Entertainer Michael Flatley has taken out two insurance policies worth €10 million on his Co Cork mansion over which a receiver has been appointed in a dispute of alleged default on a €5.6 million debt, the Commercial Court heard.
As a result, an application to lift an interim injunction obtained by Mr Flatley preventing the receiver taking possession of the Castlehyde property in Fermoy did not proceed before the court on Thursday.
Earlier this week, Kieran Wallace, who was appointed receiver over Castlehyde, sought to have the injunction preventing possession lifted because there were concerns that there was not proper insurance cover in place.
Mr Wallace was appointed receiver over alleged default on a €5.6 million loan by Novellus Finance Ltd to the “Lord of the Dance” star’s Blackbird Film Productions company. Mr Flatley was guarantor for the loan on the strength of the value of Castlehyde.
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Kelley Smith SC, for the receiver and Novellus, told the court on Wednesday that the insurance policy which had been provided by the Flatley side did not cover all risks including storm, flooding and criminal damage. The policy only covered fire, lightning explosion and aircraft damage, she said.
Ronnie Hudson, for Mr Flatley, said there was sufficient cover in place and he was prepared to bring an insurance broker to court to give evidence to that effect.
The case was adjourned to Thursday when Ms Smith said the Flatley side had provided an affidavit stating two further policies, through Dolmen brokers, had been put in place, one for €8 million and another for €2 million and would be in place until May 2025.
Counsel said another affidavit on behalf of the brokers stated the insurance underwriters were aware of the appointment of the receiver as certain policies are invalidated by receivership.
It was also stated there was CCTV monitoring at Castlehyde, she said.
Given that this certainly appeared to address the immediate concerns, Ms Smith said in that situation she was now applying for liberty to apply to the court in the event that anything arises between now and the hearing of the full dispute between the parties.
Ms Smith also said her side should be awarded its costs given there had been a “failure to engage” as well as the making of claims that were untrue on the question of insurance by the Flatley side until the application to lift the injunction was made.
Mr Hudson, for Mr Flatley, said two representatives of Dolmen brokers were in court and they had affidavits that the insurance was in effect from Wednesday, one of the policies having been “achieved with some considerable difficulty”. Counsel said it was noteworthy that the cost of this insurance is about €500,000 per annum and they cover “all risks”.
Mr Flatley’s solicitor, Max Mooney, had “worked tirelessly” with the brokers to deal with all of the concerns raised, he said.
Mr Hudson said the CCTV, which is internal to the mansion, links an alarm to the local Garda station and fire brigade. “There is also a permanent presence there so it is not a property that is in the wilderness,” he said. Counsel said the issue of costs should be reserved to the hearing of the case
Mr Justice Mark Sanfey, who had expressed concern on Wednesday that the property might not be properly insured, said it appeared it was now in force “but only due to the efforts of the defendant”.
He adjourned the matter, including the question of costs, to next month and gave both sides liberty to apply to the court should anything arise in the meantime.
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