Courts / Ireland / Report

Challenge brought against NAMA company over alleged €15m penalty

Date
2017-03-08

Stage
Charge Or Pretrial

Summary

The Cannon Kirk group of property development firms, alongside individuals Michael Cannon, Cathal Cannon, Seamus Cannon, and Owen Kirk, have launched a High Court action against National Asset Loan Management Designated Activity Company (NALM). The applicants, represented by Lyndon MacCann SC and Niall Buckley Bl, challenge an alleged €15m penalty imposed on loans originally advanced by AIB in 2010, later taken over by NAMA and transferred to NALM. Counsel stated that while the group reduced its indebtedness by over 50%, a 2016 agreement extending loan facilities included a clause requiring a €5m redemption fee plus monthly fees, which NALM now claims totals approximately €15m. The applicants allege this clause operates as an unlawful penalty and an impermissible clog on redemption, arguing the fees are unrelated to the debt quantum. They seek declarations that the clause is void and unenforceable, repayment of monies paid, and damages for alleged intentional interference with economic interests, breach of contract, and breach of duty. Mr Justice Paul Gilligan granted permission to bring the action ex-parte, noting a substantial issue had been raised. The matter was adjourned to a date later this month.

Who, what, where, when and why

What: Report matter: Challenge brought against NAMA company over alleged €15m penalty. Procedural stage: charge_or_pretrial

When:

February 2016 Other
March 2016 Other
2017-03-08 Publication

Why: However, it says it cannot do so because of a redemption fee of more than €15m being sought by NALM. CNI source report