A "vulnerable" farmer fears proposed actions by a receiver appointed by a "vulture fund" over his lands could his destroy his business, the High Court has heard.
Andrew McDonnell (47), a dairy farmer with a herd of 100 cattle on his 80-acre farm at Cappagh, Newbliss, Co Monaghan, says the receiver has threatened to remove and sell any items on the farmer’s land – including stock and farm machinery – unless he removed it within seven days.
Mr McDonnell said the receiver had no right or entitlement to remove or sell the items. As a result he has brought the proceedings against Mr Tom O'Brien of Mazars, who was appointed receiver over the lands, and financial fund Promontoria (Oyster) Designated Activity Company.
Mr McDonnell claims the receiver wrote to him telling him that if he did not respond within a week, Mr O’Brien would take steps including selling items on the land to reduce the arrears.
Mr McDonnell fears such action would result in the destruction of his farm business.
At the High Court on Thursday, Mr McDonnell secured a temporary injunction preventing the defendants from continuing to threaten to remove, sell or transfer any stock or items on the land.
The injunction was granted on an ex-parte basis – where only one side was present in court – by Mr Justice Max Barrett.
The court heard the receiver was appointed by the fund, which Mr McDonnell's barrister, Francis Treanor, said others had described as "a vulture fund". It had acquired Mr McDonnell's loan from Ulster Bank in December 2016.
Mr McDonnell had been in full compliance with the terms of his loan until he fell into arrears with the bank due to the fall in milk prices.
Mr Treanor said Mr McDonnell now owed about €420,000 on the loan.
Mr McDonnell, after obtaining financial advice, had offered to pay some €370,000 after obtaining funds from his family, but this offer had not been responded to.
He said he had not been offered any alternative restructuring option by the fund, other than to settle his loan in full.
List of assets
On August 29th, the same day he made his proposal to the fund, Promontoria had decided to appoint a receiver over his property.
The receiver, counsel said, then sent communications to Mr McDonnell in relation to the items on the lands.
Mr McDonnell said the communications represented threats against his farming business.
Counsel said his client was further alarmed when the receiver asked for a list of all the assets on the lands.
Financial pressures had affected his client’s health and he was “a vulnerable individual”.
In addition to seeking the injunction, Mr McDonnell is seeking damages for alleged negligence and breach of contract. He also claims the fund has acted without due regard for the Central Bank’s code of conduct and practice when dealing with a customer in arrears.
After granting the injunction, the judge said the fact €370,000 was offered on a debt of €420,000 meant that something had gone wrong somewhere.
The judge adjourned the matter to a date in October.