A British businessman has challenged a refusal by IBRC to recognise a judgement for stg£113m (€128m) he obtained against it over the sale of a 100-room mansion in the UK.
Baljit Singh Bhandal, also known as Barry Bhandal, was once the beneficial owner of a property known as Updown Court in Windlesham in Surrey, England.
In order to fund the redevelopment of the property, he borrowed some stg£14m from Irish Nationwide Building Society in 2000.
However, following an investigation into alleged money laundering a restraint order was placed over Mr Bhandal's assets by British Customs (HMRC) officials in 2001 and the house was sold by an INBS appointed receiver for stg£14m in 2002.
The restraint order was lifted in 2006 and Mr Bhandal was never charged with any offence in regards to the alleged money laundering.
He sued INBS's successor in title IBRC for damage arising out of what he claimed was the sale at an undervalue of Updown Manor, which he claims is worth stg£80m.
He obtained a judgment against IBRC in 2013 for stg£113m, after IBRC opted not to contest the matter as at the time it did not expect there would be any money to pay a dividend to unsecured creditors, and did not accrue to any further costs.
Arising out of the judgment Mr Bhandal obtained a European Enforcement Order and submitted his claim in IBRC's special liquidation.
IRBC special liquidators informed Mr Bhandal in 2017 that they were not bound by his claim as it was not true and bona fide, and after a careful review of key documentation, held there is not a true underlying liability on the part of IBRC.
Arising out of the refusal Mr Bhandal has brought proceedings in the Irish High Court against Irish Banking Resolution Corporation Ltd (In special liquidation)
IBRC, represented by Michael Collins SC and Andrew Fitzpatrick SC, opposes the application, which they argue should be dismissed.
He seeks orders under the 2014 Companies Act that the Stg£113m judgement he secured against the IBRC from the English High Court in March 2013 be admitted to proof as an unsecured liability in the special liquidation.
He also wants the High Court to review the manner in which IBRC's special liquidators exercised their powers in rejecting his claim, and how they have sought to look behind the judgement he obtained from the English High Court in 2013.
He claims IBRC has failed to exercise their powers appropriately in the manner in how they adjudicated his claim.
The case commenced before Mr Justice Tony O'Connor today and is expected to continue for several days.
Opening the case Aidan Redmond SC, appearing with Dave Whelan Bl, instructed by solicitors said his client had successfully worked for many years in the alcohol and off-licence business.
In the late 1990s, he became the beneficial owner of a large then-derelict property known as Updown Court in Windlesham in Surrey, England.
He invested stg£8m of his own funds in the redevelopment of the property, and also borrowed from lenders including INBS.
He had hoped to sell the property, but in July 2001 UK Revenue and Custom's obtained a restraint order on his assets for alleged money laundering and duty evasion.
Counsel said IBRC seemed to be basing its decision not to recognise his client's debt on a 2015 judgment by the English High Court concerning Mr Bhandal's damages claim against HMRC over the making of the restraint order against his assets in 2001.
His claim was dismissed and in his judgment, Mr Justice Andrew Collins concluded that Mr Bhandal was involved in money laundering and that Updown Court had been acquired through the proceeds of crime.
There was nothing in that judgement which demonstrated the 2013 proceedings were anything other than a properly conducted judicial process, counsel said.
Counsel said IBRC is not entitled to rely on those findings in the 2015 judgment and said his client denies involvement in money laundering, or that the property was acquired with the proceeds of crime.
Mr Bhandal, he said, was never charged with, let alone convicted, of the offences referred to by Mr Justice Collins.
Counsel said that IBRC is not entitled to deal with his client's claim in this manner, and its actions were fundamentally unfair.
Opposing the action the special liquidators say they were obliged to look behind the 2013 judgement and were entitled to rely on the findings contained in the 2015 judgement.
The special liquidator's assessment of the 2015 decision, they claim, was entirely appropriate and in accordance with proper procedure.
The hearing continues.