A bankruptcy trustee has asked the Supreme Court to ban three directors from managing a company for at least five years after a slaughterhouse collapse left more than 100 farmers out of business.
Iquidator John Healy seeks a High Court finding that directors of Edenmore Farm Meats Limited engaged in reckless trading with intent to defraud creditors.
He also wants them to be personally liable for the company’s debts, which are running a deficit of more than 2.5 million euros.
Details of the application were presented to Justice Michael Quinn this week.
The court has previously heard contentious claims that the rented slaughterhouse site in Lifford, Co Donegal was “occupied” by its previous owner in 2016 in a dispute over unpaid rent.
There were also allegations that the INLA threatened two Edenmore employees around the same time.
Mr. Healy of Kirby Healy Chartered Accountants was appointed liquidator of the company in 2020 after a group of farmers successfully applied to have the company reinstated.
He is seeking explanations and orders against directors Donal Gallagher and Richard Burke, both with addresses in London, and former director Robert Daly of Buncrana, Co. Donegal.
It is expected that the trio will contest the request in full.
Mr Gallagher is Managing Director of the Galldris Group, a construction company based in London. Mr Burke was managing director of Edenmore before it ceased trading while Mr Daly served as financial controller.
John Kennedy SC, for the liquidator, said it was “a very serious matter” which involved a claim of reckless trading.
“Over 100 farmers have been affected, some very seriously, including issues related to family homes,” he told the court.
Mr Justice Quinn approved the instructions agreed between the two sides to move forward with the case, which will be returned to court in November. The three defendants are represented by Woodcock Solicitors.
The company was formed in 2009 following the merger of McGavigan Meats Limited and Riverview Meat Products Limited and has grown into a significant operation. By 2014 it was slaughtering 8,500 cattle and 10,000 lambs annually, working directly with 300 farmers and local markets.
The court was told the motion arose in circumstances where the directors incurred significant debt in 2015 and 2016. Mr. Healy claims they knowingly engaged in running the business in a reckless manner.
He claims a feature of the company’s trading was a significant volume of unpaid checks to farmers and markets.
According to an affidavit filed by Mr. Gallagher, previous owner Liam McGavigan and others occupied the premises in October 2016 and did not allow the company access to the facility. He claimed he was unable to access his assets or records from that point forward.
Mr McGavigan has disputed Mr Gallagher’s version of events and says he repossessed the premises when rent was not paid.
https://www.independent.ie/business/abattoir-firm-directors-hit-with-reckless-trading-claim-41685657.html The directors of a slaughterhouse company have been hit with ruthless trade claims