La Stampa owner 'terrified and confused' at AIB receiver move
The owner of the former La Stampa restaurant on Dublin's Dawson Street was "terrified and confused" to find a bank had appointed a receiver to sell the asset just days after he believed he had entered into an agreement for a consensual sale, the High Court heard.
Louis Murray (73), and his company Balieboro Springwater, in receivership, are suing AIB and the receiver claiming they sold his two adjoining properties on Dublin's Dawson Street, including the Dawson Hotel and Samsara Bar, at an undervaluation of €17.5m when he had an offer from an investor for €21.5m.
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He says the bank breached an agreement for the consensual sale when it appointed Declan McDonald as receiver and further breached it when the property was advertised as a 'forced sale' with a guideline price of €15m.
He says, as a result, he still had a debt of €2.3m when he could have sold it at a price which would have repaid the outstanding €19.5m debt against him while still running his business.
Mr Murray was "the essence of a self-made man" who left school at 14, got involved in the jewellery business, which proved profitable, before later getting involved in the nightclub business, his counsel John Fitzgerald said when opening his case yesterday.
In 1989, he bought 35 Dawson Street from which La Stampa operated and later bought the adjoining property from which the hotel and bar operated. Both restaurant and bar were very popular in the 1990s and early 2000s, he said.
Business suffered during the downturn. In 2011, Mr Murray was diagnosed with cancer, counsel said.
In 2013, AIB, called him in because of concern over an inability to repay debts. Mr Murray appointed his son-in-law, John Quinn, as a director and to find a way to discharge the €19.6m debt to AIB. They also brought in accountant Bernard Somers and Mr Murray's other son-in-law, Shane Woods of Deloitte accountants.
A business plan was drawn up and, among the proposals, was one to increase revenue by extending the ground floor bar. That work began in October 2015 with a loan from Irish Distillers, counsel said.
However, a meeting took place on October 17, 2015, between officials of AIB, Mr Murray and Mr Somers. Mr Murray and Balieboro Spring Water claim it was at this meeting an agreement was reached that there would be a "consensual sale" of the property. AIB denies there was any such agreement.
A week later, on October 24, AIB appointed receiver Declan McDonald.
Mr Fitzgerald said Mr Murray was shocked and viewed this a breach of the consensual sale agreement.
His son-in-law, Mr Woods, on the evening of the receiver's appointment, found Mr Murray "terrified and confused".
Discussions followed and there was some discussion about entering examinership and about keeping the business running so it could avail of the Christmas trade. Mr McDonald agreed to co-operate in this.
Efforts were made to find an investor over the following months. Mr Murray, it is claimed, got two offers, including one from Olympia Investments for €21.5m. The breakdown of this investment ultimately turned out to include a €5m contribution from Mr Murray based on his other assets, including his home in Killiney, Dublin, but which AIB was not happy with.
On May 5, 2015, Mr McDonald advertised the property with a guide price of €15m which Mr Murray claims was deliberately set at that figure to scupper his efforts to sell it.
It sold for €17.5m
In evidence, Mr Woods told the court the relationship between Mr McDonald and Mr Murray had broken down. When Mr Murray sought to be allowed into the premises to show a prospective investor around, Mr McDonald allegedly said "F... Louis, I don't want to help him" and that Mr Murray had threatened to sue the receiver, Mr Woods said.
Under cross-examination by Lyndon MacCann SC, for AIB, Mr Woods agreed Mr Murray had sent abusive text messages late at night to Mr McDonald "making complaints and being generally abusive".
Mr Woods said, however, that was a couple of months before the sale. He agreed the receiver's solicitors had to write to Mr Murray threatening legal action if the abusive texts did not stop.
The case continues before Mr Justice David Barniville.