BoS after developer of Clancy Barracks for €15.5m
THE builder behind the €70m development of the former Clancy Barracks in Dublin is being pursued for €7.5m by Bank of Scotland (BoS) over guarantees he gave for loans to property companies.
The bank is seeking summary judgment against Jersey-based David Kennedy. Proceedings are to be fast-tracked to the Commercial Court in tandem with separate proceedings in which it is claiming another €8m in judgment orders against him arising from his alleged limited guarantee of a €260m loan.
The €8m proceedings were transferred to the court last week and the latest proceedings – for €7.5m – were transferred yesterday.
Mr Justice Peter Kelly directed the bank's summary judgment applications in both cases will be dealt with on July 31, when he will decide whether any defence has been raised entitling Mr Kennedy to a full hearing.
Mr Kennedy was involved in Clancy Quay Properties Ltd (CQP) which paid some €25m for the 13.5-acre site of the 19th Century Clancy Barracks site at Inchicore, Dublin.
CQP bought the site for some €25m and purchase and development loans were financed by BoS and National Irish Bank (NIB).
Both banks, now owed some €260m, later appointed receivers. A development of some 420 apartments on the site was completed and went on sale last April, marking the largest distressed property sale in Dublin to date.
In its first action against Mr Kennedy, BoS, acting as security trustee for loans advanced by it and NIB, claims development loans of some €260m were advanced to CQP on foot of securities including a guarantee of Mr Kennedy limited to €8m and he is liable to it in that sum.
Mr Kennedy, the court heard, will argue he is not liable to repay any sum on grounds including BoS had a 20pc shareholding in CQP and various actions of it concerning the development had caused losses.
In its second action, the bank wants €7.5m summary judgment orders arising from guarantees of Mr Kennedy of the debts of Davitt Road Developments to a maximum €3m, plus interest and costs; and of three other companies – Rimley Ltd, Eirmur Ltd and Florence Investment Properties Ltd –to a maximum €1.5m for each company plus interest and costs.