“They have continued to withhold the full story..Furthermore, their evidence bearing on remuneration for professional services rendered to Lyndhurst is sparse in the extreme…I have no evidence that these two respondents are impecunious or that they have no support from well resourced sources…The judge declared that it would be fair and proportionate to fine each man GBP 15,000 and given six months to pay.In default, they will each be sentenced to four weeks imprisonment” Judge McCloskey in the Belfast High Court today, sanctioning two Ukrainian defendants in a Sean Quinn case
On this side of the Border, one of the common questions emerging in the past 24 hours has been how IBRC’s pursuit of Sean Quinn and family for €2.9bn and an international property portfolio and rental income thereon, will be affected by the IBRC scheme. The answer is contained in the Department of Finance Q&A that was published after the announcement last night.
“a) Cases taken by IBRC IBRC’s claims against third parties, whether or not the subject of Court proceedings, will be unaffected by the winding up. The Special Liquidators will have the power to continue to manage any IBRC claims that currently exist and will have the ability to assert further claims where they arise. Alternatively, the Special Liquidators could sell IBRC’s interest in any such claims to a third party, or to NAMA, in which case the acquirer will be entitled to continue those proceedings. “
So, the Quinns are not off the hook at all with the IBRC scheme and the betting is that NAMA will end up pursuing it.
On the other side of the Border today, in the Belfast High Court, Judge McCloskey sanctioned two Ukrainian defendants who appeared via video link in a Quinn court case last year where IBRC was seeking to undo certain transactions involving a Northern Ireland company and a company registered in the British Virgin Islands. The judgment today is not yet online, but in brief, Judge McCloskey held the two Ukrainians, Oleksandr Serpokrylov and Dmytro Zaitsev, to have flagrantly and deliberately ignored an order against any transfer of debts surrounding the €50m Univermag shopping mall in Kiev, Ukraine.
A chain of assignments scrutinised in the case set out how Fermanagh-based firm Demesne Investments, of which Mr Quinn is a former director, was owed $45m by Univermag. But in April 2011 Demesne transferred its rights to the debt to Innishmore Consultancy, another Northern Ireland company run by Mr Quinn’s nephew Peter Quinn. From there the loan was moved on to Lyndhurst.
Lawyers for IBRC argued that the assignment was a sham, part of an asset-stripping exercise carried out at a massive undervalue and not worth the paper it was written on.
The two men appeared before the High Court by video-link from Kiev to defend the action.
In a scathing judgment last month Mr Justice McCloskey found both them and Lyndhurst in contempt of court. He delayed imposing punishment to allow further submissions by the respondents’ legal team. But today, the Judge sanctioned the two Ukrainians though because they are apparently resident outside the European Union, questions were raised about the enforceability of any outcome.
Ruling today on the penalties, Mr Justice McCloskey described the two men as “relatively minor players in the overall scheme” who had acted on their client’s instructions.
But he also pointed out how they had declined to disclose their income or assets, and made no attempt to answer questions raised in the case.
“They have continued to withhold the full story,” he said. “Furthermore, their evidence bearing on remuneration for professional services rendered to Lyndhurst is sparse in the extreme. I have no evidence that these two respondents are impecunious or that they have no support from well resourced sources.”
The judge declared that it would be fair and proportionate to fine each man GBP 15,000 (€17,000) and given six months to pay. “In default, they will each be sentenced to four weeks imprisonment,” he said.
Legal costs for the contempt action were awarded against all three respondents, Lyndhurst Development Trading, Oleksandr Serpokrylov and Dmytro Zaitsev.