Four property developers have consented to judgment for €3.55 million against them over default on loans issued in 2006 towards the purchase of a 7.5-acre plot of land in Birr, Co Offaly.
Part of the site, on the Tullamore Road, was later sold to supermarket chain Lidl.
The original loan, for €3.4 million, was made by Allied Irish Banks to developers Peter Donnelly, Newtown, Ardclough Road, Celbridge, Co Kildare; Paul Kelly, Doon, Boyle, Co Roscommon; Brian O’Sullivan, Kilgolan Upper, Kilcormac, Co Offaly; and Kevin Gallagher, Rocky Valley Drive, Kilmacanogue, Co Wicklow.
AIB says it sought judgment for €3.55 million after they failed to meet a repayment demand for the outstanding debt in May last year.
Two-month stay
When the case came before the Commercial Court on Monday, Mr Justice Brian McGovern was told there was consent to judgment for €3.55 million with a two-month stay on execution of the judgment order. The judge entered judgment with a two-month stay on execution as agreed.
Michelle Kierans, a manager in AIB’s financial solutions group, said in an affidavit that discussions had taken place in 2016 between the bank and the four, with their financial adviser, over the debt.
There was breakdown in those negotiations later after AIB believed the defendants had taken action to move assets out of the bank’s reach. Demands for repayment were made and proceedings issued.
The defendants said they were trying to market the Tullamore Road site, which would provide money towards debt reduction, Ms Kierans said.
The bank told their lawyers last October it was willing to refrain from seeking to have the case entered into the fast-track Commercial Court list to allow sale of part of the site to Lidl to progress.
It was sold last January and the defendants paid some €435,000 off the debt, which stood at about €3.9 million, Ms Kierans said.
The bank was no longer willing to delay seeking to enter the case into the commercial list and there was still a very significant sum outstanding, Ms Kierans said.
