Sunday 25 February 2018

Former Anglo executive wants to subpoena Sean Fitzpatrick and David Drumm

Tim Healy

THE former head of lending at Anglo Irish Bank is seeking to subpoena some of its former executives, including chairman Sean Fitzpatrick and CEO David Drumm, for his defence of the bank's claim for €50m judgment orders against him.

Tom Browne may also subpoena bankrupt businessman Sean Quinn and Irish Times journalist Simon Carswell, author of the book, Anglo Republic, for the trial of the action against him at the Commercial Court in October, Mr Justice Peter Kelly was told today.

The judge was dealing with pre-trial management issues arising from he action by Irish Bank Resolution Corporation( formerly Anglo) against Mr Browne which is set for hearing on October 16.

Paul Gardiner SC, for IBRC, said his side had received Mr Browne's witness statement and statements from two other persons concerning banking practices. They had also received a list of 14 people the defence may subpoena and the bank needed to know what Mr Browne said those people would say.

Most of the 14 were former employees or directors of the bank, including Sean Fitzpatrick, David Drumm, Pat Whelan and Lar Bradshaw but some were not, including Sean Quinn Senior; Liam McCaffrey, former Quinn Group finance director and Mr Carswell, counsel said.

Micheal P. O'Higgins SC, for Mr Browne, said his client had encountered difficulties preparing his defence as some people had said, because they have loans with Anglo, they were fearful of being seen to assist Mr Browne as they were concerned such assistance could prejudice them.

His side wished to reply on an AIB official, John Phillips, to prove AIB had relied on Anglo shares as security, counsel also said.

Mr O'Higgins said Mr Carswell had in his book said Mr Browne was kept by design "out of the loop" in relation to the Contracts for Difference (CfD) shareholding held by Sean Quinn in Anglo prior to its nationalisation. When that shareholding became public, it had a dramatic effect on Anglo shares, he said.

Mr Carswell had said he had undivided access to the bank and had written that Mr Browne was kept out of the loop and his side wanted to explore that issue with Mr Carswell, counsel said.

Mr Justice Kelly said Mr Carswell appeared to have access to a "Deep Throat" source and he anticipated that would be objected to as inadmissible hearsay. He did not want the trial going up "blind alleys" in a situation where Mr Carswell's evidence was unlikely to be admissible on the basis of the first principles of evidence and where, if pressed on the matter, Mr Carswell was likely to invoke journalistic privilege.

The judge said he could not see how Mr Carswell could be a witness as his book made clear the information he was given was based on what someone told him which made it hearsay. He was also sure Mr Carswell would refuse to divulge his source and what would happen then, would the court be asked to jail him, the judge asked.

The judge also remarked he envisaged problems for Mr Browne in that another person on the subpoena list, David Drumm, was out of the jurisdiction.

In the circumstances, the judge said he wanted Mr Browne's side to outline in general terms the nature of the evidence those people they sought to subpoena were expected to provide. He anticipated a hard- fought battle on what could be admitted as evidence, he added.

If Mr Browne proceeded with subpoenaing the numbers set out, the trial was likely to last longer than the four weeks anticipated, Mr Gardiner said. The judge said there would be "strict application" of the rules of evidence.

Mr Browne, Ferney Hill, Brighton Road Foxrock, Dublin, head of lending at Anglo between 2005 and 2007, claims he has no liability for some €50m loans on grounds including, when the loans were made, the bank was allegedly aware the interest acquired by Sean Quinn in the bank was such as to undermine its stability and to render his shareholding valueless.

Had he known of such matters, he would never have exercised his share options in late November 2007 or held on to shares which became "worthless", he claims.

The case will address a wide range of issues, including claims by Mr Browne Anglo directors withheld information from him related to the CfD positions built up by Sean Quinn in the bank.

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