A Limerick developer has consented to a record judgment of more than €86.5 million being entered against him over unpaid property loans of over €165 million made to his companies by Anglo Irish Bank.
The judgment order granted by Mr Justice Peter Kelly against Michael Daly today is the largest ever entered against an individual at the Commercial Court.
In his defence to the bank’s proceedings, Mr Daly had claimed he was regarded by Anglo as a “favoured developer” in the mid-west region with “easy access” to senior figures in the bank, including Sean Fitzpatrick and David Drumm. He claimed he was actively encouraged by Anglo in 2006 and 2007 to undertake massive property developments with the assurance hundreds of millions would be made available.
His companies spent more than €300 million on development projects here, plus more than €100 million in projects in Germany, Mr Daly said. In 2006 and 2007, Anglo was anxious the group make additional investments in Germany and David Drumm made it clear funds of up to €500 million were available, he alleged.
Mr Daly, of “Dalmin”, North Circular Road, Limerick, said he had relied on oral assurances from Anglo executives that personal guarantees provided by him over loans were secondary to security taken by the bank and would never be relied upon. The bank however failed to take proper security and its handling of securities was “a shambles”, he said.
Anglo argued the claims about Mr Daly’s access to senior Anglo executives were not relevant and described as “incredible” his claims relating to Anglo’s approach to the guarantees.
Last year, the proceedings against Mr Daly were sent to a full plenary hearing after the court ruled Mr Daly had made out an arguable defence.
The full hearing was listed for January 11th next but Anglo brought a preliminary motion seeking to strike out Mr Daly’s defence on grounds of failure to make discovery of documents.
That motion was due to be dealt with today but Mr Justice Kelly was told by Brian Kennedy, for Anglo, Mr Daly had emailed Anglo earlier indicating he was consenting to judgment in the sum sought.
Mr Daly confirmed he was consenting to judgment, plus costs and Mr Justice Kelly entered judgment in the sum of €86,543,769 million against him. Third party procedings by Mr Daly in which he made claims against a number of Limerick solicitors were also struck out, with costs against Mr Daly, after Mr Daly said he was not proceeding with those claims.
Anglo previously secured judgment orders against four solicitors arising from guarantees related to loans to companies and partnerships linked to the Fordmount property group.
Dermot O’Donovan, Michael Sherry and Aidan Frawley, all partners in the Limerick-based firm Dermot G O’Donovan & Partners, consented at the Commercial Court last month to judgment orders for €21.7 million against each of them. A fourth partner in the firm, Thomas Dalton, previously consented to summary judgment against him for €21.4 million.
Mr O’Donovan, Mr Sherry and Mr Frawley had argued they had a defence to Anglo’s claim on grounds including that assurances were given by Anglo officials to Mr Daly their guarantees over certain loans would never be relied upon.
The three solicitors had claimed they believed the guarantees were “a box ticking exercise” for Anglo’s credit committee and that Mr Daly had a special status with Anglo, having been taken on several golfing trips by it including one involving travel on the Orient Express.
Anglo had described the solicitors’ claims as “incredible” and argued, as experienced professional solicitors, they could not have genuinely believed the guarantees were unenforceable.
The proceedings arose from unpaid loans of more than €165 million advanced by Anglo to three companies in the Fordmount property group and two partnerships to buy lands and buildings in and around Limerick city and county for development. When they were not repaid, the bank appointed a receiver over most of the assets of the companies.
Under personal guarantees of various loans, the bank alleged Mr Daly was liable for €86 million while the four solicitors each had a € 21 million liability.
