DEVELOPER JOHN Fleming, whose businesses were placed in liquidation last year with debts of €1 billion, was discharged from bankruptcy in Britain yesterday, giving him a financial clean sheet in that country.
The UK’s Insolvency Service, confirmed Mr Fleming was discharged from bankruptcy with effect from yesterday, November 10th. He was originally declared bankrupt in Southend County Court on the same date last year.
The British court’s discharge of his bankruptcy means creditors will not be able to pursue any assets or wealth he creates or develops in the UK from now on.
Mr Fleming’s development and construction group was one of the first high-profile property businesses to go under as a result of the crash, when the High Court appointed a liquidator to a number of its companies in March last year.
The court appointed Tom Kavanagh of Kavanagh Fennell as liquidator to Tivway and a number of associated companies following a failed examinership that began in 2009 and ended in the Supreme Court in early 2010.
The group owed its banks, Anglo Irish Bank, AIB, Dutch-owned ACC and Bank of Scotland, over €1 billion. Only ACC, which was owed €22 million, opposed the examinership.
Much of the debt was related to a site that the group was developing for residential commercial purposes in Sandyford in Dublin.
Mr Fleming’s bankruptcy and discharge could have implications for State assets agency, Nama, although it was not clear yesterday what these may be.
Last year, the agency took over €260 million that the Fleming group owed to AIB and Anglo Irish Bank (now the Irish Bank Reconstruction Corporation). Those debts were backed by personal guarantees given by Mr Fleming.
Under normal circumstances, if Nama cannot recover the full amount of a developer’s debt from the sale of the assets involved, it can pursue the individual for the balance, and demand that they use other resources or sell other assets, to repay whatever is due.
However, if Mr Fleming has used other assets to discharge his UK bankruptcy, that option will not be open to Nama.
The agency will not be able to pursue any wealth that he accumulates in Britain following yesterday’s discharge by the Southend court. Nama did not comment.
According to UK Insolvency Service documents, Mr Fleming had a British residence at Billericay in Essex,close to London. This entitled him to go through Britain’s bankruptcy system.
The Republic’s bankruptcy regime only allows for discharge after 12 years. In Britain, the period is much shorter, generally lasting up to two years.
Under both country’s systems, a court-appointed trustee takes over the bankrupt’s assets and shares them out amongst creditors.
Britain does not allow pension funds to be used in bankruptcy, but Irish law does. Both regimes allow the bankrupt to start again with a clean sheet once they are discharged.
Along with his Irish property business, Mr Fleming is understood to have some interests in Britain. He also has an alternative energy operation in the US.
Mr Fleming is from west Cork, and his business was based in Bandon, close to Cork city. He began his construction business in Cork in 1975. The company has worked on projects across industry, energy and pharmaceuticals, and earned a strong reputation for the quality of its work.
The group ran into trouble after it bought and began developing the Sandyford site, centred around a partially built 14-story block, known as the Sentinel.
Tivway paid €245 million for the 11.3 acre site in Sandyford in early 2006, just as the property boom was reaching its peak.
Three years later, Tivway went to the High Court to seek protection from its creditors, and to have an examiner appointed to allow it time to make a rescue plan.
The court appointed George Maloney of accounting firm Baker Tilly Ryan Glennon. The rescue plan put forward in late 2009 involved the sale of the building contract business to a new company, Donban, and handing over the Sandyford property to the banks, which could then recover value as the market returned.
