AIB case against Tony O'Reilly admitted to court

Monday 26 May 2014 17.37
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AIB said Mr O'Reilly and his companies had been given every possible opportunity to try to reach an agreement on the debt
AIB said Mr O'Reilly and his companies had been given every possible opportunity to try to reach an agreement on the debt
Tony O'Reilly had borrowed heavily in an attempt to rescue Waterford Wedgwood
Tony O'Reilly had borrowed heavily in an attempt to rescue Waterford Wedgwood

Allied Irish Banks is seeking an order from the Commercial Court against businessman Anthony O'Reilly to recover debts of more than €22m.

The action was admitted to the Commercial Court this morning.

AIB is seeking a summary judgment order against Mr O'Reilly - who has an address in the Bahamas - and two of his companies.

The action relates to borrowings and guarantees by Mr O'Reilly and two companies - Indexia Holdings limited, registered in Cyprus, and Brookside Investments which has a registered address at Castlemartin Stud Farm in Kilcullen in County Kildare.

Lawyers for Mr O'Reilly said he accepted the monies had been borrowed and were repayable.

The bank said it had taken this legal action only after every possible opportunity had been given to Mr O'Reilly and his companies to reach a satisfactory agreement with the bank.

Senior Counsel Michael Collins for AIB  said the money fell due in 2010 and 2012.  He said there had been two separate standstill agreements.   

He said the bank had had no option but to take this action.

Mr Justice Peter Kelly asked lawyers for Mr O'Reilly and his companies if they had any defence to the bank's claim.   

Barrister Bernard Dunleavy said the defendants accepted the monies had been borrowed and were repayable. But he asked for a short period of time to file a reply to the bank's claim.   

He said there may be matters it would be appropriate to bring to the court's attention which would affect the ordinary course of action the court would take.

Mr Justice Kelly granted a short adjournment until 23 June.

Documents submitted to the court outlined efforts made to resolve matters between the two sides.    

A representative of Mr O'Reilly and his companies, Bernard Somers, told the bank in July 2012 that Mr O'Reilly was "only living on a modest income".   

The bank demanded a "material, upfront cash payment" from Mr O'Reilly in May 2014.   Mr Somers told AIB there was no money to make such a payment.  

AIB told Mr Somers earlier this month that to defer legal action it required €2m to be paid by Monday 19 May along with confirmation that Mr O'Reilly and his companies would take immediate steps to dispose of their assets within six months to realise any surplus funds.   

The bank said Mr Somers told it, the defendants could not comply with this requirement.

Mr O'Reilly also wrote to the bank from his home in Normandy in France and disclosed that his coastal estate in Glandore in Cork - Shorecliffe House  - was for sale.     

He also told the bank he was selling Castlemartin Estate - which he described as 750 acres of the finest stud land in Ireland.     

He also disclosed that a programme of disposal in respect of his holding in Independent News and Media held as security by AIB was in place.    

He said that since 2011 he had disposed of assets with a value in excess of €150m which had been used to reduce borrowings.