Two brothers behind a number of high profile Irish franchises – including several Starbucks cafes, TGI Fridays, Mao and Hard Rock Cafe – have secured a stay on a court order restricting them from acting as directors.
In a judgment published last month, Ms Justice Nessa Cahill found Colum and Ciaran Butler failed to prove they acted responsibly in the operation of one of their companies, Downtul Ltd, which leased a premises at St Stephen’s Green, Dublin, that operated as a Starbucks. Downtul was placed in voluntary liquidation in November 2022.
The judge granted a declaration sought by Downtul liquidator Patrick O’Connell restricting the brothers from acting as company directors or secretaries for five years unless the company meets certain requirements set out in the Companies Act 2014.
Such an order means that, for the Butler brothers to act as directors of a company during that five-year period, that company must have share capital of at least €100,000 paid up by shareholders – or €500,000 in the case of a public limited company.
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The judge had found that the brothers did discharge the burden of showing they acted honestly in the operation of Downtul.
Lawyers for the Butlers on Tuesday successfully applied for a stay on the order, after submitting that their clients would require time to get their affairs in order.
Brian McGuckian told the court his instructions were to seek a stay on the order for six months for two reasons.
He said he was firstly seeking the stay to allow the Butlers time to organise their affairs, noting that Ciaran is the director of 134 companies, while Colum is the director of over 170 companies.
Mr McGuckian said there was a general practice of the court affording directors time to organise their affairs in the context of an order of this kind.
He said he was also seeking a stay pending a possible appeal being brought against the High Court decision.
Padraic Lyons SC, for the receiver, said there was an obvious distinction between the granting of a stay pending an appeal, and a stay to allow the directors to get their affairs in order.
His side had received no correspondence on a potential appeal, and there were no draft grounds of appeal before the court. It was a matter for the directors to put before the court arguable grounds for appeal, he said.
Mr Lyons agreed there should be a stay granted to allow the directors to organise their affairs but submitted that six months was an excessive amount of time.
Ms Justice Nessa Cahill said she would grant a stay of four months to allow the Butlers to organise their affairs.
She said she was not granting the stay pending a possible appeal, but noted the granted stay will be the same terms had she acceded to the application for a stay pending appeal. It was a matter for the respondents if they wished to bring an applicant to appeal, she said.
