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Investor cannot prevent sale of €1.5m property

Court rules against claimed contract to buy Dublin house for €10


Development:The luxury homes at Cluain Aedin were eventually built by Weslin New Homes

Development:The luxury homes at Cluain Aedin were eventually built by Weslin New Homes

Development:The luxury homes at Cluain Aedin were eventually built by Weslin New Homes

A businessman has effectively failed in his efforts to prevent a receiver from selling a high-end €1.5m home in Dublin for which he claimed he had an existing contract to buy for a nominal €10.

The High Court said that Kevin Thompson had secured what appeared to be “entirely improper” securities on foot of the sale of the site on which the house was ultimately built at the exclusive Cluain Aedin development in Sutton.

Mr Thompson and his associate, Brian Wallace, owned a company called Tourview that since 1992 owned the prime site on which the development was later built.

In 2015, the pair agreed to sell their shareholdings in Tourview to Copia Capital for €2.7m. One of Copia’s investors pulled out, the High Court heard, leaving it with a shortfall in the amount of money it had to pay Mr Thompson and Mr Wallace.

Mr Thompson agreed to a late payment of €200,000 from Copia. He also obtained a number of assurances from the firm, including a 10pc shareholding in Copia held in trust and that Mr Thompson would receive money from Copia “from development finance drawn down” in respect of two sites, including one in Sutton.

The High Court said that three of the assurances, where Mr Thompson would receive money from development finance secured by Copia, ”appear entirely improper inasmuch as they involve the procuring of finance to be used for the development of sites at Sutton and at Ashford, but the diversion of enough of these monies to pay the debt to Mr Thompson”.

“The three securities involved siphoning off construction finance so that Mr Thompson would be paid money due to him for his shares in Tourview,” it noted.

As part of his deferred consideration scheme, Mr Thompson also secured an option agreement that required Copia to pay him four instalments, each of €50,000. If any payment was missed, the house on the Sutton site was to be put up for sale for market value, with Mr Thompson entitled to recoup money owed to him, plus interest.

However, the court heard there were already charges over that property, of which Mr Thompson was aware.

In 2016, Irish Residential Loan Investments (IRLI) refinanced Tourview’s debt. IRLI was informed by a firm of solicitors that prepared Mr Thompson’s securities that the relevant property was “free from encumberances”.

Mr Thompson later executed his contract with Tourview, after still not receiving money that was due to him.

But the receiver of the property insisted in court that an equitable mortgage was held by IRLI over the property in Sutton.

“This security ranks ahead of any entitlement claimed by Mr Thompson,” said Justice Brian O’Moore.

The Cluain Aedin scheme was eventually constructed by Weslin New Homes and was launched in 2019, with some of its handful of houses put on the market for €1.55m.

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