Slyne Properties Ltd and Others

JurisdictionIreland
JudgeMr. Justice Brain J. McGovern
Judgment Date11 February 2010
Neutral Citation[2010] IEHC 37
CourtHigh Court
Date11 February 2010

[2010] IEHC 37

THE HIGH COURT

[No. 53 COS/2010]
Slyne Properties Ltd & Ors, In Re
IN THE MATTER OF SLYNE PROPERTIES LIMITED
AND IN THE MATTER OF BLACK SHORE HOLDINGS LIMITED
AND IN THE MATTER OF SWEENEY OIL RETAIL LIMITED
AND IN THE MATTER OF SWEENEY OIL (MOYCULLEN) LIMITED
AND IN THE MATTER OF SWEENEY OIL SERVICES STATIONS LIMITED
AND IN THE MATTER OF THE COMPANIES ACTS 1963 TO 2009

COMPANIES (AMDT) ACT 1990 S2

COMPANIES (AMDT) ACT 1990 S4

GALLIUM LTD (T/A FIRST EQUITY GROUP), IN RE 2009 2 ILRM 11 2009 IESC 8

COMPANIES (AMDT) ACT 1990 S24

VANTIVE HOLDINGS & ORS, IN RE UNREP SUPREME 11.8.2009 2009 IESC 68

FERGUS HAYNES (DEVELOPMENTS) LTD, IN RE UNREP LAFFOY 1.9.2008 2008/24/5188 2008 IEHC 327

ATLANTIC MAGNETICS LTD, IN RE 1993 2 IR 561 1992 DULJ 101 1991/11/2520

COMPANY LAW

Examinership

Appointment of examiner - Opposition by largest creditor - Prospect of survival - Independent accountant's report - Purpose of examinership - Difference between examinership and receivership - Protection of company - Preservation of jobs - Benefit of economy - Whether reasonable prospect of survival as going concern - Whether court should exercise discretion - Re Gallium Ltd [2009] IESC 8, [2009] 2 ILRM 11; Re Vantive Holdings [2009] IESC 68, (Unrep, SC, 11/8/2009) and Re Atlantic Magnetics Ltd [1993] 2 IR 561 considered - Companies (Amendment) Act 1990 (No 27), s 2 - Examiner appointed (2010/53COS - McGovern J - 11/2/2010) [2010] IEHC 37

In re Slyne Properties Ltd

Facts Slyne Properties Limited ("the company") had brought the proceedings seeking to have an Examiner appointed pursuant to section 2 of the Companies (Amendment) Act 1990 ("the Act"). The company also sought the appointment of the Examiner over related companies. Principally the petition opposed by Anglo Irish Bank, who was the largest creditor. The other creditors were either supportive of the petition or neutral. On behalf of Anglo Irish Bank it was contended that there was not a reasonable prospect of survival and that the Bank intended to appoint a receiver at the first available opportunity. In addition it was claimed that the court should decline to exercise its discretion, having regard to the purpose of the Act. There was nothing in a receivership which would achieve a different result so far as the preservation of jobs was concerned and the benefit to the economy as a whole. On behalf of the company it was contended that the matters raised by the Bank were more properly matters to be dealt with in a section 24 hearing to confirm a scheme of arrangement.

Held by McGovern J granting the petition. The independent accountant had provided evidence that the companies had a reasonable prospect of survival if the conditions set out in his report were met. The purpose of the legislation governing the examinership procedure was to enable enterprises to continue in existence for the benefit of the economy as a whole, and took into account a number of matters such as the preservation of jobs. On the other hand, the primary responsibility of the receiver was to protect the interests of the security holders and to realise the charged assets for their benefit. The Act in no way ignored the rights of debenture holders as the court would not confirm the Examiner's proposed scheme of arrangement unless they have been accepted by at least one class of creditors whose interest would be impaired by the implementation of the proposals.

Reporter: R.F.

1

1. Slyne Properties Limited ("the company") has presented this petition for the appointment of Mr. Michael McAteer as Examiner of Company, pursuant to the provisions of s. 2 of the Companies (Amendment) Act 1900 ("the Act"). The Company also petitions for the appointment of Mr. McAteer as Examiner of the following companies, namely, Sweeney Oil Retail Limited (SOR), Sweeney Oil (Moycullen) Limited (SOM), and Sweeney Oil Service Stations Limited (SOSS), pursuant to the provisions of s. 4 of the Act. The company had also petitioned for the appointment of an Examiner to Black Shore Holdings Limited ("the holding company"), but that petition was withdrawn and I made an order for the winding-up of the holding company.

2

2. The petition is opposed by Anglo Irish Bank plc. who is by far the largest creditor. The other creditors either support the petition or are neutral.

3

3. The principal activity of the company is the operation of the Courtyard/Marriott Hotel on the Headford Road in Galway. The hotel has an associated spa and car park. It also owns and operates a service station. The management of the forecourt shop has been licensed to a third party. The company owns and manages retail and office space close to the hotel.

4

4. The petitioning company and the related companies which are included in the petition are all wholly owned subsidiaries of Black Shore Holdings Limited.

5

5. "SOR" is the retailer of petroleum products and the operator of a Spar forecourt convenience store and an Esso filling station. It is also landlord of a property in Clifden, County Galway.

6

6. "SOM" is the owner of an Esso filling station in Moycullen, County Galway, and the...

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