IBRC wins €121m judg­ment against Pa­tri­cia Quinn

Wife of Seán Quinn will no longer be in­volved in ac­tion deny­ing li­a­bil­ity for €1.24bn loans Judg­ment was sought aris­ing from a guar­an­tee and in­dem­nity pro­vided in 2008

The Irish Times - Business - - FRONT PAGE - MARY CAROLAN

Ir­ish Bank Res­o­lu­tion Cor­po­ra­tion has ob­tained a €121 mil­lion judg­ment against Pa­tri­cia Quinn, wife of busi­ness­man Seán Quinn.

The judg­ment means Mrs Quinn, who was ad­ju­di­cated bank­rupt in 2011 on the ap­pli­ca­tion of IBRC, will no longer be in­volved in the ac­tion by mem­bers of her fam­ily deny­ing li­a­bil­ity for some €1.24 bil­lion in loans made by the for­mer An­glo Ir­ish Bank to var­i­ous Quinn com­pa­nies.

Mrs Quinn’s five adult chil­dren are con­tin­u­ing the case due for hear­ing next March.

The €121 mil­lion judg­ment, in­clud­ing in­ter­est, was sought aris­ing from a guar­an­tee and in­dem­nity pro­vided by Mrs Quinn in Oc­to­ber 2008 guar­an­tee­ing re­pay­ment of a €100.5 mil­lion fa­cil­ity pro­vided to a Cypriot company, Mor­boneto Hold­ings Ltd.

The judg­ment ap­pli­ca­tion, which was not op­posed by Mrs Quinn or her of­fi­cial as­signee in bankruptcy, was granted ear­lier this week at the Com­mer­cial Court by Mr Jus­tice Robert Haughton. Be­cause Mrs Quinn’s claim in the fam­ily case against IBRC re­lated solely to the Mor­boneto guar­an­tee, her claim will not pro­ceed.

Sep­a­rately this week Mr Jus­tice Haughton or­dered two men who are al­leged to be di­rec­tors and/or of­fi­cers of com­pa­nies based in the United Arab Emi­rates should be jailed for “se­ri­ous” con­tempt if they do not com­ply within days with cer­tain or­ders in­tended to pre­vent al­leged as­set strip­ping from com­pa­nies of the Quinn fam­ily. The judge also made or­ders on Wed­nes­day for se­ques­tra­tion of the prop­erty of the UAE com­pa­nies.

The or­ders were sought by IBRC in the con­text of its own marathon pro­ceed­ings against var­i­ous Quinn fam­ily mem­bers and com­pa­nies al­leg­ing a con­spir­acy to place mul­ti­mil­lion-euro assets in the fam­ily’s in­ter­na­tional prop­erty group be­yond the bank’s reach.

Ini­ti­ated in 2011, the IBRC case, known as the con­spir­acy case, will be heard after the fam­ily’s case.

Con­spir­acy case

In the lat­est pre-trial ap­pli­ca­tion in the con­spir­acy case, IBRC al­leged con­tempt of court or­ders by three com­pa­nies – Me­con FZE, Yangtze Con­sult­ing FZC and Se­nat Le­gal Con­sult­ing FZ LLC – and by two in­di­vid­u­als, Michael Waechter, a Swiss na­tional be­lieved to be based in the UAE, and Willem Smit, a Dutch na­tional also be­lieved to be based in the UAE, in their al­leged ca­pac­i­ties as di­rec­tors and/or of­fi­cers of some of those com­pa­nies. It was al­leged both are of­fi­cers of Me­con and Se­nat Le­gal and that Mr Waechter was also an of­fi­cer of Yangtze.

There was no ap­pear­ance by or on be­half of the re­spon­dents.

In an af­fi­davit, Kieran Wal­lace, spe­cial liq­uida­tor of IBRC, said the re­spon­dents were in con­tempt over breach of dis­clo­sure obli­ga­tions in or­ders made by the Ir­ish High Court on dates in 2012 and 2018. There was de­lib­er­ate with­hold­ing of doc­u­ments and in­for­ma­tion that must ex­ist and ought to have been pro­vided, he said.

With the ex­cep­tion of Mr Smit, who is not a party to the main con­spir­acy case, the re­spon­dents seek to ig­nore the fact the claim against them for con­spir­acy is for more than €500 mil­lion, he said. The al­leged as­set-strip­ping scheme is “un­prece­dented in both its com­plex­ity and in terms of the loss caused to IBRC”.

Mr Wal­lace also al­leged fail­ure to co-op­er­ate with Cathal McCarthy, a re­ceiver ap­pointed by the court last Fe­bru­ary over shares held by Me­con in an In­dian company, Mack Soft. Mr Jus­tice Haughton found there was se­ri­ous con­tempt by the re­spon­dents.

‘Egre­gious’ con­tempt

In Me­con’s case, there was “egre­gious” con­tempt con­cern­ing its in­volve­ment in the bring­ing of pro­ceed­ings in In­dia against the re­ceiver, he said. An In­dian district court had set aside in­junc­tions granted ex parte (one side only rep­re­sented) against the re­ceiver after find­ing Me­con came to that court with “un­clean hands”, he noted.

Me­con’s ac­tions amounted to an “out­ra­geous at­tack” on an of­fi­cer of the Ir­ish court, he said.

He made or­ders for com­mit­tal to prison of Mr Smit and Mr Waechter but stayed those to De­cem­ber 4th to al­low fur­ther time to pro­cure com­pli­ance with or­ders re­quir­ing the re­ceiver be for­mally au­tho­rised un­der the In­dian Com­pa­nies Act as rep­re­sen­ta­tive of Me­con FZE for tak­ing all acts on be­half of Me­con in re­spect of the Mack Soft shares.

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