ACC takes the fast track to sue Mick Wallace in TD's loans case
Published 09/10/2011 | 05:00
Wexford TD Mick Wallace is being sued by ACC Bank in a case relating to loans of almost €20m.
ACC is suing Mr Wallace and his construction firm M&J Wallace, which had some of its assets put into receivership by the bank in May.
ACC will apply tomorrow to have the case admitted to the fast-track commercial division of the High Court.
The amount of money involved is not clear but the Commercial Court only hears cases worth more than €1m.
ACC launched the debt collection proceedings against the independent TD in July and, if admitted, the case could be heard in a matter of months.
The action comes four months after the bank appointed receivers to three main assets in his construction group, M&J Wallace.
At the time, Mr Wallace claimed ACC moved in the receivers after giving him 24 hours to repay €18.5m.
He lost control of a large chunk of properties in his empire, including the flagship restaurants in Dublin's Italian quarter.
The move against Mr Wallace could have far-reaching ramifications for the property developer who admitted in the past that he gave personal guarantees on "just about everything".
If ACC is successful in its action, Mr Wallace's family home and other family properties could be under threat.
If bankruptcy proceedings are brought against Mr Wallace, he could be forced out of the Dail as the 1992 Electoral Act bars bankrupts from holding office.
However, Mr Wallace said last June that he didn't expect to be made bankrupt because there would be "no merit" in any of the banks doing so.
"It would cost them money to do so," he said.
Mr Wallace could not be contacted by the Sunday Independent yesterday.
He has made no secret of his financial difficulties. In 2009, at a time when other developers were silent about their problems, he revealed that he wasn't paying any interest on his bank loans and neither were any of his competitors. During his campaign for a Dail seat earlier this year, he told this newspaper: "I have problems with all of the banks. Listen, it's very possible my business will not survive.
"I am trying to do my bit to make it survive. I have been fighting since September 2007," he said.
He topped the poll in Wexford in February but three months later ACC appointed a receiver to three of his prime assets. In a brief RTE interview, Mr Wallace said: "It's rough... but that's life."
He said ACC was charging him 20 per cent interest on his non-performing loans since January 2009, which he claimed was "draconian".
In the intervening period, he made interest payments on the functioning part of the loans but Mr Wallace admitted that the Rathgar site was a problem because it was "dead in the water".
He said that ACC had told him on May 23, that he owed €18.4m, which they wanted repaid within 24 hours because the loans were no longer performing.
The receiver was appointed the following day May 24.
At the time, he said he was hopeful that another of his companies, Wallace Calcio Ltd, would continue to operate the wine bars in two of the affected properties.
Mr Wallace is a director of more than a dozen companies that were worth €70m at the height of the boom but have since plummeted to €20m.
After graduating from university with a philosophy degree, Mr Wallace revived his father's construction company in Wexford.
He opened Italian restaurants in some of his flagship buildings, importing wine from his own vineyard in Italy. He also built up the successful Wexford Youths FC in Ferrycarrig, Wexford. According to company accounts in 2009, the football club was dependent on the continuing support of its parent, M& J Wallace, for its existence. Mr Wallace has been a vocal critic of banks but the property developer turned politician is now at their mercy.