A legal dispute has been settled between two bank managers and Cork County Council over a controversial land deal, in which the council negotiated to buy lands for €11.6 million which had allegedly been on offer for €8 million just months earlier.
Under the terms of settlement, the council is to buy the lands on 20 acres at Charleville, zoned for housing, from Denis O'Reilly and Brian Cremin "at a price that is satisfactory to all parties", Justice Peter Kelly was told at the Commercial Court today.
The price was not disclosed.
The negotiation of the deal for the Charleville lands is the subject of an internal council investigation which probe has been extended to other property transactions involving the council.
It is understood a senior official has been suspended as part of that investigation.
The settlement of the action brought against the council by Denis O'Reilly, TSB Cork city branch manager, with an address at Knysna, Rathpeacon, Co Cork, and Brian Cremin, Permanent TSB Regional Manager, of Ballygurrihy, Donoughmore, Co Cork, was announced by Mr John Gordon SC, for the plaintiffs.
Mr Brian Murray SC, for the council, read an agreed statement which stated that, after negotiations and compromise by the parties, the plaintiffs had agreed to sell, and the council to purchase, the lands for a price that is satisfactory to all parties.
On that basis, the proceedings were compromised, he said. Mr Justice Kelly agreed to counsels' request to adjourn the matter to November 13th to facilitate implementation of the settlement.
The plaintiffs had brought the action last May seeking specific performance of a contract allegedly agreed between them and the council on April 28th 2006 under which the council had agreed to buy the lands at Charleville for €11.6 million.
The hearing was due to open last July but was adjourned to facilitate an investigation by the council in relation to how the alleged contract was negotiated.
The investigation was triggered when the original vendor of the lands, Pushkin Developments Ltd, queried why the council was planning to buy the land for €11.6 million from the plaintiffs just months after Pushkin put the land up for sale at €8 million.
As part of its investigation, the council has examined mobile and other phone records of employees.
This analysis indicated "a very high level of telephone contact" between a council employee and Mr Denis O'Reilly, it was stated in an affidavit for the council.
That phone activity had increased in and around key dates relevant to the transactions at the centre of the court proceedings and this was one of the "major issues" under investigation, the council said.
The council also interviewed an employee last month to allow him explain certain matters which had "given rise to serious questions regarding the manner in which the negotiations for the proposed contract were carried out".
The council affidavits said the investigation was still at an early stage and it was premature to make findings. It was possible there was an explanation which involved no impropriety, it was stated.
The council said it had was aware of allegations that approaches were made to the council on behalf of Mr O'Reilly regarding the sale of the lands in October 2005, two months before the plaintiffs had contracted to buy the same lands from Pushkin.
The council was also told the lands were still on the open market in October 2005.
In its defence and counterclaim to the action, the council denied there was any contract or any valid contract for the sale of the lands with the plaintiffs.