The High Court has adjourned until today a claim that a letter had been sent to the liquidator of Money Markets International (MMI) Stockbrokers in which a Jersey company said it would not be pursuing a claim for negligence against the insolvent Irish firm.

The liquidator Mr Tom Kavanagh has alleged MMI Stockbrokers directors misappropriated more than £1.9 million (€2.4 million), a sum said to have been in an account in the Jersey company.

During the course of an application by Mr Kavanagh, who was seeking answers from the MMI directors, Mr Mark Sanfey, counsel for one of the directors, Mr Oisin Fanning, addressed the court in relation to a letter he said Cater Allen's solicitors had sent. During hearings last year, the court was told that the liquidator had identified the Cater Allen company but was not able to identify the beneficiaries of the account. The books and records of MMI purported to show payments to Cater Allen in Jersey, but the persons shown to get credit were, in certain cases, Mr Fanning, of Forenaughts House, Forenaughts, Naas, Co Kildare; Mr John Curran, another MMI director, of Kingsley Mews, Raglan Road, Ballsbridge, Dublin; and others associated with them.

The court was told the liquidator believed £1.9 million had been misappropriated and he was issuing summonses seeking damages against: Mr Fanning; Mr Curran; Mr Paul Boucher of Sandford Road, Dublin; Mr Colm O'Reilly, Alexandra Terrace, Bray, Co Wicklow; Mr Tim Murphy, Dublin Road, Clane, Co Kildare; Mr Cian Kealy, Castledawson, Sion Hill, Blackrock, Co Dublin; and Mr Peter O'Byrne, Monpelier Parade, Monkstown, Co Dublin.

The earlier hearings were told by Mr Bill Shipsey, SC, for the liquidator, that his client was concerned that Cater Allen was shown as receiving an amount totalling £1.9 million and that it was a large debtor. The Jersey agents of Cater Allen were denying they ever received these monies and their response was that they intended to sue MMI for the negligent operations of the discretionary account.

Yesterday, Mr Justice O'Sullivan said he had adjourned the application until yesterday afternoon following an allusion made as to whether or not a witness from Cater Allen would or would not be available. Mr Sanfey had said Cater Allen's solicitors had written to the liquidator indicating Cater Allen was not making any complaint and was not at a loss.

Mr Shipsey said his instructions were that no such letter had arrived at the liquidator's solicitors offices. The liquidator's solicitors office had written to Cater Allen's solicitors telling them that they had been informed a letter was coming, expressing what the liquidator believed would be an astonishing volte face on the part of their client.

Cater Allen's attitude was extraordinary in the light of what it had stated earlier and the claim it had not authorised the use of the money by anybody else.

Mr Sanfey said a partner in the solicitors firm acting for Mr Fanning had been told by a person in the firm of Noel Smyth and Partners that the letter was sent on Tuesday morning and he did not know why the liquidator's solicitors had not received it.