The High Court has granted National Asset Loan Management DAC (NAMA) security for its costs before allowing Tom McEvaddy Property Limited, trading as Nexus Homes and in liquidation, to proceed with its substantive claim. The court decided the security application only; it did not determine whether the company is entitled to the money it claims or whether a trust existed.
The company says it paid €228,375.84 in planning fees in September 2008 for a development at Robin Hill, Blackthorn Road, Sandyford, Dublin 18. It claims the McEvaddys, who owned the property and controlled the company, were to hold sale proceeds on trust for it to the extent of that payment. The company’s substantive proceedings seek, among other relief, a declaration that NAMA holds that sum on trust. NAMA’s loan and security over the property had later been sold to Promontoria (Gem) DAC.
The company argued that NAMA’s alleged failure to account for the money caused its inability to pay costs, a circumstance that could justify refusing security. The court applied the four-part test in *Connaughton Road Construction Ltd v Laing O’Rourke Ireland Ltd*: the company had to show, on a prima facie basis, actionable wrongdoing, a causal link, recoverable loss, and that the loss was enough to make the difference to its ability to pay NAMA’s costs.
The judge found that the company had not produced cogent or credible evidence to support the alleged trust or actionable wrongdoing. The liquidator’s account, the court said, did not establish how the payments were made or that they were made on trust rather than, for example, as a loan. The court also found no adequate evidence that NAMA’s alleged non-payment caused the company’s financial position.
The company’s January 2020 statement of affairs showed a deficit of €2,301,107. It argued that nearly all of that debt was statute-barred, leaving €58,309 outstanding, and that recovering the disputed sum would then leave enough to meet an adverse costs order. NAMA said the company had also omitted €103,318 owed to Revenue. The court found no detailed analysis or supporting evidence for the claim that the debts were statute-barred. It did not decide whether €66,748 would cover NAMA’s likely costs, saying no submissions on likely costs had been made.
The court concluded there was no basis to refuse security and granted the relief sought in NAMA’s notice of motion. It asked the parties to try to agree outstanding matters; if necessary, the case was to be listed for mention one week after judgment for consideration of final orders. The judgment was delivered on 20 November 2020.