A Dublin pub has succeeded in turning out a receiver appointed by a bank trying to recover a €4m debt.
In a landmark High Court judgement, the court ruled that the appointment of the receiver to Foley's and O'Reilly's bars on Merrion Row by Bank of Scotland Ireland last October was void because it did not adhere to certain rules.
At a special court sitting yesterday, the iconic watering hole was placed in examinership, putting the business under court protection while it attempts to trade out of its difficulties.
Both Foley's and the adjoining O'Reillys bar, which are close to Government Buildings, are favourite haunts of politicians and civil servants. The actress Sarah Jessica Parker and former British prime minister John Major have both sipped Guinness there.
A receiver was appointed by Bank of Scotland Ireland in October to recoup the €4m in outstanding loans. At one point, the receiver, David O'Connor, was close to selling the pub for what the court heard was a "reasonable offer". It's believed the price was close to €2.75m.
Sean Foley and his wife, Sherry Yan, who are directors of the company that owns the bars, had submitted that they suspected the appointment of a receiver was unlawful and that the pub would have been a candidate for examinership.
The challenge to the receiver centred on a number of issues. In his judgement, Mr Justice Paul Gilligan found that the appointment of the receiver should have been under seal but it was not. Insolvency specialist Seamus Sutcliffe, of Lansdowne Francs who advised on the case, said it appeared the case was the first in Irish law that the appointment of a receiver had been successfully challenged.