank, after monitoring the progress of his business, including his business acumen and methods, urged him to solve his cash-flow problems by expanding his business.
Mr Behan claimed that the bank told him it would fund such expansion and would advance all necessary funds to achieve profitability. The bank would hold the title deeds of his lands and property. A repayment schedule, which would not be strictly enforced, would be drawn up and agreed between the parties.
In 1982, Mr Behan claimed, losses of £40,000 were offset by the sale of some machinery and a gate lodge. By the end of the year, he submitted a working programme for 1983 to the bank. The programme was dictated by the increasing demand and profit margins in the harvesting and sale of peas.
By the end of 1983 Mr Behan had turned around a loss-making business into a profitable enterprise and had come from a position of an annual loss of about £40,000 to one of profit of about £18,000.
However, 1985 and 1986 were a disaster for the pea harvest, and by mid-1985 Mr Behan was forced, to sell off assets to clear debts to the bank which, he claimed, was then putting him under intense pressure. By 1990 he had lost everything.
The case continues.