BY Aodhan O’Faolain
THE High Court has approved a personal insolvency arrangement (PIA) allowing a former property developer and investor from Timoleague to write-off approximately €170m of debt owed to parties, including Nama and various financial institutions.
The PIA was made in favour of 55-year-old Barry Harte, from Chapel Hill, Timoleague who is to provide a total of €80,000 to his creditors.
The former dentist, a prominent figure in local GAA circles, established Harte Holdings about 20 years ago. It specialised in property investment and development in the hospitality and residential sectors, particularly in Ireland and London. The business was fuelled by loans from banks and private investors during the Celtic Tiger era.
Following the economic crash in 2008, the group’s assets went into negative equity. Keith Farry, barrister for Mr Harte’s personal insolvency practitioner John O’Callaghan of KPMG, told the High Court on Monday that following the crash, Mr Harte effectively became an asset manager for institutions, including Nama, of €650m worth of assets.
Most of the assets have been disposed of. However, Mr Harte had, through personal obligations, legacy debts of: to Nama owed €46m, Ulster Bank owed €23m, Link Finance €4.5m, Pepper Finance, owed over €67m, and several individuals, some of whom were owed up to €16m.
The total secured and unsecured debt came to over €170.9m, the barrister said.
Of the unsecured creditors, only Ulster Bank, which is owed €23m, had opposed the insolvency arrangement, Mr Farry said.
He added that the unsecured creditors, who account for the vast majority of what is owed, will get a return of 0.042% of what they are owed.
His secured and preferential creditors, which account for a small proportion of his overall debt, will get a better return, largely thanks to the handing-over of assets belonging to Mr Harte.
As part of the arrangement, two properties owned by Mr Harte, one in Bundoran in Co Donegal and another in Co Tipperary, are to be surrendered to creditors.
Overall, Mr Harte’s creditors will do marginally better under the arrangement than if Mr Harte was declared bankrupt.
Mr Harte will retain assets of just €6,000, which includes a computer and clothing, said Mr Farry.
The barrister added that the funds for the arrangement have come from Mr Harte’s friends and family. The arrangement will last for 12 months following which Mr Harte will return to solvency.
Counsel said that Mr Harte’s Timoleague home does not form part of the arrangement as it belongs to his wife Barbara.
Counsel said that it was his understanding that the property has been put up for sale and that the Harte’s currently occupy the property.
Mr Justice Alexander Owens, who noted that under the arrangement the majority of Mr Harte’s creditors will get ‘a tiny return’, said he was satisfied to approve the arrangement, which also makes provisions for reasonable living expenses of €2,800 per month.
Mr Harte’s current income is approximately €2,900 per month, the court also noted.
Barry Harte is a former coach of Argideen Rangers and was a prominent hurling and football player at under 21 levels.