Irish group Treacys Hotels will clash with US fund Cerberus next week in a High Court case that is key to the future of a landmark property that has been empty for several years.
Family-owned Treacys maintains it agreed to buy the Ard Rí Hotel overlooking Waterford city in November 2016 from Promontoria Aran Ltd, part of US investment fund Cerberus, for €1.6 million.
It says Promontoria Aran subsequently agreed to sell the property to businessman Seamus Walsh for €1.5 million, despite receiving a €160,000 non-refundable deposit from the Treacy family, sparking a legal dispute.
Maria Keena, a member of the Treacy family, is due to ask the High Court on Tuesday to order Promontoria Aran, receiver Luke Charleton of EY and others to fulfil what the hoteliers say is a contract to sell them the Ard Rí, or pay damages.
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She signed a receipt for the deposit, which she maintains is part of the evidence to support the claim that there was a contract to sell the hotel to her as the group’s representative.
The High Court dismissed Ms Keena’s claim in February 2019 on the grounds that she had not established an arguable case, but in October last year the Court of Appeal decided her case should be heard.
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That ruling means the High Court must hear Ms Keena’s and the Treacys’ case that a receipt for the €160,000 deposit, and emails between the parties, amount to evidence of a contract to sell the hotel to them.
Promontoria Aran and Mr Charleton maintain that this is not the case. They asked the High Court to dismiss the claim when it was first heard.
Once part of the old Jury’s group, the 165-bedroom Ard Rí has lain idle for several years and was not in use at the time Treacys Hotels offered to buy it.
Its state has prompted concerns locally about vandalism and antisocial behaviour around the property.
Treacys Hotels became interested in the Ard Rí in 2016, the same year that Cerberus acquired loans secured on the hotel through Promontoria Aran, and appointed Mr Charleton as receiver.
Bob Lanigan, a close associate of the hotel group’s head, Ms Keena’s father Jim Treacy, approached Terry Byrne of Cerberus European Services Advisors (Ireland) Ltd in November 2016 to see whether the US firm would sell the property.
Mr Lanigan maintains that Mr Byrne told him he would “enforce the sale” at €1.4 million to €1.5 million, although the defendants dispute that he said this.
Mr Treacy authorised Mr Lanigan to offer Mr Byrne €1.6 million. It has been claimed that while he did not name either Mr Treacy or the group, Mr Lanigan subsequently confirmed to Mr Byrne in phone conversations on November 21st, 2016, that the person he represented was prepared to pay that sum for the Ard Rí.
Mr Lanigan maintains that Mr Byrne told him to pay the non-refundable deposit of €160,000 to Ernst & Young – now EY – at the accountants’ firms’ offices in Dublin that day.
It has also been claimed that Ms Keena, Mr Lanigan and Mr Treacy travelled to the offices and at 8:30pm handed over a bank draft for €160,000 to EY staff member Chris Allen.
Mr Lanigan maintains that Mr Allen confirmed this was 10 per cent of the price for the Ard Rí. The EY staffer, according to the claims, then made out a receipt, using a copy of the draft, which he, Mr Lanigan and Ms Keena signed.
Another EY staff member, Ciara O’Mongain, signed as a witness to all three, court documents show.
The High Court hearing focused heavily on the question of the buyer’s identity, as Mr Lanigan did not say initially on whose behalf he was negotiating.
In her Court of Appeal ruling, Ms Justice Máire Whelan said that, applying common sense to the circumstances, a case could be made that Ms Keena, a member of the Treacy family, signed as the purchaser.
Neither the Treacys, EY nor Cerberus would comment.
