Keaney v Sullivan and Others

• Jurisdiction: Ireland
• Judge: Ms. Justice Dunne
• Judgment Date: 23 July 2015
• Neutral Citation: [2015] IESC 75
• Court: Supreme Court
• Docket Number: [Appeal No. 061/2007]
• Date: 23 July 2015

Between

Vincent Keaney

Plaintiff/Appellant

and

James Sullivan

First Defendant

Joan Sullivan

Second Defendant

St. John Culligan

Third Defendant

Michael Nolan

Fourth Defendant

Titanic Queenstown Trading Company Limited (in Liquidation)

Fifth Defendant

Magpie International Holding Company Limited (in Liquidation)

Sixth Defendant

Titanic Queenstown Memorabilia Limited (in Liquidation)

Seventh Defendant

Allied Irish Banks Plc

Eighth Defendant

Q.E.F. Global Limited

Ninth Defendant

Roger Duncan, Geoffrey Lewis, David Marsh, Tom Moore, Declan O'luanaigh, Neil Payne, David Isaacson (Carrying on Practice Under the Style and Title of Ormsby Rhodes and Bkr Ormsby Rhodes)

Tenth to Sixteenth Defendants

Tregan Properties

Seventeenth Defendant

Julia Nolan

Eighteenth Defendant

[2015] IESC 75

Clarke J.

Dunne J.

Charleton J.

[Appeal No. 061/2007]

THE SUPREME COURT

Property transfers – Statement of claim – Fraud – Plaintiff seeking to set aside transactions, deeds and property transfers – Whether appellant passed the threshold of having alleged fraud in a sufficient manner to give the defendant a reasonable picture as to the fraud contended for

Facts: The plaintiff, Mr Keaney, won a sum of money in the Lotto in the 1990s. In 1996, he acquired a premises, Scotts Building in Cobh, Co. Cork, and decided to establish and run a theme bar, the Titanic Bar. In 2000, he retained the services of the first defendant, Mr Sullivan, a chartered accountant as financial advisor and to seek an investment partner. The fourth defendant, Mr Nolan was identified as such a person, in relation to a joint venture for the premises acquired and the pub to be run therein. The plaintiff and the fourth defendant entered into a heads of agreement and subsequent transactions pursuant thereto. These included a deed of assignment by the plaintiff to himself and the fourth defendant as tenants in common in equal shares of the premises known as Scotts Building, the incorporation of the fifth defendant, Titanic Queenstown Trading Company Ltd (TQT Company), and the granting to it of a lease of the said premises. It was agreed that the proposed pub was to be operated and run by TQT Company which was owned as to 49% by the plaintiff and 51% by the fourth defendant. The publican”s licence originally obtained in July, 2000, in the name of the plaintiff was transferred to TQT Company in September, 2001. TQT Company traded as Titanic Bar until December 2002. In July, 2003, the plaintiff and the fourth defendant entered into heads of agreement legally binding in July, 2003 and pursuant thereto entered into a further series of agreements, deeds and share transfers. These included a contract for sale of the plaintiff”s interest in the Titanic Bar premises, a deed of assignment between the plaintiff and the fourth defendant and eighteenth defendant, Ms Nolan, of the plaintiff”s interests in the premises, a transfer of the plaintiff”s 49% shareholding in TQT Company to the fourth defendant and a deed of release. The plaintiff, in 2006, brought multiple claims and made many allegations against the 18 defendants arising out of the transactions entered into in 2000, the running of the pub between 2000 and 2003 and the transactions in 2003. He sought to set aside all the transactions, deeds and property transfers entered into and effected both in 2000 and 2003. The High Court, in 2007, struck out parts of the statement of claim delivered by the appellant. The plaintiff appealed to the Supreme Court against this judgment.

Held by Dunne J that, having considered Foss v Harbottle (1843) 2 Hare 461 and National Educational Welfare Board v Ryan [2008] 2 IR 816, the appellant fell short of passing the threshold of having alleged fraud in a sufficient manner to give the defendant a reasonable picture as to the fraud contended for. In addition, Dunne J held that many of the claims made in the proceedings were claims that could only be properly brought by TQT Company. Dunne J was satisfied that each of the grounds relied on by the respondents in support of their applications to strike out parts of the statement of claim were carefully considered by the trial judge; the relevant principles of law were set out in the course of her judgment. Dunne J held that there was no suggestion that she erred in any way in identifying those principles. Dunne J saw no basis for suggesting that the High Court erred in any way in its application of the relevant principles to the facts and circumstances of the case. Dunne J did not think that this was a case in which the Court should have given any consideration to the possibility of an amendment of the statement of claim; the statement of claim at issue was the third statement of claim to be delivered. Dunne J recalled that it had been directed that the second statement of claim should be delivered in circumstances where the complaint made at that time was the failure to particularise the claims being made against the various respondents. Dunne J held that in circumstances where the appellant has had three opportunities to deliver a statement of claim setting out appropriately the claims against the respective respondents it was difficult to see what purpose would be served by giving a further attempt to plead the case appropriately.

Dunne J held that she would dismiss the appeal.

Appeal dismissed.

Ms. Justice Dunne

1 This is an appeal from the plaintiff appellant (the Appellant) in respect of the judgment of the High Court (Finlay Geoghegan J.) delivered on the 16th January, 2007 and the order perfected on the 26th day of January, 2007 striking out parts of the statement of claim delivered by the Appellant in these proceedings. The order of the 26th January, 2007 was made pursuant to four separate notices of motion issued on behalf of the defendants/respondents (the Respondents) as follows:

1. The third, fourth, ninth, seventeenth and eighteenth respondents.

2. The eighth defendant (AIB).

3. The first respondent (Mr. Sullivan).

4. The tenth to sixteenth respondents (Ormsby Rhodes).

2 The background to this matter is described by the learned trial judge in her judgment and I gratefully adopt and set out her description of the background as follows:

‘The plaintiff won a significant sum of money in the Lotto in the 1990's. In 1996, he acquired a premises known as Scotts Building in Cobh, Co. Cork and decided to establish and run a theme bar to be known as the Titanic Bar. In 2000, he retained the services of the first defendant a chartered accountant as financial advisor and to seek an investment partner. The fourth defendant Michael Nolan was identified as such a person, in relation to a joint venture for the premises acquired and the pub to be run therein. In 2000, the plaintiff and the fourth defendant entered into a Heads of Agreement'' and subsequent transactions pursuant thereto. These included a deed of assignment of the 20th October, 2000, by the plaintiff to himself and the fourth named defendant as tenants in common in equal shares of the premises known as Scotts Building; the incorporation of Titanic Queenstown Trading Company Limited (‘TQT Company'') on the 11th August, 2000 and the granting to it of a lease of the said premises. It was agreed that the proposed pub, the Titanic Bar was to be operated and run by TQT Company which was owned as to 49% by the plaintiff and 51% by the fourth defendant. The publican's licence originally obtained in July, 2000, in the name of the plaintiff was transferred to TQT Company in September, 2001.

TQT Company traded as Titanic Bar until December 2002. In July, 2003, the plaintiff and the fourth defendant entered into ‘heads of agreement legally binding’ on 2nd July, 2003 and pursuant thereto entered into a further series of agreements, deeds and share transfers. These included a contract for sale of the plaintiff's interest in the Titanic Bar premises dated the 24th July, 2003; a deed of assignment between the plaintiff and the fourth and eighteenth defendants of the plaintiff's interests in the premises; a transfer of the plaintiff's 49% shareholding in TQT Company to the fourth defendant and adeed of release and other documents referred to in paragraph 62 of the statement of claim. The intended effect of these transactions appears to have been to separate the business and property interests of the plaintiff and fourth defendant.

The plaintiff in these proceedings by plenary summons issued in 2006, has brought multiple claims and made many allegations against the 18 defendants arising out of the transactions entered into in 2000, the running of the pub between 2000 and 2003 and the transactions in 2003. He seeks inter alia to set aside all the transactions, deeds and property transfers entered into and effected both in 2000 and 2003.

Following commencement of the proceedings the fourth defendant, Michael Nolan, the seventeenth named defendant, Tregan Properties Limited and the eighteenth defendant Julia Nolan, his wife made application for admission to the Commercial List. On the 3rd April, 2006, Kelly J. entered the proceedings into the Commercial List and treated the motion as the initial directions hearing. He further ordered that the plaintiff deliver a statement of claim on or before the 13th April, 2006.

On the 24th April, 2006, at a further hearing of the directions motion on complaint from a number of the defendants in relation to the form of the statement of claim delivered Kelly J. ordered that: “the plaintiff be at liberty to deliver an amended statement of claim herein by close of business on Monday 8th May, 2006, the said statement of claim to be properly drafted, in the proper form and properly particularised.”

An amended statement of claim was delivered on the 8th May, 2006.

The defendants were further given liberty on the 24th April, 2006, to bring notices of motion for orders dismissing or striking out the...