Business Irish

Friday 19 January 2018

Lynch family 'is not being pursued for all the debts of developer'

AIB insists liability only relates to failed €25m property deal

Tim Healy

AIB is not trying to hold businessman Philip Lynch and his family liable to pay all of developer Gerry Conlan's debts to the bank as a result of a €25m loan they jointly took out to develop a site in Waterford in 2007, a court has heard.

The bank claims the family is only liable for all of Mr Conlan's debts associated with the €25m -- but not for his other debts.

Mr Lynch's daughter, Philippa, told the court yesterday she did not know the extent of Mr Conlan's debts to AIB but believed they were "a couple of hundred million". She had no resources to pay either that sum or the €25m, she said.

Michael Collins, for AIB, made the clarification yesterday after earlier suggestions that a mortgage related to a €25m AIB loan facility for the Waterford deal appeared to make the Lynch family liable for all the debts of Mr Conlan to AIB.

In evidence yesterday, Mr Lynch's wife, Eileen, her daughters Philippa and Therese, and her son Paul, all said they would not have become involved in the Waterford deal if they believed AIB had any personal recourse to them over the €25m loan and added they do not consider they owe AIB that sum.

Mrs Lynch said her husband would talk to her about his business dealings and she would call him "conservative" and herself "very conservative". She would never consider anything risky and would "not have been a bit pleased" about exposure to a €25m liability.

Risk

If her husband had said there was any such risk, she did not think she could say in court what she would have said to him, Mrs Lynch said.

Paul Lynch said he had expressed concerns at a Lynch family meeting in late January 2007, before the loan facility was signed on February 8, 2007, about getting involved in property deals because he was sceptical about the property market.

Therese Lynch became distressed during her evidence in which she told the court her family was very prudent and her father would not do anything risky. She had never believed there was any risk associated with the Waterford deal, she said.

The court also heard Paul Lynch, Philippa Lynch and Mrs Lynch had bought substantial shareholdings in One51 investment group, of which Mr Lynch is CEO.

Evidence on behalf of the Lynch family concluded yesterday in their action aimed at preventing AIB pursuing them individually over the €25m loan. The family claim the loan was advanced on a non-recourse basis.

On Tuesday Mr Justice Michael Peart will decide whether an application by the Lynch family to have the claim dismissed should stand after AIB told the court it would not be calling evidence to support its case.

The Lynch's counsel, Michael McDowell, said he was applying for a dismissal of the bank's counterclaim where the bank was seeking orders for the €25m from each of the six Lynch family members arguing there was no evidence before the court to support that counterclaim and to show the money was due and owing.

Should this application succeed, the Lynch family would win its action and have no liability to AIB and the only issue to be decided would be costs, the court heard.

Irish Independent

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