Milners Residents

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Blueythebear

New Member
andycole said:
Just to update people -

I have not yet received any reply from the solicitors for the Examiner - confirming if they have presented my letter to the attention of Mr. Justice Clarke this morning.

Initially the reply that we received was that the Homebond limitations have already been presented to the Court.

But I then made the point that this is a new issue, while related to Homebond, was actually about making Mr. Justice Clarke aware of the Homebond Warning that was issued by the Law Society in 2000 and requesting that a "Client Warning Notice" be included by builders solicitors in contracts.

So I am unaware if Mr. Justice Clarke is aware at this moment in time of the existence of the "Client Warning Notice" .

Request for Help: Can anyone who is going to the Hearing today bring this new issue to the attention of the Examiner, Mr. Paul McCann and his legal representatives?
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This "Client Warning Notice" in the Gazette is not relevant for this hearing. Whether it was or was not put to buyers is not relevant in this case as the purpose of the hearing is to present the examiner's scheme of arrangement to the Court and have the Court judge if it should be accepted or not.

The limitations of the Homebond Scheme were probably put to the Court originally as they are relevant when ascertaining the impact of a liquidation on depositors as it was first thought that if the company liquidated, the depositors would get the deposit back under the Homebond Scheme. They would not receive anything from the company on liquidation and unfortunately it would seem that there is a two year time limit under the Homebond Scheme so that they wouldn't get any joy from Homebond either.

This is taken into account by the judge as the conditions for forcing the examiner's scheme through, require that the unsecured creditors would not be in a better position if the company liquidated, which they clearly wouldn't be here as they'd get nothing from Laragan or the Homebond Scheme.

The "Client Warning Notice" would be relevant if anybody was interested in suing the builder's solicitor or their own solicitor from professional negligence although proving that a solicitor was obliged to include it could be tricky...
 
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andycole

New Member
Thanks for that BlueyBear - I kinda was thinking today after I had posted it earlier this morning that it was not important probably as well - because as you say - the judge is only deciding upon the actual Scheme of Arrangement.

It should all be over today - I think the best thing to hope for is that perhaps we might be upgraded to a higher class of creditors. But personally I do not hold out much expectation - I think if something like this was to be considered that another vote by the classes of creditors would probably be needed.
 
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Dont Be Made Fools Of

New Member
Just to update everyone. Justice Clarke heard all the evidence for and against the scheme by 16.15 on Friday (so he heard four days in total, it took longer than most expected). On closing on Friday he said that he will make his decision on Tuesday morning at 10.30 whether to pass the scheme of arrangement or send Laragan Developments Ltd into liquidation. He said that he may give his reasons for whatever decision he makes on Tuesday or alternatively his reasons will be released at a later date.

Note to purchasers who bought in blocks A, B, C and D and who were considering now purchasing in E or F as they can use their €15,000 deposit against the new revised sales price. It appears that all 96 units (split something like 20 in block F and 76 units in block E) that are already constructed (well 95% complete) and ready to be closed in Milners Square are 'contracted sales'. Ok presumably most of these 96 purchasers wont/cant close for the contracted price but some will and others will want to close at new reduced prices as they have their hearts set on moving into Milners Square and they dont want to lose their deposits. Maybe i misunderstood but i am reasonably sure the above is true. If its true then Laragans dont have any units to offer the disgruntled purchasers from A, B, C and D. Not for many months anyway until they see how they see how their original 'contracted sales' go. Any comments on this would be appreciated.
 
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Renegade

New Member
Still no decision (taken from RTE website).....



The judge dealing with the examinership of Laragan Developments said he has not yet reached a conclusion in the case.

Mr Justice Frank Clarke, who was due to decide the case today, said he will not have a ruling until Thursday because of the serious issues raised.

95 home buyers, who paid either €15,000 or €20,000, as deposits for apartments in Santry and Carrickmines in Dublin are set to lose 99% of their money under a scheme being recommended by the examiner.

Creditors, including some who are owed €1m, would only get back 6.4%.

Laragan Developments, part of the Hanley Group, has debts of €147m with assets of €2.35m.

€101m of the debts are owed to Alan Hanley of the Hanley Group.
 
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Renegade

New Member
Scheme Rejected - Laragan to go into Liquidation

The High Court has refused to approve the scheme put together by an examiner to save property company Laragon Developments and it will be put into liquidation.

This means there will be a winding up of the company and its assets, if any, will be redistributed.

Mr Justice Frank Clarke, in handing down his decision, said the way in which depositors and creditors were dealt with by Laragon was unfair.

The court heard that 157 parties are owed money by Laragon in respect of its developments at Kilronan Castle Hotel and holiday homes in Roscommon, Carrickmines Green in Co Dublin and Milner Square in Santry.

Ninety-five homebuyers paid €15,000 or €20,000 in deposits for apartments at either Milner Square or Carrickmines Green and the examiner scheme was offering them 1% of that back due to the company's collapse.

Trade creditors who carried out work on the developments were being offered around 6% of what they were owed and described this as a joke.

The owner of a block-laying company who is owed a significant sum said he would prefer to see the company go into liquidation so it could be investigated.

Today, Mr Justice Frank Clarke said Laragon was not a company the examinership process was designed to protect.

He said its collapse happened in circumstances where the market changed dramatically and he felt the depositors and creditors were not dealt with fairly.

He said that, in all the circumstances, he could not approve the scheme and the company would be put into liquidation, which may mean that depositors and creditors will be left with nothing.

He will officially make the orders tomorrow.
 
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Calgar99

New Member
While I get a small amount of satisfaction out of this result, I still think there were dodgey dealings going on in the background and the main culprits have lost feck all.

What happens now? Does the court decide how much goes to each creditor class? How long a process is it?
 
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Dont Be Made Fools Of

New Member
Small correction renegade, I think that there were 450 trade creditors and not just 157 parties. Dont mean to be picky just making everyone aware of how many people were negatively affected by Laragans / Hanlys actions.

I was in court today. The relationship between Alan Hanly and Laragan Developments Ltd raised a number of serious questions according to Justice Clarke. For example it was claimed by Alan Hanly that there was an RIAI contract in place with Alan being the employer and Laragan being the main contractor/builder. However they didnt carry out their business as if this was the case ie payments were not made monthly by Alan Hanly to Laragan Developments Ltd for the apartments that Laragans were constructing for Alan. Instead Alan loaned Laragan money to construct and i believe that when the apartments were complete and ready to be sold purchasers would sign two contracts paying the majority to Alan Hanly personnally and paying the balance to Laragan. Laragan then repayed Alan for the loan.

I suspect that two of the serious questions that Justice Clarke alluded to are as follows:

1. Who decided exactly what the split was going to be for each unit? In other words was Alan Hanly personnally making fortunes (literally millions and millions) whilst Laragans were expected to trade at a loss? :rolleyes:

2. Why has Alan not paid for partially built apartments as per the contract? If he paid Laragan the WIP figure of €60 million in March 2009 (as per Laragans own accountant) then there was plenty of cash to pay disgruntled unconnected creditors (eg trade creditors, depositors, the revenue etc) in full three times over!!! :eek:


Justice Clarke went on to describe Laragan as a 'vehicle of convenience'.


Anyway there maybe light at the end of the tunnel for trade creditors and purchasers. Laragan Developments owe the banks nothing. Not a bean. All the finance was arranged through Alan Hanly personally who loaned it to Laragan Developments Ltd. There are 96 'contracted sales' in Milners Square and possibly half that again in Carrickmines (just a guesstimate). I am aware that the 96 units in Milners Square are in Block F and E and they are all but 100% finished. So Laragans can expect to recieve at least €100,000 per unit for say 144 units = €14,400,000. Where is this money going? Presumably Anglo (€2.3 million) the revenue (€1.8 million), employees (€275,000) and the liquidator (€400,000 total guess) get paid in full. Assume €2.5 million will be required to bring the apartments from 'all but 100% complete' to 100% complete (snagging etc). That should still leave around €7,275,000 million left in the kitty to pay a total of €19 million broken down as follows:

the trade creditors (€4 million for Milners Square creditors, €4.5 million for Kilronan Creditors, €4 million for Carrickmines creditors and say €5 million between the ROT creditors and disputed creditors) and depositors (€1,105,000 in Milners Square and €440,000 in Carrickmines).

Will all of the above now get 37% of what they are truely owed?

But hang on :) back to the WIP. Surely Alan Hanly still owes Laragan Developments money for the partially built units now standing in Milners Square and Carrickmines. I believe he does according to the RIAI contract. If he doesnt owe them the WIP figure of €60 million already discussed as per Laragans Accountants in March 2009 then perhaps he only owes them the WIP figure of €32 million as per the examiners section 18 report of June 2009. Again either way once Alan Hanly pays Laragan Developments Limited for the work that was carried out by Laragans for him then every creditor can be paid off in full and there is still change left in the pot!!!!

One may ask has Alan Hanly got millions to pay Laragans? Well I believe that he has. :p

Please comment.
 
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Shanowen

New Member
answer

WIP = work in progress
RIAI = Royal Institute of Architects of Ireland

When Laragan is liquidated, doesn't this mean that the contracts of buyers in Blocks E and F can't be enforced?
 
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Calgar99

New Member
ok Im a bit confused. If hanly gave a loan to laragan to build Milners for example, how does hanly stand to make millions if the company he lent money to go into liquidation?
 
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mosby

New Member
I too would like to know what happens to buyers in Block E & F who have signed contracts for apartments which were due to be finished in early 2008 . These apartments are now worth 50-60% of the contract price and mortgage approvals expired for many over 2 years ago.
Im sure many buyers will not want to live on a building site indefinitely.
 
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Dont Be Made Fools Of

New Member
Calgar the main culprits certainly havent lost feck all. Far from it now. That may have been the case in examinership but not in liquidation.

Also the courts wont decide what the creditors get (if they get anything!!!), the liquidator will decide. The amounts due back to creditors will depend on how much they can get in from Alan Hanly for WIP, selling already built units etc

And how long does it take?? In total most likely 4 or 5 years unfortunately. They have so many companies in Laragan Holdings to go through. Maybe an effort can be made to pay creditors and repay depositors before the end of the entire process.

Finally calgar it is assumed that Alan Hanly personally made tens of millions over the last 11 years since laragan developments ltd was set up. They built and sold over 1,500 residential units in that time. For example if a unit is sold for €400,000 laragans get €125,000 (making minimal profit) while Alan Hanly gets €275,000 having paid only €200,000 for the site (making massive profit). There is nothing wrong with that per se.

The problems arise now when Laragan Developments rack up €147 million worth of debt most of which is owed to Alan Hanly or companies connected to him. How could the company building and making millions for Alan Hanly be in financial difficulty? This needs to be investigated and for this to happen they had to be put into liquidation.

Shanowen Laragans will go into liquidation tomorrow morning (unless Laragan appeal to the Supreme Court which is deemed highly unlikely) with Grant Thornton being put forward as the interim liquidator. Maybe somebody else will be appointed liquidator over the coming weeks or a reciever maybe appointed by the banks.

Mosby My understanding is that the purchasers of units in Blocks E and F will still be expected to complete on the sales. Though the purchasers that i have spoken to are not being asked to complete at the initial contracted sales price. Just personally speaking i would find it ludricous if they couldnt walk away (albeit losing their entire deposit) from the development based on the huge delays in constructing them, its indefinitely a half finished development, the lack of confidence in the developer etc

I am not a legal eagle but i believe everything that i typed is accurate and correct
 
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Blueythebear

New Member
Dont Be Made Fools Of said:
Calgar the main culprits certainly havent lost feck all. Far from it now. That may have been the case in examinership but not in liquidation.

Also the courts wont decide what the creditors get (if they get anything!!!), the liquidator will decide. The amounts due back to creditors will depend on how much they can get in from Alan Hanly for WIP, selling already built units etc

And how long does it take?? In total most likely 4 or 5 years unfortunately. They have so many companies in Laragan Holdings to go through. Maybe an effort can be made to pay creditors and repay depositors before the end of the entire process.

Finally calgar it is assumed that Alan Hanly personally made tens of millions over the last 11 years since laragan developments ltd was set up. They built and sold over 1,500 residential units in that time. For example if a unit is sold for €400,000 laragans get €125,000 (making minimal profit) while Alan Hanly gets €275,000 having paid only €200,000 for the site (making massive profit). There is nothing wrong with that per se.

The problems arise now when Laragan Developments rack up €147 million worth of debt most of which is owed to Alan Hanly or companies connected to him. How could the company building and making millions for Alan Hanly be in financial difficulty? This needs to be investigated and for this to happen they had to be put into liquidation.

Shanowen Laragans will go into liquidation tomorrow morning (unless Laragan appeal to the Supreme Court which is deemed highly unlikely) with Grant Thornton being put forward as the interim liquidator. Maybe somebody else will be appointed liquidator over the coming weeks or a reciever maybe appointed by the banks.

Mosby My understanding is that the purchasers of units in Blocks E and F will still be expected to complete on the sales. Though the purchasers that i have spoken to are not being asked to complete at the initial contracted sales price. Just personally speaking i would find it ludricous if they couldnt walk away (albeit losing their entire deposit) from the development based on the huge delays in constructing them, its indefinitely a half finished development, the lack of confidence in the developer etc

I am not a legal eagle but i believe everything that i typed is accurate and correct
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I would have thought that disgruntled depositors should now be able to take High court action against Laragan now that the protection of the examinership has been lifted. I'd have thought a class action (involving all purchasers of Milners Square and / or Carrickmines) would be the way to go. I presume the matter would be for breach of contract in that now that Laragan have liquidated, they can't complete the contracts and everyoine should get deposits back. In addition joining Hanley and Hanley Homes Ltd as 2nd and 3rd defendants would mean there might be some possibility of getting some money back.
 
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andycole

New Member
Just to say thanks "Don'tBeMadeFoolsOf" for such an informative posting.
It is much appreciated to have someone who was in Court to relay the information covered back to us here.

This situations sounds very complex - but that is very strong criticism from Mr. Justice Clarke when he said that Laragan Developments Ltd was just a vehicle of convenience.
 
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andycole

New Member
I saw this comment on another website:

"Surely there's still the possibility that the liquidator could finish off the nearly completed blocks and enforce existing contracts?

In which case they are not off the hook yet."

Could something like this happen? In that we would all be obliged to honour our contracts and complete the purchases of our Apartments and Duplexes?
 
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Tismeself

New Member
I am sure that purchasers in Blocks A-D are now just as contracted to the sale as purchasers in Blocks E/F as the scheme of arrangements to release them from the contract has been rejected.

Not sure what way the liquidator will see this but that would be my take on it.

Any ideas?
 
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andycole

New Member
Could the following happen?

Can the liquidator can sell the contracts to a third party?

Is it possible that the liquidator could determine that it is in the best interest of the creditors to get Milners Square Completed?

Is it possible that the liquidator would enforce contracts with buyers in Milners Square knowing that there are "contracts" that if completed will give a higher profit than current prices?
 
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MissNoMoneyPenny

New Member
Tismeself said:
I am sure that purchasers in Blocks A-D are now just as contracted to the sale as purchasers in Blocks E/F as the scheme of arrangements to release them from the contract has been rejected.

Not sure what way the liquidator will see this but that would be my take on it.

Any ideas?
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I think these contracts have been breached in multiple ways at this stage . My question is - will Hanly get jail when investigations are complete? :rolleyes:
 
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