Saturday 17 August 2019

Couple with €32m debt refused to move from 'trophy home' to cheaper property, court told

‘Trophy home’: The property at Palmerston Road in Dublin 6. Photo: Steve Humphreys
‘Trophy home’: The property at Palmerston Road in Dublin 6. Photo: Steve Humphreys

Tim Healy

Nama has won the right to repayment of €32m from a property investor who refused to move from a "trophy home" to a less valuable property.

A High Court judge ruled Nama's demand for the outstanding money, on loans for property investments, was valid and lawful.

But a finding whether Nama can enforce a further €3.5m loan secured on the family home of Carol and John Morrissey at Palmerston Road, Dublin 6, would be "pre-emptive" as Nama has not so far sought to enforce that loan, Ms Justice Una Ní Raifeartaigh held.

She adjourned the making of final orders for two weeks. Mr Morrissey said an appeal will be brought.

In dismissing the case by the couple, representing themselves, the judge noted that Nama claimed Mr Morrissey had in 2013 rejected a suggestion they relocate to a less valuable property on Lower Churchtown Road, insisting they were entitled to continue living on Palmerston Road.

A Nama agent had said he explained to Mr Morrissey Palmerstown Road would be considered to be a "trophy home" as it was valued in 2013 between €1.8m to €2m while the Churchtown property was valued at €800,000.

The agent said he questioned how "optically" it would look to the taxpayer if Nama was to allow Mr Morrissey and his family remain there whilst owing them more than €25m in residual debt - the debt remaining after the investment properties were sold - and more than €4.7m outstanding on the loan secured on their home.

The couple had claimed damages over alleged various unlawful acts by Nama, including taking enforcement action over the loans and appointing receivers over properties.

Mr Morrissey got loans of some €27m from Irish Nationwide Building Society between 2004 and 2006 in connection with acquiring seven investment properties.

The loans were secured by mortgages over the properties, there were problems with repayments as early as 2006 and the loans were in serious default when acquired in 2010 by Nama.

In 2014, Nama called in the loans by demanding the then outstanding sum of €32m. When that was not paid, it appointed receivers who sold the investment properties, reducing the debt to €25m.

A loan of €3.75m borrowed in 2005 to buy the Palmerston Road property, secured on the house, is also in default but Nama has not so far decided to enforce against that loan.

In their case against Nama, Capita Assets Services (Ireland) Ltd and various State parties, the couple argued Nama was not entitled to call in the loans and also sought a declaration Nama does not have valid security over the family home.

The defendants disputed the claims. Nama counter-claimed for final judgment.

Irish Independent

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