Monday 24 November 2014

IBRC are trying to "grind down" Sean Quinn's family - court hears

Published 17/01/2014 | 17:19

Former billionaire Sean Quinn
Former billionaire Sean Quinn

IRISH Bank Resolution Corporation (IBRC) is seeking to "grind down" the family of bankrupt businessman Sean Quinn, it was claimed in the High Court today.

The bank is doing so as part of the long running litigation between the sides so as to make them bankrupt and unable to pursue their case against IBRC, Martin Hayden SC for the family said.

IBRC's opposition yesterday to a stay being granted on a legal costs order made against the family, following the court's refusal of their bid to "ring-fence" Quinn group assets and stop them being moved to NAMA,  marked "a change of attitude" by the IBRC special liquidators in relation to costs issues arising from the litigation, counsel said.

Until now, both sides had agreed that stays should apply on multiple costs orders arising from many pre-trial applications by both sides pending the outcome of the family's case in which they argue Anglo Irish Bank (IBRC's predecessor) advanced unlawful loans of some €2.34bn to companies in the Quinn group.

That action has been parked pending the outcome of criminal proceedings taken against a number of former Anglo executives.

Yesterday, Brian Murray SC, for IBRC, said his side believed, in regard to the costs of this particular application, the court should not grant the usual stay on the costs orders on grounds this particular application had been "unstateable" from the outset.  It also could not have succeeded and should never have been brought, counsel said.

Neil Steen BL, for receivers appointed over shares in Quinn companies, advanced the same grounds for opposed a stay on costs orders in his client's favour,

Mr Hayden disputed those arguments and said the "ring-fencing" application had to be brought because of the State's decision to wind up IBRC last year.

The winding up meant, should the Quinns ultimately win their case, IBRC would not be in a position to pay them damages.

In her ruling on the stay issue, Ms Justice Mary Finlay Geoghegan said, while she had not used the word "unstateable" in her judgment dismissing the Quyinn's application last December, what Mr Murray had said about that application was substantially correct.

However, for two specific reasons, she would place a stay on her order awarding costs against the Quinns of this particular application pending the outcome of the case, the judge said.

One reason was that the Quinns could not pursue their full aciton due to the criminal proceedings against former executives of Anglo.

Another was that both sides had to date agreed that any costs orders made in the many applications brought so far in the litigation should be stayed pending the outcome of the full action, she said.

The judge also noted that Mr Hayden had said his side was considering whether to appeal her December judgment.

In that judgment, the judge found the Quinns had only established an interest concerning six companies in the Quinn group and went on to find they had failed to establish any value in the shareholdings of those companies.

As the Quinns had failed to show they would suffer loss if the shares in the six companies were transferred or disposed of, they were not entitled to any injunctions restraining that transfer or disposal, she found.

Two of the six companies - Quinn Group (ROI) Ltd and Quinn Quarries Ltd - are in liquidation and the Quinns had failed to establish any value in the other four companies as of June 2013 last, when their injunction proceedings were initiated.

The other four companies are Quinn Finance Holding, Quinn Group Properties Ltd, Quinn Group Hotels Ltd and Slieve Russell Ltd.

The judge also refused injunctions restraining IBRC disposing of other Quinn assets or 27 identified properties including properties located here and in Russia, India, Ukraine, Turkey and the Czech Republic.

The family are claiming damages in their full action and intend also to sue the Central Bank and Department of Finance, in their capacity as financial regulators. Because IBRC is in special liquidation, any damages awarded to them would have to be paid by the State.

They previously said, should the ring-fencing orders be refused, they would consider a constitutional challenge to provisions of the IBRC Act allowing the Quinn assets be sold.

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