The accounts of the company awarded the contract for the €60 million National Aquatic Centre in Dublin "raised more questions as to what is going on at this aquatic centre", a High Court judge said yesterday.
Mr Justice Peter Kelly made the remark when fixing July 26th for the hearing of the action in which an order for possession of the centre is being sought by its owners, Campus and Stadium Ireland Development (CSID) against the operators of the centre, Dublin Waterworld Ltd (DWL).
Mr Justice Kelly said the centre had been let in 2003 to DWL, an entity which was not trading, was "assetless" and had a VAT liability in excess of €10 million.
He said DWL had not complied with his order to make discovery within two weeks of documents in its possession. It was a matter for DWL to put "its house in order" if it wished to bring a counterclaim for damages against CSID.
Mr Justice Kelly said he had been furnished with a series of accounts produced by DWL and an associated company, Dublin Waterworld Management Ltd (DWML).
If alarm bells had been ringing in CSID when the litigation got underway, they had become much more shrill and much more intense as a result of the information that could now be gleaned from the accounts, he said.
DWL's accounts for the year to December 31st, 2003, were approved at a directors' meeting on October 22th, 2004, he said. The accounts for 2003 showed that DWL had no turnover and assets of €12,116.
The accounts for December 31st, 2004, signed off by the directors on July 1st this year, showed no profit and the same assets of €12,116.
The judge said it was "remarkable" that the accounts were signed off on July 1st, the very same day that an arbitrator held that DWL had a €10.25 million VAT liability. A note in the accounts described the company being "invoiced with VAT of €10.254 million on the creation of a lease" with CSID and stated that DWL was vigorously disputing liability for that amount but believed it could reclaim the VAT. CSID now found itself in a situation where DWL was effectively assetless other than for €12,000, it had not traded for a number of years and now had the liability for VAT, the judge said.
DWML, on the other hand, was not a party to these proceedings but had apparently been providing some form of service to DWL, the judge said.