Former property tycoons Michael and John Taggart dispute Nama debt
FORMER property tycoons Michael and John Taggart have disputed owing money to a firm that controls £1 billion of Nama loans in Northern Ireland, the High Court has heard.
As the Co Derry brothers continue to battle against being declared bankrupt, their barrister argued yesterday that Promontoria Eagle has produced no evidence of any alleged debts.
He told a judge: "We simply say they have provided effectively no proof whatsoever of their debt."
The Taggarts are challenging the company's standing at a meeting where creditors rejected an alternative proposal to bankruptcy. Dublin registered Promontoria Eagle, a subsidiary of US private equity giant Cerberus, was set up to manage the former Nama property loan book. The Taggarts, said to have total debts of up to £213 million, are facing bankruptcy petitions brought by Ulster Bank.
Proceedings were issued after the house builders lost a legal battle over their liability for millions of pounds in personal guarantees for land purchases and development on either side of the Irish border. Earlier this year the petitions were put on hold so Individual Voluntary Arrangement (IVA) proposals could be put to a meeting of creditors.An IVA involves a binding agreement to pay back at least some of the outstanding debts.
A majority of creditors must vote in favour of the plan before bankruptcy proceedings can be stopped.
It was disclosed at that stage that the total amount owed to unsecured creditors was £213m, with liabilities to Ulster Bank assessed at around £11m. The alternative resolution involved payments of 0.03 pence in the pound. At a previous hearing it was confirmed that the proposal was rejected by a majority of creditors.
However, the Taggarts began moves to challenge a decision by the chairman of the meeting to accept the outcome of the ballot.
Counsel for the brothers raised issues over the standing of a creditor later confirmed to be Promontoria Eagle. The company is understood to have voted against the IVA arrangements. Amid claims the proposal would have been approved without Promontoria's inclusion, the brothers are now seeking to have them ruled out of the process.
Ulster Bank, meanwhile, is contesting the standing of up to three other creditors to counter the Taggarts' move.
Adjourning proceedings, Master Kelly listed the case for a further review in September.
The brothers have been locked in litigation with the bank for several years.
As part of the legal battle they unsuccessfully claimed that its 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.
Michael Taggart, who was at one time 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".