THE IBRC IS currently involved in growing number of legal cases, both as plaintiffs and defendants.
It was revealed in a parliamentary question put to Minister for Finance Michael Noonan that the IBRC (Irish Banking Resolution Corporation) is involved in over 1,100 disputes.
The question was asked by Fianna Fáil’s finance spokesperson Michael McGrath and related to the amount being spent by the IBRC in undertaking their liquidation duties.
While the Finance Minister was unable to specify the amount the department anticipated spending on the cases, he noted that the Special Liquidator KPMG had informed him that a legal panel of Irish law firms were in place to help deal with the cases the IBRC are currently involved in.
Deputy Noonan made the point that the Special Liquidator “remain extremely mindful of the imperative to reduce expenditure on legal fees”. As of last month the winding up of the IBRC had cost the tax payer €112 million, according to a report by the Special Liquidator.
Here are a few of the major spats the IBRC have been caught up in:
Seán Quinn
The IBRC has been intrinsically tied to Ireland’s former richest man and his stake in the Anglo Irish Bank. Last month the former major shareholder hit out at the IBRC for using “stolen goods” to finance a campaign against Quinn and his family.
Having declared bankrupt in 2012, Quinn went to prison for nine weeks late last year in relation to the case. The Quinn family are currently taking a court case against the office of Minister for Finance, the Central Bank and ten former directors of Anglo Irish Bank over the Quinn family’s liability for €2.34 billion worth of loans.
These were given by Anglo to Quinn are being contested on the grounds that they were illegal loans designed to prop up Anglo’s share price. IBRC in turn are pursuing Quinn for money it claims is still owed.
Century homes
Eco-friendly developer Gerard McCaughey was in the Supreme Court earlier this month, contesting that he is not yet liable to repay a loan from Anglo Irish Bank relating to investment in two New York hotels. The court found that McCaughey would be entitled to a full hearing.
McCaughey’s contention against paying back the loan centres around a collateral agreement with Anglo that he would not have to repay the loans until the connected investment projects had concluded. In January of this year, it was ruled in the commercial court that McCaughey would be liable for €5.2 million.
Century Homes was bought over by Kingspan in 2005.
Blackrock Clinic
Attempts by the IBRC to offload loans relating to Blackrock Clinic came up against opposition from one of the private clinic’s major shareholders, Johnny Flynn.
However, the US Bankruptcy Court in the State of Delaware ruled against Flynn’s attempt to block the IBRC from selling loans. This allowed joint Special Liquidators Kieran Wallace and Eamonn Richardson to complete the sale.
They were ordered at the time to set aside an amount of $36 million for a period of 60 days to allow the Flynn parties an opportunity to seek a stay on the order, pending an appeal.
Joan Collins
Although not taken directly against the IBRC, United Left Alliance TD Joan Collins took a case against the €31 billion promissory note deal supporting Anglo Irish Bank in November last year. Collins contested that the legislation behind the deal gave the Minister for Finance an unconstitutional power of being able to approve payments to the bank without Dáil approval.
In November last year, the court ruled against Deputy Collins. In judgement on the issue, the High Court said: “It is not part of this Court’s function to express any view on and still less to review the political or economic wisdom of the decisions which culminated in the 2008 Act”.
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