Developer 'had vital clause' deleted in €25m deal
BUSINESSMAN Philip Lynch told his daughter he wouldn't go ahead with a €25m property deal if AIB could come after him personally 24 hours before the family signed the loan documents, she told the Commercial Court yesterday.
Judith Whelan, who managed the family's investments and signed the loan documents on behalf of herself, her father and mother and three siblings, said a clause that would have made Mr Lynch and Jerry Conlan -- the family's co-investor in the Waterford land deal -- solely liable for repaying the loan, was deleted the day before the deal was finalised.
They, relying on their lawyers, then interpreted this as meaning that the bank was only entitled to go after the land if they were unable to repay.
She said AIB on that day wanted to have recourse to her father and businessman Gerard Conlan for the loan, but her father said that was "unacceptable". She believed others were acting on foot of what her father had said, she added.
She was being cross-examined by Michael Collins, counsel for AIB, in the continuing hearing of proceedings by the Lynch family against AIB and two firms of solicitors -- LK Shields and Matheson Ormsby Prentice (MOP) -- aimed at preventing AIB securing €25.3m judgment orders against them.
The Lynch family claim they entered the loan on the basis that AIB could only reclaim the lands at Waterford to repay the loans. They also claim that, between the two defendant law firms -- LK Shields as their solicitors and MOP, representing Mr Conlan, they were collectively led to believe on February 8, 2007, they were signing up to a deal which would involve AIB having recourse only to the 86 acres. The defendants deny the family's claims against them and AIB contends it is entitled to €25.3m judgment orders against all of the plaintiffs.
Cross-examined by Michael Cush, counsel for MOP, Ms Whelan agreed her family had retained LK Shields to look after the Lynch family interest in relation to the Waterford lands transaction and there was a dispute between her family and LK Shields about the extent of the firm's retainer.
She said the first time she met anyone from MOP was on February 8, 2007, the day she signed the loan documents, and agreed neither she nor any member of her family raised the loan recourse issue with MOP. She agreed MOP acted for the Conlan side in the Waterford deal and did not act for the Lynch family, except in relation to the conveyancing for the lands.
The plaintiffs are: Philip Lynch and his wife Eileen, Athgarvan Lodge, The Curragh, Co Kildare; their daughters Judith Whelan, Leinster Wood, Carton Demesne, Maynooth, Co Kildare; Therese Lynch, Ardoyne House, Pembroke Park, Dublin 4; Philippa Lynch, Burlington Gardens, Burlington Road, Dublin 4; and their son Paul Lynch, Oakley Road, Ranelagh, Dublin 6.
Separate but related proceedings by AIB seeking €25.3m judgment against Mr Conlan, Forenaughts, Naas, Co Kildare, will be heard later.
The proceedings arise from the purchase of 86 acres at Kilbarry, Waterford, with a view to development.
The case continues.