Former Bord Gais CEO settles claim

Former Bord Gais Eireann CEO Gerry Walsh has settled on undisclosed terms his High Court action in which he claimed entitlement…

Former Bord Gais Eireann CEO Gerry Walsh has settled on undisclosed terms his High Court action in which he claimed entitlement to an additional €2 million sum from the company arising from a letter signed by former BGE Chairman Michal Conlon.

Mr Walsh (58) previously received up to €2 million from BGE during his seven year tenure as CEO when his salary more than doubled between 2000 and 2007. He received €184,000 in 2000 and his salary was increased every year until it reached €432,000 in 2007, when his contract expired.

In his court proceedings, he claimed he was also entitled, arising from a letter signed by Mr Conlon in November 2000, to avail of the company's Early Retirement Scheme which, the court heard, would give him benefits exceeding €2 million.

The ERS provides for a year's pay at the end of employment and half pay from 2007 until age 60 when a pension would be paid based on his final salary (€432,000). Some €50-60 million and perhaps more had been paid out under the BGE ERS to retired executives, the court was told.

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If not entitled to the ERS, the court heard Mr Walsh would in any event be entitled to a pension from the company based on his service with it since 1984 and his salary of €115,000 prior to becoming CEO.

The case opened before Mr Justice Bryan McMahon earlier this week but later settled on undisclosed terms.

In outlining the case, Marcus Dowling, for Mr Walsh, said BGE appeared to be arguing Mr Walsh's €2 million claim was "outlandish" when the government derpartments responsible for BGE and "directing the defence" of the case "pay themselves greater figures".

A Government Department Secretary-General on a seven year contract who retired at the end of that term would not only get early retirement provisions but a defined benefit pension based on his final salary which the State refused to give to Mr Walsh, counsel said.

Mr Walsh claimed Mr Conlon had agreed he was entitled to the ERS and had signed a letter to that effect on November 14th 2000 after first securing legal advice from O'Flynn Exhams Solicitors that he had the authority of the BGE Board to sign it. Mr Walsh had no idea whether the BGE Board saw the letter, counsel said.

Mr Dowling said the letter was negotiated in circumstances where a condition of Mr Walsh's appointment as CEO under his August 2000 contract was he would serve a maximum seven year term but that could be a minimium one year term.

He was aged 47 in 2000 and his concern was not to sign up to a contract where he could be out of a job after a year and could not resume employment with BGE. It was in those circumstances Mr Conlon gave him the side letter, counsel said.

In opposing the action, BGE denied the claims and argued the letter was not binding on it. Maurice Collins SC, for BGE, said Mr Walsh had received the benefits "at the stroke of a pen in a letter which never was seen by the Board or the Minister" and the issue the court had to determine was whether that was lawful.

Mr Dowling said BGE seemed to be suggesting Mr Conlon engaged in "some kind of frolic" outside the scope of his authority and that was why he had been joined to the case. If BGE was correct, and Mr Walsh's side insisted it was not, then Mr Conlon was liable to Mr Walsh on grounds he made representations negligently.

Mr Conlon, in his defence, had denied the claims. He pleaded he had explained to Mr Walsh he did not have authority to agree to any variations of Mr Walsh's employment contract of August 2000 and said heprovided Mr Walsh with the November letter so he could go before the BGE board and argue his case. Mr Conlon further pleaded he had told Mr Walsh any potential variations to his contract would have to be approved by the relevant Minister.

The court heard Mr Conlon has been diagnosed with Alzheimer's condition and would be unable to give evidence. His counsel, Brian Cregan SC had asked the court to admit into evidence a witness statement signed by Mr Conlon.

Mary Carolan

Mary Carolan

Mary Carolan is the Legal Affairs Correspondent of the Irish Times