A meeting between the banks and a representative of Michael Lynn, the solicitor whose assets have been frozen at the behest of the Law Society, did not go ahead yesterday as planned. Colm Keenaand Simon Carswellreport.
The High Court was told last Monday that Mr Lynn's solicitor, Giles Kennedy, had arranged a meeting for yesterday with a syndicate of banks to see what measures could be taken to repay their liabilities in an orderly way.
The meeting was designed to allow the banks establish who was owed what, and on what basis, as well as what exactly was owned by Mr Lynn, with a view to organising an orderly sale of properties.
It is understood the meeting was cancelled on Thursday afternoon, at Mr Lynn's instigation. A number of the affected banks were contacted yesterday but did not want to comment. Sources said the cancellation of the meeting is not seen as a positive development by them.
Mr Lynn has taken on a new solicitor to act for him in his dealings with the Law Society, Seán Sexton of PJ Walsh & Co. He has also engaged the services of Dublin accountants, O'Donovan Stewart, to provide financial advice. Mr Kennedy is not longer acting for Mr Lynn.
The High Court was told on Monday that Mr Lynn owned 105 properties personally or through his company, Proper T Capel, 35 to 40 of them abroad in nine countries, including Bulgaria, Slovakia and China. About 40 properties were bought this year, financed by loans. Mr Lynn also ran a business, Kendar Holdings, developing property in Portugal and Hungary, while running his legal practice. He was to produce a list of all these properties for the court, as well as loans taken out against them.
The Law Society conducted an inquiry into Mr Lynn's practice last month after it became concerned about his property dealings. It found that Mr Lynn had used his legal practice's client account for personal transactions and property dealings.
He owes at least seven lenders more than €26.3 million in borrowings drawn down for his property transactions since the start of this year.
This discovery led to the application to have his assets frozen and last Monday's hearing where Mr Lynn gave a commitment not to practise.
Meanwhile, it has emerged that Mr Lynn had applied to suspend his solicitor's practising certificate prior to his assets being frozen. The 39-year-old Co Mayo native was seeking to have the certificate suspended when the Law Society last month launched its investigation into his legal firm, Capel Law.
According to minutes of an emergency meeting of the Law Society's regulation of practice committee, convened on Tuesday, October 9th, to discuss Mr Lynn's dealings, the committee's chairman John O'Connor revealed that Mr Lynn was seeking to have his certificate suspended.
Mr Lynn did not attend the October 9th meeting because he was in Luxembourg, the minutes say. Solicitors must apply to the Law Society every year to renew their practicing certificates.
Mr Lynn has been concentrating more heavily in recent years on his property business, Kendar Holdings. He had received deposits from 220 Irish investors.
Mr Lynn's certificate was not suspended by the court last Monday because of concerns that his professional indemnity insurance of €11 million would lapse.
There is concern among solicitors that as a result of the Lynn case, the Law Society will increase the annual fee that solicitors must contribute to the society's compensation fund.
It is not clear whether investors in Mr Lynn's property business will be able to file claims against the compensation fund given that some of their money moved through the client account of his practice.
The Law Society accountant who investigated the firm found a minimum deficit of €702,830 in Capel Law's client account, although she said she believed the actual deficit is "much more than this".
