THE FINANCIAL position of the owner of Kinnitty Castle Hotel has been described in the High Court as "perilous" when he applied for the dismissal of a bank-appointed receiver.
Rossa Fanning, for KBC Bank, formerly IIB Bank, described as "hollow" a damages undertaking to the court by Cornelius Ryan. Mr Fanning told Mr Justice Peter Charleton that Mr Ryan had conceded in evidence that he could face bankruptcy.
Martin Canny, for Mr Ryan, told the court his client wished to have Declan Taite, an insolvency expert with Farrell Grant Sparks, removed as receiver to the midlands hotel on the basis that a partner in his firm had allegedly previously bid for Kinnitty Castle.
He said Mr Ryan also sought to have a January 9th closure date for lodging tender bids for the hotel extended until February 16th to allow a German consortium, interested in buying the hotel for just over €10 million, to carry out due diligence inquiries.
Mr Ryan, Pipers Cottage, Kinnitty, Co Offaly, and Kathleen Seret Ryan, from whom he is divorced, had sought the High Court's intervention in the management and sale of the hotel.
Mr Justice Charleton heard that the Ryans claimed the hotel was in law protected as a family home and that he owed his former wife €1.6 million under a divorce settlement agreement.
Mr Ryan told the court he had bought the hotel in 1994 and mortgaged it in 2004 for €5,871,000. He now owed the bank more than €6 million. He said a deal to sell the property for €12.6 million fell through in 2006 and he had been trying to sell since. He had agreed with the bank to a tendering process that would conclude on November 27th last.
A valuation of €9 million had been placed on the hotel and bids of €8 million and $12million (€8.6 million) had been made.
Mr Ryan claimed he had no option but to withdraw from the tendering process following a damaging article published by the Irish Independent on November 11th.
Mr Justice Charleton refused all of Mr Ryan's injunctive reliefs. He was satisfied Mr Taite would carry out his professional duties responsibly both to the bank and to Mr Ryan. He said there was nothing to stop the German company from carrying out due diligence before January 9th and making a bid if it wished to.