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Politician’s home saved as €4m debt written off
A Waterford Fianna Fáil politician in heavy debt has saved his 350 square metre family home and had €4m in debt written off by the High Court.
Mr Eddie Mulligan (56), a former councillor and general election candidate, secured approval for a personal insolvency arrangement (PIA) from Judge Alexander Owens following a brief hearing. His family home had been facing repossession but has now been safeguarded under the debt deal, which will wipe out his mortgage arrears.
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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 with the financial crash in 2008.
He also gave personal guarantees in relation to the borrowings of a paint sales business and also his wife Dervla’s hairdressing business, which ran into difficulties and was liquidated.
Mrs Mulligan previously secured a PIA at the Kilkenny Circuit Court in 2021.
Former politician Mr Mulligan, 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 during the economic crash. at reduced rate applied to a range of businesses and services, from hotels and restaurants, to newspaper sales and hairdressers. It didn’t return to 13.5% until January 2019. e hospitality sector has lobbied intensively to retain the most recent cut to the rate, with the Restaurants Association of Ireland insisting the 9% rate should be made permanent.
Dermot Crowley, the chief executive of hotel group Dalata, is among those who have questioned why Ireland does not retain a permanent 9% rate. Dalata operates hotels under the Maldron and Clayton brands. e highest amount paid over the past 16 years by hotels and guesthouses was in 2008, when the gure was €456m. at same year saw the beginning of the global nancial crash. e lowest gure was in 2021, at €97m, while the cumulative gure in the 16-year period was €3.1bn. and last year, when he stepped down to take up a paid position with Waterford City and County Council.
Hotels and guesthouses paid an estimated €203m in Vat last year on accommodation services while the 9% VAT rate was in force. e gure compared with €276m paid in 2019, before the pandemic and when the rate was 13.5%.
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 PIA 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.