THE HIGH COURT has approved a Personal Insolvency Arrangement allowing a couple to write off more than €6m of their debts.  

At today’s sitting of the court, Justice Denis McDonald said he was satisfied to approve the arrangement sought on behalf of Thomas Flanagan, a retired Garda, and his wife Jean Errity, a civil engineer, both of Hortland, Donadea, Co Kildare.

The couple had debts including €6.1m owed to Ulster Bank, €419,000 to Permanent TSB, €150,000 to a building company called MOF Construction Ltd, and €160,000 to Pepper Finance. 

As part of the PIA, the couple will retain their four bedroomed family home, valued at €430,000, and will continue to make mortgage payments on that property, and have been afforded reasonable living expenses. 

To fund the couple’s PIAs, two investment properties owned by Mr Flanagan in Co Mayo will be sold, and the proceeds from the sale of Mr Flanagan’s share in a cottage in Co Galway he inherited from his parents will be used.

A lump sum of over €40,000 from family members will go towards the funding of the arrangements, the court heard. 

The couple’s Personal Insolvency Practitioner, John McCormack, represented in court by barrister Keith Farry Bl, had argued that the court should approve the arrangement, and the creditors would not be any better off if the couple were to be bankrupted.

The PIA was fair and equitable and maximised the couple’s full debt servicing ability, counsel argued.

The couple’s PIAs were opposed by Ulster Bank DAC, which had advanced loans for a property development project that did not materialise due to planning difficulties, and St Raphael’s Garda Credit Union, which was owed €7,500.

The bank had argued that the couple’s four-bedroomed house might be beyond their reasonable living accommodation needs and that they should seek alternative accommodation. 

The couple had rejected the bank’s arguments. 

In his ruling, Justice McDonald said he was satisfied to approve the PIA, and dismissed the objections raised by both Ulster Bank and the credit union. The judge said that the creditors would at worst do no better in a bankruptcy situation.

The court approval of the PIA’s did not amount to an injustice to the couple’s creditors. 

The judge also said that the couple had already made several payments towards their debts adding that this was not a case where persons seeking a PIA had “thumb their noses at” those they owed money to.   

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