A High Court judge has jailed the son and nephew of bankrupt businessman Sean Quinn for three months after finding failures to adequately comply with court orders aimed at reversing measures stripping multi-million assets from the Quinn family’s international property group.
Peter Darragh Quinn, Mr Quinn’s nephew, did not attend court today as required and a warrant was issued for his arrest.
Miss Justice Elizabeth Dunne ruled later, while punitive sanction was a last resort, there had been an “outrageous” contempt of court orders by Sean Quinn Senior, Sean Jnr and Peter Quinn and she was not happy with their level of co-operation to date to reverse the asset-stripping measures.
In those circumstances, she would grant the former Anglo Irish Bank’s application to jail Sean Junior and Peter Quinn but leave over a punitive sanction against Sean Quinn so that he should take further steps towards compliance.
The bank had said it would not seek to jail Sean Quinn Senior because it wanted him to be available to take steps to unwind the asset-stripping measures as he had admitted directing a scheme to move assets beyond the reach of the bank.
The judge said the imprisoned two could apply to the court earlier than the three month period if they considered they had purged their contempt, but refused an application by Bill Shipsey SC, for the Quinns, to put a stay on her orders pending appeal to the Supreme Court.
The three Quinns had argued in detailed affidavits filed in the early horus of yesterday morning they have done everything possible to comply with court orders, had written many letters and disclosed many documents. They were helpless to do more due to attitudes taken by others, including lawyers and former employees in Russia and Ukraine, they said.
Peter Quinn and Sean Quinn Junior were also fearful of returning to Ukraine due to developments there, the court heard.
Their counsel Brian O’Moore SC argued the bank’s application to jail the son and nephew to put pressure on the “chieftain” Sean Quinn was “mediaeval” but Ms Justice Dunne said, “far from being medieval”, she considered it “a practical way” of procuring compliance.
Sean Quinn and his son were in the packed courtroom but a warrant was issued just after noon for the arrest of Peter Quinn over his failure to attend when the court began at 11am or to respond to phone calls to elicit his whereabouts.
The judge heard a solicitor for the Quinn side was phoned after 10am apparently by a relative of Peter Quinn’s to say he was sick but further efforts to contact that person or Peter Quinn failed. The Quinn’s solicitors had last seen Peter Quinn between 2-3am when he filed affidavits for the hearing and he appeared “okay”, it was stated.
Earlier, the judge heard affidavits and submissions from Irish Bank Resolution Corporation (formerly Anglo) and the Quinns as to whether there had been adequate compliance with coercive orders made by her on June 29th aimed at reversing the stripping of assets from the IPG.
Those coercive orders were made after the judge found the three in contempt of court orders of June and July 2011 restraining them moving assets beyond the reach of the Bank which is pursuing the Quin family over loans of €2.8 billion.
They dispute liability for those loans but have admitted liability for loans of some €455 million.
Today the bank argued there was a “very significant failure” to comply with the coercive orders and said it believed there should be further efforts to secure the Quinns' compliance with the coercive measures coupled perhaps with some punitive measures.
Paul Gallagher SC and Shane Murphy, for the bank, said there may be no alternative but to jail Peter Quinn and Sean Quinn Jnr while Sean Quinn Snr, the “apex” of the Quinn family chain of command, take steps to achieve compliance.
The Quinns appeared to have taken the attitude they would seek to hold on to assets worth €500 million even if that meant spending a short period in jail, Mr Gallagher said. Nothing material had been done concerning return of assets and there was no explanation of what happened to€35 million rental income from properties.
Mr Murphy said the bank did not accept the Quinns were helpless or had lost control of the asset-stripping scheme to others in Russia, Ukraine and elesewhere. While there was a theme of helplessness, it was clear they could control payments to themselves of very significant sums from April 2011 (when the bank appointed share receivers over Quinn companies), he said.
Among matters of serious concern to the bank was that the Quinns had disclosed in affidavits various members of the Quinn family had received sums totalling some €2.8 million in the period from April 2011.
Mr Murphy said matters just disclosed also contradicted evidence given by the three in the contempt proceedings including disclosure of a €1 million payment to lawyers in Moscow who had acted for the Quinns and that Peter Quinn had received payment of €450,000 in 2011 as general director of a Russian company.
It had also emerged Sean Quinn Junior had had a contract of employment with another Russian company, counsel said.
Mr O’Moore, for the Quinns, said his clients had done all they could but certain steps complained of by the bank were taken by others, not the Quinns. The rent roll from certain properties, for example, was not been paid to the Quinns or any companies under their control.
Mr Shipsey said some of his clients had travelled to Dubai and Russia seeking information and reversal of transactions while offers to assist the bank in litigation overseas aimed at protecting assets were not accepted.
The Quinns' lawyers objected to the judge viewing a video-recording of a January 2012 meeting in Kiev, Ukraine - published in the Irish Mail on Sunday last month - and which the bank claimed showed Peter Quinn and Sean Junior discussing the moving of funds and showed Peter Quinn was “prepared to lie” to the court.
The judge viewed the video but said it related to matters on which she had already made findings and it did not assist her in dealing with other matters yesterday. She could not see there was intimidation of the Quinns at the taped meeting, as had been argued, she added.
The judge said she was suprised at the late disclosures of the €1 million payment to a firm of Russian lawyers who acted for the Quinns and of the employment contracts for Peter Quinn and Sean Quinn Junior.
She was also surprised at late disclosures of monies paid to Quinn family members and concerning transfer of part of a shareholding in a Russian company, a transfer which was denied by Peter Quinn but which “appeared to have his handwriting all over it”.
