Anglo Irish Bank has conceded that its former CEO David Drumm has an arguable defence to its claim for some €8.3m judgement orders against him over unpaid loans.
The concession means Anglo will not proceed with its application, listed for hearing at the Commercial Court next week, for summary judgement orders for €8.3m against Mr Drumm but will instead seek the €8.3m in a full plenary hearing later this year.
As well as opposing the Bank's claim for the €8.3m, Mr Drumm has counterclaimed for some €2.6m over the termination of his employment and loss of bonuses.
Yesterday, Brian O'Moore SC, for Mr Drumm, told Mr Justice Peter Kelly that Anglo was withdrawing its claim for summary judgement against his client, in effect accepting there were triable issues between the sides. In those circumstances, the sides had agreed a schedule for the exchange of the legal documents necessary for a full plenary hearing, counsel added.
John Hennessy SC, for Anglo, confirmed that the bank was not proceeding with its summary judgement application, listed for hearing on January 21.
Mr Justice Kelly approved the agreed schedule and listed the case for further directions on March 8 next. A hearing date will be set at a later stage.
Mr Drumm, now living in Cape Cod in the US where celebrities such as Johnny Depp, the Jonas Brothers and Harry Connick Jnr also have homes, has in letters to Anglo claimed he has sufficient assets to meet his liabilities to the bank.
He claims the demand for immediate repayment is premature, in breach of loan agreements with him and he is being harassed. Anglo Irish Bank denies those claims and has alleged Mr Drumm has failed to date to file a statement of affairs.
Mr Drumm has also claimed he and his wife Lorraine have given undertakings relating to their former family home in Malahide. This has been transferred into Mrs Drumm's name in what Anglo alleges is a fraud on creditors but the couple claim was for 'taxation reasons'.
Anglo has brought two actions, one against Mr Drumm over non-repayment of loans and a separate action against the couple seeking to set aside the transfer of the Malahide property. That second action will be mentioned next week before Mr Justice Kelly.
In the proceedings against the couple, Anglo is seeking orders to set aside their voluntary transfer for 'natural love and affection' of the property at 20 Abington, Malahide, Co Dublin - which had been jointly owned by the couple - into Mrs Drumm's sole name.
Anglo claims this property was Mr Drumm's main asset and the transfer is void as a fraud on creditors because it would mean the property cannot be used to reduce Mr Drumm's liability to Anglo.
The Drumms claim the transfer was 'for taxation reasons' based on advice from US lawyers and not designed to protect the property from claims by creditors.
Mrs Drumm's lawyers said she is supportive of her husband trying to come to an agreement with Anglo about repayment of his loans and other matters and added the couple had made no final decision about leaving Ireland on a long-term basis.
In the case against Mr Drumm, who resigned on December 2008, the claim arises from loans on dates in May 2007 and January 2009, the last being made two weeks before the bank was nationalised. Most of the €8.3m sum sought relates to refinancing of a facility whereby Mr Drumm could invest in shares in Anglo.
