THE COMMERCIAL Court has cleared the way for Vodafone to seek damages from a former financial executive and others over allegedly conspiring to defraud the company of more than €2.3 million via the fraudulent requisitioning of services.
An e-mail from Niall Barron, who was dismissed as head of Vodafone’s corporate financial services division and has never defended the legal action, instructed another person to use the e-mail address “dodgycookies@yahoo.ie” in respect of the alleged fraud, Mr Justice Peter Kelly heard yesterday.
Mr Barron had told an alleged co-conspirator, David McGovern, in another e-mail: “Your cut is f***** up by the whole Chess thing and tax. Before tax and wages I’ll get about 240K (including kickbacks) and Chess/Consultech will get 250K – the extra that I get is from kickbacks,” the judge heard.
Such “highly incriminating” e-mails were “not out of kilter” with various other documents discovered for the legal action, Maurice Collins SC, for Vodafone, said.
Vodafone has claimed Mr Barron, with addresses at Clonattin Village, Gorey, Co Wexford, in Kilkenny and in England, enriched himself by buying services on behalf of Vodafone which were either never provided or inadequately provided over a five-year period. It claimed he ordered services, for which invoices were not provided, on behalf of a company, Tel-Q Ltd, of which he is the owner and which is registered in the south Pacific island of Vanuatu.
He also allegedly purchased services from Fusion TV Ltd, Elmsborough Rise, Kiltipper Road, Dublin, which traded as Universal Sound and Picture, and from a now dissolved company, Chess Business Consultancy Ltd, Greenogue Business Park, Rathcoole, Dublin.
Vodafone claimed the directors of Fusion and Chess were husband and wife David McGovern and Elaine Dixon, both of Burrow Manor, Colverstown, Kilcullen, Co Kildare. It claimed they also carried on business under the trading name Consul-Tech, which received requisitions from Mr Barron for services not provided.
Vodafone initiated proceedings against Mr Barron, the couple and Fusion earlier this year alleging they all defrauded Vodafone from 2002 by issuing invoices and being paid for services which were not provided at all or provided by a different company and/or at an inflated price.
After the alleged fraud was discovered in February 2007 and a Garda investigation began, Mr Barron was summarily dismissed in March 2007; Mr McGovern and Ms Dixon allegedly handed over materials to gardaí.
It is alleged total payments to Consul-Tech, Tel-Q, Fusion and Chess for services not allegedly provided was €2,386,320. In addition to recovery, Vodafone also wants damages against all defendants alleging conspiracy, fraudulent and/or negligent misrepresentation and breach of contracts.
Last June, Mr Justice Kelly ruled Vodafone was entitled to damages from Mr Barron after he failed to enter a defence in the case but deferred assessment of damages pending the outcome of the case against the other defendants.
That case was due to open yesterday but Vodafone claimed the failure of the remaining defendants to make full discovery of materials required for the action, including a laptop of Mr McGovern’s, entitled it to an order striking out the defence.
Mr Collins, for Vodafone, said there was very significant and continuing deliberate failure to discover materials in accordance with court orders. Mr McGovern had considerable computer acumen but had claimed to be unable to open certain computer documents when Vodafone’s side could easily open them, counsel said.
Richard Kean SC, for the defendants, said Mr McGovern had health problems and had made considerable efforts to furnish documents. Mr McGovern had handed over pre-2007 material from his laptop but did not want to hand over the laptop itself because it contained privileged post-2007 material. Mr McGovern was also surprised that Vodafone had been able to access certain documents which he could not, counsel added.
Mr Justice Kelly said the defendants had had several opportunities to adhere to agreed discovery orders dating back to June last. Because of previous failures to comply, he had made an order on November 3rd last that, unless full discovery was made by November 12th, the defences would be struck out.
The defendants had failed to comply by November 12th and had still not complied, the judge said. In all the circumstances of this case, there were no exceptional circumstances allowing the defences be reinstated.
The judge’s decision means Vodafone can now apply to the court for judgment in default of defence, plus damages against all the defendants. That application will be heard on January 18th.
