Quinn children and IBRC to enter mediation over €2.34bn loans

A mediation will be held later this month in a bid to resolve the marathon dispute between businessman Seán Quinn's five adult children and Irish Bank Resolution Corporation concerning loans of €2.34 billion, the High Court has been told.

Mr Justice Michael Twomey, who had urged the sides to consider mediation before embarking on a hearing that could take up to six months at costs of several million euro, was told on Friday the sides had agreed to a mediation.

The mediation will be held over two days in mid February.

While the identity of the mediator has not been disclosed, it is understood it will be a retired judge.

Preparations will continue in the interim for the hearing in March of the children's action disputing any liability for loans of some €2.34 billion advanced by Anglo Irish Bank, IBRC's predecessor in title, to Quinn companies.

David Drumm, the jailed former chief executive of Anglo, is among at least 49 witnesses due to give evidence in the case.

Mr Justice Twomey has been allocated to hear the case, initiated in 2011.

The hearing costs will be on top of costs of tens of millions already incurred in the family’s case and in parallel litigation by the bank against members of the Quinn family and various companies in the Quinn international property group.

The bank’s case, in which IBRC alleges a conspiracy to strip some €455 million assets from the group’s companies in several countries, is due for hearing after the children’s action.

Both cases were put on hold for several years pending the hearing of criminal proceedings against various Anglo executives and officials, including Mr Drumm.

Core issue

The core issue in the Quinns’ case is the validity of securities provided by them concerning loans advanced by Anglo to Quinn companies.

On Friday Mr Justice Twomey held a further case management hearing attended by 18 lawyers, including five senior and four junior counsel.

The lawyers were representing the Quinns, IBRC, receivers appointed over assets of the Quinns and third parties.

Seán Quinn snr and two former Quinn group executives, Liam McCaffrey and Dara O’Reilly, were previously joined as third parties in the context of the bank’s claims they acted as agents for the children in relation to disputed securities. That claim is denied.

The judge heard from Bernard Dunleavy SC, for the Quinns, and Paul Gallagher SC, for IBRC, that the sides had agreed on a mediation.

The judge had asked previously whether it was necessary for lawyers for the receivers to physically attend at the March hearing as the receivers have said they would be supporting the bank’s arguments and playing only a limited role in the case.

Getting a transcript of the proceedings might suffice and save costs, he suggested.

He was told today by Paul Gardiner SC, for the receivers, that his side was conscious of the need to minimise costs but believe they need to be present for the hearing. The nature of their attendance will be reviewed after the opening of the case, he said.

After dealing with other case management issues, the judge adjourned the matter. It is expected he will be updated on the outcome of the mediation later in February.