An email sent by an Irish architect worried that he might be killed during a visit to Kabul played a key role in a legal dispute over the ownership of $8 million (€6.5m) sitting in a bank account in Guernsey.
The email was sent on April 23rd, 2012, against a backdrop where the architect, Jeremiah Ryan, had moved the money to Guernsey to hide it from his creditors as he prepared to enter bankruptcy.
"Barry. Sorry to be paranoid," the successful architect said in the email to the founder of the Winthrop Engineering Group Barry English.
“Just in case anything goes wrong in Kabul over the next few days will you make sure money from company gets to Veronica in an efficient way. Set aside 10 per cent for Liz. In relation to company here wind it down just to complete the ADP and take cash out as above…”
The email was quoted in a High Court judgment published on Monday in which Mr Justice Denis McDonald declined an application that he reassess a decision he made in 2019 about what should happen with the $8 million.
The email “was clearly written at a time when Mr Ryan was concerned about his own safety as he headed for Afghanistan”, Mr Justice McDonald said. “If ever Mr Ryan was likely to reveal his true intentions, this was it.”
High Court proceedings
In 2017 Mr Ryan and a company called HKR Middle East Architects Engineering LLC (HKRME) took High Court proceedings against Mr English over the money.
Mr Ryan was not acting on his own behalf in the proceedings but rather on behalf of HKRME and a trust.
He claimed that the money in Guernsey should be used to pay the lawful liabilities of the company, and that the money that was left over should to go to the Ryan Children’s Trust (RCT).
The beneficiaries of the RCT are Mr Ryan’s three daughters.
The $8 million had gone from HKRME to a bank account in Guernsey in the name of a British Virgin Islands company called Sunvit International Ltd.
Sunvit was in turn controlled by a Guernsey trust established for the benefit of Mr English and his family.
“The email was, in essence, a direction to Mr English as to how to deal with, inter alia, the Sunvit monies in the event of [Mr Ryan’s] death while in Afghanistan,” the judge said.
“The email is utterly inconsistent with the suggestion made in these proceedings that the money was to be held for the benefit of the RCT. The email does not even mention the RCT, or any beneficiary of that trust.”
The reference to Veronica was a reference to Mr Ryan’s wife, who was not a beneficiary of the RCT, while the reference to Liz was a reference to Mr Ryan’s partner, who again, the judge noted, was not a beneficiary of the RCT.
“The email clearly shows that Mr Ryan regarded the monies transferred as held for his own benefit.”
Mr Ryan, formerly the principal of Horan Keogan Ryan Ltd, an Irish architectural firm, was facing financial ruin at the time he sent the email because of property investments in Ireland and elsewhere that lost value after the 2008 financial crash.
However, HKRME, based in the United Arab Emirates and which Mr Ryan controlled, had secured a contract for the Abu Dhabi Plaza (ADP) project in Nur-Sultan, formerly Astrana, the capital of Kazakhstan.
The initial design fee for the ADP was about €34 million. Mr Ryan was also connected with projects in Kabul.
HKRME sale
Mr English bought HKRME from Mr Ryan in 2011 for €100,000, prior to Mr Ryan going into bankruptcy in England in November 2012.
According to the judge, the sale to Mr English was at an artificially-reduced price.
Mr English sold the company back to Mr Ryan after Mr Ryan had emerged from bankruptcy in England in 2013.
Mr English disputed Mr Ryan’s claim that, despite what the legal and other documents from the time showed, Mr English was acting as a “caretaker” role during the period he owned HKRME.
The documents, Mr Ryan told the court, were a “sham”, designed to conceal what was really going on.
Mr English said he was the owner of HKRME and that he earned the money that was transferred to Guernsey through the sale of services to HKRME.
He said he had been entitled to transfer the money to the British Virgin Islands company’s account as he was at the time the owner of HKRME.
However, Mr Justice McDonald decided otherwise, and said he considered the short email response that Mr English sent to Mr Ryan as Mr Ryan prepared to travel to war-torn Kabul to be significant.
“It’ll be taken care off [sic]”, the email from Mr English said.
The judge decided that the funds that had been transferred to Guernsey were transferred at the direction of Mr Ryan, who was at the time the beneficial, though not the legal owner of HKRME.
The transfer of the ownership of HKRME to Mr English had been organised by Mr Ryan as part of a series of steps taken by him “in order to hide his assets from his creditors”.
While it appeared, the judge said, that Mr Ryan and Mr English had never decided exactly what would happen with the $8 million, he did refer, in his 2019 ruling, to evidence suggesting that Mr English would keep $1 million.
London hotel
Mr English gave evidence, that was not accepted by Mr Ryan, about a meeting in a London hotel in July 2013.
According to Mr English, Mr Ryan proposed that, out of the Sunvit money, Mr English should retain €1 million, another €1 million would go to Mr Ryan’s partner (Liz), and a further €1 million would go to each of Mr Ryan’s three daughters.
According to the judgment, Mr English, in his evidence to the court, said his response to this suggestion had been: “That’s kind of you.”
“To my mind if Mr English believed himself to be the true owner of the Sunvit monies, it is extraordinary that he would respond in this way,” the judge said.
In the judgement published this week, Mr Justice McDonald said he was still of the view that the only part of the Guernsey money that Mr English had to return was the money that was needed to pay the lawful debts of HKRME.
These now stood at about $3 million, leaving $5 million in the Sunvit account controlled by a trust the beneficiaries of which are Mr English and his family.
Since the 2019 judgment, Mr Ryan's bankruptcy trustee, Nicholas Stuart Wood, has initiated proceedings against Mr English, stating that the money transferred to Sunvit, at Mr Ryan's direction, should form part of Mr Ryan's bankruptcy estate.
If he is to win the case Mr Wood will have to address all the issues raised by Mr English in the HKRME proceedings, Mr Justice McDonald said.
