Conroy affidavit believed to contain allegations about Murphy tax affairs

The argument over the affidavit sworn by Mr Liam Conroy, a former chief executive of the Murphy group, has raged almost as long…

The argument over the affidavit sworn by Mr Liam Conroy, a former chief executive of the Murphy group, has raged almost as long as the Planning Tribunal has been in session.

Lawyers for Murphys have done everything in their power to prevent its disclosure, including threatening to go to the High Court. It is believed it contains serious allegations about the tax affairs of Mr Joseph Murphy snr. and his companies.

Mr James Gogarty claims it accuses his erstwhile employer, Mr Murphy, of "everything under the sun". His lawyers have pressed for it to be admitted into evidence, in expectation that it will support his version of the struggles within Joseph Murphy Structural Engineering.

Mr Conroy has featured regularly in evidence given to the tribunal by Mr Gogarty. But as he died last summer, aged 62, he is not in a position to defend himself. His affidavit was sworn in March 1989 during a lengthy legal battle with JMSE, in which Mr Conroy sought damages for unfair dismissal.

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Mr Conroy was in the same position of conflict vis-a-vis JMSE and Mr Murphy as Mr Gogarty was later to find himself in. Both men were outsiders drafted into the family-owned company and both performed valuable services for Mr Murphy. Yet both ended up in ruinous legal battles with their former employer.

Not that there was any love lost between the two former employees. Mr Gogarty, whose involvement with Mr Murphy goes back to 1968, was instrumental in having Mr Conroy removed from the company. Mr Conroy was a "Jekyll and Hyde" character who was "ripping off" his boss, he has claimed.

This saga has its roots in the late 1930s or early 1940s, when Mr Murphy emigrated to England. He worked as an unskilled labourer and then formed a sub-contracting company with his brother, John.

In the late 1950s, the brothers split and Mr Joseph Murphy set up his own cable-laying business. The company prospered; there wasn't a great deal of competition and the supply of cheap, hardworking Irish labour seemed limitless.

By the late 1960s, Mr Murphy was a multi-millionaire. Mr Conroy and Mr Gogarty say he was making so much money he delimited his companies. His financial adviser, Mr Edgar Wadley, advised him to place his interest in the company into a trust. An Isle of Man trust, Armoy, was set up to control his UK interests. Subsequently, his Irish interests were vested in a second trust, Ashdale.

In 1969, Mr Murphy was advised to become involved in the setting up of a bank in the Isle of Man, the International Finance and Trust Corporation (IFTC). The following year, he became non-resident in the UK. He lived in Bermuda, the Bahamas and Ireland before finally settling in Guernsey, where he still lives.

Mr Conroy, who was a partner in an architectural firm Conroy Manahan, worked for Mr Murphy on a housing development scheme in 1978.

However, in 1981 IFTC went into liquidation, putting at risk Mr Murphy's £7 million investment. Mr Gogarty has claimed in his evidence that Mr Murphy's response was to start drinking heavily, and Mr Conroy has echoed this allegation.

Mr Conroy became friendly with Mr Murphy and assumed control of the rescue operation. He says he discovered substantial funds belonging to Mr Murphy in Swiss banks had been moved without his knowledge. He appointed a new firm of solicitors to act on Mr Murphy's behalf and chased up funds in Switzerland which had been credited to a wrong account. Eventually, almost 80 per cent of Mr Murphy's investment was recovered.

Mr Conroy says he was not paid for this work.

In the early 1980s, Mr Conroy became more closely involved with Mr Murphy, on the latter's urging. He was appointed chief executive of all his interests at an annual salary of £52,000 plus benefits.

According to Mr Conroy, the UK companies were "totally bereft" of management. Their managing director was "virtually illiterate" and all the staff were "blindly loyal" to Mr Murphy but incapable of change.

In this period, Mr Conroy looked after Mr Murphy's affairs and claims to have developed an office block in Guernsey which showed a profit of £5 million. Mr Conroy says his relationship with Mr Murphy was very good until October 1987. He blames the deterioration on Mr Gogarty, who relayed a series of allegations about the management of the company to Mr Murphy.

As a result, Mr Murphy constantly interfered with Mr Conroy's instructions to staff and undermined his authority, Mr Conroy has alleged.

Matters came to a head in mid-1988 when Mr Murphy and Mr Gogarty joined forces to oust Mr Conroy and his management team. On June 14th, 1988, a meeting was called near London to consider Mr Conroy's suspension. Mr Wadley, who had been involved in the IFTC fiasco, re-emerged at this meeting, much to Mr Conroy's surprise. Two days later, Mr Conroy resigned.

He settled with the Murphys in the early 1990s for considerably less than the original sum sought.