Bank of Ireland is seeking summary judgment for some €3 million against acting manager of Glasgow Celtic Football Club Neil Lennon under a guarantee allegedly provided by him for a loan to a building company of which he was a director.
The bank has admitted it has lost the guarantee itself but claims it can produce evidence Mr Lennon signed it at Dublin airport in February 2006.
The bank claims Mr Lennon was in Ireland on the weekend beginning February 24th 2006 because he had a free weekend due to Celtic having been knocked out of the Scottish Cup.
Colm McHugh, a senior business manager at BOI’s Dundalk branch, said Mr Lennon had arrived at the airport carrying golf clubs and had signed the guarantee form at the BOI branch at the airport. Mr McHugh claims he had advised Mr Lennon the guarantee meant the bank was entitled to call on him personally to repay the loan if the company, Rocket Developments Ltd, did not clear the debt.
Mr McHugh also claims Mr Lennon told him he anticipated planning permission would be obtained by Rocket for about 60 houses on a site Rocket intended to develop in Co Louth, that 50 per cent of the sites would be sold to clear the debt to the bank and the rest of the site would either be developed or sold at an expected profit of some €3 million.
Mr McHugh said he had commented on such a level of profit and that Mr Lennon had said he would be satisfied with a lower level.
The proceedings against Mr Lennon, with an address at Queen’s Gardens, Glasgow, were admitted to the Commercial Court today by Mr Justice Peter Kelly on the application of Aidan Redmond SC, for the bank and on consent of counsel for Mr Lennon.
Mr Redmond said it was being contended Mr Lennon has a credible defence to the claim and had not executed the guarantee.
Mr Justice Kelly said it was clear the guarantee allegedly executed by Mr Lennon had been lost and the bank could not find it. The bank was contending it could produce evidence as to the execution of the guarantee, he noted. The judge fixed the summary judgment application for hearing on May 12th.
BOI claims Mr Lennon was a director of Rocket Develonments Ltd, with registered ofices at The Crescent, Dundalk, Co Louth. It claims it loaned that company some €3 million in early 2006 to part fund the proposed purchase of seven acres of zoned residential land at Knockbridge, Dundalk.
It is claimed the loan principal and interest were to be cleared in full within a 12 month period from the sale of serviced sites on those lands.
It alleges Mr Lennon agreed to sign personal letter of guarantee for the loan for €3,070,000 and had signed that guarantee at Dublin airport on February 24th 2006 in the presence of Mr McHugh and another bank official.
The bank claims Mr Lennon had on February 27th, 2006, brought the signed personal guarantee to the BOI branch in Dundalk where it was placed on an official’s desk. It was discovered in mid to late 2006 the guarantee had been mislaid, and extensive searches failed to locate it, the bank says.
Mr Lennon was informed in later 2006 about the guarantee being mislaid but had refused to re-sign a copy of the guarantee, the bank claims. It alleges it is entited to reply on the terms of its standard personal guarantee and on oral evidence from the officials allegedly present when the guarantee was allegedly signed by Mr Lennon.
The bank claims Rocket Developments defaulted on its loan obligations and owes some €3.7 million inclusive of principal and interest. Mr Lennon is liable for €3.07 million of that sum under his alleged guarantee, it is claimed.
