Murphy v O'Halloran

JurisdictionIreland
JudgeMr. Justice David Keane
Judgment Date29 July 2016
Neutral Citation[2016] IEHC 460
CourtHigh Court
Docket Number[2011 No. 466 COS]
Date29 July 2016

[2016] IEHC 460

THE HIGH COURT

Keane J.

[2011 No. 466 COS]

IN THE MATTER OF SECTION 150 AND SECTION 160 OF THE COMPANIES ACT, 1990

AND

IN THE MATTER OF SECTION 297A OF THE COMPANIES ACT, 1963

AND

IN THE MATTER OF SECTIONS 202 AND SECTION 204 OF THE COMPANIES ACT 1990

AND

IN THE MATTER OF TSON

(IN OFFICIAL LIQUIDATION)

BETWEEN
AIDEN MURPHY
APPLICANT
AND
BRENDAN O'HALLORAN

AND

PATRICK O'HALLORAN
RESPONDENTS

Company – Winding up proceedings – Discovery – Inspection – Claim of privilege.

Facts: The respondent challenged the applicant's claim of privilege against the inspection of certain documents discovered in an affidavit sworn by the applicant. The applicant had sought an order making the respondents personally liable for its debts pursuant to the provisions of s. 204 and s. 297A of the Companies Act 1990. The applicant had alleged that the respondents failed to keep proper books and records, as required by s. 202 of the 1990 Act, and carried on the business of the company in a reckless manner and with the intent to defraud creditors. The applicant averred that the subject documents had been produced for the purpose of obtaining legal advice and, thus, were covered by professional privilege. The respondents claimed that the subject documents came into existence some time prior to the initiation of the application to have the respondents made liable for the company's debts and to have them each disqualified or, in the alternative, restricted.

Mr Justice David Keane held that the application challenging the applicant's claim of privilege against the inspection of certain documents discovered in an affidavit sworn by the applicant would be refused. The Court found that the applicant had a valid claim of privilege. The Court agreed that the subject documents had been produced for the purpose of obtaining legal advice and, thus, were covered by professional privilege.

Ruling of Mr. Justice David Keane delivered on the 29th July 2016
Introduction
1

This ruling concerns the respondents' challenge to the applicant's claim of privilege against the inspection of certain documents discovered in an affidavit sworn by him on the 17th of April 2015.

Background
2

The applicant was appointed as official liquidator of TSON Limited (‘the company’) by order of this court dated the 13th of September 2011, on foot of a petition presented by Allied Irish Banks plc.

3

In the context of those winding up proceedings the applicant seeks an order making the respondent directors (‘the respondents’) of the company personally liable for its debts pursuant to the provisions of s. 204 and s. 297A of the Companies Act 1990 (‘the 1990 Act’).

4

As part of the same application, the applicant seeks the following declarations: that the company failed to keep proper books and records, as required by s. 202 of the 1990 Act; that the respondents carried on the business of the company in a reckless manner and with the intent to defraud creditors; a declaration of disqualification in respect of each of the respondents pursuant to s. 160 of the 1990 Act or, in the alternative, a declaration of restriction in respect of each pursuant to s. 150 of the 1990 Act. The applicant also seeks the usual ancillary reliefs.

The present application
5

On the 1st of December 2014 this court ( per Barrett J.) made an order requiring the applicant to make discovery of a number of categories of documents. On foot of that order, on the 17th of April 2014, the applicant swore an affidavit in which he indicated that he objected to the production of certain of the documents covered by the order (‘the documents’) on the basis that they consisted entirely of communications between him and his legal representatives, or between his legal representatives and third parties, or between other persons, which were designed either to obtain material to be used as evidence in these proceedings or to enable his legal representatives to conduct these proceedings on his behalf. The applicant averred that these documents were produced for the purpose of obtaining legal advice and, thus, were covered by professional privilege.

6

In a letter dated the 4th of November 2015, the solicitors for the respondents raised certain questions regarding the applicant's assertion of privilege. In that letter, the respondents' solicitors stated that they assumed that the privilege being claimed was litigation privilege but noted that the application to have the respondents made liable for the company's debts, and to have them each disqualified or, in the alternative, restricted, had begun by notice of motion dated the 5th of July 2013, whereas some of the documents over which privilege was claimed predated the commencement of that application by more than two years. The letter then went on to state that the respondents' solicitors considered the basis for the applicant's assertion of privilege to be ‘wholly unclear.’ Clarification was then sought concerning the precise basis upon which the applicant was claiming privilege over the documents failing which, the letter stated, the respondent would bring an...

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