Two men who were directors of Eurokabin Ltd, a company wound up by court order with debts of more than £2 million, have been restricted by the High Court from acting as company directors for five years.
The order applies to Mr Robert Burke, Firenze, Dublin Road, Sutton, Co Dublin, and Mr John Seaver, Holmpatrick Terrace, Skerries, Co Dublin.
Both were restricted on consent in 1994, in relation to another company of which they were also directors - Europa Forklift Hire, Ltd, which was wound up with substantial debts - from acting as company directors for five years.
Mr Justice Shanley rejected an application by the liquidator of Eurokabin Ltd to have three other men restrained from acting as company directors who the court was told had signed consent forms to act as directors of the company but who were unaware they were actually directors.
The judge said yesterday he was satisfied the three men - Mr Ivor Callely TD, Howth Road, Raheny, Mr Malachy Menton, Charlemont, Griffith Avenue, Marino, and Mr Eoin Daly, Kincora Avenue, Clontarf - should not be restricted from operating as company directors.
He was satisfied neither Mr Callely nor Mr Menton believed they were directors of the company and it was clear they really should not have been in court at all.
He was also satisfied Mr Daly should not be restricted on the grounds that he had satisfied the court he was in all probability not involved in any way in relation to the company's deficiency or its financial affairs and was unaware there were financial problems.
In his judgment, Mr Justice Shanley said Eurokabin Ltd was wound up by the court in August 1991. Mr John Donnelly, chartered accountant, was appointed liquidator and had applied under Section 150 of the Companies Act, 1990, as he was obliged to do so by court order, to have the five directors restricted from acting as company directors for a period of five years.
The judge said Eurokabin was insolvent at the date of winding up and had "extraordinary liabilities" of more than £2.2 million. Its assets were a "paltry" £42,965.
In Eurokabin's annual returns for the year to the end of December 1987, Mr Robert Burke, Mr John Seaver and Mr Ronald Squires, of Sweetmount Drive, Dundrum, Dublin, were shown as directors.
The judge said it was stated that there were consents of Mr Malachy Menton, Mr Ivor Callely and Mr Eoin Daly to act as directors and they were notified as being directors from November 1990.
The judge said that position did not change, and on the winding up of Eurokabin there were found to be six directors. One, Mr Squires, had died and the remaining five were Mr Burke, Mr Seaver, Mr Menton, Mr Callely and Mr Daly.
Addressing the role of each of the five men, the judge said Mr Menton agreed he had signed a consent form to act as a director but believed he would be told if he had been appointed one. It was not until February last, when the present proceedings were issued, that he said he became aware he was registered as a director.
The judge said Mr Ivor Callely said that, in late 1989, Mr Burke had offered him the possibility of becoming a director of Eurokabin. It was an offer Mr Callely regarded as contingent, as he understood it was subject to board approval.
Mr Callely regarded the offer as warranting investigation by his accountants into the company's affairs and its financial state of health. He said he had never been told he had been appointed a director.
The judge said both Mr Callely and Mr Menton had signed consent to act as directors of the company and both conceded that, having so signed, they took no actions to see where that consent went. The judge said he did not see that they had an obligation to do so.
He said Mr Eoin Daly had signed consent to act as director about the same time as Mr Menton and Mr Callely. He appeared to have been aware he was a director but painted a picture of being offered the directorship as a form of reward for his work for the company and in a nominal capacity only.
Mr Daly had said he was never aware of any financial problems in Eurokabin and had no involvement in the company's financial affairs.
The judge said Mr John Seaver had been restricted from acting as a company director for five years in relation to another company, Europa Forklift Hire Ltd. Because of that, he submitted that any restraint from acting as a director should be backdated to 1994. The judge said Mr Burke was in the same position.
Mr Justice Shanley said neither Mr Burke nor Mr Seaver had addressed the deficiency in the company or given any explanation of why the creditors were at such a loss. The failure to offer an explanation for the "glaring and very serious" deficiency left the court in no position but to infer neither had acted responsibly.
He said Mr Seaver was clearly unwell during some of the period when the deficiency arose. He had told the court he had a heart condition and said he had told Mr Burke he wanted to resign, but Mr Burke had persuaded him to stay on.
It was clear both Mr Burke and Mr Seaver were directors of the company, the judge said. He had little option but to make an order restraining them from acting as company directors for a period of five years.
