Property developers, banks and reckless trading.

[Digout]

A part of Irish Law seems to being ignored at the moment, its the 1990 companies act. There is a part of it which deals with reckless trading, and if a company is deemed to be reckless trading, it loses its limited liability and the directors are personally liable for the companies debts. Here is part of the act.

"297A.—(1) If in the course of winding up of a company or in the course of proceedings under the Companies (Amendment) Act, 1990 , it appears that—
( a ) any person was, while an officer of the company, knowingly a party to the carrying on of any business of the company in a reckless manner; or
( b ) any person was knowingly a party to the carrying on of any business of the company with intent to defraud creditors of the company, or creditors of any other-person or for any fraudulent purpose;
the court, on the application of the receiver, examiner, liquidator or any creditor or contributory of the company, may, if it thinks it proper to do so, declare that such person shall be personally responsible, without any limitation of liability, for all or any part of the debts or other liabilities of the company as the court may direct.
(2) Without prejudice to the generality of subsection (1) ( a ), an officer of a company shall be deemed to have been knowingly a party to the carrying on of any business of the company in a reckless manner if—
( a ) he was a party to the carrying on of such business and, having regard to the general knowledge, skill and experience that may reasonably be expected of a person in his position, he ought to have known that his actions or those of the company would cause loss to the creditors of the company, or any of them, or
( b ) he was a party to the contracting of a debt by the company and did not honestly believe on reasonable grounds that the company would be able to pay the debt when it fell due for payment as well as all its other debts (taking into account the contingent and prospective liabilities).
(3) Notwithstanding anything contained in subsection (1) the court may grant a declaration on the grounds set out in paragraph (a)of that subsection only if—
( a ) paragraph (a), ( b ) or (c)of section 214 applies to the company concerned, and
( b ) an applicant for such a declaration, being a creditor or contributory of the company. or any person on whose behalf such application is made, suffered loss or damage as a consequence of any behaviour mentioned in subsection (1).

So, can any bank that loaned massive sums to a property developer after the market had started to decline be considered to have been reckless trading? Can any property developers who took out massive loans with little of no deposit or using collateral already already given on another loan be deemed to have been trading recklessly?

From what I've recently been reading, the creditors of the property developer scam artists are not going to get anywhere near the money they are owed, but the banks are going to get pretty near the full amount, so, looks like the directors of the property firms do plan to screw the creditors, this could be deemed as reckless trading also.

Its time to remove the limited liability of these gombeens and take all of their assets and let them live in a bedsit in Rathmines, or even better, a council flat .

Instead of removing the limited liability of the banks,Clowen and Co went and guaranteed them, FFS.

And yet we let this go on, while hundreds of thousands struggle to make ends meets. Seanie Fitz is still having a good life. Muckey Fingers walked at with €28 million, the FF lads are all still riding the expense gravy train.

Its high time we took some pride in our country and remembered those who died so we could have a country. Pearse, Connolly, Collins and the boys would not think twice about removing these crooks.

[hammer]

As far as I`m aware the worst that can happen is that you are barred from being a director of a company for 5 years where the share capital is less than about €63,000

NEXT !!

[Digout]

As far as I`m aware the worst that can happen is that you are barred from being a director of a company for 5 years where the share capital is less than about €63,000

NEXT !!

And their personal assets can be taken.

[Mr. Greasy Till]

A part of Irish Law seems to being ignored at the moment, its the 1990 companies act. There is a part of it which deals with reckless trading, and if a company is deemed to be reckless trading, it loses its limited liability and the directors are personally liable for the companies debts. Here is part of the act.



So, can any bank that loaned massive sums to a property developer after the market had started to decline be considered to have been reckless trading? Can any property developers who took out massive loans with little of no deposit or using collateral already already given on another loan be deemed to have been trading recklessly?

From what I've recently been reading, the creditors of the property developer scam artists are not going to get anywhere near the money they are owed, but the banks are going to get pretty near the full amount, so, looks like the directors of the property firms do plan to screw the creditors, this could be deemed as reckless trading also.

Its time to remove the limited liability of these gombeens and take all of their assets and let them live in a bedsit in Rathmines, or even better, a council flat .

Instead of removing the limited liability of the banks,Clowen and Co went and guaranteed them, FFS.

And yet we let this go on, while hundreds of thousands struggle to make ends meets. Seanie Fitz is still having a good life. Muckey Fingers walked at with €28 million, the FF lads are all still riding the expense gravy train.

Its high time we took some pride in our country and remembered those who died so we could have a country. Pearse, Connolly, Collins and the boys would not think twice about removing these crooks.

...but Mr. Digout, what about the sacrifices the private sector have made?

[Digout]

...but Mr. Digout, what about the sacrifices the private sector have made?

There are plenty of other threads on private vs public sector, this thread is about punishing those who engaged in reckless trading.

[YellowRedGreen]

what about judges allowing appointment of examiners where receivers or liquidators would normally be put in place. this scams tentacles are many and far reaching...

[hammer]

It is 99% probable that a case for reckless trading will not be taken. The proof required is enormous. It is not reckless to buy property that was valued at a particular price at a particular point in time if the price can be justified in any way.

[robert151410]

There are plenty of other threads on private vs public sector, this thread is about punishing those who engaged in reckless trading.

I would say that anyone who bought a house with a mortgage more than five times earnings could be accused of reckless trading.

[Mr. Greasy Till]

There are plenty of other threads on private vs public sector, this thread is about punishing those who engaged in reckless trading.

Sorry mate. I was compelled to be sarcastic.

[Digout]

It is 99% probable that a case for reckless trading will not be taken. The proof required is enormous. It is not reckless to buy property that was valued at a particular price at a particular point in time if the price can be justified in any way.

It was very reckless to take out or give a massive loan when the market started to decline. I know many people who sold their entire property portfolio's 3 years ago, they knew what was coming. Many people knew it was a bubble.