Belfast Telegraph

Ex-property tycoons owing £213m given time by court for bid to stave off bankruptcy

By Alan Erwin

Former property tycoons Michael and John Taggart owe up to £213m, the High Court has heard.

The scale of the Co Londonderry brothers' financial liabilities was disclosed as a bid to have them declared bankrupt was put on hold.

An alternative resolution has been advanced where creditors are to be offered payments of 0.03p in the pound.

The proposal will now be voted on at a meeting next month.

Ulster Bank brought bankruptcy petitions against the Taggarts over debts running into several million pounds.

Proceedings were issued after the brothers lost a marathon legal battle with the bank.

In November last year a High Court judge in Belfast held them liable for a €4m personal guarantee over land purchases in the Republic of Ireland.

A second personal guarantee of £5m linked to development north of the border also remains outstanding.

The Taggarts failed in their counter writ which claimed the bank's actions contributed to the collapse of the Taggart Group.

Once a huge house-building operation on either side of the Irish border, with further interests in Britain, Europe and the United States, the firm was decimated in the 2007 property market crash. Within a year it had gone into administration.

During a 30-day trial the court heard how the brothers' property portfolio once extended to a Luxembourg shopping centre and luxury apartments in Florida and on the borders of Monte Carlo. Michael Taggart, once among Ireland's richest businessmen, insisted his company would not have gone bust if bank concerns had been disclosed sooner.

But a judge ruled against him after describing his evidence in the case as being "flawed, inconsistent and implausible".

In court yesterday the Taggarts applied to adjourn the bankruptcy petitions so Individual Voluntary Arrangement (IVA) proposals can be put to a meeting of all creditors.

An IVA involves a binding agreement to pay back at least some of the outstanding debts.

A significant majority of creditors must vote in favour of the plan before bankruptcy proceedings can be stopped. A lawyer for the Taggarts told Master Fiona Kelly: "The proposed dividend represents 0.03p in the pound, as opposed to nil in bankruptcy."

Pressed further, he revealed the total amount owed to unsecured creditors is £213m.

Of that figure, liabilities to Ulster Bank were assessed at around £11m.

Even if the Bank opposed the IVA plan it could be outvoted by the rest of the creditors, the court heard.

If the proposals are backed a lump sum will be available to make payments.

Due to the situation, Master Kelly held that she could not justify refusing the adjournment application.

Belfast Telegraph

Popular

From Belfast Telegraph