My head is on a plate, says builder in €1.5bn debt
Published 14/01/2010 | 05:00
DEVELOPER Bernard McNamara last night admitted his "head is on a plate" as he revealed he owes €1.5bn and is facing personal ruin including the loss of his family home on Dublin's exclusive Ailesbury Road.
On the day of his 60th birthday, the man once estimated to be worth more than €1bn told the High Court he would not appeal an order to repay loans towards the purchase of the controversial €412m former Irish Glass Bottle (IGB) site at Ringsend in Dublin.
For weeks, the former Fianna Fail councillor waged a battle to avoid registration of a €62.5m court-ordered debt arising from a personal guarantee he provided to an elite group of private clients of Davy stockbrokers who had invested in the IGB site, now valued at a mere €50m.
But yesterday Mr McNamara confirmed that he is personally exposed to the consequences of the judgment -- the largest personal guarantee action to come before the Irish courts -- and insisted he is "prepared to take the full consequences".
Within hours of the ruling, the Clare-born tycoon resigned from Michael McNamara & Company, the hugely successful construction firm that he inherited from his father.
In an emotional interview with RTE's Mary Wilson, he said that he was "broke" but insisted that Michael McNamara & Company was a legally separate and profitable entity unaffected by the High Court judgment.
He said property developers were now "pariahs", but said he was not ashamed of anything he had done.
"I will be there if they want to come and get me," he said.
Mr McNamara's future is now unclear as the Davy investors consider their enforcement options.
The Irish Independent has learned that the group of investors -- which include businessmen Lochlainn Quinn and Martin Naughton -- were deeply divided about enforcing the judgment which may ultimately lead to bankruptcy proceedings. Earlier this week, the Commercial Court was told Mr McNamara has conceded he has "no unencumbered assets" and all of the equity in his personal assets had been used to shore up his businesses. He had offered to pay €100,000 per month off the summary judgment, but the offer was rejected as "paltry" by the investors given the sums owed.
Mr McNamara revealed that in recent days a settlement figure of €5 million to €10 million was being discussed between the parties, but no deal could be reached.
The investors, whose debt ranks behind any bank charges over Mr McNamara's assets, are expected to move quickly to satisfy their debt.
Yesterday lawyers for the investors told Mr Justice Peter Kelly, who had ruled in their favour last December, that they were anxious to formally register the massive debt with the Central Office of the High Court.
The judgment was formally entered last night, paving the way for the investors to pursue a range of enforcement options including ordering a full statement of affairs from Mr McNamara and registering a judgment mortgage against any properties that he has an interest in.
The investors may seek an order requesting the Dublin county sheriff to go to Mr McNamara's home and seize certain goods including cars and art works or try to recover any monies paid to him by third parties. Last night, a number of insolvency practitioners said that the first move by the creditors will result in an examination of his property interests and shareholdings to see if liens can be registered against them.
Mr McNamara's family home is also at risk.
The house at 22 Ailesbury Road, D4, is registered in the name of Bernard and his wife Moira McNamara, according to the Registry of Deeds office.
The house was purchased back in 1998 for €2.95m.
The registration of the judgment against Mr McNamara could also lead to a fresh raft of claims by creditors.
Like many beleagured developers, Mr McNamara's banks are "holding his hands" pending the transfer of all toxic loans to the NAMA and he said that his resignation from Michael McNamara & Company was designed to ringfence the company. The building firm has 12 current projects in Ireland and is employing several hundred direct employees and several hundred sub-contractors.