INVESTMENT BANK Morgan Stanley has taken control of a London office building from a company controlled by Dublin property investor and solicitor Brian O’Donnell, who is embroiled in a legal action with Bank of Ireland.

A loan of about £130 million (€160 million) was to be repaid on 15 Westferry Circus in Canary Wharf yesterday. Mr O’Donnell told the Commercial Court earlier this week that a legal action taken by Bank of Ireland had blocked the refinancing of the debt.

Morgan Stanley took control of the building in recent days by appointing its mortgage servicing division as a “special servicer” under a securitisation agreement through which the loan was sold on to institutions and investors.

Three other properties unconnected with the O’Donnells are financed through the same securitisation deal arranged by Morgan Stanley. A spokesman for the investment bank had no comment.

Mr O’Donnell told the court on Tuesday that Bank of Ireland’s action to claim an interest in the building through a charging order was likely to lead to the appointment of a receiver yesterday.

He said in evidence that the bank’s charging order against the property had caused “absolute havoc” and that the lender’s actions had “destroyed” the value of the properties in his business, which traded as Vico Capital.

The bank, which is owed €75 million by Mr O’Donnell and his wife, was examining him in court on what Mr Justice Peter Kelly had previously described as “alarming” discrepancies between statements of assets he submitted in March 2011 and February last.

The Canary Wharf property, which is occupied by Morgan Stanley, was owned by the English company Hibernia (2005) and the loan on the property was sold on in a mortgage-backed security, Radamantis (European Loan Conduit No 24) which was listed in Ireland.

Mr O’Donnell had previously indicated to Bank of Ireland that Hibernia (2005) was 100 per cent owned by himself and his wife but he recently disclosed that he was in fact the sole shareholder of the company and that this share was held in trust for his son, Blake.

Mr O’Donnell told the court earlier this week that he signed the trust document passing ownership of the property to his son in 2005.

The Radamantis securitised loan agreement, dated 2006, also stated that Hibernia (2005) was “wholly owned” by Mr O’Donnell and his wife, Mary Patricia.

He admitted in court it was “incorrect” to say in the loan documents that Hibernia (2005) was jointly owned by the couple.