The High Court has granted Allied Irish Banks plc summary judgment for €10,872,303 against developers Bill Moloney and Eamonn McCarthy, finding their claim of a binding oral loan restructuring agreement was not credible. The ruling was made on the bank’s summary judgment application, without sending the dispute to a plenary hearing.
The defendants did not dispute that they had borrowed the money. The loans related to their development of the Cnoc an Cairn housing estate at Chapel Lane, Dingle, County Kerry, secured by a legal charge over the estate. They argued that at a meeting on 21 June 2013, the bank agreed they would sell the charged properties and the remaining debt would be written off. The bank denied that any binding agreement had been reached.
The judge said the evidence did not support a credible claim of a concluded agreement. A pre-negotiation undertaking signed by Moloney said the bank would not be bound unless a formal agreement was executed. The judge also considered the bank’s June 2014 heads of terms, which were expressly non-binding and provided for a five-year review, and the defendants’ subsequent agreement to those terms in principle, subject to legal advice. The court found that the competing accounts of whether the proposed review period was two or five years reinforced the lack of agreement on essential terms.
The defendants also relied on their sale of charged properties as part performance. The court held that this did not assist them because it had found there was no concluded agreement. It rejected their argument that uncertainty about joint and several liability required a plenary hearing, pointing to the 2012 sanction letter, which replaced the earlier letter and expressly incorporated terms imposing joint and several liability.
The court granted the bank summary judgment for the amount claimed. It refused the defendants’ request to restrain the bank from appointing a receiver, finding no basis for an injunction after granting judgment. It also refused to compel the bank to consent to the proposed sale of the final nine properties to Moloney’s nephew for €240,000. The judge said damages would be an adequate remedy if the bank’s refusal caused loss. The ruling did not determine the outcome of any later sale or enforcement action.