Ex-Fianna Fáil cllr gets €4m debt write-off and saves family home

Eddie Mulligan (56), a former councillor and General Election candidate, secured approval for a personal insolvency arrangement (PIA) from Mr Justice Alexander Owens following a brief hearing today.

His family home had been the subject of repossession proceedings but has now been safeguarded under the debt deal, which will see his mortgage arrears wiped out.

Mr Mulligan’s total debts before securing the arrangement amounted to €4.8m.

The court was told his debt issues related to property investments which lost value and rental income due to the financial crash in 2008.

He also gave personal guarantees in relation to the borrowings of a paint sales business and his wife Dervla’s hairdressing business, which ran into difficulties and was liquidated.

She previously secured a PIA at the Kilkenny Circuit Court in 2021.

The former politician, of Dunmore Road, Waterford, said in an affidavit, the collapse of the business “took a serious impact on our health and mental health” and described dealing with creditors as “extremely challenging”.

He claimed repossession proceedings were started “despite constant communication and co-operation by me with my creditors and my very best endeavours to meet my financial obligations”.

Mr Mulligan was a county councillor between 2014 and last year, when he stepped down to take up a paid position with Waterford City and County Council.

A former naval serviceman who also worked in a family painting and decorating business, he ran unsuccessfully for the Dáil in 2020.

In his affidavit, Mr Mulligan said the PIA was “crucial” to his “personal and family position” and his ability to move on with his life.

The personal insolvency arrangement was approved after a creditor dropped their objection to the debt deal.

It was presented to the court by Keith Farry BL, counsel for Mr Mulligan’s personal insolvency practitioner Mitchell O’Brien, instructed by solicitors Anthony Joyce & Co.

Some €608,000 was owed to Pepper Finance Corporation on the family home, which has a market value of €425,000.

Under the deal, the negative equity element of the debt is to be written off, while the mortgage on what is left will be extended under new terms following a 12-month interest only period.

Mr Mulligan’s interests in a commercial unit, a retail unit and a site will be sold under the arrangement.

His other main creditors were Everyday Finance DAC, owed over €2.7m, and Bank of Ireland, owed €1.4m. Most of his debts were classed as “unsecured” as they were not backed by assets.

Unsecured creditors will share just €5,195 under the arrangement, but Mr Farry said they would have received nothing if Mr Mulligan had been made bankrupt.

Everyday Finance had initially objected to the debt deal, claiming it was unfairly prejudicial to its interest. However, that objection was dropped. It purchased some of Mr Mulligan’s debts from AIB.

Mr Mulligan said his financial difficulties dated back to the economic recession in 2008.

“Properties I owned devalued greatly and fell into negative equity and lost rental income,” he said.

Mr Mulligan said his wife’s hairdressing business also suffered greatly and ultimately fell into liquidation. Both he and his wife ended up being restricted as directors.

“However, for what it is worth, in my view this arose due to our insolvency and means at the time. We were advised by the accountant that we could defend the matter, but we did not have the means to defend the proceedings,” said Mr Mulligan.

He said he had fully engaged at all times with his creditors and “answered everything asked” of him.

“That was not always reciprocated by the financial institutions concerned. It became increasing frustrating and stressful,” he said.