Business chief loses appeal over €26m debt
BUSINESSMAN Philip Lynch has been dealt a devastating blow after the Supreme Court dismissed his appeal over a €26m judgment secured against him in 2011.
Mr Justice Donal O'Donnell described as "understated" a previous High Court finding that Mr Lynch gave "hopelessly confused and unreliable" evidence about events that led to a €25m loan being issued to buy 86 acres of development land in Waterford.
The Lynches had bought the land in conjunction with developer Gerry Conlan in early 2007. The land was valued at just €5m in 2011 following the property bust.
Mr Lynch is the former boss of investment group One51, which owns Irish Pride and a stake in energy and roads firm NTR, as well as other assets.
The businessman and his family had sued AIB in 2010 over the soured deal that had an expected €20m return.
Mr Lynch and his family had insisted insisted the AIB loan was issued on a "non-recourse" basis, meaning the bank would be unable to pursue them for the other assets if the loan wasn't repaid.
They had also sued solicitor firms LK Shields and Matheson Ormsby Prentice (MOP). The family wanted one or both of those firms to provide an indemnity against the AIB debt. The two firms had provided advice on various aspects of the land purchase.
But in 2011, the High Court said that AIB was entitled to judgment orders of about €26m each against Mr Lynch, his wife Eileen, as well as their adult children, Judith, Philippa, Paul and Therese.
But despite finding against Mr Lynch yesterday, the Supreme Court has allowed the appeal of his wife and children over the judgment to proceed.
In the High Court, the Lynches had also lost their case against LK Shields and MOP. The Supreme Court has now effectively drawn a line under the case.
Giving judgment yesterday, Mr Justice O'Donnell said the Waterford development deal appeared very attractive in 2007, as it was predicted to quickly produce about €20m profit for the Lynches.
Before there could be any real risk to the deal, there would have to be a total collapse in Irish property values and a "dramatic and total destruction" of the wealth of Mr Lynch and Mr Conlan, but it seemed unlikely that would occur.
"We now know better," the judge said.