THE HIGH Court has agreed to give Liam Carroll’s besieged Zoe development group a second chance to seek the appointment of an examiner to seven companies in a bid to ensure its survival.
Granting the companies leave to apply for examinership, Mr Justice John Cooke said there were “strong reasons” why they should be afforded another opportunity to argue for their survival.
He said that the overwhelming majority of the companies’ creditors, employees and suppliers supported the new application. The interests of those parties should not be affected by any past mistakes and misjudgments of directors of the companies, the judge said in his ruling.
The fresh attempt for court protection was described as “extraordinary and unprecedented” in the history of corporate litigation in Ireland by counsel for ACCBank, which is threatening to liquidate companies in the group.
The judge’s decision gives Mr Carroll’s companies and development group, which has bank debts of €1.2 billion, another reprieve to plead for protection after their first petition was rejected by the High Court and Supreme Court.
The case will be before the court again on Monday when the judge will set a date for the hearing of the second application for long-term court protection. The judge will also outline in detail the reasons for his ruling. He said the second hearing will decide whether the “defects” outlined by the High Court and the Supreme Court in the first unsuccessful application had been “adequately answered”.
The companies, led by Vantive Holdings and Morston Investments, two firms at the apex of the Zoe group of 51 companies, have submitted a detailed business plan and property valuations to support their application. They have also submitted letters of support from the group’s main lenders and evidence from employees and suppliers to Mr Carroll’s main development firm, Danninger.
Lyndon MacCann, senior counsel for Dutch-owned ACCBank, which opposed the hearing of the petition in an attempt to recover loans of €136 million, said the companies made a tactical and strategic decision to deliberately withhold the key business plan showing property valuations in the first, failed application.
Mr MacCann described this as “a bad decision” and said the companies justified this by blaming the stress Mr Carroll was under at the time and claiming that his judgment had been impaired. It also emerged that the Zoe group of companies are seeking to appoint Ray Jackson, a retired partner of KPMG, the accountancy firm that drafted an independent report backing their survival, as their examiner.