STRUCK-OFF SOLICITOR Thomas Byrne has told the High Court that property developer John Kelly received more than €10 million from Mr Byrne’s client accounts over six months up to the closure of Mr Byrne’s practice in autumn 2007.
Mr Byrne said about €4 million was paid into his accounts on behalf of Mr Kelly, Hunter’s Moon, Kilquade, Co Wicklow, over the same period and Mr Kelly’s acounts were in constant deficit.
There was “almost a daily requirement” from Mr Kelly “that I send money somewhere” whether Mr Kelly’s account was in funds or not, he said.
He had paid some €10 million into Mr Kelly’s NIB account from March 30th 2007 until his practice was closed in October 2007 by the Law Society, Mr Byrne said. Other funds were very regularly paid into Mr Kelly’s AIB account because AIB “insisted the account be run on clear funds”.
Mr Byrne said some €9 million lent by IIB to Mr Kelly in December 2006 was effectively all gone by March 2007, having been used to fund a property deal in Co Wexford and to repay AIB and National Irish Bank.
Mr Byrne said he had not converted those monies to his own use but used them to make payments on behalf of Mr Kelly. He said Mr Kelly was aware in late January 2007 the IIB money had not been used to pay off €6.1 million loans from the Educational Building Society (EBS) to Mr Kelly and was also aware there was not money to discharge the loans.
Mr Byrne was continuing his evidence in proceedings against him by Mr Kelly who alleges he failed to honour undertakings required to pay off the EBS loans and had converted to his own use monies from the IIB €9 million loan. Mr Byrne has denied the claims.
Mr Byrne said Mr Kelly instructed him in late January 2007 not to ask the EBS for a redemption figure relating to the EBS loans because that would alert EBS that the loans had not been discharged.
Mr Byrne said he was not saying Mr Kelly was not concerned about the EBS loan. He believed Mr Kelly thought the matter would be dealt with a lot sooner. EBS had made a further loan of some €3 million to Mr Kelly later in 2007.
Mr Byrne said he was instructed by Mr Kelly to write fraudulent letters to Ulster Bank arising from its funding for an apartment development at Liberty View, Dublin. “To my shame, I did,” he said.
Mr Byrne said Mr Kelly instructed him to write to Ulster Bank stating certain apartment sales would be completed within seven days when that was not the case and also instructed him to write other letters to Ulster Bank concerning the development which were “pure fiction”. Ulster Bank was still owed millions in relation to the development, he added.
John O’Donnell SC, for Mr Kelly, objected that Mr Byrne was effectively alleging Mr Kelly instructed the solicitor to perpetrate a fraud on Ulster Bank when such claims were not pleaded. Mr Byrne was claiming money was not being given to Ulster Bank on closure of sales because it was being sent to Mr Kelly, counsel said.
Mr Justice Frank Clarke said it was unfair such claims were being made in open court when they were not pleaded and Mr Kelly had been given no opportunity to comment on them. This was bordering on “abuse of process” and contempt of court for which there were very serious consequences.
Mr O’Donnell said it should be clear there was no acceptance by the court of the truth of the claims simply because they were made by a witness. Mr Byrne had been directed to confine his evidence to what was in the pleadings, counsel added.The case resumes on March 28th.
