The High Court has approved a Personal Insolvency Arrangement (PIA) allowing a Co Wicklow-based construction manager to write off almost €3 million in debt.
The PIA was sought in respect of Ciaran O’Neill who, the court heard, will make a contribution of €163,000 during the six-year duration of the arrangement.
His creditors include two related financial funds, Promontoria Aran and Promontoria Scariff DAC, which acquired loans over which Mr O’Neill had given personal guarantees.
When interest was included, the fund claims they were owed more than €2 million by Mr O’Neill.
Other creditors included AIB and AIB Mortgage Bank, owed approximately €490,000; Bank of Ireland, owed €61,000; and the Revenue Commissioners, owed €180,000.
He owed dozens of trade creditors, firms and suppliers involved in the building industry, sums ranging from €15,000 to just under €2,000.
The PIA, under which Mr O'Neill retains his family home at Rockville, Killegar, Ballybetagh Road, Enniskerry, Co Wicklow was approved by Mr Justice Mark Sanfey on Monday.
The court heard Mr O’Neill, a married man aged 59, had worked in the construction industry for many years.
In 2000, he set up his own company, Kyneill Construction Ltd, which traded successfully. Loans, some of which were ultimately sold to Promontoria, were taken out to acquire property, over which he gave personal guarantees.
Mr O’Neill got into difficulty in 2008 when the recession hit.
The court was told he did his best to deal with and repay his creditors, but was unable to keep up with his repayment commitments. His business was dissolved and he sought to enter into a personal insolvency arrangement.
In a sworn statement, Mr O'Neill's personal insolvency practioner Judy Mooney said, under the scheme, her client's creditors will do better than if he was adjudicated a bankrupt.
Ms Mooney said the outcome under the PIA, compared to bankruptcy, was the same for Mr O’Neill’s creditors.
However, under the PIA unsecured creditors would receive 2c in the Euro, whereas in a bankruptcy scenario they would get just 1c in the Euro.
Keith Farry BL, for Ms Mooney, said Mr O’Neill, who now works as a construction manager for a building company, has “a painful six years ahead of him”.
As part of the PIA he will make monthly payments of between €685 and €1,025 over the next 72 months. The PIA will be further funded by the proceeds of sale of investment properties owned by Mr O’Neill, and by cashing in savings and pensions he had taken out.
There were no objections to the application to approve the arrangement, although a number of creditors had voted against the PIP’s proposals, counsel added.
