A FORMER Limerick hotelier is facing the prospect of losing his family home if his investment in the development of a resort on a holiday island proves unsuccessful.
Bank of Ireland Mortgages have initiated legal action against Brendan Dunne and his wife, Hilda, over unpaid borrowings of €1.6 million taken out in 2004.
As part of the Circuit Court action, the bank is seeking an order for the possession of the Dunne’s home - Shamrockville - on North Circular Road.
The three-storey property, which is around 4,600 square feet in size, is set on 1.3 acres and features five bedrooms, four bathrooms, a games room, library, study, conservatory, drawing room, dining room, living room and coat room.
It was once labelled a “landmark residence” in one of Limerick’s most sought-after addresses.
In 2010 Shamrockville was placed on the market with an asking price of €4.5m, but this was later reduced to €1.5m as the effects of the recession continued.
During a review of the case, Derek Sheahan BL, representing the bank, said his client recently received a letter outlining details of the Dunne’s investment in a development at Cape Verde - a group of islands off the coast of West Africa.
However, he insisted the development was not the bank’s concern and that it intends pursuing the application for possession.
Mr Sheahan said while Bank of Ireland Mortgages does not accept the contention that the potential return from the investment will enable the Dunne’s to repay the outstanding monies, he agreed that it may be premature for the granting of a formal order “as we are currently in a holding pattern until the other cases are finalised”.
The application for civil possession was previously adjourned to facilitate the completion of separate legal proceedings relating to the development.
Judge Tom O’Donnell was told that construction at the Paradise Beach development on the island of Sal had been halted on foot of an ‘Arresto warrant’ - the equivalent of a court injunction.
However, he was advised that agreement has been reached in those proceedings and that it is anticipated the warrant will be lifted on February 24 next - clearing the way for construction to resume almost immediately.
Pat Barriscale BL, representing Brendan and Hilda Dunne, told the court his client’s interests in the Cape Verde development were likely to be worth around €3.5m once realised.
He added that the value of Shamrockville was likely to increase in the near future given that seven properties in the locality have been sold recently and that the property market is on an upward curve.
Mr Barriscale sought a lengthy adjournment of the proceedings saying the realisation of their investment was the only possibility Mr and Mrs Dunne have of repaying the monies owed.
“They have lost everything, it’s all they have left,” he said, adding that if a possession order is granted they would have nowhere to live.
Judge O’Donnell was told that at one time, Brendan Dunne, 68, owned six hotels and 20 properties which were all fully serviced and paid for.
However, in 2007 he became ill and was diagnosed with the life threatening condition Guillain-Barré syndrome, which has left him almost totally paralysed and confined to a wheelchair.
He spent 16 months in hospital and lost his entire business, said Mr Barriscale.
“It’s not that he frittered it away,” he said, adding that his clients were anxious to see out the Cape Verde development and are “hopeful and optimistic” that it will be a success.
Judge O’Donnell said he is conscious that the property at the centre of the possession application is a family home and not a development property.
“While I appreciate the position of the bank that the Cape Verde development is not their problem, I am willing to see if there could be some realisation to this,” he commented
The judge said he was willing adjourn the case to June to see if construction of the Paradise Beach development had restarted as he was “trying to meet the best of both sides”.