A HIGH Court judge has expressed concern about an increasing number of cases in which solicitors are being sued by banks and others for allegedly dishonouring undertakings to take the necessary steps to ensure financial institutions have good security for loans advanced.
Mr Justice Peter Kelly made the remark yesterday when dealing with proceedings in which ACCBank wants court orders requiring a solicitor to perform a number of undertakings to ensure the bank has security for loans amounting to more than €2 million advanced to two property development companies on dates in 2004 and 2005.
In that action, an official with ACC said the ability of banks in general, and ACC in particular, to engage in the financing of property transactions depends to a large extent on the unquestioned reliability of solicitor's undertakings.
Earlier yesterday, the judge admitted two separate cases to the Commercial Court in which ACC and Anglo Irish Bank are seeking similar orders against other solicitors.
Dealing with the ACC action against Joseph Traynor, practising as Traynor Co Solicitors, Clan-brassil Street, Dundalk, Co Louth, Mr Justice Kelly said he was unhappy the undertakings had still not been performed despite his being told last week that Mr Traynor had complied with four of the five undertakings and intended that further progress would be achieved on the fifth by the end of last week.
Counsel for Mr Traynor outlined a number of steps which had been taken to ensure the undertakings were honoured.
Eoin McCullough SC, for ACC, said his client was prepared to press ahead with the case.
The judge said he was not impressed with the handling of matters to date. He was "increasingly concerned" because lots of solicitors were being sued for allegedly dishonouring undertakings.
Mr Justice Kelly adjourned the matter to later this week.
The dispute relates to a number of loans advanced by the bank to Speedwell Developments Ltd on dates in 2004 and other loans to Tronmarron Ltd in 2005.
Also yesterday, the judge admitted to the Commercial Court proceedings in which ACC is suing Pádraig J Butler, practising as Butler Solicitors, of Lower Patrick Street, Kilkenny over alleged failure to comply with alleged undertakings to ensure security for the bank on loans totalling €2.18 million it advanced to Séamus and Eugene McKenna, c/o APX Ltd, Milford Cross, Co Carlow.
The bank has taken separate proceedings against the McKennas relating to the loan while Mr Butler also took proceedings against them for orders restraining them from reducing their assets below €1.28 million.
The judge also admitted proceedings by Anglo Irish Bank against Matthew W Mulvey and Peter Kenny, practising as Mulvey Kenny Co, College Street, Carlow, over an alleged failure to honour an alleged undertaking of March 2007 to lodge €1 million to the bank from the proceeds of sale of sites in Carlow.
