Business Irish

Friday 22 September 2017

Family facing heavy losses after court ruling

Siobhan Creaton

MR Justice Michael Peart's devastating judgment against businessman Philip Lynch and his family has left them facing financial ruin.

Over the coming days and weeks, Mr Lynch, his wife Eileen, daughters Judith, Therese and Phillipa, and son Paul will be consulting with their lawyers about whether to appeal it.

That may be their last chance to absolve them of a €25m debt.

Mr Lynch wasn't in court to hear the findings; his daughter Judith was the sole family representative to hear they had comprehensively lost their lengthy battle.

The judge acknowledged they had a difficult case to make but he didn't find any evidence to support their claims.

The family "only have themselves to blame" for their predicament, he concluded.

Mr Lynch, the successful businessman who ran IAWS and set up the investment company One51, had "controlled the decision-making" that had left them with this massive debt, the judge found.

In 2007, just before the property market crashed, he bought his family into what he believed was a sure bet -- a deal that would set his children up nicely for the future.

By joining with property developer Jerry Conlan to buy an 86-acre site just outside Waterford city in 2007, the family could expect a huge profit within a few years.

He and Mr Conlan were long-time business associates and Mr Lynch was delighted to be cut in on the deal.

His evidence, and the judge's findings, recalled the frantic activity that surrounded property deals during those heady days.

There were few formalities. Mr Lynch left it up to Mr Conlan to deal with the bank, for instance. The family simply had to sign the papers and wait for their payday.

Mr Justice Peart said it was "regrettable" that such an experienced businessman regarded entering into a €25m deal as a "minor matter" at that time.

Had he not "relegated it" to such a "low level of importance", things might have been different, he suggested.

Crucial details, such as who was actually liable to repay the loan in all circumstances, could have been ironed out before the deal closed and saved the family a fortune.

There is no doubt, according to the judge, the Lynch family were given wrong advice by LK Shields about the loan being non-recourse but that didn't make that firm liable for the loan.

Mr Justice Peart noted the family would have gone ahead with the deal regardless.

Irish Independent

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