Forfas and the Industrial Development Agency Ireland have been given leave to serve proceedings on a company in Canada in connection with an alleged £1.6 million debt following the closure of a clothes-manufacturing plant in Co Kerry.
It is claimed Klopman International Ltd, with registered offices at Clash Industrial Estate, Tralee, Co Kerry, and its Canadian parent, Dominion Textile Inc, of Montreal, Quebec, owe £1,674,957 arising out of an agreement with the State agencies of January 1994.
The IDA and Forfas have already initiated proceedings against Klopman and the High Court yesterday granted leave to serve its Canadian parent with proceedings.
Mr David Barniville, for the agencies, said Klopman carried on cloth-manufacturing in the Clash estate. In January 1994 it had entered into an agreement with his clients. In an affidavit on behalf of the agencies, accountant Mr Derek Fahy said both Klopman and Dominion had agreed to provide 220 full-time permanent jobs at the Tralee plant.
If the job total was less than this figure for a continuous period of two months during the agreement, it was agreed the companies would repay to Forfas £7,613 for each job less than the 220 undertaking. Mr Fahy said another clause in the agreement confirmed that the maximum amount of Klopman and Dominion's liability was £1.67 million, representing the grant liability.
In December 1996, the number of permanent full-time jobs being maintained by Klopman in Tralee had fallen from 220 to 141 for a continuous two months. This was in breach of the covenant and Klopman was asked to repay just over £600,000 on account of this.
By November 1997, it came to the attention of the agencies that Klopman had ceased to trade. Because it had failed to ensure that 220 full-time positions would be maintained at its Tralee plant until December 31st, 1998, IDA (Ireland) sent Klopman a demand for the £1.67 million.
Both Klopman and Dominion had refused to pay the claim or any part of it.
Mr Fahy said while solicitors Arthur Cox had indicated they were acting for Klopman, there was no response to a query if they were also acting for Dominion.