Nolan v Dildar Ltd

JurisdictionIreland
JudgeMr. Justice David Barniville
Judgment Date27 November 2020
Neutral Citation[2020] IEHC 614
Date27 November 2020
CourtHigh Court
Docket Number[2017 No. 6193 P.]
BETWEEN
ANN NOLAN, ELIZABETH NOLAN, JOAN NOLAN, RICHARD NOLAN, PATRICIA NOLAN, SALLY NOLAN

and

QUEST CAPITAL TRUSTEES LIMITED
PLAINTIFFS
AND
DILDAR LIMITED, CIARAN DESMOND

AND

COLM S. McGUIRE

AND

DERVAL M. O'HALLORAN, FORMERLY TRADING UNDER THE STYLE AND TITLE OF McGUIRE DESMOND SOLICITORS, A FIRM, JOHN MILLETT, PINNACLE PENSIONER TRUSTEES LIMITED, DILDAR LIMITED

and

JOHN MILLETT INDEPENDENT FINANCIAL ADVISORS LIMITED

AND BY ORDER

DILLON KENNY

AND

DARREN KENNY

AND BY FURTHER ORDER

PAUL KENNY
DEFENDANTS
AND BY ORDER
STEPHEN DECLAN MURPHY, EDEL MURPHY, KEVIN JOSEPH McMAHON, JOHN LYNCH, EFG BANK AG, BNP PARIBAS WEALTH MANAGEMENT, UNITED OVERSEAS BANK LIMITED

and

ALLIED FINANCE TRUST AG
THIRD PARTIES

[2020] IEHC 614

David Barniville

[2017 No. 6193 P.]

[2017 No. 170 COM.]

THE HIGH COURT

COMMERCIAL

JUDGMENT of Mr. Justice David Barniville delivered on the 27 th day of November, 2020
Introduction
1

This judgment deals with another interlocutory application in this long running and complex case. The application the subject of this judgment was brought by the plaintiffs who were dissatisfied with the discovery made by the fifth, sixth and eighth defendants (the “Millett defendants”) on foot of an order for discovery made by the High Court (Twomey J.) on 22 nd February, 2019. The Millett defendants maintained that their computer systems were subjected to a cyber attack in the form of a ransomware attack which affected their ability to make the discovery required by that order.

2

In their application, the plaintiffs initially sought various wide-ranging orders permitting inspection and search facilities in respect of computer servers, mail servers, information technology devices and email addresses, together with an explanation on affidavit as to the whereabouts of electronically stored information, the appointment of an independent expert nominated by the court to carry out such an inspection and various other orders. The plaintiffs refined their application somewhat at the hearing in light of the affidavits exchanged between the parties.

3

The plaintiffs' application raises an issue as to what the court can or should do in circumstances where a party which is the subject of an obligation to make discovery on foot of an agreement or order for discovery finds itself unable properly to do so, in circumstances where its computer systems have been subjected to a cyber attack such as the ransomware attack allegedly suffered by the Millett defendants in this case.

4

For reasons set out in this judgment, I have concluded that, notwithstanding the clear deficiencies in the discovery originally made by the Millett defendants on foot of the order, those defendants have adequately addressed the plaintiffs' complaints, have provided a satisfactory explanation on affidavit and have addressed the deficiencies in their discovery. I have concluded that no useful purpose would be served by granting the modified form of relief sought by the plaintiffs on the hearing of the application and that it would be unfair to the Millett defendants, contrary to the interests of justice and disproportionate to grant the modified relief sought by the plaintiffs. While the plaintiffs were perfectly entitled to bring their application in light of the unsatisfactory affidavit of discovery sworn by Mr. Millett on behalf of the Millett defendants, the deficiencies were (save in one respect) adequately addressed in the affidavits sworn in response to the plaintiffs' application by Mr. Millett and by Eamon Gallagher, the information technology expert engaged by the Millett defendants. I have concluded that, in light of the various affidavits sworn on behalf of the Millett defendants in response to the plaintiffs' application, the deficiencies in their discovery have been adequately addressed and that it would not be fair, appropriate or proportionate to accede to the plaintiffs' application for an order permitting the inspection and search of the Millett defendant's IT systems by an independent expert. I have, however, concluded that Mr. Millett should swear a further affidavit to confirm that a laptop was searched for responsive documentation at the time the discovery was made by the Millett defendants in late May, 2019.

Brief Description of the Proceedings
5

I have previously delivered a number of reserved judgments in interlocutory applications made in this case: [2020] IEHC 243 and [2020] IEHC 244. It is unnecessary to repeat the detailed description of the proceedings contained in the longer of those two judgments. It is sufficient to provide a brief summary in order to put in context the issues which have arisen on this application.

6

The plaintiffs have brought these proceedings in their capacity as trustees of a pension fund set up for the benefit of members of the Nolan family, the Oaklands Property Trust. The plaintiffs claim that a sum of in excess of €6.96 million, representing a portion of that pension fund, was lost due to the alleged fraud and other wrongdoing on the part of their solicitor, Ciaran Desmond (the second defendant), and their pensions and financial advisor, John Millett and companies operated by him as part of his business (the fifth, sixth and eighth defendants) (the “Millett defendants”). The plaintiffs claim that, without their knowledge or consent, Mr. Desmond and the Millett defendants permitted the plaintiffs' funds, which were in a bank account with EFG Bank in Zurich in the name of a Panamanian company, Clear Vision Solutions SA (“CVSSA”), to be pledged as collateral in order to obtain finance to purchase investment products to be issued by a number of the third parties in Singapore. By reason of a series of events, the plaintiffs claim that the bulk of their monies were misappropriated and lost to them.

7

The plaintiffs also claim that in September, 2013, without their knowledge or consent, Mr. Desmond and the Millett defendants used approximately €2.828 million of the plaintiffs' funds in the CVSSA account with EFG Bank to substantially finance the purchase, by an Isle of Man company, Dildar Limited (“Dildar IOM”), the first defendant, of development lands in Cork which were formerly owned by Nemo Rangers GAA Club (the “Nemo lands”) which were purchased by Dildar IOM in September, 2013 for €3.07 million.

8

The plaintiffs claim damages and other reliefs against Mr. Desmond and the Millett defendants arising out of the alleged misappropriation of their funds. They also claim beneficial ownership of Dildar IOM and of the Nemo lands, which they claim were purchased substantially with their funds. Detailed allegations are made by the plaintiffs against Mr. Desmond and the Millett defendants. It is unnecessary to recite those allegations in this judgment. Mr. Desmond and the Millett defendants deny the claims against them. They deny that the Nemo lands were purchased with the plaintiffs' funds and both plead that the funds used to purchase those lands, which were in an account in the name of CVSSA in EFG Bank, were monies belonging to another family (the Kennys) and did not come from the plaintiffs' monies. The plaintiffs dispute this. Several third parties were joined to the proceedings on the application of Mr. Desmond. Various members of the Kenny family were also joined as defendants.

The Discovery Process Involving the Millett Defendants
9

The plaintiffs sought discovery from the Millett defendants in July, 2018. In their discovery request dated 20 th July, 2018, it was stated that, to the extent that any of the categories of documents sought contained electronically stored information, the plaintiffs requested that such documents be produced in searchable form and that the plaintiffs be provided with inspection and searching facilities. There was no agreement between the plaintiffs and the Millett defendants in relation to the plaintiffs' discovery request and a motion for discovery was issued in September, 2018. The Millett defendants agreed to make certain voluntary discovery and the scope of that discovery was ultimately agreed between the parties and reflected in the terms of the order made by the High Court (Twomey J.) on 22 nd February, 2019.

10

The order required that discovery be made within twelve weeks of the making of the order. Mr. Millett swore an affidavit of discovery on behalf of the Millett defendants on 31 st May, 2019. At para. 12 of his affidavit, Mr. Millett stated that the Millett defendants did not have in their possession, power or procurement, the documents set forth in the second schedule to the affidavit. Paragraph 2 of the second schedule referred to:-

“Documentation which in the ordinary course of business of the fifth, sixth and eighth defendants have possibly been lost, destroyed, or mislaid or which has not been retained or may have been overwritten prior to the commencement of these proceedings.”

11

Mr. Millett further stated at para. 12 of his affidavit of discovery that the Millett defendants were not aware of any other documents which were in their possession, power or procurement. He concluded the paragraph by stating:-

“For the sake of completeness, the fifth, sixth and eighth named defendants [have] not been able to conduct a search in relation to documents which were not retained by them, and/or were destroyed or were overwritten in the ordinary course of business, or were lost or mislaid prior to the commencement of these proceedings.”

12

The plaintiffs have focused for the purposes of the present application on one of the categories of documents which the Millett defendants were required by the order to discover, namely, category 3. Category 3 referred to documents relevant to the relationship between Mr. Desmond and Mr. Millett. Under category 3 of the order, the Millett defendants were required to make discovery of:-

“All documents, communications and correspondence exchanged between the...

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1 cases
  • Kenneth Grace v Paul Hendrick and Edmund Garvey
    • Ireland
    • High Court
    • 10 May 2021
    ...the inherent jurisdiction of the court and the rule is one giving altered effect to that inherent jurisdiction”. 35 In Nolan v. Dildar [2020] IEHC 614, page 15, Barniville J. noted that: “ The court has an inherent jurisdiction to direct further and better discovery where the discovery made......

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