The High Court has appointed an interim examiner to a company that is building 16 social housing units in Co Limerick.
At the High Court on Thursday, Mr Justice Mark Heslin said he was satisfied to appoint experienced insolvency practitioner Joseph Walsh of JW Accountants as interim examiner to Top Drawer Developments Ltd.
The judge said the company, with a registered address in Newcastlewest, Co Limerick, was insolvent and unable to pay its debts as they fall due.
However, he was granting the company protection from its creditors on the basis that an independent expert had stated the firm has a reasonable prospect of survival if certain steps are taken.
The steps include the appointment of an examiner, obtaining court approval for a scheme of arrangement with the company’s creditors, and obtaining fresh investment.
The company, represented by Ross Gorman BL, instructed by solicitor Graham Kenny, sought to have the firm placed into examinership. It is currently building 16 social housing units in Pallaskenry, Co Limerick for the local authority.
Counsel said that the company had got into difficulties due to the disruption to the project caused by the Covid-19 pandemic.
This had delayed construction for a considerable time between 2020 and 2021. Counsel said that as well as the pandemic, the impact of Brexit had seen an additional increase in the cost of building materials.
Borrowed
Counsel said that the company had borrowed €2.4 million to complete the project from a company called PBRidge 1 DAC, for a period of 14 months.
Arising out of the considerable delay caused by Covid-19, the company had to pay an interest surcharge on top of what it was already repaying to its lender.
The lender had issued a letter of demand and had threatened to appoint a receiver over the company’s assets, counsel said. As a result of that it was decided to seek to place the company in examinership.
Counsel said that the company was confident of obtaining fresh financing as well as obtaining work in the future.
An independent expert had assessed the company and deemed that it was profitable, and it has a good prospect of survival.
The charity Focus Ireland was also interested in acquiring the houses, counsel added. The appointment of an independent examiner would allow the company to complete the social housing project, and would also be in the best interests of the firm's creditors and employees, he said.
After appointing Mr Walsh on an interim basis Mr Justice Heslin agreed to adjourn the case, and remit it back to Limerick Circuit Court.
