Ex-CIE head claims conspiracy in removal

Former CIE chairman Mr Dermot O'Leary is seeking to bring a High Court claim that two senior civil servants engaged in a conspiracy to have him removed from his post by former minister for transport, Mr Michael Lowry, in 1995. The claim is denied.

In an affidavit read to the High Court yesterday, a former CIE board member, Mr Anthony Rooney, said Mr Michael McDonnell, now CIE group chief executive, had told him in September 1995 that Mr John Loughrey (then secretary of the Department of Transport, Energy and Communications, and now secretary of the Department of Public Enterprise) and Mr McDonnell himself had arranged to have Mr O'Leary fired.

Mr Mel Christle SC, for Mr O'Leary, asked Mr Justice Kelly for leave to amend the challenge to his removal to include a claim for conspiracy. In March 1996 Mr O'Leary secured leave to challenge his removal. He contends he was wrongly removed. Mr Lowry and the State claim he resigned.

The application to amend the challenge was strongly resisted by the State. Mr Justice Kelly reserved judgment.

In an affidavit, Mr Loughrey said the allegations by Mr Rooney, in so far as they related to matters within his knowledge, were absolutely and totally false.

Mr Loughrey rejected the "damaging and gratuitous statement" by Mr Rooney that Mr McDonnell had "a few things" on Mr Loughrey. "This is untrue, damages my good name and impugns my personal and professional integrity." He said Mr O'Leary had tendered his resignation at a meeting with Mr Lowry on April 25th, 1995, at which Mr Loughrey was present.

Mr Paul Gallagher SC, for Mr Lowry and the State, asked the judge to refuse the application on the grounds of delay in bringing it, failure to make full disclosure in affidavits, and the irrelevance of the conspiracy claim to the substantive case. The net issue was whether Mr O'Leary was removed from his post or had resigned.

In his affidavit, Mr Rooney said he worked between 1989 and 1996 as general manager of the Berkeley Court Hotel, reporting to Mr Michael Brennan, then general manager of the Doyle Hotel Group. Mr Brennan was now dead.

Mr Rooney said Mr Brennan told him on April 25th, 1995, that Mr O'Leary had been fired from the CIE board. Mr Brennan said he had received a telephone call from Mr McDonnell, a senior civil servant at the Department of Transport, who wished Mr Rooney to vote for him when he was proposed for the position of group chief executive of CIE by the new chairman, Mr Eamon Walsh , at a board meeting on May 3rd, 1995.

Mr Rooney said Mr Brennan also said Mr Loughrey and Mr McDonnell had arranged for Mr O'Leary to be dismissed by Mr Lowry and that it was most important for Mr Rooney, as a representative of the Doyle Hotel Group, to vote for Mr McDonnell. When he told Mr Brennan he would have to consider the matter because there were clear procedures governing the appointment of chief executives in semi-state bodies, Mr Brennan replied: "To hell with the procedures. If McDonnell gets this job without your vote, we are in big trouble and could lose our largest block business, CIE Tours."

Mr Brennan had told him: "You know what to do, Tony, and if you don't conform, you also know the consequences for yourself."

At a CIE board meeting on May 3rd, 1995, the new chairman, Mr Eamon Walsh, said he had three names - A, B and C - in front of him for the new chief executive. Mr Walsh had said A and B were not suitable and Mr Michael McDonnell was C, and Mr Walsh had said: "I have never met him but they tell me we will be a dream team. I am proposing to you that he will be the next chief executive of CIE." ail Senator Treas Honan, and worker director Michael Flaherty said they would be unhappy. He said Mr Walsh had said the shareholders wanted it that way, and Mr McDonnell was appointed. In the following weeks the CIE board members were uneasy about media publicity. Mr Rooney said Mr McDonnell had asked to have a few private words with him on September 2nd while Mr McDonnell, Mr Brennan and their wives were dining in the Berkely Court Hotel. Mr McDonnell had said: "Tony, I will never forget that you voted for me to become group chief executive of CIE, but some of the directors, not you, are making things very difficult for me and that is why I am arranging with Loughrey to have Minister Lowry shaft them, the same way as I had O'Leary shafted. I will be doing my fucking best to ensure that yourself, Treas, Angela and Callaghan will be kept on when this happens. It will be no problem for me to get Loughrey and Lowry to agree."

Mr Rooney said he had raised concerns about the future of CIE. Mr McDonnell had told him: "Tony, you know how the system works. I wanted that fucking job and that bollocks O'Leary and his committee were not going to block me. Loughrey and I arranged to have O'Leary fired and Lowry, who wanted to make a name for himself, was delighted to go along with it." He later said: "It is the senior civil servants who tell the minister what to do, and I was the one who set up O'Leary and convinced Loughrey and Lowry to agree. Tony, when I want something, I won't ever let anyone stand in my way and I'll fuck those directors who are causing problems for me off the board. Loughrey will have to back me in anything I want to do in CIE and I have a few things on him and Lowry, who is an idiot and only wants his face in the media."

Despite that conversation, Mr Rooney said he received a letter on November 7th, 1995, demanding his resignation from CIE. He initially refused to resign. During a meeting with Mr Brennan he asked him whether if he resigned he would be reappointed as Mrs Treas Honan was. Mr Brennan had said Mrs Honan "is just an ould political hack who has no principles and she had a meeting with Lowry mid-1995 and she agreed with him that O'Leary would be fired to make way for McDonnell's appointment. Lowry thinks it would be a good political stroke to leave a Fianna Failer on the board. You are in a different league to Treas Honan and it is the danger of losing CIE business that concerns me." Mr Brennan had told him, "resign or I will fire you," Mr Rooney said.

Urging the court to allow Mr O'Leary amend his case to argue conspiracy, Mr Christle said various matters had come to light and were still coming to light in relation to dealings in which Mr Lowry was involved during his term as minister for transport. Those matters cast serious doubt on the credibility of Mr Lowry, who was a vital witness.