High-flier 'lived off bank loans'
Developer suing struck-off solicitor over soured property deal
HE commuted to work by helicopter and flew in pop stars Girls Aloud for his step-daughter's 21st birthday party.
But yesterday John Kelly, one of Ireland's high-profile developers, revealed that at the height of his prowess he was living off bank loans and a belief that the property boom would never end.
Mr Kelly, who is suing struck-off solicitor Thomas Byrne in a complex High Court battle over a soured property deal, admitted he had no real income and that his business model relied on bank borrowings and a rising property market.
Court papers reveal that in 2007 Mr Kelly earned just €130,116 after expenses compared to €69,234 in 2003 when the property boom took off.
This is despite the fact that he was involved in property deals worth €100m before the market crashed.
"Valuation was the aim, leverage was the currency," Mr Kelly told High Court Judge Mr Justice Frank Clarke who suggested to the developer that his business model was centred on bank debt rather than "traditional" income such as trade or employment.
Mr Kelly told Judge Clarke that if it was not for "the madness that became the [property] market" and the willingness of banks to lend, he would have had nothing to live off.
The developer, once Mr Byrne's largest client, also denied in the High Court that he ever had any business dealings with car dealer Lee Cullen.
Mr Cullen loaned model Katy French the car she was driving before she collapsed and died three years ago. Yesterday Mr Kelly said he had only met Mr Cullen, a friend of Mr Byrne, once in 2005.
But the developer admitted that he had written a cheque for just over €10,000 that was cashed by the car dealer.
The 2001 cheque was made out to Mr Cullen who paid the deposit on a house that Mr Kelly wanted to buy.
Mr Kelly said that he wanted to "stay in the background" and that Mr Byrne had arranged for one of his clients -- Mr Cullen -- to put the deposit down on the house and he later reimbursed him for the deposit.
"Other than that, I had absolutely no business dealings with Lee Cullen," said Mr Kelly.
An insight into the staggering deals transacted during the Celtic Tiger has been revealed in the Kelly/Byrne proceedings.
The High Court has heard that transactions of almost €250m were processed through Mr Byrne's legal practice, representing some €100m in property deals conducted by Mr Kelly.
Mr Byrne operated a small, single-man practice until it was shut down in October 2007 following an investigation by the Law Society.
Mr Byrne and Mr Kelly were subject to Revenue audits in 2007, months before Mr Byrne's activities were investigated by the solicitor's ruling body.
The High Court also heard that an accountant reporting on Thomas Byrne's practice had warned the Law Society as far back as 2003 about his handling of deals with Mr Kelly.
Yesterday forensic accountant Liam Grant who reviewed the funds transferred between Mr Kelly and Mr Byrne said that dealing with Richard Durkin -- an accountant who trawled through Mr Byrne's solicitor's practice ledger on behalf of Mr Kelly -- was "like playing a game of poker" owing to conflicting amounts that Mr Durkin claimed was owed to Mr Kelly by Mr Byrne.
Mr Grant described Mr Byrne's practice accounts as "a swamp" and concluded that by October 2007 Mr Kelly owed Mr Byrne about €7.7m rather than the solicitor owing his biggest client any funds.