Nursing home owner takes action against Promontoria over alleged hold up to €4.5m sale
The owner and operator of a nursing home has brought High Court proceedings against financial funds over their alleged failure to provide him with documents he needs to complete the sale of the business.
The action has been brought by Mr Patrick Shanahan who is the owner of the 75 bed Oakfield Nursing Home in Courtown, Co Wexford, which he intends to sell for €4.5m as part of deal he entered into with the funds Promontoria (Arrow) Ltd and Promontoria (Aran) Ltd.
However he claims the funds has failed to provide him with documents, including the original title deeds, he needs to complete the sale.
As a result he has brought High Court proceedings aimed at preventing the funds from appointing a receiver over the nursing home, Mr Shanahan has run for 12 years.
The sale of the nursing home is to cover several bank loans he took out with Bank of Ireland.
The loans were subsequently transferred to NAMA before they were acquired by the two funds, which are special purpose vehicles set up by Cerberus to acquire loans from NAMA and other entities.
In 2016 Mr Shanahan entered into an agreement with the funds over the loans which included that he would sell the nursing home before September 30.
Represented by Ross Gorman Bl and instructed by Kenny Solicitors, Mr Shanahan, of Grange Road, Rathfarnham, Dublin 16 said his client fears that he will be unable to complete the sale before the deadline.
Counsel said Mr Shanahan wrote several times to Capita Asset Services, who he had been dealing with during the negotiation of the 2016 agreement, seeking the documentation he needs to sell the facility.
He was informed in July that he would get the documents.
By the end of August the documents had not arrived.
Some documentation was forwarded to his solicitors in late September, but he says the title documents he got are incomplete.
Counsel said with the deadline looming his client still does not have all the documents required to completed the sale.
Mr Shanahan had also asked for an extension of time, but counsel said Mr Shanahan was told "no".
Mr Shanahan fears the deal he arranged for the sale of the nursing home may fall through, and the funds may appoint a receiver to sell the business.
Counsel said his client who carried out works to upgrade the nursing home is also concerned for the safety and well being of the residents.
He wanted to make sure that the facility was sold to somebody who would operate the home as it has been in the past and that all the employees would be kept on.
The appointment of a receiver could undermine the business and alarm the nursing home's residents.
Mr Shanahan also fears his reputation would be seriously undermined if the deal collapses and a receiver is appointed over the nursing home.
At the High Court on Friday Mr Justice Robert Haughton granted Mr Shanahan permission to serve short notice of his Mr Shanahan's bid for an injunction preventing the financial funds from appointing a receiver.
The businessman also seeks an order preventing the funds from terminating the agreement they reached in 2016.
The matter was adjourned to next Tuesday's sitting of the Court.