Well, this will give some developers in (the Republic of) Ireland pause for thought.
ACC Bank has just succeeded in overturning the August 2012 bankruptcy of Wicklow property developer Sean McCann. Back in August 2012, ACC Bank had been pursuing Sean through the Dublin courts in respect of €5.5m loans provided to his development company, Killorglin Investments Limited.
But in a surprise move, Sean was bankrupted in Northern Ireland on foot of a GBP 1,400 (€1,600) bill for rent arrears.
ACC Bank then contested the bankruptcy, apparently claiming that Sean’s centre of main interest (COMI) was in the Republic and not Northern Ireland.
The High Court in Belfast last week accepted ACC’s case and overturned the bankruptcy. The High Court judged that Sean had only “a very tenuous link” to Northern Ireland. Furthermore the person to whom Sean owed the GBP 1,400 in rent was described as “at very least” an acquaintance if not a friend.
Last week in the Dail, the Minister for Justice and Equality, Alan Shatter admitted that he had had discussions with UK and EU counterparts as part of an EU summit in an attempt to homogenize bankruptcy procedure across Europe. However, this present case seems more akin to the reversal of Sean Quinn’s bankruptcy after Anglo objected to Sean;s original bankruptcy order in Belfast’s High Court, and Anglo subsequently bankrupted Sean in Dublin.
The current bankruptcy period in (the Republic of) Ireland is 5-12 years but that is set to be reduced to three years when all sections of the Personal Insolvency Act 2012 are finally commenced.
UPDATE (1): 4th March 2013. The Belfast High Court judgment which overturned the bankruptcy is now available here.
UPDATE (2): 4th March 2013. The BBC reports on the case in some detail here.