in New Haven
The plaintiff in developer Sean Dunne's US civil trial is seeking another €25.2 million on top of the €18.1 million that a jury ordered Mr Dunne's wife, Gayle Killilea, to surrender last month.
Following three weeks of testimony, the jury found that Mr Dunne had fraudulently transferred millions of euro in assets – including Walford, Ireland’s most expensive home – to Ms Killilea during and after the collapse of his property empire to protect them from creditors.
It ordered Ms Killilea to pay Mr Dunne’s US bankruptcy estate, from which his creditors are being paid, €18.1 million.
The lawsuit, filed by the trustee in Mr Dunne’s US bankruptcy, contained additional allegations the jury did not rule on, including that Ms Killilea was unjustly enriched by the wealth transfers. US district judge Jeffrey Meyer, who presided over the case, will now decide those charges.
In the case, the jury did not find that the additional assets the plaintiff is seeking were fraudulently transferred. The separate question now before Judge Meyer is whether their transfer constituted unjust enrichment.
Bankruptcy
In a brief filed this week, the trustee urged Judge Meyer to find Ms Killilea was unjustly enriched and order her to pay an additional €25.2 million to the bankruptcy estate.
The assets they are seeking include proceeds from Ms Killilea’s US property ventures, payments and salary from two of Mr Dunne’s companies, moneys from the sale of hotel fixtures and furniture that Mr Dunne gave her and proceeds from the sale of a Swiss condominium.
“As elaborated herein, the evidence adduced at trial demonstrates that Killilea was unjustly enriched by tens of millions of dollars to the detriment of Mr Dunne’s creditors, whether Connecticut law or Irish law is applied,” the brief says. “Accordingly, the court should enter judgment in favour of the trustee and award damages in the amounts set forth herein.”
In total, Mr Dunne owes creditors more than €900 million (€800 million), according to the brief.
The brief comes as the two sides are scheduled to meet behind closed doors on Wednesday in New Haven's federal courthouse in an effort to reach a settlement. Mr Dunne and his wife Ms Killilea are expected to attend, according to plaintiff's solicitor Thomas Curran.
Mr Dunne and Ms Killilea’s solicitors did not return calls seeking comment.
Sale
The biggest chunk of the additional assets the trustee is seeking is $18.4 million – €16.5 million – from Ms Killilea’s property development projects in Greenwich, one of America’s wealthiest communities, and New York state.
The brief accuses Mr Dunne of making “a deliberate decision to defraud his creditors in Ireland and come to America”. It further alleges Mr Dunne, not Ms Killilea, controlled the US company created to carry out the ventures. The couple denied both charges during the trial.
In addition, the trustee’s solicitors are seeking: €3.3 million in allegedly improper payments from Mr Dunne’s Amrakbo company to Ms Killilea; €2.7 million she made selling the 4D Hotels’ fixtures and furnishings that Mr Dunne gave her to Ulster Bank; 2.8 million Swiss francs – €2.5 million – she received from the sale of a Swiss condominium bought in part with money from one of Mr Dunne’s companies; and €286,070 in allegedly “excessive” salary to Ms Killilea from Mr Dunne’s CDC builders.
The plaintiff’s lawyers are also asking Judge Meyer to take action to prevent the sale of Greenwich home that Ms Killilea has rented for $17,500 a month and order the couple to provide a full accounting of their assets.
Mr Curran said he expects Judge Meyer to hold at least one hearing before ruling.
