BUILDER BRIAN Cunningham has been allowed to change his claim of fraud against First Active in a preliminary ruling yesterday in the Commercial Court.

Mr Justice Frank Clarke has permitted Mr Cunningham to amend his claim to allege that the bank fraudulently and deliberately misrepresented itself by contending at key meetings in August 2002 that it would continue funding two of his group's building projects in Dublin and Salthill, Galway, while at the same time putting documentation in place which allowed it to refuse to provide this funding.

Mr Cunningham had previously claimed that First Active did not have "any intention" of lending further money for the Salthill project.

He must submit a new statement of claim in the case.

The Galway builder is suing the bank over its appointment of a receiver, Ray Jackson of KPMG, to his building business, the Cunningham Group, in 2003 over loans totalling €38 million. He is also suing Mr Jackson and developer Bernard Duffy who bought the Salthill project, Baily Point.

First Active, Mr Jackson and Mr Duffy are contesting the action.

In his ruling yesterday, Mr Justice Clarke has allowed the group proceed with its claim that First Active benefited from a "secret profit" from the sale of part of the Baily Point site through "an arrangement fee" as this could be inferred as a benefit to the bank and not the building group.

The judge refused to allow the group proceed with a claim against Mr Jackson and Mr Duffy that they also benefited from "a secret profit" on the sale of Baily Point. The group had suggested at one point that this amounted to "a bribe" by Mr Duffy to Mr Jackson and the bank. The judge said it had been "wrong" and "unfair" of the group to have made the allegation without informing the defendants about the claim in advance.

The case continues today.