Accountant deceived three brothers over site, judge rules
AN accountant deliberately deceived three brothers over a deal to sell a housing development site to a firm which former EU commissioner Ray MacSharry was chairman of, the High Court has found.
Yesterday, Judge Sean Ryan ruled that accountant Kenneth McMoreland deliberately deceived Arthur, Kieran and John Grady over the purchase of the site by the company Foresthaze Developments.
Mr MacSharry was brought into the case as a third party by Mr McMoreland seeking that he be indemnified by him for any damages that may be awarded against him (McMoreland) arising out of proceedings over the deal.
Mr MacSharry will have to wait until February 29 to find out if he and other third parties -- including his sons Ray junior and Senator Marc MacSharry -- have any liability for the Gradys' losses, the judge ruled.
The High Court has heard that although they were investors in the deal, the Gradys were told the purchase price of the site was €11.5m when in fact it was €9.85m.
Mr McMoreland, then a partner in the Sligo accountancy firm Gilroy Gannon, induced the Gradys -- by fraudulent misrepresentation -- to invest €2.4m in the company Foresthaze Developments, a judge found.
Around 300 houses were to be built at the site at Hazelwood, just outside Sligo town.
The brothers' company, TJ Grady, sued over the agreement in September 2006, via a loan from their firm, to invest €2.4m in Foresthaze to buy the site.
Unknown to the Gradys, a contract for the €9.85m sale of the lands to a solicitor in trust for Mr McMoreland and quantity surveyor Jackie McMahon, acting on behalf of a consortium of investors, had been signed earlier in April 2006.
The investors incorporated Foresthaze in July 2006 and it was later decided to sell the lands to Foresthaze for €11.5m, on grounds that additional funds would be required and, if the land was sold at a higher price, there would be an immediate profit for the promoters, the judge found. The funding shortfall of €2.4m was eventually obtained from the Gradys on foot of fraudulent representations by Mr McMoreland including that the purchase price was €11.5m, the judge found.
The case was against Mr McMoreland, Mailcoach Road, Sligo, formerly of Gilroy Gannon accountants; others practising as Gilroy Gannon accountants, Stephen Street, Sligo; Mr McMahon, Creggconell, Rosses Point, Co Sligo, and Foresthaze, Riverside, Sligo.
Mr McMoreland later joined as third parties to the case the MacSharrys; Gerard Healy c/o Kevinsfort, Castle Street, Sligo; Damien Torsney, Merrion Road, Ballsbridge, Dublin; and Edward and Jacqueline Donaghy, Drumcliffe, Co Sligo.
Yesterday, the judge upheld the Grady claims against Mr McMoreland.