High Court hears anger of Trade creditors of Laragan developments
A number of trade creditors of house builders Laragan Developments have told the High Court their anger over the manner they were treated by the company and during the examinership process.
Today Mr Justice Frank Clarke, who has been asked by a court appointed examiner Mr Paul McCann to approve a scheme of arrangement to ensure the survival of Laragan Developments, heard submissions from trade creditors of the house building company.
The firm which is part of the Hanly associated group of construction and quarrying companies has debts of has liabilities of €147m. It has assets worth €2.35m. Counsel said that €101m of Laragan's liability is owed to Mr Alan Hanly of the Hanly group.
Under the terms of the scheme many of the trade creditors will get 6.4% of what they are owed, and many have expressed their anger over the offer in the proposed scheme.
On what was the second day of the hearing Mr Danny Lally, speaking on behalf Mayo Trowel Trades Ltd told the court that we "did everything Laragan asked us" but failed to get full payment from them.
The money that was being offered to trade creditors under the scheme of arrangement was "a pittance" and "a joke". He also told the court that he would be prepared to get no money and see the firm go into liquidation and have the company "properly investigated."
"There are many people in court who would fully agree with me," he said.
Mr Lally was also critical of the Examinership process, and many trade creditors are opposed to the scheme.
He told the court that he believed that a vote taken last June by creditors to approve the proposed scheme was "meaningless". He said the he and others were not allowed ask questions at the meeting and that the organisers seemed to be "more interested in the Lions rubgy match on TV"
than dealing with issues concerning the creditors.
Another creditor, Mr Donald Hannigan of Hannigan builders told the court that his small firm was decimated because of money it was owed for doing work for Laragan at Kilronan Castle in Co Roscommon. He said he already had to lay off 10 people who had been with his firm for years.
He said that if the scheme is approved his firm would be left on the "dung heap" while Alan Hanly would have got off free with a clean bill of health.
Mr Aidan Redmond SC on behalf of Goode Concrete Ltd said that the Examiner should have fully investigated the relationship between Laragan and Mr Hanly.
Under the proposed scheme from the court appointed examiner creditors will receive between 30% and 1% of what they are owed.
On Tuesday the court heard that under a scheme to ensure the firm's survival it is proposed that those who paid deposits of between €15,000 and €20,000 for properties at Carrickmines Green in South Dublin and Milner's Square in Santry, North Dublin will receive 1% back.
Counsel for the examiner, Bernard Dunleavy told the court that as part of the examinership process the examiner had looked at the books of the company. It was the examiners view that the company had traded for three to four months longer than it should have.
It had been paying bills up until late 2008.The examiner did not find evidence that Laragan had engaged in "reckless trading." The examiner did not refer the matter to the Office of Corporate Enforcement.
The examiner had made 11 revisions to his scheme, had left "no stone unturned" in order to ensure that all creditors would be left better than they would be if the company went into liquidation.
The hearing continues tomorrow.
