IRISH BANK RESOLUTION CORPORATION Ltd v QUINN

• Jurisdiction: Ireland
• Judge: Mr. Justice Kelly
• Judgment Date: 11 December 2012
• Neutral Citation: [2012] IEHC 510
• Date: 11 December 2012
• Court: High Court
• Docket Number: [2011 No. 5843 P & 2012 No. 120 COM]

[2012] IEHC 510

THE HIGH COURT

[No. 5843 P/2011 ]

[No. 120 COM/2012]

Irish Bank Resolution Corp Ltd & Ors v Quinn & Ors

COMMERCIAL

BETWEEN

IRISH BANK RESOLUTION CORPORATION LIMITED, QUINN INVESTMENTS SWEDEN A.B. AND LEIF BAECKLUND

PLAINTIFFS

AND

SEÁN QUINN, CIARA QUINN, COLETTE QUINN, SEÁN QUINN JR., BRENDA QUINN, AOIFE QUINN, STEPHEN KELLY, PETER DARRAGH QUINN, NIALL MCPARTLAND, INDIAN TRUST A.B., FORFAR OVERSEAS S.A., LOCKERBIE INVESTMENTS S.A., CLONMORE INVESTMENTS S.A., MARFINE INVESTMENTS LIMITED, BLANDUN ENTERPRISES LIMITED, MECON FZE, CJSC, VNESHKONSALT, OOO STROITELNYE TECKNOLOGH, RLC-DEVELOPMENT AND KAREN WOODS

DEFENDANTS

RSC O.40 r1

RSC O.37 r2

RSC O.38 r3

DIRECTOR OF CORPORATE ENFORCEMENT v SEYMOUR UNREP O'DONOVAN 16.11.2006 2006/15/3126 2006 IEHC 369

COMPANIES ACT 1990 S160

COMPANIES ACT 1990 S8

COMPANIES ACT 1990 S22(B)

DEUTSCHE BANK v MURTAGH 1995 2 IR 122

HOUSE OF SPRING GARDENS LTD & ORS v WAITE & ORS 1985 FSR 173

BEKHOR & CO LTD v BILTON 1981 2 AER 565

COMET PRODUCTS UK LTD v HAWKEX PLASTICS LTD 1971 2 QB 67

DEN NORSKE BANK v ANTONATOS 1999 QB 271

PRACTICE AND PROCEDURE

Cross-examination

Deponents - Injunction - Mareva injunction - Defendants ordered to disclose assets - Plaintiffs alleging non-compliance - Plaintiffs seeking to cross-examine defendants - Whether cross-examination appropriate - AJ Bekhor & Co Ltd v Bilton [1981] QB 923; Comet Products UK Ltd v Hawkex Plastics Ltd [1971] 2 QB 67; Den Norske Bank ASA v Antonatos [1999] QB 271; Derby & Co Ltd v Weldon (Nos 3 and 4) [1989] 2 WLR 412; Deutsche Bank AG v Murtagh [1995] 2 IR 122; Director of Corporate Enforcement v Seymour [2006] IEHC 369, (Unrep, O'Donovan J, 16/11/2006) and Holland v Information Commissioner (Unrep, SC, 15/12/2003) and House of Gardens Ltd v Waite [1985] FSR 173 considered - Rules of the Superior Courts 1986 (SI 15/1986), O 40 - Cross-examination directed (2011/5843P and 2012/120COM - Kelly J - 11/12/2012) -[2012] IEHC 510

Irish Bank Resolution Corporation Ltd v Quinn

PRACTICE AND PROCEDURE

Cross-examination

Deponents - Injunction - Mareva injunction - Defendants ordered to disclose assets - Plaintiffs alleging non-compliance - Plaintiffs seeking to cross-examine defendants - Whether cross-examination appropriate - AJ Bekhor & Co Ltd v Bilton [1981] QB 923; Comet Products UK Ltd v Hawkex Plastics Ltd [1971] 2 QB 67; Den Norske Bank ASA v Antonatos [1999] QB 271; Derby & Co Ltd v Weldon (Nos 3 and 4) [1989] 2 WLR 412; Deutsche Bank AG v Murtagh [1995] 2 IR 122; Director of Corporate Enforcement v Seymour [2006] IEHC 369, (Unrep, O'Donovan J, 16/11/2006); Holland v Information Commissioner (Unrep, SC, 15/12/2003) and House of Gardens Ltd v Waite [1985] FSR 173 considered - Rules of the Superior Courts 1986 (SI 15/1986), O 40, r 1 - Cross-examination directed (2011/5483P - Kelly J - 11/12/2012) [2012] IEHC 510

Irish Bank Resolution Corporation Ltd v Quinn

Facts: The parties were engaged in substantial and long running litigation in respect of debts owed to the first plaintiff and the efforts of the first plaintiff to realise their security held over assets of the defendants. The plaintiffs in the current application sought an order requiring the attendance of a number of defendants for cross examination in respect of their affidavit evidence. A further order was sought requiring disclosure in respect of a number of points.

Held by Kelly J, that the extent of any entitlement to cross examine in respect of affidavit evidence turned in the nature of the proceedings in which the affidavit evidence had been sworn. Considering the leading case in the field, the Court stated the purpose of cross examination in a matter such as this was to allow the plaintiffs sufficient information which would enable policing of the injunctions live in the case, and to allow the pursuit of disclosure if required. The Court was satisfied that the courts had power to direct cross examination to further this purpose. Director of Corporate Enforcement v. Seymour [2006] IEHC 369 considered, House of Spring Gardens Limited & Ors v Waite & Ors [1985] FSR 173 applied.

The defendants had raised a number of other objections to the making of an order to permit cross examination. Taking each of these in turn, the Court could not accept that the order sought was inappropriate, and was in any way likely to interfere with the defendants" right to avoid self-incrimination.

The application would therefore be granted.

Introduction

1 1. The sole relief which is sought on this application is an order requiring the attendance of the second, third, fourth, fifth, sixth, ninth and twentieth defendants for cross examination in respect of affidavits sworn by them on foot of orders of the court made on 25 ^th July, 2012 and 31 ^st July, 2012. The order is sought pursuant to the provisions of O. 40, r. 1 of the Rules of the Superior Courts (RSC) or, alternatively, pursuant to the inherent jurisdiction of the court.

2 2. In the motion paper grounding this application there is a second relief sought. It is sought in addition to or in the alternative and without prejudice to the first. It is for an order requiring each of the said defendants to make full and proper disclosure and/or further and better disclosure of the matters required at paras. 4, 5 and 6 of the orders of the court of 25 ^th July, 2012 and 31 ^st July, 2012.

3 3. That second relief was not and is not being pursued at this time.

Background

4 4. These proceedings concern an alleged conspiracy on the part of the defendants to wrongfully convert and appropriate assets, details of which are set out in the first schedule to the amended plenary summons.

5 5. In addition to seeking declaratory relief and damages, the plaintiffs sought and were granted injunctions at an earlier stage in the proceedings. These injunctions were granted in June and July 2011 by Clarke J.

6 6. It was alleged that a number of the defendants had breached those injunctions. Dunne J. heard and determined an application in respect of that alleged contempt of court in June 2012. She found that a contempt of court had been committed. In addition to dealing with that issue, she made a number of other orders, one of which involved the appointment of a receiver over the assets of certain of the defendants. She also made disclosure orders requiring information to be furnished on affidavit of all assets of whatever nature or kind situate in Ireland or worldwide and all documents relating to the material which was specified in her order.

7 7. Subsequently, the plaintiffs applied to transfer the litigation into the Commercial List. That order was granted. An application was then made seeking Mareva type injunctions restraining the second to the ninth defendants from reducing their assets below the sum of €50m. I granted those orders and also appointed receivers over the assets of these defendants. Those orders were made on 25 ^th July, 2012. On 31 ^st July, I made similar orders against the twentieth defendant, Karen Woods.

8 8. It is important to set the context in which the orders of 25 ^th July and 31 ^st July, 2012, were made.

9 9. Prior to 25 ^th July, 2012, the Mareva type orders had been granted by me on an interim basis. The hearing of the application for similar orders on an interlocutory basis was fixed for 25 ^th July, 2012 and three days were set aside for that hearing. The application was grounded upon extensive affidavit evidence which set out in great detail very serious allegations of wrongdoing on the part of the relevant defendants. Despite ample opportunity being given to the defendants to respond to those allegations, no replying affidavit of any sort was filed by any of the defendants. The orders sought were not resisted by the defendants.

10 10. I gave judgment ex tempore on 25 ^th July, 2012. In the course of that ruling, I pointed out that I had already granted freezing orders on an interim basis and that I was now asked to do so on an interlocutory basis. I recounted that since the granting of the interim orders, a number of things had happened. This is what I said:-

"First, Dunne J. has delivered judgment on a contempt application heard by her in this litigation. In the course of her judgment, she said the following:-"

'What has never been in dispute is the fact that a sum of €455 million approximately is due to Anglo. Instead of trying to repay the admitted debt due, the Quinn family and in particular the respondents have taken every step possible to make it as difficult as can be to recover any amount due. They have engaged in a complex, complicated and, no doubt, costly, series of steps designed to put the assets of the IPG beyond the reach of Anglo, in a blatant, dishonest and deceitful manner. They have consciously misled courts here and elsewhere. They have sought to deprive Anglo of the assets which would go some way to discharging an admitted indebtedness. The behaviour of the respondents outlined in evidence before me is as far removed from the concept of honour and respectability as it is possible to be.'

As a result of the findings in that judgment one of the defendants has been sent to jail and the other is now a fugitive from justice.

The second matter that has occurred is that further evidence has been put before me by the bank. In the case of one of the defendants it shows a willingness on his part to lie about his activities, even to a court and under oath. I quote from the transcript which has been extracted from the video which had been put in evidence where that defendant laughingly said 'I would have to lie. That wouldn't overly worry me.' That is in the context of a lie being told to the court.

The third development which has taken place is that in the most recent evidence one finds...