Bankrupt developer Sean Dunne has been refused orders allowing him cross-examine his Irish bankruptcy official in a forthcoming High Court hearing aimed at extending the developer's bankruptcy over alleged non-co-operation and hiding assets.
In his affidavit seeking to cross-examine official assignee Chris Lehane, Mr Dunne had not contested most of the facts concerning his engagement with Mr Lehane, Ms Justice Caroline Costello said.
She was unable to identify conflicts in the affidavits of Mr Dunne and Mr Lehane “relevant to the issues to be determined” so as to make cross-examination of Mr Lehane necessary to justly decide the extension application, she ruled.
It is Mr Dunne’s conduct that has to be assessed by the court, not Mr Lehane’s, and she would exercise her discretion to refuse this cross-examination, she said.
Application
Mr Dunne was due to be automatically discharged from bankruptcy in July 2016 but, before that, Mr Lehane initiated his application to extend the bankruptcy and secured orders temporarily extending it pending the full extension hearing.
The judge was previously told it is of “paramount importance” to Mr Dunne to “get free of the shackles of bankruptcy” and he disputes Mr Lehane’s claims concerning the extent of his co-operation.
Ulster Bank petitioned the High Court in February 2013 to have Mr Dunne adjudicated bankrupt here over default on some €164 million in loans. The following month, Mr Dunne filed for bankruptcy in Connecticut, US, when he claimed to have debts of $1 billion and assets of $55 million. In July 2013, he was adjudicated bankrupt here.
In seeking to cross-examine Mr Lehane, Mr Dunne said the latter had made specific allegations concerning the Lagoon beach hotel in South Africa; “Walford”, Shrewsbury Road, Ballsbridge, and a property at Churchfields, the K Club, Straffan, Co Kildare.
Mr Lehane disputes the validity of transfers of those properties by Mr Dunne, has obtained freezing orders concerning the Lagoon Beach Hotel and has also taken proceedings against Gayle Dunne and his son John Dunne.
Ms Justice Costello said Mr Dunne referred to the freezing orders and disputed transfers in his 5½-page affidavit in support of his application to cross-examine Mr Lehane. Mr Dunne argued, as the extension proceedings have not been decided, Mr Lehane cannot in fact state Mr Dunne has failed to disclose income or assets to the official assignee and he also touched briefly on other matters in dispute relating to his US bankruptcy.
Affidavit
Under the Bankruptcy Act, the official assignee may be cross-examined if the court grants liberty for that, the judge said.
The issue was whether cross-examination was justified here but Mr Dunne’s affidavit did not set out matters on which he wished or needed to cross-examine Mr Lehane, other than to say it is “equitable and just” Mr Lehane me made available for cross-examination.
Mr Dunne had not demonstrated probable presence of some conflict on the affidavits “relevant to the issue to be determined”, she held.
When hearing the application to extend this bankruptcy, the court will not be determining issues concerning ownership of the Lagoon Beach Hotel, Walford or Churchfields, she said. Nor would it be deciding the extent of Mr Dunne’s co-operation with his US bankruptcy trustee or the extent of information acquired by Mr Lehane from sources other than Mr Dunne concerning the latter’s estate.
The court instead will be focused on the acts and, where relevant, the failures to act, of Mr Dunne, she said.
The court must be satisfied on all the evidence whether or not Mr Dunne has co-operated with Mr Lehane or hidden assets or income from him, she said. It would not be weighing any belief of Mr Lehane and cross-examination concerning any conclusions or inferences of his was unnecessary to decide the issues, she ruled.
