IBRC entitled to call in businessman's €36m property loans
IRISH Bank Resolution Corporation (IBRC) was entitled to demand repayment of €36m in property loans given to businessman John Morrissey, the Commercial Court has ruled.
The relationship between the bank and Mr Morrissey, who described himself in 2000 as a "self-employed serial entrepreneur for 20 years with a mixed portfolio of activities", did not go beyond that of a normal contractual relationship, Judge Mary Finlay Geoghegan found.
The judge was dealing with two preliminary issues in advance of a hearing of the bank's application for judgment for around €36.7m owed by Mr Morrissey arising out of loan facilities first granted to him by IBRC's predecessor, Anglo Irish Bank, in 2000.
The loans related to properties in Ranelagh, Rathgar, Rathmines and Monkstown in Dublin, Kildare and Clare, as well as for part-financing the purchase of a share portfolio.
The court heard Mr Morrissey, an actuary who worked as an investment portfolio manager for Investment Bank of Ireland and later with aircraft leasing company Guinness Peat Aviation, set up his own aircraft leasing business in 1994 which was later sold to Royal Bank of Scotland.
He returned to study physics, obtaining an honours degree in TCD where he met the founder of the software company HAVOC which he helped finance before it was sold to Intel.
In 1997, he got involved in the property business, primarily acquiring and renovating period properties in Dublin 6 which he sold on or rented.
In early 2009, Anglo viewed his €36m loans as impaired because of the diminished value of the properties provided as security on them and demanded repayment.
There were extensive discussions in 2009 between Mr Morrissey and the bank about restructuring the loans but in January 2010 it appointed a receiver over his assets, Judge Finlay Geoghegan said in her judgment yesterday.
The bank argued it was entitled to call in its loans. It was "simplistic" to blame the collapse of the Irish property market and economy on Anglo alone, IBRC's lawyers added.