Lynch fights €25m action against family
Published 10/03/2011 | 05:00
Businessman Philip Lynch would never have gotten his family involved in a Waterford land deal if he thought the bank would hold his wife and four children individually liable to repay loans of €25.3m, the High Court has heard.
Michael McDowell, for the family, said yesterday that Mr Lynch would say that if he thought for a moment the only basis for involvement in a development scheme for lands in Waterford was to make him and his family liable, he would "most emphatically" not have done that.
Mr Lynch, who is chief executive of the One51 group and the former chief of the IAWS Group, is battling with AIB and two Dublin firms of solicitors to protect his wife Eileen, their three daughters Judith Whelan, Therese and Phillipa Lynch and their son Paul, from these debts.
In 2007 they joined with another investor, Gerard Conlan, Forenaughts, Naas, Kildare, to purchase an 86-acre site in Waterford with the intention of applying for planning permission to build a retail and housing development. That investment turned sour with the collapse of the property market and now AIB wants the loan repaid.
The dispute relates to the loan agreement, with the family claiming the bank allowed them to borrow the money on a "non-recourse" basis, meaning the Waterford site was to be the only security put up against the loan.
If things went wrong the bank could take the site back and sell it to repay the loan but that was the extent to which it could pursue that debt.
Mr McDowell said yesterday that between two law firms -- LK Shields Solicitors, then acting for the Lynchs, and Matheson Ormsby Prentice Solicitors (MOPS), representing Mr Conlan -- the Lynchs were collectively led to believe on February 8, 2007, they were signing a "non-recourse" loan.
The bank and the solicitors deny the claims.
Separate but related proceedings by AIB seeking €25.3m judgment against Mr Conlan will be heard later.