A Midlands-based antiques business has launched High Court proceedings aimed at preventing a financial fund-appointed receiver from selling the premises it has operated from for over 20 years.
The business, Mullingar Salesroom Limited, is located at Lynn Industrial Estate in Mullingar, Co Westmeath, had been put up for sale via an online auction earlier this month.
The proposed auction did not proceed after the company and the joint owners of the property, Michael Lynn and his wife Eileen Lynn, brought proceedings against Promontoria (Oyster) Designated Activity Company and receiver, Tom O'Brien of Mazars Ireland.
Mr Lynn is also a director of the company.
The High Court granted the applicants for a temporary injunction restraining the defendants from taking any steps to sell or dispose of the property.
When the matter was mentioned before Mr Justice Mark Sanfey on Wednesday, the court was told that by agreement the injunction could be replaced with an undertaking, in the same terms, that was being offered by the defendants.
The matter was adjourned to a date next month.
When seeking the injunction, the applicants, represented by Gerard Martin Byrne Bl instructed by James O'Brien Solicitors, claimed the property was acquired in 2000 and sells various antiques, including antique furniture.
Between 2008 and 2011, the property was used as security for loans taken out with Ulster Bank.
The couple claim the property is the subject of a 35-year lease agreement, entered into between the company and the couple in 2015, and that the bank was aware of this.
Financial difficulties
In a sworn statement to the court, Mr Lynn said while he has always tried to meet his financial commitments, he fell behind on loan repayments following a family bereavement in 2011 and due to the economic downturn.
He also claims that there was an overestimation of the interest due on the loans.
In 2016, Promontoria acquired his loans from Ulster Bank, and in 2017, Mr O'Brien was appointed receiver over the property.
Following the loan transfer, Mr Lynn said Promontoria accepted rent payments in respect of the property from the company, but the receiver did not accept the validity of the lease agreement.
The applicants say rent was paid between 2017 and 2020, but ceased during the Covid pandemic when the business was not trading.
It is also claims that under the loan acquired from the bank, the receiver does not have a power of sale.
The applicants claim the property was advertised for sale earlier this year as being occupied under unknown terms. They say this is not correct, and the property is the subject of a lease agreement between the company and the couple.
They also claim there was an attempt by the receiver in March to forcibly take possession of the property.
As a result of the intention to sell the property, the applicants sought injunction relief on the grounds that they would suffer great prejudice if the auction went ahead.
As well as seeking an injunction restraining the sale, the plaintiffs also seek various declarations that the company is a lawful tenant under the lease, and the Lynns are the lawful landlords.
They also seek declarations that Promontoria is bound to accept the lease agreement.
