Seán Dunne and Isle of Man trust seek to set aside freezing orders on property sale proceeds

Bankrupt businessman Seán Dunne and an Isle of Man based trust are seeking an early hearing of applications to vacate freezing orders obtained against them by the businessman's children, their lawyers have told the High Court.

Last month, the court granted five of Mr Dunne’s sons a temporary injunction against Mr Dunne, Traviata Ltd and Bessilton Holdings Ltd.

The orders prevent the defendants selling or dissipating the proceeds of sale of two valuable properties, 9A and 19 Churchfields, Straffan, Co Kildare, near the K Club resort.

The order also prevents the defendants dealing with the proceeds of the sale of one of the properties. The court heard one of the properties was sold for about €1 million.

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Traviata is an Isle of Man registered company, fully owned by the SD Trust. Seán Dunne is the settlor of the trust, which is allegedly for the benefit of his children.

When the matter came before the court on Thursday, Aillil O’Reilly BL, for Traviata, told Mr Justice Senan Allen his client disputes the court’s jurisdiction to have made the injunction.

The trust does not recognise the court’s jurisdiction and claims it is not bound by the orders; the court heard.

Counsel said Mr Dunne has nothing to do with and is separate from the trust. In reply to the judge, counsel said most of the money from the sale of one of the properties was in an Isle of Man bank.

The remainder of those funds remain in the client account of an Irish solicitor’s firm, for capital gains tax obligations, counsel said.

Injunction ‘ fraud’ claim

Seán Dunne, who now resides in the UK, claims the injunction was a fraud against him and the court. He claims assets at the centre of the dispute were not his, and belonged to the trust.

A solicitor told Mr Justice Allen the firm had just come on record for Mr Dunne, and was seeking a date for the hearing of a motion seeking to have the injunction against him set aside.

The third defendant, Bessilton, is the alleged registered and legal owner of the two properties, but not the beneficial owner.

It claims the dispute is between the other parties and its lawyers have said it will comply with all orders made by the court.

Ross Gorman BL, instructed by solicitor Graham Kenny, for the plaintiff ’s children, said they are very concerned particularly about the trust position in relation to the injunction and wanted a hearing as soon as possible to have the freezing orders kept in place until the full trial of the action.

Counsel also said his side was concerned the defendants had not adhered to deadlines previously imposed by the court for exchange of documents in the case.

Mr Justice Allen, noting the failure to adhere to those directions, adjourned Traviata’s motion to a date next month, with the temporary orders remaining in place.

The injunction was sought by John Dunne, the businessman’s adult son from his first marriage, along with four minor sons of Seán Dunne and Gayle Killilea, Seán Dunne’s second, and now former wife.

The four minors are suing through Ms Killilea.

Amrabko unlimited Company is also a plaintiff. Ms Killilea is a director of that firm which claims it has spent €577,000 on a house being built at one of the properties.The plaintiffs claim the two properties were the subject of the settlement of a legal dispute between Seán Dunne and Bessilton in 2004.

One of the properties was to be transferred to John Dunne and works have been carried out on that site by Amrabko, it is claimed.

It is claimed when that property was completed it was to be sold, and Amrabko would be paid from the proceeds of that sale.

The second site was held in the name of Traviata for the benefit of the children from both of Seán Dunne’s marriages, it is alleged.

The plaintiffs claim they became aware that the properties had been put up for sale, in an allegedly secret manner.

One of the two properties was sold for €1million, which it is alleged amounts to a gross undervalue of the property.

The plaintiffs believe the properties are not being sold for the beneficiaries, but rather for the benefit of Seán Dunne.

As Seán Dunne is a bankrupt, the Official Assignee in Bankruptcy was made a notice party to the application and is reserving his position regarding the action.