Developer Daly, NAMA in clash over €457m debt pile
Published 25/06/2011 | 05:00
NAMA and leading developer and builder David Daly of Albany Homes have clashed over €457m of loans taken out by him and his children after the agency moved to appoint a receiver last night.
It has been known for several days NAMA was in discussions with Mr Daly, but last night the state loans agency sought to appoint BDO Ireland and BDO UK as receivers, but Mr Daly and family are now challenging this.
They claim NAMA is exceeding its rights in seeking immediate repayment of the loans, which they claim are being fully serviced. Mr Daly and his children own the Louis Vuitton building on London's Bond Street.
The family also have loans for a Department of Justice building on St Stephen's Green, and Mr Daly's wife owns the Airside Retail park in north Co Dublin.
Mr Daly's legal team yesterday secured permission from the High Court to serve short notice of their proceedings on NAMA, the State and AIB, the original lender to Mr Daly.
Mr Daly could not be reached for a comment after the Irish Independent left a message for him last night. However, the matter returns to court on Monday where further legal argument will be heard.
Counsel for the Dalys, Mr Michael Cush, said the Dalys' case was that they were meeting all their obligations concerning the loans, but NAMA had taken the view these were demand facilities which could be called in any time.
The Dalys are seeking a declaration that credit facilities entered into by them with AIB in July 2007 and February 2008, which loans were transferred to NAMA last year, are not repayable on demand.
NAMA's decision to demand repayment of the facilities on or about June 22 and June 24 is unreasonable, disproportionate and contrary to their constitutional rights and an improper exercise of its powers, they claim. They are also claiming certain provisions of the NAMA Act are invalid, unconstitutional and in breach of the State's obligations under the European Convention on Human Rights.
In an affidavit, David Daly said he had set up Manor Park Homebuilders with Jim Flavin and Joe Moran and ran it profitably for 15 years. He used his share of profits to start building a property portfolio. In 1995, he was bought out of Manor Park and set up Albany Homes Ltd and Trident Home Builders Ltd. He used Bank of Ireland as banker to Albany while AIB was his personal banker.
From 1995, when he established Albany, he was concerned to involve his family and share his wealth with them.
Since that time, property assets were purchased in the names of his two children so as to increase their wealth.
From the outset of the relationship with AIB, the investment strategy was that the loans would be repaid out of rental income and after tax profits from Albany, and AIB had fully supported that strategy.
All the facilities negotiated with AIB were to fund the purchase of property intended to be held on a long-term basis, he added.
The July 2007 and February 2008 facility letters were agreed following the presentation of detailed cash flows for the period up to December 2020. Despite the difficult financial conditions over the last three years, the cash flow projections "broadly speaking", were being met, he said.
Mr Daly said all their loans were fully performing, all interest is being repaid, there had been no breach of covenant and they were fully tax compliant. AIB, he added, had told him it did not want their loans transferred to NAMA.
Mr Daly said NAMA had also taken issue with certain transfers -- including Airside Retail Park -- to his wife, Mary.
He said those transfers were planned since 2005 and up to 2009 on the advice of KPMG in anticipation of certain budgetary changes which would impact on tax relief of the transfer of assets between spouses.