A dispute between firms of developer Johnny Ronan and the Fortress Funding Group, which has financed some €1 billion price of business property tasks has been admitted to the Industrial Court docket.
RGRE J&R Ltd, RGRE Borrower Ltd, J&R Lehaunstown Ltd Partnership, J&R Fitzwilliam Ltd Partnership and RGRE Sen Borrower Ltd, have introduced proceedings in opposition to Collir SARL, Fortress Funding Group LLC and CF Troy Holdings LLC. Collir and CF Troy are each not directly owned by funds managed or suggested by associates of Fortress.
Commercial
The Ronan associated firms are looking for damages for breach of contract, illegal interference with contractual relations and/or inducing breach of contract and/or negligence and/or breach of obligation.
In addition they search declarations together with that by failing to have interaction with the plaintiff companies’ effort to refinance services beneath a improvement belongings facility settlement and a mezzanine facility settlement, the defendants have breached an obligation to not clog, stymie, or in any other case hinder redemption rights beneath these agreements.
Claims denied
Commercial
In addition they search a declaration that the defendants have been unjustly enriched by motive of the work accomplished by the plaintiffs on developments at Spencer North and South and Fibonacci Sq. in Dublin. That work had tremendously enhanced the worth of these developments for the defendants, it’s claimed.
The claims are denied.
Commercial
On Monday, Mr Justice Denis McDonald admitted the proceedings to the Industrial Court docket on the appliance of Lyndon MacCann SC, for the defendants and on consent of the plaintiffs.
Mr MacCann stated his purchasers wished finality to the dispute and there was “a historical past between the plaintiffs and defendants”.
In an affidavit looking for entry of the case to the industrial listing, Shalini Shanthikumar, senior vice chairman/authorized counsel of the Fortress Group, stated it was clear from the orders sought that the proceedings principally associated to industrial mortgage services superior by Collir to the plaintiffs.
These associated to a improvement belongings facility settlement of March twenty fourth, 2015, and later amended in 2022 referring to an authentic mezzanine facility settlement of March 2015.
Commercial
Disputed exit price
Ms Shanthikumar stated the plaintiff firms’ collective liabilities to Collir in reference to these agreements is greater than €93 million which doesn’t embody an exit price which the plaintiffs say is €21 million and the defendants say is €33 million.
Commercial
The defendants strongly consider the proceedings had been introduced with the only goal of obstructing Collir’s train of its contractual rights beneath the agreements, she stated.
The plaintiffs’ respective liabilities are subordinated to the liabilities of a lot of Ronan Group firms, together with RGRE J&R and RGRE J&R Borrower, beneath a senior facility settlement with Financial institution of Eire as agent and safety trustee beneath a “senior facility settlement”, she stated.
Cost obligation
A €10 million fee obligation has fallen due on the finish of July 2023 and the defendants don’t consider the Ronan firms will probably be able to discharge, she stated.
Commercial
No rationalization has been provided by the plaintiffs as to why they commenced the proceedings now although the complaints arose previous to January twentieth final, she stated.
The defendants consider that the conditions the Ronan Group has orchestrated on the Spencer North and Fibonacci developments had the target of forcing Collir to simply accept a refinancing proposal which isn’t in Collir’s industrial curiosity, she stated.
Ms Shanthikumar additionally stated this was in opposition to the background of separate proceedings in 2021 introduced by Ronan Group Corporations over the sale belongings to CF Troy by the Ronan former co-investor, Digitalbridge Group. These proceedings had been in the end settled in February 2022.
Subsequently, a senior lender for the Ronan household portfolio appointed a receiver to 12 properties in that portfolio. Following negotiations, new variations of the 2015 improvement agreements had been drawn up, and the receiver was discharged.
Commercial
Ms Shanthikumar stated Collir agreed to facilitate the refinancing of senior debt in good religion. With out it, she stated, the underlying belongings of the Ronan household portfolio would for probably the most half now be offered.
The scenario within the which the plaintiffs now discover themselves is “totally of their very own making”, she stated.
Had Collir accepted the refinancing proposal from the plaintiffs final January, simply two days earlier than the exit price was reinstated final January, it will have resulted in Collir recovering simply 57 per cent of the debt as a consequence of it, she stated.