FORMER ANGLO Irish Bank chief executive David Drumm has lost a bid to withhold $500,000 (€364,000) from his creditors in his US bankruptcy case by failing in a claim that his seaside property in Cape Cod was his main home.
A Boston court ruled yesterday that Mr Drumm was not entitled to claim a “homestead exemption” for $500,000 on his multimillion-dollar house at Stage Neck Road in Chatham, Massachusetts.
Individuals can claim the exemption to allow them retain their home or $500,000 of equity from the sale of a principal residence so they can keep a home through bankruptcy under state law.
The court-appointed officer overseeing Mr Drumm’s bankruptcy objected to his claim, arguing that he was not domiciled in Massachusetts for the required 730-day period before he declared bankruptcy in October 2010.
The independent trustee, Kathleen Dwyer, said Mr Drumm was not eligible because the house was not his principal residence and, as an Irish citizen and resident in the US during the 730-day period only on a temporary visa, did not establish “domiciliary status”.
No response was filed to Ms Dwyer’s objection, the court said. “Accordingly, the homestead exemption is hereby disallowed in its entirely,” the court ruled.
The court granted approval to Ms Dwyer to sell Mr Drumm’s Cape Cod home for $3.88 million (€2.8 million) and its furnishings and fittings for $150,000. He bought the house in March 2008 for $4.6 million. Mr Drumm moved to the US in 2009 after resigning as chief executive of Anglo, now Irish Bank Resolution Corporation, in December 2008. He filed for bankruptcy after he failed to reach a settlement with Anglo over debts of €8.5 million.
