Former Anglo Irish Bank chairman Seán FitzPatrick has been adjudicated a bankrupt by the High Court at his own request, just days after opposition from the bank ensured the collapse of his proposed settlement deal with creditors.
The official assignee in bankruptcy, Chris Lehane, will now deal with Mr FitzPatrick’s creditors, who are owed some €150 million. His assets are estimated to be worth some €50 million, including investments of some €45.7 million, and some €1.23 million in accounts in various financial institutions.
He is joint owner of six properties, including his family home and another house in Greystones, Co Wicklow; a house in Bray, Co Wicklow, and apartments in Marbella, Spain; at Smithfield Market, Dublin and Killiney Court, Killiney. Only the Marbella apartment is not subject to a mortgage.
A Proof of Debt process by the Official Assignee, not yet complete, has estimated the level of Mr FitzPatrick’s unsecured creditors at €70,292,885. He is also appealing some €2 million in various tax liabilities.
Anglo is the largest creditor of its former chairman. It says it is owed some €110 million and its counsel Paul Gardiner SC today rejected claims it would have done better under the proposed settlement deal.
Because Anglo did not support the deal, Mr FitzPatrick could not secure the necessary 60 per cent support of creditors and that led to his petitioning for bankruptcy.
A motion by Anglo to end court protection for Mr Fitzpatrick did not proceed today because he was adjudged bankrupt. Mr Gardiner said that motion had been brought to ensure the bankruptcy petition did go ahead.
Mr Gardiner said Anglo had made clear on March 12th last it was rejecting an informal scheme advanced by Mr FitzPatrick and the formal scheme advanced since then was “no more favourable” to the bank. It was not the case Anglo would get a better outcome from a scheme than bankruptcy, he said. The bank has some 85 per cent of Mr FitzPatrick’s debt, he added.
Mark Sanfey SC, for Mr FitzPatrick, said he would not argue at this stage about something that was “academic”.
Mr Justice Brian McGovern said he would not allow the court to be used as a forum for disputes between the sides. If there were things to be said, they should be said in another forum, he added.
Mr FitzPatrick claimed his creditors would have got a dividend more than twice as large under his scheme than was expected under bankruptcy. His scheme included his selling his half share in his family home – which has been valued at €1.5 million - and making available his half share of total pension assets of €3.4 million to creditors.
Mr FitzPatrick was adjudicated bankrupt this morning following a 12 minute hearing in a packed High Court. His was the first of 20 cases dealt with by the court. Mr FitzPatrick did not attend.
Mr FitzPatrick will be unable to act as a company director or manager after being declared bankrupt. He will be unable to borrow more than €650 without disclosing that he is a bankrupt.
All assets and property owned by him will now come under the control of the official assignee, the court officer who monitors the financial affairs of bankrupt individuals. Any salary, income or pension will also go to the official assignee.
In Ireland, individuals can only be discharged as a bankrupt once their debts and the costs of their bankruptcy is covered, or after 12 years have elapsed.
