Businessmen Jay Bourke and Eoin Foyle are being pursued by ACC Bank for €1.08 million summary judgment orders each arising from loans related to The Skylab building in Dublin.
The building at Exchange Street was valued at more than €6 million at the height of the property bubble but has since “devalued very considerably”, the court heard.
Mr Justice Peter Kelly yesterday granted the bank’s application to fast-track the proceedings in the Commercial Court after rejecting arguments by the defendants of delay on the bank’s part disentitling it to an urgent hearing.
The case is against Mr Bourke, Leinster Road, Rathmines, Dublin, and Mr Foyle, Charelville Road, Rathmines, Dublin.
Gary McCarthy SC, for Mr Bourke and Mr Foyle, said he wanted to advance a defence grounded on the bank’s failure to accept an offer last year by Mr Jan Kohler, another business partner of the defendants, to take over Mr Bourke’s interest in the ACC loan. That failure amounted to contributory negligence on the part of the bank, he said.
While he had “considerable doubts” concerning this “novel” line of defence being advanced to the bank’s claim, the judge said he would allow time for matters to be set out on affidavit and listed the matter on March 10th when he will decide if there is an arguable defence entitling the case being sent to a full hearing.
In its action, ACC claims some €1.084 million is owed by Mr Bourke and Mr Foyle under a facility letter of May 2008 under which loans were advanced to finance and fit out The Skylab at Exchange Street, Dublin. It claimed repayments had not been made under that facility since June 2010 and some €1.084 million was due and owing by both defendants.
The bank in November last appointed Declan Taite as receiver and manager over the interests of Mr Bourke and Mr Foyle in The Skylab. While The Skylab was a secured asset, the bank said it was unlikely that asset would be realised in the short to medium term and, when realised, there was likely to be a significant shortfall.
On that basis, it was anxious to obtain judgment as soon as possble with a view to enforcing it against unencumbered assets of Mr Bourke, ACC said. Mr McCarthy said Mr Bourke had no unencumbered assets.
In an affidavit on behalf of himself and Mr Foyle, Mr Bourke said he believed there was a bona fide defence to the bank’s claim. He said ACC had advanced funds to refinance his 25 per cent share of the costs of developing and fitting out The Skylab and had entered into a similar agreement with his business partners in the venture, Mr Foyle and Mr Kohler, with Mr Foyle holding a 25 per cent stake in the property and Mr Kohler holding the remaining 50 per cent.
He said all the funds advanced to him were secured against his interest in the property, which was developed in 2005. Since then, it was used for showrooms and offices and a substantial part of it was let to O’Hagan Contract Interiors Ltd which has gone into liquidation owing some €70,000 in rent arrears.
Mr Bourke said he had made proposals to ACC to deal with the debt but it had failed to address those in a timely fashion. He had also made clear to ACC he has no unencumbered assets against which ACC could secure any judgment obtained by it.
Mr Bourke also rejected the bank’s claims he and Mr Foyle had been unhelpful towards the receiver.
