Dublin’s Market Bar owner claims Sherry FitzGerald undervalued the property
By The Headlines, April 18, 2023 | 09:12 PM
The owner of Dublin's Market Bar and an adjoining premise claims that auctioneer Sherry FitzGerald undervalued the property to meet the loan-to-value (LTV) requirements of his lender.
Mark Conan has brought proceedings against Sherry FitzGerald (Commercial) Ltd in High Court, claiming that the valuation they carried out caused him to suffer a loss of €841,000 when he had to liquidate his investments to fulfil LTV criteria.
Sherry FitzGerald refutes the notion that the property was worth more than the estimated value of the auctioneer. Likewise, they reject Mr Conan's assertion of losses.
Mr Justice Mark Heslin rejected an application to have Mr Conan's action dismissed on the grounds of delay in prosecuting the case, which was taken in 2017.
The judge detailed that in 2012, Mr Conan was required to maintain a Loan-to-Value (LTV) agreement for loans that had been sold by AIB to Vesta Mortgages Investment, a US-based Private Equity company, Lonestar.
It was reported that the total value of his loans amounted to €5.2 million, while the property he owned was estimated at €6.1 million.
Mr Conan argued that, at the time of evaluation, there was a deficit of €310,000 regarding the Loan-to-Value covenant. The €6.1 million LTV valuation comprised the Market Bar in Fade Street and an adjoining retail unit with office/workshop premises, an apartment in George’s Quay, Dublin, and a property in Cheltenham, England.
Mr Conan stated that Sherry FitzGerald had valued the Fade Street properties at €1.68 million when they were worth €2.4 million.
He says the real value of the property was significantly greater than the figure reported to Vesta by Sherry FitzGerald.
As a result, he states, he had to sell some of his investments, including shares in Ryanair and convert his sterling cash balances to Euros. The payment to Vesta also hurt his finances, leading him to sell the Cheltenham and George's Quay properties, he adds.
Mr Conan's medical condition
In 2022, Sherry FitzGerald filed a motion with the court requesting to dismiss the case due to a delay in processing.
The auctioneers argued that they were severely prejudiced by the delay. They stated that, while Mr Conan had argued that part of the delay was due to a medical condition he was suffering from, this did not stop him from bringing proceedings in two other cases in August 2021.
Mr Conan opposed the application.
The judge denied the application to dismiss, arguing that no tangible harm had been established.
There was no evidence of any damage to Sherry FitzGerald's reputation and business, and it had not been asserted that having these proceedings "hanging over" it had created any difficulty for its business, he said.
The judge said that, even if he was entirely wrong in his view that prejudice had not been established, it seemed to him that any prejudice to the defendant was of a general and minor sort, which fell below what could be considered moderate.
He took the view that a fair trial remains possible now, and for the foreseeable future, as at any other time to date.