Byrne v Judge O Leary and Others

• Jurisdiction: Ireland
• Judge: Mr. Justice Paul Gilligan
• Judgment Date: 07 December 2006
• Neutral Citation: [2006] IEHC 412
• Court: High Court
• Docket Number: [No. 499JR/2002]
• Date: 07 December 2006

[2006] IEHC 412

THE HIGH COURT

[No. 499JR/2002]

BYRNE v O'LEARY & ORS

BETWEEN

JOHN J. BYRNE

APPLICANT

AND

HIS HONOUR JUDGE SEAN O'LEARY, NOREEN MACKEY, PAUL ROWAN AND MICHAEL CUSH (INSPECTORS APPOINTED BY ORDER OF THE HIGH COURT TO ANSBACHER (CAYMAN) LTD)

RESPONDENTS

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 272

COMPANIES ACT 1990 S8

COMPANIES ACT 1990 S17

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 275

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 50

COMPANIES ACT 1990 S7(4)

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 CH 3

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 290

STATE, POWER v MORAN 1976-77 ILRM 20

CHIEF CONSTABLE OF THE NORTH WALES POLICE v EVANS 1982 1 WLR 1155

KEEGAN, STATE v STARDUST VICTIMS COMPENSATION TRIBUNAL 1986 IR 642

GOVERNMENT OF IRELAND REPORT OF THE INSPECTORS APPOINTED TO ENQUIRE INTO THE AFFAIRS OF THE ANSBACHER (CAYMAN) LTD 2002 CH 3.4

PERGAMON PRESS, IN RE 1971 CH D 388

ASSOCIATED PROVINCIAL PICTUREHOUSES LTD v WEDNESBURY CORP 1948 1 KB 223

O'KEEFFE v BORD PLEANALA 1993 1 IR 39

AER RIANTA CPT v COMMISSIONER FOR AVIATION REGULATION UNREP O'SULLIVAN 16.1.2003 2003/1/141

Land & Conveyancing – S. 120 of the Registration of Title, 1964 (Rule 216) – Error in land registry – Sale of property – Compensation

Facts: The appellant had filed an appeal against the order and judgement of the Registrar of Deeds and Titles awarding compensation to the appellant on the basis of the valuation of the disputed lands as of the day they were sold by the mother of the appellant as the full registered owner, as she was shown in error by the Land Registry instead of the limited owner, the title which she in fact held. The appellant contended that the Registrar had made an error while holding that the mother of the appellant was entitled to sell the disputed lands and that the appellant was not entitled to recover the costs of an action initiated in the Circuit Court for setting aside the alleged deed of transfer. The contention put forward by the Registrar was that the appellant was not entitled for any compensation under s. 120 of the Registration of Title, 1964.

Mr. Justice Henry Abbott awarded compensation to the appellant on the basis of the updated claim and the valuer's report after discounting the valuation of the disputed plot. The Court granted an order for the recovery of costs in relation to the said Circuit Court proceedings along with the costs of the claim before the Registrar. The Court in line with the decision of Darcy J. in Application of Sean Leonard, Folio 20518 Country Limerick (Unreported, 30th June 1981) held that the proper valuation date would be the date of hearing and not when the alleged transfer had been made. The Court found that the failure of the appellant to request for register an inhibition in relation to an undesired transfer of land by an oversight would not amount to negligent default under the Act of 1964 so as to deprive him of the compensation under the said Act. The Court held that since the Registrar was on notice of the Circuit Court proceedings, he was bound to consider whether such proceedings were a precondition to its liability to pay compensation.

Mr. Justice Paul Gilligan

1 This is an application to quash a number of conclusions reached by the respondents and outlined within their Report of the 6th day of July 2002 into the affairs of Ansbacher (Cayman) Limited (hereafter referred to as "the Report”). The respondents are Inspectors appointed pursuant to ss. 8 and 17 of the Companies Act,1990 by order of the High Court of the 22nd September, 1999, as later amended by orders of the 5th October, 1999, and the 8th December, 2000. The order states:

"It is ordered that the said Inspectors investigate and report to the Court on the affairs of the Company in the title hereof and in particular

(a) to examine and define the nature and extent of the Company's Irish business from 1971 to date i.e. the business carried out in the State or any other business carried out on behalf of Irish residents whether in the State or elsewhere;

(b) to identify as far as possible all of the parties who were either officers (including shadow directors) and agents of the Company, clients of the Company or who otherwise assisted in the carrying out of the business at the relevant time

(c) to examine whether the Companies Acts,1963–1990 were breached by the Company, its officers (including shadow directors), agents or third parties at the relevant time and if so to identify the provisions involved and the persons in default in each case;

(d) to examine whether the affairs of the Company were conducted with intent to defraud its creditors or the creditors of any other person or otherwise for a fraudulent or unlawful purpose and if so to identify the statutory provisions involved and the persons in default in each case;

(e) to report on any related matters."

2 This Court made a number of ancillary orders relating to the investigation to be carried out by the Inspectors as duly appointed and in particular made an order on 25th day of May, 2001 pursuant to a motion of counsel for the Inspectors which was madeex parte, pursuant to which it was ordered that the motion be heard otherwise than in public and the motion resulted in an order being made inter alia that;

"where it has not been found practical for all four Inspectors to be present at an interview at which a witness” evidence has been taken under oath or where that witness has been interviewed prior to the appointment of a particular Inspector the Inspector or Inspectors who was/were absent from that interview shall not be precluded from further examining that witness or reporting to the court on that witness subject to the following;

that the veracity of the evidence given by that witness during the said interview is not in dispute or if the veracity of the evidence given by that witness during the said interview is in dispute that the said interview is conducted in full again with the said Inspector or Inspectors in attendance".

3 The Report lists five specific scenarios in which an individual is considered to be a client. At p. 272 of the Report it is stated that;

"In particular, but without prejudice to the generality of the foregoing, a client shall include:

2 (a) Any person who directly or indirectly maintains or has maintained all or part of any account with the Company [i.e. Ansbacher Cayman Ltd] or who has or hadde facto or de jure control over all or part of any account with the company.

3 (b) Any person who has or hadde jure or de facto control of a body corporate which directly or indirectly maintains or has maintained an account with the Company or is or was administered by the Company or which has had borrowings directly or indirectly secured wholly or partly by the Company.

4 (c) The Settlor of any trust administered by the Company or of which the Company is or was the trustee and/or any other person or persons who funded such a trust or caused such a trust to be funded.

5 (d) The beneficiary of any trust administered by the Company or of which the Company is or was the trustee in circumstances where the beneficiary has or hadde jure or de facto control over all or part of the trusts funds.

6 (e) Any person who had an account relationship with a body corporate owned or managed by the Company."

4 Category A clients are stated in the Report at p. 275 to include:

"persons who established trusts, and persons who deposited money in a simple account. The persons who established trusts tended to be larger clients. In these cases, the trust would have a name which would not immediately identify the beneficial owner of the funds. It also would have one or more companies, which would be used by the trust as a vehicle for the investments controlled."

5 The Report contains a list and description of all Category A clients as so found and the applicant is categorised as a Category A client. The first reference in the Report to the applicant is to be found at p. 50 dealing with the guarantee of back-to-back loans which were provided by Guinness and Mahon Ltd to individuals who had deposited monies with Ansbacher Ltd., these loans being secured by the deposits placed in the Bank. The reference is as follows:

"3.4 Knowledge of GMCT and Guinness and Mahon"

6 … As already reported, GMCT had a number of deposit accounts in Guinness and Mahon, and, to an increasing extent over the years, these were used to provide funds for beneficiaries of trusts of which GMCT was trustee. No evidence has emerged that these payments were made as a result of decisions by trustees to make distributions to beneficiaries. Among files of over 50 trusts furnished to the Inspectors by Ansbacher (Cayman) Limited following litigation in the Grand Court of the Cayman Islands, not a single document exists minuting a decision of the trustees to make a distribution. On the contrary, all the evidence points to the request for payment originating with the client and being processed in Guinness and Mahon (and later in IIB) upon the instructions of Mr. Traynor. GMCT was not informed of the completed transaction until Mr. Collery (having posted the transaction in the secret Irish Memorandum accounts or otherwise processed it internally within Guinness and Mahon) sent a reconciliation statement to Cayman, which he did on a monthly basis. This is strong evidence that the trust structure was a sham — not in respect of its legal status at...