THE HIGH Court has been asked to find two directors of a liquidated building company personally liable for its debts of €3.2 million, including €2.1 million in under-declared tax liabilities to the Revenue.
Peter Killeen and Lorraine Higgins, who were the only directors of PSK Construction Ltd, should be made liable for those debts and should also be disqualified or restricted from future involvement in companies, the liquidator of the firm has argued.
PSK, based in Naas, Co Kildare, employed about 160 workers in subcontracting work on major sites around Dublin before it went into voluntary liquidation in March 2006.
The liquidator, Tom Kavanagh, claims Mr Killeen was a party to the carrying on of the business of PSK with intent to defraud creditors of the company. He also claims Mr Killeen and Ms Higgins carried on the business of the company in a reckless manner.
Mr Killeen, former managing director of the company, has claimed he continued operating the business after the problems started in an effort to trade out of its difficulties.
The liquidator wants orders making both directors personally liable for the company’s debts, along with damages for alleged breach of duty and breach of trust. He also wants an order requiring Mr Killeen to repay personal expenses allegedly incurred by himself on a company credit card.
While Ms Higgins was more involved in office organisation, she was a signatory to the company accounts as one of its directors, the court heard yesterday.
Opening the case before Ms Justice Mary Finlay Geoghegan, Lyndon MacCann, for the liquidator, said the company was established in 2002 and traded successfully until 2005.
It had become involved in two major projects at at Sir John Rogerson’s Quay and Beacon Court in Sandyford, Dublin, which led to it trading while insolvent for a considerable time. As a result of this attempt to continue trading, the total amount of tax which was underdeclared for 2005 was €2.1 million. This had the knock-on affect of increasing debts to creditors.
This insolvency was not “a sole victim type” and there was a “deliberate scheme of wrongdoing on the part of Mr Killeen to lie to the Revenue” as to what the companies tax exposure was.
After the withdrawal by the Revenue of the company’s certificate of authorisation to carry out works (C2 certificate), a new company, with another woman and Mr Killeen’s son as directors, was set up to take over jobs in which PSK was engaged.
In affidavit from Mr Kavanagh, it was stated the matters at issue included that PSK was not placed in liquidation in a timely fashion and that the company had fraudulently preferred AIB Leasing Ltd and AIB Finance Ltd.
It was also claimed Mr Killeen had knowingly bought €29,000 worth of stolen tarmacadam and that the company breached provisions of the Companies Acts by lending money to Mr Killeen.
Mr Kavanagh said it appeared PSK was kept alive as a going concern from February 2005 by trading using monies owed to the Revenue and allowing huge tax arrears to build up.
The case continues.
