TREASURY HOLDINGS has brought a legal action to compel businessman Harry Crosbie pay an alleged €3 million share related to a €19.2 million debt to another company under agreements for the financing of the Spencer Dock development company.
Lawyers for Mr Crosbie say he will be counter-claiming for some €70 million from Treasury over agreements related to development in the docklands.
Treasury claims, in face of a winding-up petition served on it last December, that it had to pay some €9 million to finance company Streamford Ltd, a subsidiary of Mercury Engineering Ltd, as part payment of €19.2 million due by Spencer Dock Development Company Ltd (SDDC) to Streamford via a Treasury subsidiary, Sharwood Twen Property Management.
Treasury, a shareholder with Mr Crosbie in the Spencer Dock company, says SDDC was unable to repay the €19.2 million when it became due last October.
Treasury claims it subsequently reached an agreement with Streamford in November to pay the €19.2 million in instalments. It claims Mr Crosbie, at a meeting on November 10th with Richard Barrett and John Ronan of Treasury, agreed a settlement should be entered into concerning repayment of the €19.2 million.
In an affidavit, Mr Barrett claims Mr Crosbie agreed to pay a contribution last month when his cash flow would be “okay” and, in light of that, Treasury reached its instalments agreement with Streamford.
Treasury said some €9 million was paid by it and SDDC by December 5th last. Treasury said it paid €7.5 million while SDDC paid €1.5 million but, when Mr Crosbie was called upon to make his one-third or €3 million contribution to that €9 million payment, he had refused to do so.
Mr Barrett said it was clear from the agreements that Mr Crosbie was liable for the sum sought, but had refused to pay.
When the proceedings by Treasury against Mr Crosbie came before the Commercial Court yesterday, Declan McGrath, for Mr Crosbie, said he would be counter-claiming for some €70 million from Treasury related to several agreements. Martin Hayden SC, for Treasury, said those agreements were not relevant to the agreement by Mr Crosbie to pay the contribution and to whether SDDC was compelled to pay its liability to Streamford.
Mr Justice Peter Kelly was also told there had been detailed engagement between solicitors for both sides and there may yet be an effort to mediate the dispute.
Making an order admitting the case to the Commercial Court, Mr Justice Kelly said that order was “no impediment to mediation”.
Earlier, Mr McGrath said there were “layers” to Mr Crosbie’s defence, including his claim that the money sought by Treasury is not owing because Treasury failed to operate provisions of the agreement between the parties. Mr McGrath said there was “a serious dispute” as to what was agreed at the November 10th meeting.
In its case, Treasury says it, Mr Crosbie, SDDC and a company called Folly Ford Ltd had agreed indemnity and contribution agreements in October 2004.
Also in 2004, Mercury agreed to provide finance to SDDC to allow it to comply with a condition imposed by the banking syndicate providing funding for the docklands development related to the amount of equity to be provided.
