Farmer in debt allowed to keep home and €1.8m farm

The debts arose from funds borrowed from Ulster Bank to purchase 64 acres of land for €1.1 million
Farmer in debt allowed to keep home and €1.8m farm

High Court reporters

An indebted farmer has secured a court-backed debt restructuring plan that allows him to keep his home and €1.8 million farm.

Despite objections from his primary creditor, Mr Justice Alexander Owens made orders approving the personal insolvency arrangement (PIA) sought by Co Wexford-based Fergus O’Connor (47), who has debts totalling €1.1 million.

It is understood this was the first time the High Court has heard a contested PIA application concerning a farm, which was described as a “core asset”.

The court heard there would be no write-down of Mr O’Connor’s debts, which were being restructured to return him to solvency.

His debts arose primarily from funds he and his now estranged wife borrowed in 2006 from Ulster Bank to purchase 64 acres of land for €1.1 million.

He subsequently sold various assets, worth about €800,000, to reduce the amount. However, the bank registered charges over other lands he owns, and the loan was subsequently sold to Promontoria Oyster DAC.

'Very fair'

Barrister Keith Farry, for the debtor’s personal insolvency practitioner, Gary Digney of PKF-FPM, told the court the treatment of the debt is “very fair”, with all unsecured creditors, owed a total of €27,000, to be fully paid upon completion of the three-year PIA.

Under the arrangement, Mr O’Connor will keep €1.8 million worth of farming assets, including land and sheep, as well as his €230,000 family home which sits on seven acres of land in Kilmuckridge, Gorey.

A separated father-of-three, Mr O’Connor requires his farm to continue with his livelihood as a tillage and sheep farmer, and to support his two dependent children, counsel said.

Mr Farry submitted that the Personal Insolvency Act 2012 states that an arrangement will not require a debtor to sell assets that are “reasonably necessary” to his or her employment.

Mr O’Connor, who also works part-time in haulage and rents out part of his land to increase his income, earns €2,850 per month. He is balance sheet solvent, with net assets of €594,000, said counsel. However, he does not have sufficient cash-flow to meet debt repayments as they fall due.

Mr O’Connor currently has €1,700 available per month to meet monthly payment demands of €16,900, which he is “misses every month”, said Mr Farry.


Promontoria, which is owed €874,000, objected to the PIA when it came before the Circuit Court and the High Court.

The High Court heard this week that Mr O’Connor would make repayments over 30 years in order to fully service Promontoria’s debt.

Promontoria was objecting on grounds including that it was unfairly prejudicial and that the agricultural lands over which it has a charge are “readily realisable”, meaning they could be easily sold.

It further submitted that the debtor has the ability to discharge his debts but has chosen not to and was asking the court to condone this choice.

Mr Justice Owens upheld the decision of the Circuit Court and approved the PIA.

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