Bankruptcy official to indicate intentions in Drumm case

THE US official administering the bankruptcy of former Anglo Irish Bank chief executive David Drumm is expected to indicate to the Commercial Court shortly whether she intends to maintain his defence to proceedings in which the bank is seeking orders requiring Mr Drumm repay loans of some €8 million.

The US Trustee in bankruptcy, Kathleen P Dwyer, must also indicate whether she intends to prosecute Mr Drumm’s counter-claim to Anglo’s proceedings in which he is seeking some €2.6m in salary, pension and deferred bonus payments and damages, including for “mental distress”.

Those proceedings against Mr Drumm, plus a separate action by the bank against Mr Drumm and his wife Lorraine over his disputed transfer of the couple’s former family home in Malahide into Mrs Drumm’s sole ownership, were mentioned at the Commercial Court yesterday before Mr Justice Peter Kelly.

Both cases had been adjourned pending a decision by another High Court judge as to whether the courts here would recognise the US bankruptcy proceedings and assist Ms Dwyer in realising the assets of Mr Drumm here, including the property at Abington, Malahide, for the benefit of his creditors.

Yesterday, Paul Sreenan, for Anglo, told Mr Justice Kelly that the High Court had ruled this week in favour of assisting Ms Dwyer but had adjourned the matter for a week to have the “order in aid” drawn up after which the trustee would seek an order in these proceedings.

In those circumstances, the bank wanted the proceedings against the Drumms adjourned for one more week.

Mr Justice Kelly said he would grant the adjournment but would like to see “some progress” in the matter. Because Mrs Drumm had last month given an irrevocable undertaking to set aside the transfer of the property at Abington, it was already known what the final order would be concerning the proceedings over the house but he would like to have that order made, the judge said.

The trustee then has to decide if she will defend the bank’s proceedings against Mr Drumm himself over the €8m loans and if she will prosecute his counter-claim, the judge said.

Mr Justice Kelly said he would adjourn both sets of proceedings for one more week but reiterated he would like progress made. He also continued an injunction restraining Mrs Drumm disposing of the Abington property.

The Commercial Court proceedings by Anglo against the Drumms were due to be heard last October but could not proceed as scheduled as a result of Mr Drumm’s filing for bankruptcy in the US earlier that same month.

The trustee may be in a position to indicate her attitude to those proceedings when the cases are mentioned again next week.