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Creditor objects Restaurateur Jay Bourke faces court battle to write-off massive €12.2m debt

A personal insolvency arrangement (PIA) would wipe out €12.2m of what Bourke owes and allow him to keep his €1.4m Rathmines home

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Jay Bourke and his wife Sarah Harte

Jay Bourke and his wife Sarah Harte

Jay Bourke and his wife Sarah Harte

Publican and restaurateur Jay Bourke faces a battle to get court approval for a massive debt write-off, after a creditor owed €12.2m lodged an objection to the proposal.

Mr Bourke has debts totalling €13.7m, and it emerged in November he intended to ask the High Court to sanction a personal insolvency arrangement (PIA) that would wipe out around €12.5m of what he owes and allow him to keep his €1.4m family home in Rathmines, south Dublin.

However, the Sunday World has learned the court has since been told his main creditor, Pepper Finance Corporation, is objecting.

Under the proposal, Pepper would receive just €65,000 of what it is owed. The debt stems from Mr Bourke's involvement in Bellinter House, the Co Meath hotel he co-owned with the late music promoter John Reynolds.

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Bellinter House hotel in Co Meath

Bellinter House hotel in Co Meath

Bellinter House hotel in Co Meath

 

It is understood Pepper will claim the proposed PIA is unfairly prejudicial to its interests and it would get a better financial return if Mr Bourke (55) was declared bankrupt.

Pepper is also expected to argue that it is unreasonable for Mr Bourke and his wife to retain their home, given the scale of his indebtedness.

The Revenue Commissioners has already filed a petition to bankrupt Mr Bourke over an unpaid debt of €558,000, but this was adjourned to allow him to seek protection from creditors and come up with the personal insolvency arrangement.

In November, Keith Farry, counsel for Mr Bourke's personal insolvency practitioner John O'Callaghan of KPMG, told the court that both Revenue and Mr Bourke's mortgage lender had agreed to the PIA.

Under the arrangement, both the mortgage bank and the taxman would be paid off in full. However, unsecured creditors such as Pepper would see debts owed to them significantly written down.

The matter is due back in court this month. Mr Bourke has been in the pub, restaurant and hotels business since 1989, first opening the Wolfman Jack's restaurant in Rathmines.

He went on to open Rí Rá nightclub, The Globe bar, the Front Lounge and Eden restaurant in Dublin, as well as Bodega bar and the Savoy in Cork, the Garavogue bar in Sligo, and the Café Bar Deli group. At its peak, his group of pubs and restaurants employed more than 1,000 people.

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His debt to Revenue stems from a capital gains tax liability of around €500,000 after he sold Bodega bar.

Mr Bourke attempted to offset this gain against the substantial loss in value of another asset he owned, Bellinter House.

However, his attempt to do so was opposed and he lost appeals at the Tax Appeals Commission and later in the Circuit Court.

Other debts relate to small bank loans he was unable to pay off or from personal guarantees he could not honour after the financial crash in 2009. He maintains that his companies were left vulnerable by the crash as the properties they leased had upward-only rent reviews.

Mr Bourke was the manager of the Berlin D2 bar on Dame Street in Dublin when it was at the centre of controversy over a "boozy brunch" event in August 2020 at which social distancing regulations were breached,

The Berlin D2 incident led gardaí to successfully object to the renewal of its licence - a decision which is being appealed.

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