DPP seeks deferral of Quinn family action

The Director of Public Prosecutions is seeking another deferral of the action brought by businessman Seán Quinn's family denying liability for some €2.34 billion loans advanced by the former Anglo Irish Bank to Quinn companies. The deferral is sought pending the trial of former Anglo Chairman Seán Fitzpatrick on charges under the Companies Acts.

Separately, the Quinns lost an application on Monday to amend their claim so as to include an allegation they never signed two of the six share pledges on foot of which receivers were appointed to various Quinn companies in Aril 2011.

The family, represented by Martin Hayden, said documents discovered for the case showed the two share pledges at issue were amended after being signed by the Quinns and signature pages from the earlier versions were switched to the amended versions.

In an affidavit, Aoife Quinn said email correspondence between Darragh Blake of the law firm William Fry, then acting for IBRC, and Dara O'Reilly of the Quinn Group showed the two men discussing between them the switching of signature pages from one document to another. Mr O'Reilly was not an agent of the family, she said.

Ms Quinn also said the delay in seeking to amend the claim arose because the emails were among some 250,000 documents which her side had had to examine. Her side were “swamped” with documents and, until they examined these emails in November 2014, the family did not suspect that signature pages from one version of the share pledges were switched with a different version.

IBRC indicated it was neither consenting not objecting to the proposed amendment but, if it was allowed, there should be conditions attached, including that there would be no more applications to amend.

Shane Murphy, for IBRC, said the proposed amendment represented a “very massive transformation” of the case made by the Quinns since 2011. The family had until now not disputed the share pledges were signed but rather alleged undue influence and that they were signed in the absence of independent legal advice, he said. The bank also argued Dara O’Reilly was acting as agent for the family.

Paul Gardiner, for the receivers, agreed with Mr Murphy’s arguments and added the proposed amendment applied to at most two of the six share pledges.

Mr Justice Brian McGovern said he would not permit the amendment. The family, without prejudice to their plea, had in June 2011 not disputed they had executed the share pledges, he said. The amendment now being proposed substantially altered the case and would give rise to “confusion, not clarity”.

The judge added he will deal on Thursday with the DPP’s application to defer the case. The DPP previously sought and secured the parking of the case pending the outcome of criminal proceedings against three former Anglo executives — Mr Fitzpatrick, Pat Whelan and William McAteer. Mr Fitzpatrick was acquitted in that case while Mr Whelan and Mr McAteer were found guilty of giving illegal loans to 10 developers to buy shares in the bank in breach of Section 60 of the Companies Act. They were given community service after Judge Martin Nolan said a State agency had lead them into error and illegality.

After those proceedings concluded in April 2014, the Quinn family case was fixed for hearing on April 14th, 2015, by which time it was considered the separate trial of Mr Fitzpatrick on other charges would have been concluded. Mr Fitzpatrick is facing 12 counts of failing to disclose to Anglo’s auditors Ernst & Young the true value of loans worth at least €139 million given to him, or people connected with him, between 2002 and 2007.

That trial was originally fixed for October 2014 but has been deferred at the request of the defence to April 2015.

In those circumstances, the DPP is seeking to again defer the Quinn action pending the conclusion of the case against Mr Fitzpatrick.

The Quinns case is against IBRC and its special liquidator Kieran Wallace. IBRC previously secured orders joining Seán Quinn senior and two former senior Quinn Group executives, Dara O'Reilly and Liam McCaffrey, as third parties. The case is expected to last up to nine months with the ultimate costs likely to be tens of millions of euro.