A High Court judge has imposed restriction on two former directors of Rathmullan restaurant The Water’s Edge after finding that they traded while insolvent.
Mr Justice Michael Quinn ruled that brothers John and Neil Blaney had not acted reasonably in relation to conduct of the company. The judge made a declaration that neither man should be appointed or act as a director or secretary, or be involved in the promotion or formation for five years.
In his ruling, Mr Justice Quinn said: “ I am not persuaded that the respondents have acted responsibly in relation to the conduct of the affairs of the company before its liquidation.”
The Blaney brothers were directors of Inch View, the company which operated The Water’s Edge. It ceased trading in September 2013 and a liquidator was appointed in July 2015.
It emerged that the company had been trading at a loss since 2010 at the latest.
In August 2015, a Statement of the Affairs of the company was sworn by the respondents, as required by the winding up order and the Act. The Statement of Affairs estimated the total realisable value of assets at €25,000, being “fixtures and fittings” which were the subject of a debenture in favour of Allied Irish Banks plc.
Total liabilities were estimated at €975,880. This amount was comprised of preferential creditors in an amount of €23,698 (comprising only Donegal County Council for local rates), €602,425 being a net balance due to AIB, and €349,757 for unsecured non–preferential creditors. The non–preferential creditors included Revenue for VAT in a sum of €52,447, and PAYE in an amount of €68,861, making a total of €121,308.
Mr Justice Quinn said in his ruling that the company had failed to file annual tax returns in 2013 and 2014 in accordance with the Companies Act. He also pointed out that the company had continued to trade while insolvent.
In regard to claims made by the Blaneys that they had ‘tried desperately’ to restructure the company, Mr Justice Quinn said no evidence was offered to show what actions had been taken to protect the interests of creditors.
The full ruling can be found here
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