Business Irish

Sunday 20 August 2017

Quinns tell Cyprus court Anglo's action is 'invalid'

Family's lawyers get injunction to prevent bank "interfering with" foreign properties

Laura Noonan

Laura Noonan

THE Quinn family has told a Cyprus court that Anglo Irish Bank's attempts to gain control of its international property companies are "invalid, null and void" because the bank is trying to enforce the terms of loans that were "illegal or tainted by illegality".

Details of the Cyprus filings came as the Quinn family's lawyers yesterday formally filed a "conditional memorandum of appearance" with Dublin's High Court, reserving the family's right to challenge the Four Court's jurisdiction on the case.

The arguments made in Cyprus mirror the arguments the Quinns have used in a broader Dublin court case challenging Anglo's rights to install a receiver across the family's leisure and manufacturing empire to recoup some €2.9bn in loans.

The Quinns have secured a temporary injunction from the Nicosia courts preventing Anglo from "interfering with" Russian and Cypriot properties that are owned by Quinn companies based in Cyprus.

Anglo was not present at the original court sitting but is expected to vigorously contest that injunction over the coming days when its lawyers have their first opportunity to make representations to the Cypriot court.

Control

The Quinns secured the Cyprus injunction by arguing that Anglo was trying to take control of the Cyprus companies by enforcing securities that related to loan agreements that were "illegal or tainted with illegality".

The reference relates to the €2.3bn loans in question that were advanced to Sean Quinn so he could buy shares in Anglo Irish Bank -- the Quinns are arguing that this amounted to illegal share support.

Anglo is expected to tell the Cyprus courts, however, that the Quinns have already acknowledged that some of the loans involved are "legitimate" and not connected to the purchase of Anglo shares.

The Quinns are also challenging the way Anglo has attempted to appoint directors to the companies of the affected Cypriot property companies and say the bank has been "unable" to provide relevant documents.

The Quinns and Anglo are also at odds over an incident where the local executive appointed by Anglo to oversee the properties involved was denied entry to a major site in Russia.

The Cypriot case is running parallel to similar actions in Dublin and Sweden.

In Dublin, Anglo is asking the courts to prevent the Quinns from interfering with any of the international property assets the bank has taken control of.

In Sweden, the Quinns have obtained an interim injunction overturning Anglo's appointment of directors to property holding companies based in Sweden -- Anglo is contesting this, and the company may end up being declared bankrupt.

The contested property empire has assets of €500m with an ownership train stretching across Sweden, Russia and Cyprus.

Anglo is arguing that any disputes should be heard in Ireland, since key decisions were made in Ireland and based on Irish advice, and the ultimate owners were Irish citizens.

So far no attempts have been made to sell any of the assets involved. Anglo executive Richard Woodhouse told the Swedish courts that it would take "18 months to three years" to achieve a "satisfactory value" for the portfolio.

Irish Independent

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