The English High Court has today [Friday 10 August 2012] given judgment against Patrick McKillen in the court case brought against NAMA, Derek Quinlan and the Barclay brothers.
Mr McKillen had challenged NAMA’s transfer in September 2011 of the £660 million debts of Coroin Limited (“Coroin”), the holding company of the Maybourne Hotel Group, to a company owned by the Barclay brothers, Maybourne Finance Limited (“MFL”). NAMA had first acquired those debts in June 2010.
Mr McKillen alleged that the debt transfer from NAMA to MFL was invalid, arguing that NAMA had failed to comply with a contractual requirement to consult with Coroin before transferring the loans.
On 27 June 2012, the English Court of Appeal gave judgment in NAMA’s favour in relation to the legal question of whether NAMA was required to consult with Coroin.
The three judges held unanimously that NAMA did not have to consult, meaning that the transfer of the debt to MFL was valid.
Today, 10 August 2012, the English High Court delivered judgement on the main body of Mr McKillen’s claim.
In a detailed judgement, Mr Justice David Richards found that given the earlier judgement in the Court of Appeal on the issue of consultation, Mr McKillen could not rely on his claim of invalidity against NAMA in the High Court proceedings.
He also noted that he was satisfied that NAMA would not have extended the Coroin loan facilities under any circumstances and that whilst Mr McKillen was aware of this, he still chose not to pursue alternative funding for the company in the interim period.
Mr. Justice Richards agreed with NAMA’s central position that Coroin’s debt of £660 million was unsustainable and the company was overleavaged by between £150 and £200 million.
Commenting on NAMA’s evidence before the Courts, Mr Justice Richards that the Agency’s witnesses were “wholly reliable” and that the Agency’s evidence had been “invaluable” in helping to establish both its approach and attitude during the period in which it held Coroin’s debt.
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