O'Donnells failed to declare fee of £120,000 in bankruptcy petition
Property investors Brian and Mary Patricia O’Donnell did not declare the existence of a £120,000 (€149,000) a year fee for managing London offices when they filed for bankruptcy in Britain, it has emerged.
The bankruptcy petition is being opposed by Bank of Ireland (BofI), which wants the couple – who owe it €71 million – bankrupted in Ireland, where bankruptcy laws are tougher.
The £120,000 a year fee is paid for managing Columbus Court – the London headquarters of Swiss bank Credit Suisse and one of the properties bought by the O’Donnells’ Vico Capital at their height.
During often testy exchanges with Mr O’Donnell in court yesterday, BofI’s barrister Gabriel Moss said he had “completely failed” to reveal it: “You certainly weren’t on state benefits, or tax credits.”
He asked Mr O’Donnell if he seriously thought the bankruptcy petition had been correctly filed without mention of the fee.Bank of Ireland is challenging the O’Donnells’ claim that their centre of main interest is in London, not Ireland – a necessary precondition before bankruptcy can be declared by an Irish citizen in Britain.
However, Mr O’Donnell sharply rejected Mr Moss’s claims, saying they had not then realised the fee needed to be declared in the petition.
“It was subsequently revealed at every turn,” he said, although Mr Moss said that only happened because the bankruptcy registrar who dealt with their application sought more information.
Mr O’Donnell rejected Mr Moss’s charges that he had no excuse for omitting it because he was a solicitor of 30 years standing: “I wasn’t answering this as a solicitor, we were under extreme pressure.”
Meanwhile, it emerged that a contract worth a similar amount for managing a luxury French ski chalet has been transferred to Kennor Advisory, owned by his sons, Bruce and Blake.
Chalet Hermione in Courcheval rents for £45,000 a week during the peak season to wealthy skiers, Mr O’Donnell told Mr Moss.
However, he rejected Mr Moss’s charge that the management contract was passed on to his sons. His contract had been terminated because he resigned. “A new company took over,” he said.
“You’re playing games,” said Mr Moss. “I am not playing games,” replied Mr O’Donnell.
Mr O’Donnell’s barrister, Paul Burton, accused BofI of advancing a “flimsy” case to challenge the bankruptcy petition.
He urged Mr Justice Newey to ignore a series of affidavits from BofI executive Des Hanrahan that were prepared for legal action between the sides in Ireland.