€18m tax levy possible on estate of late developer

A POTENTIAL tax liability of €18 million could be raised against the estate of the late property developer Brian Rhatigan, the…

A POTENTIAL tax liability of €18 million could be raised against the estate of the late property developer Brian Rhatigan, the High Court was told yesterday.

Mr Rhatigan, who died in early 2006, was believed by the Revenue Commissioners to be evading tax and was investigated during the Ansbacher inquiry, James Dwyer SC, for solicitor Sharon Scally, executer of Mr Rhatigan's estate, said. Accountants Deloitte had said his estate could face a potential tax assessment of €18 million, Mr Dwyer added.

Mr Dwyer told Odilla Gilson, a daughter of Mr Rhatigan who has expressed concerns about the administration of his estate, that her father's estate appeared insolvent and suggested that Mr Rhatigan was reluctant to pay tax. Ms Gilson said she knew nothing of her father's tax affairs but believed he would try to pay the least tax that was legally possible.

Ms Gilson was being cross-examined by Mr Dwyer during the resumption of proceedings relating to the will of Mr Rhatigan (60), Rathmichael, Dublin.

READ MORE

In the late 1990s, Mr Rhatigan became estranged from his wife Odilla, with whom he had three children, and he was living with his partner, Rachael Kiely, with whom he had two children, at the time of his death.

Ms Rhatigan (64), Brennanstown Road, Cabinteely, Dublin, has claimed she is entitled to half his estate and has alleged Mr Rhatigan had set up a trust to defeat or diminish her right to her share.

Mr Rhatigan, who had motor neurone disease, signed a will in May 2005 in which he made Ms Scally, of Amorys Solicitors, Sandyford, a co-executor. Another executor has since died. A legal warning, or caveat, was entered to the will on behalf of Ms Rhatigan in November 2008.

Ms Scally then brought proceedings seeking a High Court order that the will be admitted as Mr Rhatigan's last will and testament. Ms Rhatigan opposed that application and brought a counter-claim.

Last December, Ms Justice Mary Laffoy ruled that Mr Rhatigan was of sound mind when he made his will. She said he may have deliberately limited the assets which would pass on so as to exclude his wife and perhaps the Revenue from recourse to those assets.

The case resumed yesterday before the judge who refused an application by Ms Gilson and David Rhatigan, the surviving children, to be joined to the action to support their mother's claims.

In evidence, both Ms Gilson and her mother said they believed Mr Rhatigan had substantial assets not reflected in his will.

Ms Gilson said her father had told her she and her brother were beneficiaries of trusts he had created and he also told her he had created trusts to safeguard his money and put it out of her mother's reach. She believed that was unfair but did not tell her mother as she did not wish to upset her.

Ms Gilson said Ms Scally had acted as her father's solicitor for years and had also acted for other members of the family. She believed Ms Scally was conflicted in her position as executer.

Ms Rhatigan said she married Mr Rhatigan 42 years ago. They separated in the late 1990s but had not legally separated or divorced.

She had reluctantly agreed at one point to sign over the family home to raise money to build a large development in the International Financial Services Centre. While she had believed the debt on the family home was cleared, she learned after his death it was not.

Her husband had told her, after they separated, she would get half of everything, she said. About two years ago, she had received a letter stating her allowances, which had been paid from her husband's office, were being cut.

Mary Carolan

Mary Carolan

Mary Carolan is the Legal Affairs Correspondent of the Irish Times