A MAN who lodged €2.2 million with Ulster Bank to be used for currency trades has brought a legal action claiming the bank was not entitled to deduct €667,210 from those funds under an earlier guarantee by him to repay €3.85 million in loans to a company for property development.
Dr Neil Healy claims that before he lodged the €2.2 million with Ulster Bank in August 2007, the bank specifically represented to him he had no liability to it under the earlier guarantee of August 9th 2006.
In his proceedings, Dr Healy, Lough Sheever Corporate Park, Mullingar, Co Westmeath, is seeking orders requiring the bank to return the €667,210 deducted and to pay damages for alleged negligent misrepresentation.
He also wants declarations that he stands discharged from the guarantee because of the representations made by the bank to him when he lodged the €2.2 million funds in August 2007.
The case was admitted to the Commercial Court earlier this week by Mr Justice Peter Kelly.
Dr Healy claims he gave the guarantee for a sum of €3,485,000 lent by the bank to Coole Property Holdings Ltd for a commercial development by that company.
He said he was a director of that company but, after protracted negotiations, he had sold his interest in the commercial enterprise to his co-guarantor, Dr Patrick Cullen.
Ulster Bank was privy to each step in those negotiations and was fully appraised of the terms under which he had disposed of his interest in the company, Dr Healy said. He added the €2.2 million lodged with Ulster Bank by him was derived from the sale of his interest in the Coole enterprise.
He only lodged the monies because of the specific representations to him by the bank that, following the sale of his interest, he stood discharged from all liability to it under the guarantee.
If the bank had told him he was not released from his obligations under the guarantee, he would not have lodged the money, Dr Healy added.
On August 14th last, the bank had set-off the sum in the transactions account – €667,210 – against the balance outstanding for the loan to Coole Property Holdings and/or Patrick Cullen, he said.
The bank was exposing him to liability for a maximum sum of €3.85 million, Dr Healy said. The bank had sought proposals from him as to the outstanding €2.25 million, he said.
