The High Court has adjudicated Alan Phelan bankrupt after rejecting his challenge to a bankruptcy summons issued by Mars Capital Finance Ireland DAC over an €800,534.05 judgment debt.
The debt arose from a 2016 High Court judgment entered by consent in favour of AIB Mortgage Bank. Under an agreement reached shortly beforehand, Mr Phelan paid €65,000 and consented to judgment for €800,534.05, with a four-month stay intended to allow time for debt restructuring or a Personal Insolvency Arrangement.
Mars Capital later acquired the loans and security. In February 2024, the High Court substituted Mars Capital as plaintiff and allowed it to enforce the judgment. The Court of Appeal upheld that decision in May 2025.
Mr Phelan argued that the bankruptcy summons overstated what was owed because it did not deduct his €65,000 payment or €6,650 in rent collected by a receiver before the judgment. He also relied on separate proceedings issued in 2022 and claimed the bankruptcy process was being used for an improper purpose.
Mr Justice Liam Kennedy rejected those arguments. He found that both sides knew about the payment and rent before entering the 2016 settlement and judgment. If Mr Phelan believed the judgment figure was wrong, he should have sought to vary or set it aside years earlier. The court said he could not now use the bankruptcy proceedings to look behind a final consent judgment.
The judge also held that even if the disputed credits were allowed, statutory interest accruing on the judgment would still leave the amount actually due above the figure claimed in the summons.
The court found that Mr Phelan's 2022 proceedings did not raise a real and substantial issue capable of preventing bankruptcy and that there was no evidence Mars Capital was acting for a collateral or improper purpose.
Having found a valid bankruptcy summons, an unpaid qualifying debt and an act of bankruptcy, the court dismissed Mr Phelan's application and made an order adjudicating him bankrupt.