The High Court dismissed Aken Limited’s application to replace Simon Coyle as liquidator of Maplewood Developments, ruling that Coyle had been properly appointed at a creditors’ meeting in August 2012. The court also declined to invalidate the vote cast by secured creditor National Asset Loan Management Ltd (NALM) or to set the value of its security for all purposes.
Maplewood, an unlimited company involved in residential property development and part of the Moritz Group, had resolved to wind up voluntarily. At a separate creditors’ meeting on 28 August 2012, the company’s nominee, Derek Earl, and NALM’s nominee, Coyle, were put forward. NALM voted as an unsecured creditor for €47.9 million, based on a judgment debt of about €70.2 million less the €22.3 million security value listed in the company’s statement of affairs. The Collector General also voted for Coyle. Their combined votes, worth €48.3 million, exceeded the €42.38 million cast for Earl, and Coyle was appointed.
Aken, itself a creditor and a company connected to Maplewood through the Moritz Group, argued that NALM should be bound by the €22.3 million security valuation it used for voting. It sought to invalidate NALM’s vote, replace Coyle with Earl, or have the court declare the security’s value to be €22.3 million.
Justice Laffoy found that the directors had estimated the security at €22.3 million in the statement of affairs and that NALM reasonably adopted that figure for the creditors’ vote. The chairperson acted within her powers by admitting NALM’s remaining €47.9 million debt as an unsecured claim for voting. The rules governing that vote did not make the meeting valuation binding when the liquidator later assesses the debt and security in the winding-up process.
The court said it had no jurisdiction under the legislation, or otherwise, to set the secured element’s value for all purposes. Any security value relevant to NALM’s unsecured claim must be assessed by the liquidator when considering that claim. The court made no determination that €22.3 million was the security’s value for that later assessment.
The judgment also addressed concerns about the solicitors briefly retained by Coyle after his appointment. They had previously acted for NALM and its receivers. Coyle later instructed different solicitors; no specific relief was sought on the issue, and the judge expressed no view on whether the initial retainer was appropriate. The court found no evidence that Coyle was significantly conflicted. It dismissed the application and amended the case title to reflect Maplewood’s voluntary liquidation.