Bank of Scotland has asked a US court for permission to enforce its interest in the former Dublin home of bankrupt developer Sean Dunne and his wife Gayle Killilea Dunne to recover a debt of €12 million.
The British bank wants Connecticut’s bankruptcy court to drop the protection from creditors granted to Mr Dunne under US bankruptcy law so it can seize and sell the couple’s one-time home, “Ouragh” on Shrewsbury Road, one of Dublin’s most exclusive residential addresses.
Ben Groves, a manager in the bank's "global non-core Ireland unit," told the court that Bank of Scotland (Ireland) loaned Mr Dunne €7 million for the house in 2002 and a further €5 million in 2007.
He said in an affidavit that Mr Dunne had conceded that he had no equity left in the property. Mr Groves told the court the house was worth about €4 million based on a valuation carried out last month.
Mr Dunne valued the house at €7.5 million in financial statements to the court when he filed for bankruptcy in March 2013 owing €690 million, mostly to Ulster Bank and National Asset Management Agency.
The house was the couple's home until 2007 when they left Ireland for France. They later moved to the UK and Switzerland before settling in the US in 2010. The Ballsbridge house was leased by the couple to the South African embassy at a rent of €180,000 a year.
‘Love and affection’
Mr Dunne told creditors at a meeting in February that he was due to transfer half of Ouragh to his wife as part of a 2005 agreement to give her €100 million, a fifth of his fortune, in return for “love and affection.”
She declined to put her name on the property after he borrowed a further €5 million on the property in 2007 because she felt she would have been liable for half or all of the debt on the house, he said.
The Co Carlow developer lent the additional €5 million on the house to his company, DCD Builders, which was due to repay the money within 12 months but failed to do so after the banking crisis struck.
The Dublin property was one of four houses that the Dunnes have had an interest in on Shrewsbury Road.
Mr Dunne told the February meeting that in 2005 he gifted his wife €58 million to buy Walford, a property on the road that, nine years after that purchase, still remains the highest price ever paid for an Irish house.
He also disclosed that he gave his wife a €14 million profit from the sale of two houses on Shrewsbury Road to property investor and financier Derek Quinlan in 2006.
