The High Court has refused Bandon Motors (Bandon) Limited’s application for an interlocutory injunction that would have stopped Water Sun Limited and Nyhan Motors Bandon Limited from presenting a winding-up petition against it.
The decision, delivered by Mr Justice David Keane on 13 April 2018, concerned whether Bandon Motors had made a sufficient case to prevent the petition from being presented. The judge stressed that he was not resolving the conflicts in the affidavit evidence. His conclusion was limited to the injunction application: the company had not shown that the proposed petition was bound to fail, that a suitable alternative remedy was available, or that the petition was being pursued for an improper purpose.
The dispute arose from money and vehicle stock provided to Bandon Motors by companies associated with Con Nyhan or his family. The judgment records that the company received €414,900 in cash and stock valued at €84,900 by March 2015. At least €250,000 remained outstanding, and Water Sun and Nyhan Motors claimed that amount was repayable on demand.
Bandon Motors argued that the advances formed part of an agreement reached in December 2013 for interest-free credit repayable only after five years. It said the debt was not yet due and that using a winding-up petition to pursue it would be an abuse of process. The defendants disputed that account. They contended that the credit depended on an immediate 40% interest in the company for the Nyhan family and a shareholders’ agreement, which was never completed.
In refusing the injunction, the judge said the company’s claim of a five-year repayment term rested on the affidavits of Kevin Barry and Bob Clarke and was not supported by persuasive documentation. He noted a declaration of trust concerning 40% of the shares and an email in which Barry referred to holding that shareholding for the Nyhan family. The judge did not determine the validity or effect of the disputed arrangements; he assessed the evidence only for the purpose of deciding whether to restrain a petition.
The company also argued that the petition could be used to advance a separate land claim or affect creditor priorities. The judge found no evidence establishing those alleged purposes. He described the defendants’ stated intention to notify the company’s bank after presenting a petition as more accurately characterised as a warning in light of the statutory provisions discussed in the judgment.
The defendants had also sought permission to cross-examine Barry and Clarke on their affidavits. The judge said it was unnecessary to rule on that application after reaching his conclusion on the injunction. The winding-up petition itself was not before him for decision, and the judgment does not determine whether the debt is owed or whether the company should be wound up.