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Carroll faces 11-day wait for verdict on protection bid

DEVELOPER Liam Carroll will not find out if his unprecedented second application for court protection is successful for another week and a half, it was indicated yesterday.

Judge Frank Clarke, who is also chairman of the referendum commission, adjourned the hearing until Monday morning.

Judge Clarke also said it would then take him seven days to consider his decision on whether to grant seven companies in Mr Carroll's Zoe Group examinership, which means a ruling is not expected until September 14.

The group has debts of €1.2bn and is being pursued by ACCBank for €136m of unpaid debts. The adjournment came on a day when ACC, which is opposing the second application, said that appointing an examiner would only be a "deferred receivership".

Counsel for ACC, Lyndon McCann, said that if examinership was granted, and the banks granted Mr Carroll a two-year moratorium, interest would merely build on the loans.

He said it was a "curious survival plan" when the "companies have greater indebtedness [rather] than smaller, at the end of the process".

He said that if the banks don't indulge the group, it is insolvent. "You can take it as night follows day that ACC will not be saying, 'We'll extend your facility'," he said.

And he said that Mr Carroll's business plan was "flawed from the very outset".

Mr McCann said that Mr Carroll's lawyers had not properly addressed NAMA, which he called "the elephant in the room".

He said that it was likely that Mr Carroll's loans would be "NAMA-ed" and there was "not a scintilla of evidence" as to what measures NAMA would take. ACC, a subsidiary of Dutch-owned Rabobank, does not fall under NAMA.


Mr McCann also used in evidence a report on the property market by Professor Morgan Kelly, of UCD, which had been referenced in court previously, although Mr McCann said it had been "glided over" by Mr Carroll's lawyers.

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He said that Prof Kelly, who predicted the property crash in 2007, had proven to be correct in that instance. Judge Clarke called him the "leading exponent of the non-soft landing school", adding: "We are all feeling the bumps now."

Mr McCann criticised evidence given by Mr Carroll, which, it was claimed, showed the banks' commitment to fund the group.

In particular, he said a letter from AIB was as "vague and as nebulous as one could hope".

Bill Shipsey, for Mr Carroll, said it was a pity ACC did not listen to Prof Kelly when they were bidding for Mr Carroll's business in late 2007 and early 2008.

"They find themselves in the position where they are, because they were last to the party," he said. "They certainly want to be the first to leave the party."

Mr McCann said that the majority of the information presented to the court referenced the 51 companies in the Zoe Group as a whole.

He said there was no individual evidence for the other 44 companies, apart from those applying for examinership.

Judge Clarke said that "the other 44 companies are not under the cosh of the banks because the only bank doing the coshing is yours".

Mr McCann said that no reason had been put why Danninger, the main development company in the group, was not seeking court protection.

A number of Danninger's creditors supported the application in court and Mr McCann said that it had been the subject of nine winding up petitions since August 2008.

He said that, presumably, the creditors who filed the petitions, had been "paid off" and said that no evidence had been supplied as to whether Vantive Holdings or Morston Investments, the companies at the head of the group had a chance of survival.

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