McFadden seeks stay on €6.3m judgment with appeal pending
Published 23/04/2010 | 05:00
FINANCIER Niall McFadden has asked the High Court to postpone a €6.3m judgment against him, pending his Supreme Court appeal challenging National Irish Bank's entitlement to the money.
Rossa Fanning, for Mr McFadden, said a stay on the judgment was justified because his client had a genuine appeal against this week's High Court finding that NIB was entitled to judgment. Mr McFadden was concerned that if there was no stay, the bank would aggressively move to enforce judgment, counsel told the court yesterday. A decision on his application will be given next Tuesday.
NIB had argued before the court that Anglo Irish Bank had last year obtained a €15m judgment against Mr McFadden, with no stay on that order.
However, Mr Fanning said Anglo had not moved to enforce that judgment and that there was a "completely different relationship" involved with ongoing arrangements between Anglo and Mr McFadden's Boundary Capital group.
Opposing the stay, James Doherty, for NIB, said the court had ruled that his side was entitled to judgment.
Mr McFadden had very significant liabilities, NIB had previously expressed concerns that he may seek to avail of UK bankruptcy procedures and it could face a greater prejudice if a stay was granted, counsel argued.
If no stay was granted and Mr McFadden won his Supreme Court appeal, there was no suggestion NIB was not "a mark" for compensation, counsel added.
Earlier this week, Mr Justice Clarke found that NIB was entitled to a €6.3m judgment against Mr McFadden, arising from his personal guarantee over a bridging loan to Naldin Ltd to help acquire the Buy & Sell classified ads business.
He adjourned the case to yesterday to allow the sides to consider his detailed judgment.
Mr McFadden, of St James Street, London, had put together a deal in 2007, under which Naldin Ltd took over Buy & Sell from Associated Newspapers for €21.3m in a deal funded by NIB, which advanced some €18m to Naldin.
After Naldin was unable to raise equity finance, the business ran into difficulties. An examinership failed, a receiver was appointed by NIB and the Buy & Sell business was ultimately sold for some €1.9m.
NIB said that while the assets of the Buy & Sell group would not meet its security for the loans provided, it had taken some comfort from Mr McFadden's €6.3m guarantee, especially where he also undertook, as long as he remained under any obligation to NIB, to maintain unencumbered assets of some €20m.