‘An unbelievable deal’ – how TV stars walked away from €2.9m debt
Write-off: Theresa Lowe and Frank McNamara win battle against vulture fund
Musician Frank McNamara and his barrister wife Theresa Lowe will have millions of euro in debts written off after a High Court judge found in their favour.
The victory for the couple over a vulture fund will mean the value of the mortgage on their home will be radically written down, and they will repay what is left at a tracker mortgage rate of 1pc. Some €2.9m in total will be written off. This is made up of €2m off the home mortgage and €900,000 in unsecured debts. One legal source described it as "an unbelievable deal".
The couple had gone to court over the refusal of the Tanager fund to agree to a personal insolvency deal (PIA). They had sought court approval for an arrangement to help them in dealing with debts of €3.7m.
High Court judge Mr Justice Denis McDonald found in favour of the couple, subject to clarifications being provided regarding an inheritance. The judge noted creditors would receive less if the couple were declared bankrupt.
Mr Justice McDonald called it "a very significant write-down in absolute terms" but added it was justified on the basis of the current value of the home and current earnings of the couple.
Their lawyer Keith Farry BL had urged the court to approve the arrangement, while it was opposed by the main creditor, Tanager DAC.
It had bought their debts from Bank of Scotland (Ireland), and was owed €2.3m.
Mr McNamara (59) worked as musical director on the 'Late Late Show' for 20 years, while Ms Lowe (56) presented 'Where In The World?' before qualifying as a barrister.
The court had been told the couple first experienced financial difficulties in the early 2000s when Mr McNamara was unable to collect music royalties owed to him.
They re-mortgaged properties and sold others in an attempt to escape what they saw as temporary financial difficulties.
The main asset is their home in Dunshaughlin, Co Meath, which they say is worth €500,000 but on which they owed almost €2.3m, according to the written judgement.
The couple also owes €550,000 to Bank of Ireland, with money owed to Belvedere College, Permanent TSB, Cabot Financial, First Citizen, and the Revenue Commissioners.
Personal insolvency practitioner James Green of McCambridge Duffy proposed writing €1.7m off the €2.3m mortgage on their Dunshaughlin home.
The couple proposed handing over an inheritance of €182,500 and a lump sum of €25,000, mostly to Tanager. Mr McNamara also cashed in a pension. Revenue will be paid as part of the deal.
Tanager objected on a number of technical grounds and argued the duration of the deal was uncertain which rendered it "fundamentally flawed".
The judge agreed with the arguments put by Mr Farry that the family home mortgage should be written down. Mr Justice McDonald said Tanager would "not be unfairly prejudiced by the proposals".
In his lengthy and detailed judgment, Mr Justice McDonald said he was of the opinion that the applications to allow the personal insolvency arrangements should be allowed once certain matters concerning Mr McNamara's inheritance from his parent's estate are clarified.
The judge said some further issues would have to be addressed in a sworn statement to the court.
The matter will return before the court next month.