Bank seeks 'security blanket' to ward off any other creditors
IT was declared in court three times. But there was still an air of incredulity when the word "insolvent" was used to describe businessman Anthony O'Reilly.
The claim was made by State-owned AIB bank which acknowledged that it was "first in the queue" to enforce debt proceedings against Ireland's former richest man.
Mr O'Reilly's lawyers have not yet contested the insolvency claims. But it was staggering to hear, in Mr O'Reilly's own words, that the €22.6m he owes to AIB represents just 11.6pc of his overall personal borrowings which are just shy of €200m.
What happens next will be determined by a court ruling on Friday morning by High Court judge Mr Justice Peter Kelly.
Mr Justice Kelly will decide whether or not he should place a postponement – or a stay of execution – on the registration and enforcement of the judgment by AIB.
The registration of a debt triggers a range of enforcement options for creditors up to and including bankruptcy.
Mr O'Reilly wants to prevent any move by AIB on his unencumbered assets. The 78-year-old is "hopeful" that the sale of his Castlemartin Estate in Kildare, home to a graveyard where his parents and grandchildren are buried, will deal with AIB's debts.
In essence, he wants to manage the sale of his unencumbered assets to secure the best price available for the benefit of his creditors.
The vast bulk of Mr O'Reilly's creditors have stood back, as it were, and have not moved on him.
These creditor horses have remained in the stable in an arrangement brokered by Bernard Somers – a debt restructuring specialist – to prevent a disorderly fire sale.
Under this arrangement, Mr O'Reilly's assets would be sold and distributed in a proportionate basis.
AIB, weary of Mr O'Reilly's "expressions of hope", fears that its position could be disadvantaged if the other horses become "afraid".
This prompted Mr Justice Kelly to remark that they might well be afraid by yesterday's application.
If the sale of Castlemartin does indeed go a long way to paying back AIB, it is hard to see how it would be disadvantaged by a short stay on registration of its judgment.
But the bank is not taking any chances and wants the security blanket of registration to ward off foreign court adventures by other creditors.
Whatever way the judge rules, the insolvency claims marked yet another extraordinary day in the fallout of the economic crisis.